Things are quiet in the California action since Judge Alsup entered a permanent injunction in Apple’s favour regarding Psystar’s Mac clones, no matter which version of OS X is being used. Although Judge Alsup invited Psystar to bring a Motion containing specific details about this product and differentiating it from the guidelines of the Injunction so that a determination could be made on the legality of their Rebel EFI software; they have yet to do so. And I do not expect them to just yet. Psystar knows that the chances of getting a favourable ruling from Judge Alsup are slim to none and is leaving that option as a last resort. Instead, they are hoping to circumvent (pun intended) the California Court altogether by persuading the Florida Court to take jurisdiction over that remaining issue.

Recap of Florida Action

On August 27, 2009, Psystar filed a Complaint against Apple which was amended on October 27, 2009. The Amended Complaint sought a declaratory judgment on the legality of Psystar’s business model including its production of Mac Clones running Snow Leopard and its Rebel EFI software. In this filing Psystar repeated its antitrust allegation and added a new allegation of violation of the Lanham Act claiming that Apple is misleading the public (i.e. lying) in stating that Psystar’s clones are illegal. Apple’s response comprised a Motion to Dismiss or To Transfer Venue (November 24, 2009) on the following grounds (simplified for summary):

1. The suit is “a transparent attempt to re-litigate” the same allegations that were ruled upon in the California suit.

2. This case is “the inseparable twin of the California Action, as the legal claims and issues, the technology, the parties, and most of the facts are virtually identical.”

3. If both cases were left to stand, it would result in a wasteful duplication of the Court’s and the parties’ resources as well as being in contravention of the “first-filed” rule.

4. This case is not ripe for litigation and as such is improper “anticipatory litigation.”

On December 10, 2009, Psystar filed its Response in Opposition to Apple’s Motion to Dismiss and asserted the following (I have grouped their counter-arguments under the same four points above):

1. The suit is “a transparent attempt to re-litigate” the same allegations that were ruled upon in the California suit.

Psystar responded that the two cases involve totally different products with unique fact patterns that were not present in the California suit. Additionally, while Judge Alsup concluded that “Mac OS compatible hardware” was not a valid market for purposes of the antitrust claims, the present complaint alleges a monopoly in the market for personal computers with a UNIX operating system.

2. This case is “the inseparable twin of the California Action, as the legal claims and issues, the technology, the parties, and most of the facts are virtually identical.”

Psystar contends that the method used for allowing Snow Leopard to run on generic hardware is completely different from the method used for Leopard, both in fact and technology and thus is significantly distinguishable from the California litigation. Additionally, Psystar has since ceased selling its computer with Snow Leopard instead focusing on the software-only product, Rebel EFI, which was not at all a factor in the California case. Lastly, Psystar alleges that the main thrust of this suit is its entirely new allegation that Apple has violated the Lanham Act by claiming that Psystar was selling an illegal product.

3. If both cases were left to stand, it would result in a wasteful duplication of the Court’s and the parties’ resources as well as being in contravention of the “first-filed” rule.

The Florida suit is the first-filed suit concerning Snow Leopard and Rebel EFI which were not part of the California litigation, with Snow Leopard being specifically excluded from that action. Further, Psystar does not object to having two separate cases as it concerns their resources, particularly since all of its key witnesses are in Florida. Lastly, the California case is nearly over. It is not a currently pending case and the case law on the first-filed rule deals with present potential conflicts (forward-looking) and not on past judgments (backward-looking).

4. This case is not ripe for litigation and as such is improper “anticipatory litigation.”

Psystar points out that all declaratory actions contain some sense of being anticipatory litigation as the party is asking the Court to make a legal determination on their rights. In order for a case to be improperly anticipatory, the filing party would have had to first receive written notice that they were about to be sued. Additionally, the case is not solely a declaratory action but also contains affirmative antitrust allegations.

**Editorial note: Incredibly, Psystar actually argued that “Apple had given no specific, concrete indications that it intended to sue Psystar over Snow Leopard or Rebel EFI before Psystar filed this case.” Come on!

