Apple, Psystar Reach Partial Settlement in Mac Clone Case

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Apple and Psystar reached a partial settlement on November 30 in their legal battle over whether or not the PC maker can build and sell Mac clones without permission. The partial settlement means the two companies won't face each other at trial in Northern California and reduces the likelihood of a trial in Psystar's parallel case in Florida.

Apple filed a lawsuit against Psystar in Northern California several months ago claiming the small PC maker was violating the Mac OS X end user license agreement, and that it was violating the Digital Millennium Copyright Act with the steps it used to install the Mac operating system on PCs. Psystar claimed that it should be allowed to build and sell PCs with Mac OS X pre-installed and that Apple is overstepping its bounds by blocking companies from selling Mac clones.

Both companies filed motions for Summary Judgement, and in November Judge William Alsup ruled in favor of Apple and against Psystar. Apple followed up by asking the court in California for a permanent injunction blocking Psystar from hacking Mac OS X, selling Mac clones, and from selling its Rebel EFI tool for installing Mac OS X on PCs.

Since the case in Norther California started before the introduction of Mac OS X 10.6, or Snow Leopard, Psystar filed its own case against Apple in Florida after the new version of the operating system shipped. According to Psystar's argument at the time, Snow Leopard should be seen as a different product and deserves its own trial.

Psystar, however, seems to have given up on trying to keep its Mac OS X 10.6 battle alive in Florida since it isn't offering a compelling argument to keep Judge Alsup from including the operating system in any injunction he issues.

"Based on its brief, Psystar really isn't contesting Apple's request for an injunction that covers all of OS X, including Snow Leopard," The Mac Observer's legal contact said. "Yes, Psystar makes a token argument, but it is neither fully briefed, cogently argued, and has no supporting case law or other legal authority."

Psystar's change of heart was apparently part of a deal with Apple. In exchange for its concessions on the potential injunction, Apple agreed to dismiss its trademark, trade-dress and state law claims, and agreed to pre-set damages for its other claims.

Psystar is still holding out on its Rebel EFI product in hopes of focusing on that product in any proceedings in Florida. Despite its arguments, Psystar may have a hard time convincing Judge Alsup to exclude Rebel EFI from any injunction.

"Psystar argues that because Rebel EFI involves the issues of whether end users have a right to to modify Mac OS X to run on non-Apple hardware, whether Rebel EFI should be enjoined is beyond the scope of the California case and, therefore, should be left to Judge Hoeveler," TMO's legal contact said. "I think that Psystar is wrong here because Judge Alsup found and held that Psystar can't traffic in circumvention technology, and can't contribute to other's act of infringing on Apple's copyright in OS X, which is exactly what Rebel EFI does."

The partial settlement and pending injunction in California make an ongoing case in Florida less likely, especially if Judge Alsup includes Rebel EFI in an injunction. What seems more likely is that Judge Hoeveler will hand the case in his court over to Judge Alsup since the issues Psystar will be arguing have already been ruled on in California.

Apple has until December 7 to respond to Psystar's arguments in the partial settlement filing.

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Comments

Jeff Gamet

Looks like Psystar is in damage control mode, and I doubt that Judge Alsup will see the company’s Rebel EFI arguments as compelling. I’m betting we’ll see a broad injunction that blocks Psystar from dealing with Mac OS X in any way.

ilikeimac

Did Alsup really describe Rebel EFI as “anti-circumvention technology?” It seems more like “circumvention technology” to me, or maybe “anti-anti-circumvention technology.”

Bosco (Brad Hutchings)

That was TMO’s legal contact, who doesn’t seem to be familiar with either the law (DMCA), the relevant terminology, or the English language.

The end-users of Rebel EFI who otherwise purchase their copy of Mac OS X in some form are violating an SLA, not infringing on copyright by using the device on their own private machines. It is more than a stretch to call Rebel EFI a circumvention device when all it does is set up an EFI emulation layer that generic hardware (e.g. Gigabyte Mobos) already presents to Mac OS X. EFI is a frigging standard that Apple is using to keep its ongoing costs low. It is, for example, what lets Windows install on a MacBook using Boot Camp. Apple cannot reasonably claim that implementing said standard and then tuning the parameters to Mac OS X’s liking constitutes a circumvention device.

geoduck

Apple cannot reasonably claim that implementing said standard and then tuning the parameters to Mac OS X?s liking constitutes a circumvention device.

And yet that’s what Apple’s team of actual trained and licensed lawyers are doing, so I guess they believe there is some validity in their claim.

