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Psystar counter-sues Apple for anti-competitive business practices


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Source (CNET)

PALO ALTO, Calif.--Mac clone maker Psystar plans to file its answer to Apple's copyright infringement lawsuit Tuesday as well as a countersuit of its own, alleging that Apple engages in anticompetitive business practices. Miami-based Psystar, owned by Rudy Pedraza, will sue Apple under two federal laws designed to discourage monopolies and cartels, the Sherman Antitrust Act and the Clayton Antitrust Act, saying Apple's tying of the Mac OS to Apple-labeled hardware is "an anticompetitive restrain of trade," according to attorney Colby Springer of antitrust specialists Carr & Ferrell. Psystar is requesting that the court find Apple's EULA void, and is asking for unspecified damages.

 

Springer said his firm has not filed any suits with the Federal Trade Commission or any other government agencies.

 

The answer and countersuit will be filed Tuesday afternoon in U.S. District Court for Northern California.

 

Pedraza attended a press conference his lawyers called to present how Psystar will defend its its OpenComputer Mac clone, which has been for sale online since April.

 

Psystar's attorneys are calling Apple's allegations of Psystar's copyright infringement "misinformed and mischaracterized." Psystar argues that its OpenComputer product is shipped with a fully licensed, unmodified copy of Mac OS X, and that the company has simply "leveraged open source-licensed code including Apple's OS" to enable a PC to run the Mac operating system.

 

Pedraza says he wants to make Apple's Mac OS "more accessible" by offering it on less expensive hardware than Apple.

 

"My goal is to provide an alternative, not to free the Mac OS," said Pedraza. "What we want to do is to provide an alternative, an option...It's not that people don't want to use Mac OS, many people are open to the idea, but they're not used to spending an exorbitant amount of money on something that is essentially generic hardware."

 

Apple will have 30 days to respond to Pystar's counter claim, and so far has declined to comment on the case.

 

Other legal experts say Psystar faces a tough legal challenge in proving Apple has engaged in antitrust behavior by loading its software on its own hardware and thereby allegedly harming consumers and competitors. Psystar's ability to prevail on the issue of having the latitude to load Apple's OS on its own hardware, given it has a licensing agreement with the company, may prove an easier road to hoe, legal experts note.

 

A newcomer to the PC scene, Psystar caused a stir when it first went online selling white box Macs earlier this year. The site went down hours after it opened for business because the company was overwhelmed with orders for the OpenComputer, originally called the OpenMac, which was then changed to its current name. And the site went down several more times as its payment-processing company pulled its services from the Psystar site. Psystar managed to stay shrouded in a bit of mystery for a while, until intrepid gadget blog readers joined the press in fleshing out some details about the company.

 

Psystar eventually got back online with a new payment-processing service, and it continues to take orders for the OpenComputer and OpenPro Computer. When Apple finally did file suit against Psystar in July, it surprised nearly no one--except perhaps Pedraza. He said he had no contact with Apple before legal papers were filed against his company. Customarily, there is some sort of communication between companies before lawsuits are filed.

 

For now, Pedraza says it will be "business as usual" at company headquarters. Though he said there was a "slight" downward dip in sales once Apple filed its suit, he plans to go ahead with making servers, and soon, a mobile product, which he said will be "like a notebook." But he refused to offer more detail.

 

More to come...

 

CNET News' Dawn Kawamoto contributed to this story.

Pretty big news for OSx86 perhaps as an outcome of this we will be fully 'legal' and not in violation of Apple's restrictive EULA. Rudy Pedraza is right on the money when he claims that people are open towards using OS 10, but don't want to pay Apple's ridiculous price premiums on normal (and often out of date) hardware. Personally I'm going to have to side with Psystar on this one as I feel that Apple's current EULA for Mac OS 10 is absurd: You pay $125 for software, and then can only install it on certain machines?

 

How do you guys think?


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I think this is the last try that Psystar could do.

Infact, they're trying to beat Apple using his own EULA, 'cause Psystar knows that they have anyway modified a software under copyright and they sold a modified version of OSX.

 

Even if Apple will lose, I don't think we'll see an "opening" of the Mac OS...infact I think there are more probabilities that Apple makes a new closest OS instead to join the open source.

 

Sorry if my english is not so good.

 

Regards,

 

Maurizio

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Of course Psystar is not doing it "for the cause" they just want to try to save their ass by stirring up some {censored}. If they sold computers with pirated copies of OSX thes deserve the troubles. If all they did was use a bootloader to install and run a paid copy of OSX that is fine with me.

 

And who started the whole price justification deal? the pro-Hackintosh users or some Mac fanboys?

 

Solaar ok you have a point and a good one, since you live in the same country as I do LOL. Still could you substantiate your argument that Apple do not have such an overhead? recent news showing Apple salaries lowest in industry, but it's ok because it's Apple and it's so special to work at Apple? even if it is special to work there, the low salaries are not justified. Even more so that their cash reserves are only going up while Microsoft cash reserve is going down. What is it now 20 billion $ for Apple? That amount just shows how much money they are making off everything they produce, if their products costed more to manufacture they would not have made so much money so fast. Sure in terms of build quality, their products are top of the range products.

