Apple and Nokia patent dispute ends in Nokia's favor

The short version: there are costs and risks involved in patent litigation and it's likely that it simply became more cost effective for one side or other to reach a compromise on licensing fees - which is what the lawsuit was about to start with.

Alternative hypothesis suggested - Nokia's deal with Microsoft altered the patent landscape and made Nokia's patents available to Apple under better terms on account of the patent licensing deals that Apple and Microsoft have with each other already.

So, I've read the compromise was a large, one time payment by Apple. (But the agreement is confidential and the reports haven't said their source, so take that with a grain of salt).