Per Setteb.it, Apple and Cisco have released a joint statement indicating that the lawsuit is on hold as negotiations are ongoing:
SAN FRANCISCO, Calif. January 31, 2007 - 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.
When Apple announced their mobile phone at Macworld, they named it "iPhone". This triggered a lawsuit from Cisco for trademark infringement.
Apple/Cisco negotiations had been reportedly been ongoing in the days prior to the Apple iPhone announcement. It appears that, for now, negotiations have resumed.