Geohot and SCEA agreed to a settlement today that resulted in a permanent injunction; he can no longer hack the PS3. However, judging by what's been said so far, it seems that he was screwed, hard, though we can't say for sure because the settlement terms were confidential.
What the hell? How did that kid become so smart?
If you buy the product, you should be able to do whatever you want with the product. Wasn't that the whole point of the iPhone ruling? Guess Sony's lawyers fucked him up.
My opinion is Sony said fuck it and didn't want to waste any more time gaining bad press with it. This was probably the only way they could walk away looking victorious without spending more money.
"Hey, we'll stop wasting our money suing you and racking up insurmountable bad press if you stop distributing the jailbreak."

"Uh... You got it."