Psystar Agrees to Pay $2.67M in Mac Clone Case

Apple agreed to a partial settlement in their ongoing legal battle over Mac clones at the end of November, and Psystar agreed to pay Apple over US$2.67 million in damages and legal fees in the deal. Psystar suffered a hefty legal blow earlier in the month when the U.S. District Court in Northern California ruled that the PC maker was violating the Digital Millenium Copyright Act and Apple's copyrights by building and selling Mac clones without authorization.

As part of the settlement, Psystar agreed to pay Apple $1,337,550 in damages and $1,337,500 in legal fees after the appeal process has been completed. The court will also rule against Psystar for circumventing the copy protection in Mac OS X 10.5, violating Apple's end user license agreement, and illegally copying Mac OS X. In turn, Apple agreed to dismiss its trademark, trade-dress and state law claims.

Psystar isn't, however, giving up on its Rebel EFI product that lets users install Mac OS X on PCs instead of Apple hardware. The company is hoping to take that fight to a parallel case it launched in U.S. District Court in Florida.

A pending injunction from Judge Alsup in Norther California could include block Psystar from building clones with any version of Mac OS X, and from using or selling technology that circumvents Apple's copy protection technology -- like the Rebel EFI.

Psystar may have a hard time convincing Judge Hoeveler in Florida that a second trial is warranted after Judge Alsup completes his rulings in California.

"The Florida case is still pending, but Judge Alsup's summary judgment for Apple and the instant stipulation disposing of the claims makes it even more likely, I think, that Judge Hoeveler will be disposed to transfer his case to Judge Alsup and the Ninth Circuit, rather than duplicate everything that Judge Alsup and the Ninth Circuit's panel has done -- or is doing -- and risk inconsistent judgments issuing from either his court, the 11th Circuit or both," an attorney familiar with this kind of case told The Mac Observer.

While the recent proceedings in Judge Alsup's court may make it look like the legal battle is winding down, this is more likely just the next step on Psystar's path to filing an appeal.

"Once Judge Alsup enters final judgment for Apple, Psystar can appeal that judgment to the U.S. Ninth Circuit Court of Appeals, which it appears that Psystar intends to do," TMO's legal contact said. "In short, Psystar has had enough of Judge Alsup and hopes to do better with a panel of judges from the Ninth Circuit."

Just how well Psystar fares in Appellate Court remains to be seen, but if the PC maker sticks with its current track record, it won't win the chance to continue making Mac clones any time soon.