Judge gives Apple green light against Psystar

Apple wanted Psystar back in court, and now it's going to happen.

An automatic stay of proceedings imposed when Psystar filed for bankruptcy in May has been lifted by the court, according court documents shared with CNET News.

Judge Robert A. Mark, who serves the Southern District of Florida U.S. Bankruptcy Court, lifted the stay on Friday, opening the door for Apple to continue its copyright infringement case against the company.

Apple made a strong case for having the stay lifted, noting that Psystar filed for bankruptcy after a motion was granted compelling Psystar to give Apple additional documents. The bankruptcy filing also came just before a scheduled deposition from Psystar.

Apple cleared the way for the bankruptcy court to lift the stay by agreeing that it would not try to collect any monetary damages against Psystar if it won the infringement case. That was also a condition imposed by Judge Mark in making his ruling.

It seems clear that Apple feels it has a strong enough case against Psystar to win a favorable ruling or it would not be pushing so hard to get the case back in court.

Apple insists that its Mac OS X license agreement (PDF), which users must agree to before installing, should stand up to the court's scrutiny. In fact, the agreement clearly states that the operating system can only be installed on an Apple-labeled computer. That should leave any clone maker without a leg to stand on.

Apple has been dealing with several clone companies this year, but the Psystar case is the furthest along, so it makes sense for Apple to see it through.

If Apple were able to get a favorable ruling, it could use that precedent as a deterrent against other companies that want to get into the Mac clone business. RussianMac and PearC have started selling clones in Russian and Germany, respectively, and Quo Computer opened the first Mac clone retail store in Los Angeles.

[shycelticwitch]

Apple 3 - Psystar 0 .... why haven't they just thrown in the towel already? They are out of money and up to their ears in complaints about their product.

See what happens when you take a bite of the forbidden fruit? I hope those ying yangs end up working at a laundry service.

[mbenedict]

Um, no.

The Psystar folks (and their attorneys) already made their money. The "bankruptcy" filing was just another one of their legal / accounting ruse.

Whatever happens, Apple wont be able to collect anything and Psystar execs will enjoy a nice retirement from their funds stashed in the Carribean somewhere. Read the article again, it specifically means this as part of the court order.

This outcome has probably been part of Psystar's plan all along. Look for more copycats.

[Vegaman_Dan]

Psystar knew going in that they couldn't keep going forever. Looks like they went in, got their money, and now can leave while making Apple look like the bad guy here- a literal Goliath squashing David. That's the sort of PR that Apple really doesn't need right now, but that's what they got.

I'd say Psystar played Apple for a sucker.... and got away with it.

[S R]

@mbenedit

I think Apple's interest in this case is not the money, but the judgment. If the court decides that it is illegal, then you won't see more copycats on the same line. Apple is not after the petty $75,000.

[seven7dust]

@mbenedict
I don't think Apple wants to collect any monetary funds from Psystar or any other clone manufacturere for that matter
afterall thats pocket change to Apple
this is more to set a example to other companies not to mess with the EULA and such,
and it's safe to say that it's been achieved

[monkeyfun14]

@seven7dust

Actually I don't think its been achieved since the trend has gone international.

Into some countries that have very little respect for copyright laws oh also these countries can speak english as well which is even more of a problem if you think about it.

[pithenumber]

@77dust
no clones based in the US can exist
but their are other countries in the world you know
and our laws don't apply there

[mbenedict]

@seven7dust

It HAS NOT been achieved even in the US.

Look up Que Computer linked in the article above. They're based in LA and JUST launched, knowing full well the Psystar case and that Apple will probably sue them.

They also know that by the time anything is settled, they'd have make enough money to make it worthwhile.

[dbargen]

Was there any doubt? The EULA on OS X was and always has been very straightforward. How about we nix the play-by-play until some actual news happens. Hmm?

[Vegaman_Dan]

Apple is going out of their way to make sure that the court doesn't examine that EULA. It would be a very bad thing indeed if it was examined closely and it turns out that it's invalid. Apple has a lot to lose as a result.

