The legal dispute between Apple and Cisco Systems over the iPhone name has been temporarily suspended.
Cisco's lawsuit has not stopped, but the two firms have agreed to extend talks aimed at "reaching agreement on trademark rights and interoperability".
The Apple iPhone, which the company has said will hit shelves in June, was launched last month in San Francisco.
Cisco immediately sued Apple for trademark infringement; Cisco has its own line of internet-enabled iPhones.
The company, which makes much of the hardware that underpins the internet, has owned the trademark on the iPhone name since 2000 after it acquired another company Infogear.
Infogear's original filing for the trademark dates to 20 March, 1996. Cisco's Linksys division has been producing a range of wireless VOIP phones under the name since 2006.
The phones allow users to make calls over the internet
Apple unveiled its iPhone at the Macworld Expo in San Francisco in January.
The touch screen phone allows users to download music and videos and comes in two versions - one with 4GB of storage space, the other with 8GB.
Linksys has produced a range of iPhones since 2006
At the time. Mark Chandler, senior vice president and general counsel for Cisco said: "There is no doubt that Apple's new phone is very exciting, but they should not be using our trademark without our permission."
Apple responded by saying the lawsuit was "silly" and that Cisco's trademark registration was "tenuous at best".
"There are already several companies using the name iPhone for Voice Over Internet Protocol (VOIP) products," said Apple spokesman Alan Hely.
"We are the first company to ever use the iPhone name for a cell phone, and if Cisco wants to challenge us on it we are very confident we will prevail."
Under US federal law, two companies are allowed to share the same name providing their uses are not similar.
Apple is no stranger to trademark battles. Last year the company was sued by Apple Corps, the Beatles' recording company, over its entry into the music business. Apple Corps lost the case.
The extended talks between Cisco and Apple are aimed at resolving the dispute before it goes to court.
A joint statement from the two companies read: "Apple and Cisco have agreed to extend the time for Apple to respond to the lawsuit to allow for discussions between the companies with the aim of reaching agreement on trademark rights and interoperability."