Research Affiliates, WisdomTree Settle Dispute

Research Affiliates also says that it has agreed not to sue WisdomTree for any future claims arising under any current patents held by Research Affiliates, as well as any future patents relating to fundamentally weighted indexes and strategies that may issue under existing or future patent applications that may be filed by Research Affiliates within the next eight years, subject to a reduction by up to three years if Research Affiliates is acquired.

The “not to sue” covenant also includes service providers and customers of WisdomTree’s products and services.

For its part, WisdomTree has agreed not to sue Research Affiliates with similar terms and conditions.

The parties say that the “not to sue” stipulations do not include a right under each party’s patents to copy the other party’s methodologies. They have further agreed that it is not copying if Research Affiliates introduces an index or strategy that uses at least three fundamental factors to weight its indexes, if they are not predominantly dividend- or earnings-weighted, or if WisdomTree introduces an index or strategy that is weighted by less than three fundamental factors.

The parties have also agreed not to challenge the each others’ patents or patent applications, and WisdomTree said that the settlement will not affect the current methodologies and fee schedules.