Apple May Lose Big in Antitrust Case

AppleInsider is reporting that Apple Inc.1 is currently defending itself in the United States District Court for the Northern District of California against a class-action lawsuit accusing Apple of violating antitrust legislation.

The lawyers represent some 8 million plaintiffs, all of whom purchased Apple iPod classics, shuffles, touches, or nanos between September 12, 2006 and March 31, 2009. The lawsuit claims that Apple acted unfairly by exclusively tying one Apple product, iTunes, to another Apple product, the iPod, thereby creating a "monopoly." The complaint was first filed in 2005 when Apple refused to open its FairPlay digital rights management software to competitors, preventing iTunes purchases from being played on non-Apple products.

At the trial, the late Mr. Jobs, deceased in 2011, is already playing a significant role in the trial.2 The Guardian reports that the plaintiffs' attorney Patrick Coughlin showed jurors a 2003 e-mail from Apple co-founder Steve Jobs stating: "We need to make sure that when Music Match launches … they cannot use iPod." The question remains whether such a statement is criminal.

In a video deposition, Mr. Jobs post-humously defended his actions and accused RealNetworks3 of "adopting the tactics and ethics of a hacker to break into the iPod."

Further in the fruit company's defense, pre-humous Apple attorney William Isaacson said that "Apple products would not be as good or secure if third parties can come into the system."

The plaintiffs disagree with Jobs and Isaacson and are seeking damages of $350 mn. Given The Clayton Antitrust Act of 1914, which mandates "treble damages" for violations such as the ones allegedly perpetrated by Apple, the fine against the company could be upwards of $1.05 bn.

The trial, representing another chapter in the battle between fairness and security, started on Tuesday, December 2, 2014.

  1. Apple is, of course, the company worth more than the entire Russian stock market

  2. Isn't the Post-Steve World fascinating? 

  3. RealNetworks, Inc. "provides network-delivered digital media applications and services to manage, play, and share digital media. It develops and markets software products and services that enable the creation, distribution, and consumption of digital media, including audio and video." 

3 thoughts on “Apple May Lose Big in Antitrust Case

  1. This is not a battle between fairness and security. There is nothing fair about companies being forced to serve rivals with their platforms. Private property isn't a conditional right. Secondly this has nothing to do with security. Music files are not executable; Apple allowing other file formats in iTunes is in no way a security threat.

    There is nothing wrong with dominating a market by dint of superior product. Michael Glaser of RealAudio and subsequently ReakNetworks had codecs, file formats and player software that were inferior. This is why WinAmp and MP3 completely dominated the market, leading directly to iTunes.

    These lawsuits are unethical attacks by Ambulance Chasers, without any merit whatsoever. The sooner they are abolished the better.

    • Parman,

      I should've written "fairness" in quotations.. These lawsuits are exactly as you describe them, that is, without either merit or ethics. However, there's really no practical way for these lawsuits to be abolished given the current USG legal system. The courts must not only accept such cases, but seek them out, as the fines their accrue have become essential funding lifelines for the broke-as-a-joke states. As such, corporations such as Apple, Google, and Wall Street firms are prime targets, no only for garnering political points as "evil is purged," but for balancing the books.

      These legal charades are merely a means to the state's continued existence. To this extent, such proceedings seem likely to continue, if not increase in frequency and intensity.

      Thank Moses for Bitcoin, eh?

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