It will be very hard for Apple to try to spin this in any way other than negative. Instead they'll just keep mum about it. It's a PR nightmare if they even acknowledge the issue.

[shldvebnacwby]

One of Pystar's main arguments it that the EULA has some very serious flaws, namely the one about only being able to run the software on Apple-branded hardware. They are probably going to argue a more advanced version of "the terms in the EULA would be like if you bought a shirt and were only allowed by law to wash it in a Maytag-branded washing machine. It is too restrictive and they should be forced to change it."

In my opinion this is a stupid move by Apple unless they are dead sure they have a perfect case. They have a lot to lose (including PR, money, and the terms of their EULA) if this case were to go the wrong way, and almost nothing to gain if they win.

[S R]

@Vegman_Dan

Well, there's no problem with a company saying that you are licensing this software to run on these machines. This license is not valid on certain other machines. If you don't like it, you don't buy the license. What we can do is to ask (request, protest, or whatever) the company to change it's policy. If they don't then refuse to buy their products.

Yes, every EULA has the same problem you mention here -- restrictions on how the software can be used.

[pithenumber]

@SR
but Apple EULA is more restrictive than others

[DrtyDogg]

EULAs needs to be displayed and readable at the time of purchase. The software is paid for at retail cost, the hardware is paid for, the only thing that stands in the way is words that are delivered after the fact. By the way, upon reading this comment you agree to pay me your entire salary for the next ten years.

[myles taylor]

I hope this goes through quickly but it's not likely with our court system.

I've said it before and I'll say it again. I am firmly against clones and I hope they get stopped, either legally or commercially.

[Bertbaby]

Imagine if IBM had done the same with the DOS EULA. We would have a personal computer world dominated by anthing but Macs or PCs.

[Perry_Clease]

Not necessarily.

[monkeyfun14]

Apple continuing even with this case is like playing russian roulette psystar has nothing more to lose while Apple has a whole lot to lose if they happen to lose the case.

[myles taylor]

So Apple should give up? Actually I think it's Psystar that has everything to lose and Apple that has almost nothing to lose. What should Apple do? The odds of them losing the case are slim compared to the nightmare if they just gave up the case.

[kelmon]

"In a stunning reversal of fortunes, monkeyfun14 has gone from being the weakest link to being the strongest link in this round"

Apologies for the Anne Robinson impression but it rather sums up the normal business on these blog comments. Usually I ignore monkeyfun14's comments but on this occasion he/she's bang on the money. Whatever happens, Psystar is toast and always has been. Apple is certainly playing a dangerous game but this case will at least give closure to a long running debate between wannabe lawyers. Apple certainly could have trouble if they lose this case...

[Vegaman_Dan]

It would be far far cheaper for Apple to simply buy up Psystar and shut it down. That would avoid the court case, embarassing examination of the EULA, and they can quietly pretend it never happened.

[Perry_Clease]

"It would be far far cheaper for Apple to simply buy up Psystar and shut it down. That would avoid the court case, embarassing examination of the EULA, and they can quietly pretend it never happened."

Then some other Psystar clone would start up and Apple would have to buy them. Apple went to court to protect its EULA, had they lost the suit then you can bet that Apple has something else up its sleeve. Apple isn't afraid to gamble, but I would also bet they knew that they are firm legal ground in this situation.

[Vegaman_Dan]

@Perry_Clease:

By that same token, Apple could be in court with lawyers to contest all of this, try to seal the records and bury it so that nobody knows of the result. They may reach an out of court settlement and nothing gets actually challenged. It wouldn't be the first time this has happened.

As much as I would love to see EULA's challenged across the industry, this doesn't appear to be the test case to go the distance.

[Beezoo]

What this means is that Psystar will now be compelled to deliver the documents that they have thus far been reticent to hand over. The most important of which are those documents exposing where the financing for Psystar and their legal fees originated. There certainly seems to be some pretty deep pockets involved behind the scenes. Perhaps now the veil of secrecy can be lifted. It will be interesting to all of us, I am sure, when those person's names, and perhaps even corporate names are disclosed.

