WisdomTree Investments has dodged a legal bullet.
That's because Index provider Research Affiliates has agreed to drop its patent infringement lawsuit against the New York-based ETF provider.
As part of the settlement, all claims and counterclaims have been dismissed with prejudice between the two companies and their subsidiaries. Research Affiliates has also agreed to a one-time payment of $700,000 to WisdomTree. Both parties have agreed not to sue for future claims arising under any current patents.
The suit was first filed in the U.S. District Court for the Central District of California in 2011 alleging that WisdomTree financial products based on fundamental factors infringed three Research Affiliates patents.
Robert Arnott, chairman and CEO of Research Affiliates, stated in a press release today that, “Based on information that came to our attention during the lawsuit, Research Affiliates can now acknowledge that WisdomTree’s fundamentally-weighted indexes and strategies were developed by WisdomTree independently of Research Affiliates.”
Both Arnott and CEO Jonathan Steinberg of WisdomTree stated that business would "continue as usual" at both firms now that the issue has been resolved.