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>Court rules Apple software is only licensed on Apple hardware

>As we have been covering, Apple brought a suit asserting copyright infringement stemming from PsyStar’s sales of non-Apple-Labeled computers with Apple’s operating system. This case presents interesting questions about hardware restrictions placed into EULAs and the viability of a copyright misuse defense based on those restrictions.

Last Friday, a Northern District of California court put forth its attempt to answer some of these questions, ruling that Apple could restrict its license of Apple Software through its EULA to only allow installation on Apple-Labeled computers. The court believed the EULA language was a permissible restriction on the use copyrighted software itself, and not an impermissible tying restriction on a good or service outside of the monopoly granted by copyright. The court indicated that Apple could control the use of its copyrighted software through its EULA as long as consumers were not prohibited from using third-party operating systems or buying third-party hardware.

In this regard, the court seems to have taken a fairly limited view of the copyright misuse defense. It is true that the EULA restriction applies to the Apple Software itself, but the restriction also drives certain consumers to buy Apple-Labeled computers who may have otherwise preferred to buy a PsyStar (or another “Hackintosh”) in the absence of such a restriction. So, Apple appears to be exerting some measure of control on hardware sales, an area outside the copyright.

There are also antitrust considerations and a public policy in favor of the ability to modify software for purposes of interoperability that arguably could have been considered by the court, but ended up left on the table.

Incidentally, this case bolters Apple’s argument that jailbreaking an iPhone results in an infringing act of software copying.

Gavin George is an associate in the Intellectual Property Practice Group of Haynes and Boone. His practice covers all areas of intellectual property law, with an emphasis on technology transactions and data privacy in the information age. His practice includes technology agreement drafting and negotiation, intellectual property analysis and due diligence, and consulting on evolving data protection and social media issues.

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November 2009