On December 21, 2009, Apple filed its Response to Psystar’s Reply and argued as follows:

1. Psystar’s representations of the rulings of the California Court as finding that transfer would be improper are false.

In support of this allegation, Apple quoted Judge Alsup:

This is without prejudice to any motion before Judge Hoeveler to transfer the Florida action here, as to which this order expresses no opinion and is without prejudice, in the event of a transfer, to a new motion to modify the case management schedule.

Apple further stated that this is a pattern and practice of Psystar in its filing, once again quoting Judge Alsup:

Psystar continues to grossly mischaracterize prior rulings in this case…

and

[Psystar has had] a particular facility with taking a word or phrase and somehow making it into a concession on which an entire structural argument is based.

Additionally, Rebel EFI wasn’t even on the market at that time, and even though Judge Alsup had previously refused to allow Snow Leopard to be a part of Apple’s case in chief, he did make a ruling on Snow Leopard, thus demonstrating the Court’s intent to apply the rationale of the injunction to other Psystar products.

2. The first-filed rule must apply as the two cases substantially overlap.

In support of this contention, Apple stated that the California Injunction confirms that the cases overlap in that Judge Alsup not only ruled on Leopard, but also ruled on Snow Leopard and specifically reserved jurisdiction to rule on Rebel EFI. As such, Snow Leopard has definitely been removed from this case and, Apple argues, Rebel EFI is currently before Judge Alsup. The fact that Judge Alsup reserved the right to rule on Rebel EFI, and Psystar already stated its intention to file such a motion with that Court, Apple is not “backward-looking” as Psystar claims, but forward-looking to such a forthcoming ruling.

3. Psystar is repackaging its dismissed anti-trust claims from the California suit.

While Psystar claims that the facts and issues of law are significantly different, Judge Alsup’s Injunctive Order speaks otherwise. Apple specifically said:

Judge Alsup found that Psystar violated the DMCA by manufacturing and trafficking in devices intended to circumvent the technological protection measure in Mac OS X to run Apple’s software on non-Apple hardware. Rebel EFI is simply a repackaged version of Psystar’s circumvention technology. And Psystar has now stated that it will seek from Judge Alsup regarding the legality of Rebel EFI.

And although Psystar is claiming that the antitrust allegations in the Florida case relate to behaviour that happened after those counterclaims were dismissed, it is still the very same behaviour. And still just as appropriate under the law.

4. Psystar’s First Amended Complaint is Anticipatory.

Although Psystar is relying upon the lack of a cease and desist letter to justify an anticipatory action, the notice requirement is just that: notice. Psystar cannot claim that it was on notice that Apple would sue to protect its rights in OS X as it had already done so, aggressively pursued adding new products when they were relevant, and apparently convinced Psystar enough that it alleged in its own Amended Complaint that it “stands threatened” by a future suit brought by Apple. Psystar cannot have it both ways. Any other affirmative claims are repackaged assertions of the issues already adjudicated by Judge Alsup.

Where things stand now

It appears that both parties have requested that the Court allow oral argument. The Court is not obligated to grant this request and may choose to simply rule on the filings. We need to wait and see.

As a follow-up to my earlier article reporting that Psystar had been listing Rebel EFI as being out of stock, their site now reads:

Psystar has voluntarily suspended the sale of our Rebel EFI software product. Psystar feels it would be prudent to halt the sale of Rebel EFI while we explicitly ask the court for clarification on the legality of Rebel EFI. Our patience has been tested but our resolve is unwavering. Psystar’s vision of bringing the Mac OS to generic PC hardware is and always will be unyielding. Although Rebel EFI may be temporarily unavailable for purchase on the Psystar online store, those who purchase a t-shirt or donate over twenty dollars will receive one free copy of Rebel EFI once the court has ruled in our favor on this issue. We respectfully disagree with courts notion that we are “hardcore copyright infringers”. Psystar has never, and will never, condone software piracy. It’s your software, you should be able to use it where you want to. If you purchase an off-the-shelf copy of OS X Snow Leopard, its your right to use that software. A publisher cannot forbid you from reading a book in the bathroom or listening to a music disc while riding your bicycle. There should be no difference in the software realm, no matter how much money Apple or anyone else throws at it. That is the real issue here and what we have always been fighting for. Psystar will continue to support all of its existing customers of hardware and software through this transitional period. Warranties on hardware will continue to be honored as long the customer has a valid warranty. Rebel EFI support for existing customers, as always, will remain exclusively available through email and the built-in ticket interface.