Jeff Gamet

Did Alsup really describe Rebel EFI as ?anti-circumvention technology?? It seems more like ?circumvention technology? to me, or maybe ?anti-anti-circumvention technology.?

Sorry about the error in the quote, and thanks for the sharp eye. It’s fixed now.

Bosco (Brad Hutchings)

Apologies to TMO’s legal contact if she indeed was misquoted. TMO’s legal contact is 100% incorrect on Rebel EFI being a circumvention device though. There is nothing to circumvent. Apple publishes the code that effectively determines if the hardware is Mac or not under a very permissive open source license. Apparently, they haven’t implemented anything higher up in the closed source portions of the Mac OS X stack to determine if hardware is genuine Apple and disable the product if not. Given what Apple has built, it’s “point of failure” for preventing Mac OS X from running on other hardware is a clause in the SLA and an end-user’s private decision to obey the clause or ignore it.

@geoduck… Actual trained and licensed lawyers, on average, lose about half of the cases that they take to judgement. And let me put my libertarian critique of Apple’s Mac OS X on Apple hardware term another way for you. Apple is asking all of us (me included) who don’t do it to be chumps.

Just Me

What I think would be interesting (if possible) is for Apple to demand that Pystar reveal who has been funding the whole enterprise. It has so bogus for Pystar to file for bankruptcy and then suddenly “find” the money to continue the legal shenanigans.

jragosta

MO?s legal contact is 100% incorrect on Rebel EFI being a circumvention device though. There is nothing to circumvent.

Judge Alsup (who saw all of the evidence and isn’t a loud-mouthed troll-boy like you) disagrees with you. He specifically stated that the method Psystar was using (which is essentially the same as the Rebel device) was being used to circumvent Apple’s encryption process. Apple’s testimony was the same and even Psystar agreed with that part of it.

Fact is that the Rebel device clearly DOES circumvent whatever process is in place to prevent an OS X CD from installing onto a generic computer.

John Dingler

Someone please explain to me why Apple is settling, if only in part, in a case in which it is completely triumphing. Seems to me that a settlement is a gambit used to prevent further loss, indicating a weakened position? This brings into question whether or not Apple is truly winning in spite of Alsop’s rulings which seem to be all in Apple’s favor. And is Apple winning on all levels, not just in court? What’s the deal?

Bosco (Brad Hutchings)

@jragosta… No, Alsup conflates the bootloader with Mac OS X in his opinion and calls the bootloader a part of the derivative work. My guess is that he is working on the theory that the bootloader + Mac OS X installed on Psystar box is the derivative work. With Rebel EFI, Psystar is just selling the bootloader, which can be used to boot other operating systems as well, and update tools.

Two things… One (again)... This pushes the actual act of license violation onto the end user, and the “only Mac hardware” term is what’s at issue. Procedurally, about the only way Apple can stop this without further encumbering their software, is suing individual users. Do you think that would go over well? Two… Eventually, the hackers will find the holes in systems, and Apple’s licensing scheme, software, open source components, etc. are just a system, bound to have holes at all levels from conception to implementation. Some holes, like this and like the app installation hack on Apple TV that Boxee and XBMC use, probably just have to be tolerated, because they are too expensive (installed base, ease of use, redesign, customer good will) to patch up. I’m reminded of a hole Microsoft faced a few years ago when virtual machines became all the rage. Initially, they opposed them. The Vista license did not allow installation in virtual environments. Then they embraced it. And we’re all better for it. Apple could buy a photocopier from Xerox (just down the street) and copy that one approach from Microsoft. We’d all be better for it.

geoduck

As Woody Allen said in one of his films: “Yes and if everyone in the world goes to the same restaurant on the same day there would be chaos. But that doesn’t happen”.

Most people are happy to NOT break the rules and will use their equipment in accordance with the license. You keep throwing this straw man up that Apple will have to sue everyone in the world one at a time because soon there will be millions of people ripping off OS-X and putting it on everything from servers to netbooks to toasters. That just aint’ gonna’ happen for the same reason that most people don’t take the catalytic converter off of their car or pull the Do Not Remove tag from their mattress. It’s not that important to them. They want a computer that does what they want without too much hassle. For confirmation look at the increasing sales of Apple products and decreasing percentage of Jailbroken iPhones. Most people have no problem living within the rules.

jragosta

It doesn’t matter if the bootloader can be used to install other OSs. The fact that they replace Apple’s bootloader with Rebel’s bootloader (on the hard disk) is more than sufficient to create a derivative work. YOU may wish it were otherwise, but you have zero legal standing (nor, apparently, legal experience).