[Vegaman_Dan]

That's all good unless the names of those financiers are from other countries in which case our laws do not apply and cannot for disclosure. They can simply hide behind the name of an investment group or other similar entity.

Corporations aren't stupid- they've been doing this sort of thing for more than a century now.

[mbenedict]

Nah. Apart from the company execs, whom we already know, the "financiers" are probably just one or more shell companies. Then Apple is stuck because they can't compel those shell companies to disclose anything.

[SiliconValleyJoe]

Apple cannot lose and if it does, the entire high-tech world ranging from robotics to simplistic home device makers will take the fight to the Supreme Court.

BMW creates software to run some its car systems. Must BMW make that software accessible to Toyota? Mercedes?

Meade makes telescopes and sells a software guidance package that drives Meade scopes. Must Meade now make that software to run on Orion or Celestron or Takahashi?

Panasonic makes projectors and home AC and provides software that runs its system. Must Panasonic now make that software available to Samsung? Fujitsu? Sony?

If you create a hardware device and then create the necessary software to run that device, are you saying YOU ARE WILLING to let that software run on other devices made by other companies who compete directly against YOU?

[cary1]

There is a significant difference in the situation here and the analogies you are presenting.

No, if BMW was in a similar situation, they would not have to make their software accessible to Toyota. That's Toyota's job. BMW will just have to let Toyota use it in their cars. There is a huge difference here.

Meade would not have to make the software run on Orion (i.e. modify their software to be compatible with orion), but they will have to let Orion modify Meade's software to run on their own devices.

PS - What product do Meade and Orion make? The names sound familiar

[El_Segfaulto]

@caryl

Wasn't sure if you were serious, but they make telescopes.

[sidb1980]

How is that any different than MS trying to keep other products from working with their browser. To me it isn't. Apple is just trying to keep anyone from building a computer that runs their software. Sounds the same to me that got MS in all the trouble. So, had IBM done that back in the day, then just think of the monopoly? No Dell, etc. Although, perhaps Atari would have survived! :)

[sidb1980]

How is that any different than MS trying to keep other products from working with their browser. To me it isn't. Apple is just trying to keep anyone from building a computer that runs their software. Sounds the same to me that got MS in all the trouble. So, had IBM done that back in the day, then just think of the monopoly? No Dell, etc. Although, perhaps Atari would have survived! :)

[monkeyfun14]

What are the odds of a company doing that though? And to be realistic with you these companies hardly make their own software anyways they ussually consult a tech company in which have experience with it..

Microsoft,Garmin,Etc

[sharmajunior]

No, you are wrong with the BMW arguement. It's Apple preventing people from using its software and dictating where it can or can't be used after it has been bought with no mentioning of the terms of usage on it's cover. You find out only after you have opened the CD and then the pop screen comes up stating that these are the terms. By that time, no store such as BestBuy or Fry's or whatever local store you have in your neighborhood would take back an open OS CD.

Besides, the OS CD's are openly available in public at the stores I mentioned. So all Apple had to do in that case is to stop selling their OS at retail stores. That would suck for us Mac users as all the updates or even a new OS would have to be downloaded or ordered via a CD by mail online.

Putting anything out in the public makes for it being used very easy.

[Squashman2]

Steve Jobs has always said that Apple is a Hardware company, not a software company.

[monkeyfun14]

I would call them more a hardware assembler tbh.

[Seaspray0]

And the cigarette companies claim smoking isn't bad for your health. Steve Jobs can claim apple is a hardware company all he wants, but what will matter is if that holds up in a court of law. This pystar case may shed some light on that.

[codewrangler]

After reading the EULA, it would seem to me that the weak part of Apple's case would be in the definition of "Apple-labeled computer".

What does that mean? I think that it may be that the court is going to determine that. But, you could argue that if you take the Apple Sticker that comes with the OSX DVD and stick it on a compatible PC, would qualify as "Apple-labeled computer".

Wouldn't it be odd that language designed to protect Apple's IP, would actually open it up to uses that are unintended?

