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Tuesday, 17 November 2009 03:19

Psystar loses big in court

A California court has rendered summary judgments in favor of Apple and against Mac clonemaker Psystar on several counts of copyright infringement. Several issues remain to be tried, though, and the ruling did not address damages.

Psystar is the company that started selling Mac clones -- generic Intel PC boxes with Mac OS X preinstalled -- in April 2008. That July, Apple filed suit for copyright infringement against Psystar in the Northern California U.S. District Court.

Last Friday (Northern California time), the court filed its Order Re Cross Motions for Summary Judgment. The order (PDF) represents a solid win for Apple in every issue it addressed -- law blog Groklaw calls it a "total massacre."

Apple charged that Psystar was in violation in three areas: reproduction, distribution, and the creation of derivative works.

Psystar's first loss came on the company's failure to assert a particular defense. The law "permits the owner of a copy of a computer program to copy or modify the program for limited purposes without incurring liability for copyright infringement," according to the court order. But Psystar never asserted that defense and, in the court's view, waived it.

As for distribution, Psystar argued that distributing Mac OS X on its computers was protected by the "first-sale doctrine," which states that "the owner of a particular copy or phonorecord lawfully made under  this title, or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord."

In other words, argued Psystar, because it bought a copy of OS X for each clone it distributed, it was allowed to resell them.

The problem, said the court, is with that phrase "lawfully made." Psystar didn't make individual copies of each DVD it bought; rather, it made one master copy from a Mac mini and then duplicated that one over and over. First sale does not apply.

For more on the judgment, see Page 2.

The final issue turned on whether Psystar created a "derivative work" of OS X, as Apple contended. Apple has the exclusive right to create such works.

To get OS X to run on its computers, Psystar replaced the OS X bootloader, disabled and removed Apple kernel extensions, and added its own kernel extensions. Psystar acknowledged that it made those modifications.

But Psystar claimed that didn't make its copies of OS X "derivative works," because it didn't actually modify Apple's source code. It merely replaced some of it with its own.

The judge called the argument "unavailing" and pointed out that Psystar didn't cite any court decisions supporting its interpretation of what makes a derivative work.

So as to the question of copyright infringement, the judge concludes, "Psystar has violated Apple’s exclusive reproduction right, distribution right, and right to create derivative works. Accordingly, Apple’s motion for summary judgment on copyright infringement must be granted."

The order also grants summary judgment for Apple's claim of contributory infringement -- encouraging others to infringe copyright, in this case by selling them unauthorized copies of OS X.

Finally, the judge took up Psystar's counterclaim that Apple was misusing copyright law to tie OS X to its own hardware.

For the judge's opinion of that argument, see Page 3.

Psystar had already made similar arguments in an antitrust claim, but that claim was dismissed last year.

Addressing the misuse of copyright claim, the judge examined exactly what Apple permitted its customers to do, and what it prohibited them from doing.

Psystar had brought up another case, in which a copyright holder required not only that its customers use its product, but that they not use any other products as well. That assertion of copyright was not upheld.

But in this case, the judge pointed out that Apple does not prohibit others from writing their own operating systems. Neither does it prohibit Mac OS X owners from using a competitor's product.

"Rather, Apple has simply prohibited purchasers from using Mac OS X on competitor's products," reads the order.

Finally, the judge found that Psystar violated the Digital Millennium Copyright Act (DMCA) by circumventing Apple's technological methods of protecting its software.

The court declined to address the question of damages or relief "at this juncture." And other issues still remain up for trial, including breach of contract, trademark and trade dress infringement, and unfair competition.

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