As for the rest, you may wish Apple would let people use OS X however they wish, but I disagree that we’d be better for it. It would create a mess and cost Apple business - which is Apple’s reward for innovation. I strongly believe that innovators should be rewarded and our system works best when they are. Furthermore, it would force Apple to waste time on finding better ways to block misuse of its OS - time that could be spent on improving the product.

Bosco (Brad Hutchings)

@jragosta… A cursory google search for “Rebel EFI” found me 20 more than pretty thorough reviews on major blogs and news sites from TechCrunch to Engadget to The Register. The tone of most of these was supportive of the concept and “yeah whatever” to the license issues. Next time an Apple exec touts SL as the best selling Mac OS X update of all time, somebody ask him to break out copies sold to hackintoshers, please.

Dude, a bootloader is totally independent of an operating system. Perhaps you have no experience outside Macs and have never seen or used one? Rebel EFI the product is a bootloader and a user friendly system for downloading drivers that work with Darwin (the open source underpinnings of Mac OS X). Itself, it’s not a derivative work of Mac OS X any more than Parallels is.

And all this BS about all the problems it would create for Apple… The horses have already left the barn. Apple may flail around like Microsoft did with VMs, but it will eventually have to adjust to reality. So will all the fanboys.

zewazir

Someone please explain to me why Apple is settling, if only in part, in a case in which it is completely triumphing.

Because even if the verdict of a trial is, for the most part, a foregone conclusion, trials are still very expensive. Apple has the choice of going through and absolutely spanking PsyStar, or they can take the win, take the damage reward, and move on all the sooner.

I’d be willing to bet the biggest factor in the agreement was to limit the damages - since it is unlikely they’ll get anything out of PsyStar anyway.

I do hope they force full disclosure, though. Find out whose pockets are funding this fiasco.

jragosta

@jragosta? A cursory google search for ?Rebel EFI? found me 20 more than pretty thorough reviews on major blogs and news sites from TechCrunch to Engadget to The Register. The tone of most of these was supportive of the concept and ?yeah whatever? to the license issues. Next time an Apple exec touts SL as the best selling Mac OS X update of all time, somebody ask him to break out copies sold to hackintoshers, please.

I did a Google search for ‘bank robber’ and found 389,000 hits. Does that mean that it’s OK to rob a bank?

Dude, a bootloader is totally independent of an operating system. Perhaps you have no experience outside Macs and have never seen or used one? Rebel EFI the product is a bootloader and a user friendly system for downloading drivers that work with Darwin (the open source underpinnings of Mac OS X). Itself, it?s not a derivative work of Mac OS X any more than Parallels is.

So we have a judge trained in the law who has seen all of the evidence presented by both sides taking one position, and a loud mouth, anonymous poster on the other. Just what rationale is there to believe that you know more about the issue than the judge?

Bosco (Brad Hutchings)

@jragosta. How about ceasing the childish name calling and demonstrating for us that you know what a bootloader is. Describe it in a sentence. Give us the name of one commercially available bootloader software which doesn’t infringe on anything. Now explain why that bootloader, were it to present an EFI image for something else like say Windows Vista or 7 to run atop, would be a derivative work of Mac OS X. Thanks! I’m totally confused about this point and look forward your learned explanation!

John Dingler

Hi Zewazir and Jeff,
If Apple’s goal is to use the partial settlement to limit litigation costs by bypassing the trial because Apple knows that Psystar itself is too poor to pay any penalties, compensations, or damages, then I wonder what method or venue Apple might employ to discover what entity, if any, is funding Psystar’s own litigation costs, and how feasible it might be to pursue that loose end.

jragosta

@jragosta. How about ceasing the childish name calling and demonstrating for us that you know what a bootloader is. Describe it in a sentence. Give us the name of one commercially available bootloader software which doesn?t infringe on anything. Now explain why that bootloader, were it to present an EFI image for something else like say Windows Vista or 7 to run atop, would be a derivative work of Mac OS X. Thanks! I?m totally confused about this point and look forward your learned explanation!

I’m still waiting for you to explain why we should believe you know more about the law than Judge Alsup.

As for the bootloader, you’re completely missing the point. The bootloader does not infringe, nor is it a derivative work of OS X. However, when you install OS X onto a hard drive with Rebel EFI, it copies OS X to the hard drive but replaces the OSX bootloader with the Rebel EFI boot loader - so that the system will book. THAT (hard disk with OSX but bootloader replaced) is the derivative work. It’s really not rocket science.