[Perry_Clease]

No

[codewrangler]

Ah, a man of few words. Would you care to elaborate on 'No'? :-)

[Perry_Clease]

"But, you could argue that if you take the Apple Sticker that comes with the OSX DVD and stick it on a compatible PC, would qualify as "Apple-labeled computer".

To be an "Apple labeled" computer then Apple would have to apply the Apple sticker.

[codewrangler]

That's one way to parse it....

[seven7dust]

Psystar was wrong and deserved what they got
they desrve no sympathy, what they did was the equivalent of stealing !
and this should set an example to everybody else !
good riddance !

[pithenumber]

if Psystar loses, it only sets an example for US cloners only
we aren't the only country in the world
our laws aren't universal either

[Jenny0913]

Psystar never had the right to offer OS X computers in the first place.

[Vegaman_Dan]

It's not illegal to offer a computer that can run OS X. There are dozens of OEM's now that produce hardware that can run OS X including Dell, HP, Lenovo, Acer, Asus, etc. By your logic, should these companies be shut down as well?

[shycelticwitch]

FYI... Psystar and it's lawyers are in bankruptcy for a reason, and without divulging information that could get me in trouble... I can GUARANTEE you that they are NOT laughing all the way to the bank in the islands. As a matter of fact... can you spell "i-n-d-i-g-e-n-t?

[Vegaman_Dan]

Can you spell "o-f-f-s-h-o-r-e-i-n-v-e-s-t-o-r-s"?

Once the money is out of the US, they are home free and not legally required to disclose the names of the investors. If companies had to disclose everything and keep the money only in the US, then there wouldn't be much reason for Swiss bank accounts to exist, hmm?

[donsms]

Relax Appleites!,Relax!

[tech_crazy]

It would be interesting if some company actually buys old/disposed Apple computers, changes the motherboard and then sells them. Technically, it would still be an Apple labelled machine.

[Perry_Clease]

"it would still be an Apple labelled machine"

One that was originally sold with an Apple OS license.

[Vegaman_Dan]

Perry's right. Since the machine was sold with the OS license, they would qualify and Apple could not fight that. But gutting old Macs and putting in new internals will still leave you with an older case that is hardly worth the effort to just sell a newer OS.

[groink_hi]

Back in the day, people were taking old Mac SE and SE/30 logic boards, and creating Hackintoshes like the Colby, among other clones. They were real Apple logic boards - and they were running Mac OS Classic.

This is what I don't understand... By now, there is absolutely no reason why Mac OS X should be a retail product. I understand that the purpose for the OS to be sold retail was to allow people still running Mac OS 9 and earlier to upgrade. But those days are LONG gone! Today, computers that can run the latest Mac OS X version cannot run Mac OS Classic. Whoever purchases the retail product, in theory, are already running Mac OS X.

I'd say just take Mac OS X off the retail market! The only way you can purchase a newer version of Mac OS X would be through the Apple Store - either on-line or at one of their retail stores. And, you would need the serial number from your Mac - not to install the OS, but to just purchase the OS. Apple already uses serial numbers when people purchase AppleCare. It could do the same thing for OS purchases. The OS still wouldn't require a CD key or anything for installation.

[pithenumber]

Apple has everything to lose[PR,Cash,right to Mac OS,...] and very little to win[no clones in the US only]
Psystar is losing either way, whether it be Apple or Dell and HP that kills them

[Leemac]

Gutting old Macs and replacing the components?? I don't think so..... Apple "branded" the 6400 Performa with a specified group of specs. You change those specs, you no longer have a 6400 Performa and THAT 6400 Performa is what was sold with an OS license, not some hackin'tosh somebody else created. Do you think BMW is going to support a BMW body with a 451 Windsor??? Apple has made that very clear that they do not support any configuration of their computers that they did not build by refusing to support any modifications to it's computers. Even, today, if you take a Mac in for service and it has 3rd party RAM installed, you'll run into problems with getting service. Take that 3rd party RAM out, and getting service just got a WHOLE LOT EASIER.

Apple wants to know WHO financed Psystar.

Can they go after them for civil damages? I don't know, I'm no lawyer.

