The licensing arrangement is contingent on Arbitron paying $4.5m to Digimarc before the end of the month, after which the research agency will receive “a non-exclusive, worldwide and irrevocable licence to a substantial portion of Digimarc’s domestic and international patent portfolio”.

A row broke out between the two firms last year, with Digimarc claiming that a key component of Arbitron’s PPM system infringed its patents – specifically Arbitron’s Critical Band Encoding Technology, the technology the company uses to embed inaudible codes in radio broadcasts, which are then detected and recorded by the PPM devices as a means of determining the audience size for various stations.

Arbitron claimed to have received a letter from Digimarc CEO Bruce Davis threatening legal action in the absence of “negotiation of a simple licence or more comprehensive business relationship”. This prompted Arbitron to seek declaratory relief from the courts, asking a judge to rule that its technology does not infringe Digimarc’s patents and that those same patents were invalid.

The case had barely got off the starting blocks when news of the licensing arrangement broke today, alongside an agreement between the two firms to dismiss the case without prejudice.