Bosco (Brad Hutchings)

Wrong, when you install OS X onto a hard drive using Rebel EFI, Rebel EFI does no copying of OS X. That’s all under the direction of Apple’s installer. The EFI layer passes bits stupidly and the process above it asks. The boot sectors are replaced after you reboot your hackintosh from the hard drive. The boot loader supports multiple operating systems, like most bootloaders. So you can have Windows, Ubuntu, Mac OS X all on the same machine. This has been SOP in the x86 world for 15ish years and you think this process, performed in your home, constitutes a “derivative work”?

The difference was in drive imaging. Alsop said that Psystar made a master and then copied this whole master to other computers. The purpose was to put a working image of Mac OS X on computers it shipped.

I wonder if anyone has tried installing Rebel EFI on genuine Mac hardware. Presumably, the goal would be to enable a Mac to run Mac OS X, Windows, Linux, etc. Is that a derivative work? Or does derivative work come in only when the hardware doesn’t sport an Apple logo?

jragosta

The EFI layer passes bits stupidly and the process above it asks. The boot sectors are replaced after you reboot your hackintosh from the hard drive. The boot loader supports multiple operating systems, like most bootloaders. So you can have Windows, Ubuntu, Mac OS X all on the same machine. This has been SOP in the x86 world for 15ish years and you think this process, performed in your home, constitutes a ?derivative work??

I’m just curious - do you really believe the trash you write?

The bootloader on the OS X hard disk is replaced with a modified (rebel efi) bootloader, so the disk is not purely the way Apple created the software. THAT is a derivative work - whether you like it or not - or whether anyone has done it for the last 15 centuries.

The court has ruled. Period. You are wrong. End of discussion. Unless you can explain why some loud-mouthed whiner posting on Macobserver knows more about the law than the judge who sat through all of the evidence.

Bosco (Brad Hutchings)

The disk is not purely the way Apple created it ten microseconds after you check your email. Unauthorized derivative work? You move fonts into the system fonts folder. Derivative work? Yet, you replace a boot sector on the drive of a machine that Apple never touched and suddenly the whole thing is a derivative work.

Read Alsop’s opinion again. Nothing is said about the Rebel EFI product. The context of discussing bootloaders and derivative works is in the imaging stage on the Mac Mini, prior to imaging to Psystar machines.

Perhaps the point is too subtle. Clearly what is happening here is that many people want to run Mac OS X on non-Apple hardware against Apple’s general wishes. Enough people want to do this, that a company comes in and pretties up a solution developed in the open source world and makes it available for sale. If the number and detail of reviews of Rebel EFI, and the comments on those reviews, are any indication, thousands of people have evaluated and/or purchased this product. Unless Apple can have that specific, granular product declared a circumvention device, it’s legal to sell. The spirit behind it may be against Apple’s wishes, but Apple has no right to shut down the market for boot loaders because someone figured out how to use one to install their OS (6% market share) on commodity hardware (near 100% market share).

Maybe the funniest part about this whole debacle is that Psystar probably “stole” (in a “did not create” sense) from everyone. But they put Hackintoshing on the map, and every new mention of it just stirs up more interest. Perhaps that’s why Apple reached a settlement with them.

jragosta

Wow. Just wow. Does it hurt to be so delusional?

The difference between what you do when you receive email or copy a file and what Rebel EFI is doing involves the rights given to you by the copyright holder. You are given the right to use a Macintosh computer to receive email, install software, etc. You are NOT given the rights to install the software onto other hardware. The bootloader is there to prevent that. By changing the bootloader, you are now operating outside of the rights you were granted by the license holder.

As for Alsup’s opinion, it doesn’t specifically mention Rebel EFI, but it most certainly DOES state that the process used by Rebel EFI (replacing Apple’s bootloader with a different bootloader) is illegal - both for copyright and DMCA reasons. You really need to read the decision - or get someone to read it to you.

No one ever said Apple could stop someone from writing a bootloader. That’s a simple strawman argument. Apple DOES have the right to prevent someone from using a bootloader to replace the bootloader in OSX - and also to prevent someone from encouraging others to do the same thing (look up the contributory infringement part of the ruling).

John Dingler

@ John Dingler,
Don’t be $htupid, John. And start reading with comprehension. According to Groklaw—you $tupid $hit—(you should read it to get better informed) Apple made no such agreement with Psystar. Geez. Psystar only proposed that agreement so far.

Apple is evaluating and will respond tomorrow, which makes your comment in which you say, “If Apple?s goal is to use the partial settlement…” wrong; The settlement never happened. This makes the premise in your last question really $htupid, uninformed. Get a life. Quit posting here.

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