Wow. A few comments are in order. First though, the interested reader may want to read the transcript of the injunction hearing in California. You may find a full copy here, and as far as I have seen, only freely available here at World of Apple.

Our patience has been tested but our resolve is unwavering.

Poor things, their patience has been tested. Isn’t that a bit like a tic complaining when the dog finally scratches it off?

…once the court has ruled in our favor on this issue.

Courts generally do not care for braggadicio.

We respectfully disagree with courts notion that we are “hardcore copyright infringers”.

Grammar problems aside, is this the same Court that Psystar just assured us would rule in its favour? Dissonance much?

Just so that it is obvious that the Court didn’t make that statement as an offhand comment, here is what was said (page 19 of transcript):

I want to be clear. While this record is sketchy on Rebel EFI, it is not sketchy on the hardcore infringement of your client.

On page 19, the Court expressed its rationale for granting a very broad injunction:

The normal rule is that an injunction is always almost always broader than the four corners of the complaint, because, otherwise, it would be too easy to let an infringer just move on to the next problem. It would always be Zeno’s Paradox at work.

Zeno’s Paradox FTW! “Contumacious conduct” (page 13) comes in close second.

If you purchase an off-the-shelf copy of OS X Snow Leopard, its your right to use that software. A publisher cannot forbid you from reading a book in the bathroom or listening to a music disc while riding your bicycle. There should be no difference in the software realm, no matter how much money Apple or anyone else throws at it. That is the real issue here and what we have always been fighting for.

Psystar once again tries to paint itself as the champion of the oppressed, but really, they are opportunistic champions of their own self-interests. They have zero respect for the Hackintosh community, and for the most part, that feeling is mutual. Apparently they don’t have much respect for their customers either as they blatantly misrepresent the transaction as a sale when they well know that it is a license; a license which has been held up by the Court in a most explicit manner at the very beginning of this suit. It gets no better with their attempt at logic. Apple does not forbid someone from using their licensed software in a particular locale, but on a particular device. If Rudy wants to use a Macbook while he is on the loo, I am sure that Apple couldn’t care less.

Psystar will continue to support all of its existing customers of hardware and software through this transitional period.

Like this guy?

In reading this transcript (particularly pages 8 through 9), I have a feeling where Psystar might attempt to take this case; into an individual user’s rights under Section 117. Rudy Pedraza, for example, might bring suit in his own name alleging that he is representative of a class of people who need their rights clarified as to their legal standing to purchase Rebel EFI. In so doing, Psystar could attempt to work from the user backwards and claim that if a consumer can legally buy Rebel EFI, then Psystar should be able to legally sell it. Although I do not claim to know the law in that situation, in sheer logic, however, that simply does not follow. Additionally, the courts have consistently held that Section 117 is an affirmative defense to suit, not a basis for suit itself. Thus, if Apple sued an individual user for making a Mac clone (which Apple has not done), then that user could plead Section 117 as a defense. However, in the absence of suit (or perhaps a letter threatening suit), the user could not offensively pursue Apple under the same Section. Not that Psystar has ever been bothered by a pesky thing like facts.

And of couse we have the appeal to the Ninth Circuit on Judge Alsup’s grant of summary judgment to Apple on the issue of copyright misuse to keep us amused for years to come.

In addition to her position as Assistant Editor at World of Apple, dizzle runs idrankthekoolaid, an Apple fangrl satire blog, and is an Administrator and Hostess at MyAppleSpace and their vidcast MASTv.