As for what laws apply and where they apply... this would depend on TREATIES. If any transaction is in violation of a Treaty, it is illegal per our Constitution. I know this in spite of not being a lawyer, because certain groups of which I am a member are closely watching various Treaty movements that may detract from our Constitutional rights. (did you ever wonder why endangered species "suddenly" went to the front of the list in our courts??) The Constitution states quite clearly that Treaties become the law of the land and that all courts are required to enforce the conditions of a treaty.

Apple pays VERY well for the advice it gets from it's legal beagles. They know exactly what they are doing and exactly why they are doing it.

******Note that Jobs is about a flaming a liberal as you can get and Obama is, too.****** A match made in #%$^&&?????

[Perry_Clease]

"Apple wants to know WHO financed Psystar. "

The bankruptcy documents did not show them owing any deep pocket investor, Psystar's CEO loaned them $160,000. However, according to someone who says that they are bankruptcy lawyer Psystar only had to list current creditors and sources of income. If someone gave them a gift of money then that would not be listed in the bankruptcy documents. There could still be a deep pocket, but it would take more investigating to find out who that may be.

See this story and read the responses: http://www.macobserver.com/tmo/article/psystar_financials_dont_reveal_deep_pocket_company/

[shellcodes_coder]

They are doing this because they want customers to buy that iCrap and pay more CrApple tax

[ckh1272]

You know you really just truly revealed yourself to be the biggest fool when even monkeyfun14 is participating an actual discussion about Apple instead behaving like a 3rd grader such as yourself. Get a D--N life!

[Seaspray0]

@ckh1272. Yep, the gene pool needs some chlorine.

[hurricane_d]

I spent quite a bit of time in the past trying to build a hackintosh and failed to build anything close to Apple's standards for reliability and ease of use. Apple really has nothing to fear at the moment from Psystar or other clone makers but I can see how they would want to stop them anyway. Other manufacturers make hardware that can be used to run OS X but they don't ship them with OS X--that's the difference, I think. While it has been very hard to build a computer to run OS X close to perfectly, it is become easier with the consolidation of hardware manufacturers. All it'll take is a compatible motherboard with firewire and a compatible video card. Apple has only dealt with two video chip makers: ATI and Nvidia. It's pretty easy to match the specs on paper, but it'll never be perfect because of differences in hardware at the lowest level and the closed nature of Apple's drivers. For example, I tried in vain to get an ATI Radeon X1950XTX to work like the X1900XT (Apple usually doesn't go cheap) that shipped in some Mac Pros, but there were still screen artifacts and other glitches. The X1950XTX is a better card, but while it is close to the X1900XT, the small differences mean hours of work to get it to work reliably. It's even more scary trying to do updates with a patchwork system like that. The trouble is if I bought a mac, I would be stuck with Apple's hardware. That's a huge hurdle for some people. It's not that there are a lot of people too cheap to buy Apple's products--games were paying $450 for the X1950XTX a little while back--they just want to be able to upgrade with their own choice of hardware without voiding the warranty. Apple could allow manufacturers to build solid drivers for motherboards and video, just like Microsoft allows for Windows, but then what's to stop someone from building a clone and then downloading the manufacturers' drivers? This used to be a hobbyist industry but I guess those days are gone. You can't even tinker anymore without feeling like you are breaking the law. It's not any easier on the Windows side. I downloaded Windows 7 after my hackintosh attempt failed and found out that ATI is preventing owners of older cards, even high end ones like my expensive X1950XTX, from using them with Windows 7 by not providing drivers. I don't blame Apple in the least here. Who knows how much money they had to spend on lawyers fees just to get their product out the door. Now they have to spend more money on lawyer fees to get rid of a pest that wants to cash in on their investment without doing any real design and development work. At least I bought a MacBook Pro and a license for OS X before attempting to build a clone out of spare parts just for fun. There are some who would just download OS X without even paying for it. In the end it's the lawyers and unscrupulous cloners/downloaders that'll win here; the actual customers will lose by having to suffer higher prices. The cycle continues....