Edible Apple

Last week, Psystar filed a lawsuit against Apple in the state of Florida alleging that Apple’s tying of Snow Leopard to Apple hardware is anti-competitive, restricts trade, and is ultimately in violation of anti-trust regulations.

If this sounds familiar, it’s because similar arguments regarding OS X Leopard were already put forth by Psystar and were dismissed by the California court overseeing the current case.

Psystar attempts to differentiate its recent lawsuit from the current litigation because that one involves Leopard while their latest legal action involves Snow Leopard.  In an attempt to prove that the cases are different, Psystar argues that the “technical mechanisms used by Apple to tie Mac OS X Snow Leopard to Macintoshes” is completely different than those used in Leopard.  Curiously, though, Psystar doesn’t take the time to describe how those technical restrictions have changed, and more importantly, how was Psystar able to know this when it filed its suit before Snow Leopard even went on sale?

Apple doesn’t buy Psystar’s argument, and writes

Psystar alleges, in its Florida complaint, that it utilizes a different circumvention method for Snow Leopard.  Apple doubts this is true.  A prompt review of Psystar’s source code will answer this question.

Basically, Psystar is using the Snow Leopard release as a pretense to launch a frivolous lawsuit against Apple where it can bring up arguments which have already been dismissed as having no legal basis.

Now let’s dig deeper into Apple’s response.

Again, Psystar’s most recent lawsuit resurrects anti-trust theories that the court in California already dismissed as being baseless.  In the first instance, Psystar alleged that Apple had a monopoly in the OS X market, whereas now it alleges that Apple has a monopoly in the market for “premium computers.”  In both instances, Psystar attempts to establish a narrow view of a “market” that simply doesn’t exist under the law.

Apple writes,

Last week, more than nine months after Psystar’s antitrust counterclaims were dismissed and Psystar chose not to file an amended counterclaim, Psystar filed a lawsuit in the Southern District of Florida.  In its complaint, Psystar attempts to reassert the antitrust claims that were dismissed by this Court and alleges an antitrust theory based on tying and monopoly maintenance.

Psystar tries to avoid the California action by misrepresenting that the California action does not cover Apple’s latest version of Mac OS X, Snow Leopard, and that the technical mechanisms used by Apple to allegedly “tie Mac OS X Snow Leopard” is somehow not within the scope of the California litigation…

Psystar should not be allowed to re-assert in a new action the antitrust claims that this Court dismissed and that Psystar chose not to amend.  Nor should Psystar be permitted to simultaneously litigate, in another forum, the same subject matter pending in this case and before this Court.  Permitting this blatant forum shopping is not only prejudicial to Apple in that it will delay the determination of matters at issue in this case, but is also a waste of judicial resources and may unnecessarily create the possibility of inconsistent results.

Apple then address’s Psystar’s arbitrary definition of the “premium computer” market, and points out that Psystar could have easily raised this same argument in the current California litigation, but chose not to.  Taking things one step further explains that Psystar doesn’t even compete in the $1,000+ segment of the computer market it alleges Apple has a monopoly in, a point which subtly implies that Psystar might lack the necessary standing to even file the suit in the first place.

Nor does Psystar’s modified definition for hardware take into account that many of Psystar’s computers are sold for less than $1000.  Moreover, this Court has already found that Mac OS-compatible computer hardware systems do not constitute a distinct submarket or aftermarket under applicable antitrust laws.  Hence, the fact that Snow Leopard is a new version of the Mac OS X operating system does not raise any new issues in terms of the alleged tying and monopoly claims.

And poking yet another hole in Psystar’s lawsuit, Apple points out that Psystar’s counsel, K.A.D. Camara, even acknowledged in a prior deposition that issues in the current California case apply to and include Snow Leopard. According to Apple, Camara remarked, “Snow Leopard beta seeds are still within your cause of action.”

Next, Apple writes that Psystar’s attempt to run to a Florida court and seek judgement on issues that are already the subject of an ongoing case in California constitutes a “clear example of forum-shopping at its worst.”

Apple makes it clear that it views Psystar’s lawsuit as a stalling tactic, similar to the time it filed for bankruptcy in the hopes that its litigation with Apple would be put on an indefinite hold – a strategy which ultimately backfired.

According to its response, Apple plans to soon contact the court in Florida and make them aware of the ongoing litigation in California, with the desired end-goal being the dismissal of the case entirely, or that it be transferred and consolidated with the current California action.

It seems clear to us, based upon a thorough review of both Psystar and Apple’s arguments, that Psystar’s Florida lawsuit is shaky at best, and arguably frivolous.  Psystar provides no specific evidence that issues relating to Snow Leopard, technical or otherwise, are any different from those relating to Leopard.  Our prediction is that the 2 cases will ultimately be consolidated in California.

But lucky for us, we’re not going to have to wait to long to find out.  Judge Alsup, the US District Judge overseeing the case in California, has already scheduled a status conference for Friday September 4th to address the issues raised by both Psystar and Apple.