 

I can't tell exactly how much the Apple hardware costs to manufacture, but it's for sure not more than PC hardware, those smart guys in Cupertino know how to produce good looking things for cheap and they are manufactured by the same manufacturers who do PC parts. Do you think the 20 year old kids (factory workers in China are usually all between 18-25 yo after they go back to the countryside where they came from) working in the factories and making 100$ a month have taken special lessons to build Apple computers?

 

Cheap in China means really cheap, the company I work for manufactures a lot of stuff in China and resells it. You can produce so cheap in China is not even funny, some parts are so cheap that 5 Swiss cents are too much to pay for one. The metal case and pieces of plastic don't cost that much to make over there, don't be fooled by the looks. There are things you think it's normal to pay 100$ for that actually cost only a couple dollars to manufacture. Sure the people in between have to make money, but I can tell you from experience that there is a big markup when you are the first in the distribution line after the Chinese factory, it's normal to sell the product 2-3 times (sometimes up to 10x) the price than you paid for it, because the final price will fit the market anyway.

 

I deeply believe that Apple are very very successful at marketing their products and image and making a lot of money. This is all good but it's frustrating when a lot of people don't want to accept the fact that they are doing a lot of $$$ now and that their prices are inflated, which again is commercially clever since people are buying anyway. I don't think that this will last for 10 years though.

 

Before Macs had an excuse to be expensive, they sold only small numbers to a niche market and the price reflected the cost of the "Think Different" now with the Ipods, Iphones and the number of new Mac users they do not have this excuse anymore for keeping the price high, except to make a maximum of $$$ while they can.

 

As for the hardware inside the Apple products you can use google and see that it is nothing special at all, it's the same that you would fit inside a PC or mobile phone or whatever. Again by doing this Apple is saving a lot of $$$ in production costs. The only special thing left is the nice case and clever design, but the difference in $$$ just for that is a little steep in my opinion.

 

And don't forget at least the PC manufacturers have the excuse that their market is too competitive and they have to keep costs down to survive, so it can partially justify the exploitation of Chinese workers, but Apple are using the same manufacturing methods and have no real competition, so I can see a moral aspect to the affair here also but that is another story... no?

 

As the Chinese factory owner told me, we make all the {censored} job and you make all the money... which is true in the end.

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Nano2k, I agree wholeheartedly with your assertion as it pertains to Psystar, the rest i skimmed cuz it's just too damn much to read. The whole point is that Apple will charge as much as they can and still get people to pay. For everyone else, there's OSX86. I think Psystar is just trying to make money off of the backs of those who make this project work, and that's not right, but hopefully in a best case scenario this will open up OS X and Apple just a little to the possibility of not hindering the effort made here so those who can't afford a Mac or need something besides what Apple offers can still get the great experience of OS X.

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Nano2k, I agree wholeheartedly with your assertion as it pertains to Psystar, the rest i skimmed cuz it's just too damn much to read. The whole point is that Apple will charge as much as they can and still get people to pay. For everyone else, there's OSX86. I think Psystar is just trying to make money off of the backs of those who make this project work, and that's not right, but hopefully in a best case scenario this will open up OS X and Apple just a little to the possibility of not hindering the effort made here so those who can't afford a Mac or need something besides what Apple offers can still get the great experience of OS X.

 

Totally agree.

 

Sorry for the long posts just trying to make my point...

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For the record, I don't care what OS X costs in other countries. This is a US issue with US prices.

 

It is a US issue for now... However the decision could set a precident world wide as companies in various companies do the same thing....

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OK, I give up. What does CH stand for?

Confédération Helvétique. The official name of Switzerland from the times when it was still a province of the Roman empire. Back in the days you know....

...before the Germanics arrived and had the brilliant idea to call it Schwyz :D

hey but no dissing here, germans are quite useful at times ;)

no no no they can be nice too....

...when they have a good day :D

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America consider yourself lucky! Here in Australia the default Mac Pro costs us $3999, while the default there costs you only $2999! But here compared to many other computers at the same price some Macs are actually a good deal. This is because here, there is not as many computers on sale as you guys in America have and everything that is a absolute rip off.

 

Mr Mook Mook

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This is going to be a fun one. As much as I love being able to run Mac OS on my Pentium4, I love even more how Apple has been able to keep hardware and software very compatible by keeping it on a specified platform. Leave the hacking to the hackers, and OS X on legit Macs, OSx86 is only a hobby and while hardware support can be perfect at times, nothing matches up to buying the real deal.

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I find it ridiculous that if I buy Windows Vista, I can't use it on my PowerPC computers!

I find it ridiculous that if I buy electronics in the US, I can't use the same power adapter in the UK!

I find it ridiculous that if I buy a PS3 game, I can't use it on my Wii!

 

Getting my message yet?

 

1: Nothing to stop you from doing that. I ran xp on my Powerbook for years before the laptop was stolen.

2: Technical Issue, not Legal Issue. If you figure out a way, everyone´s happy.

3: Again, technical issue, not Legal...

 

Got my message?

 

:-)

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This is going to be a fun one. As much as I love being able to run Mac OS on my Pentium4, I love even more how Apple has been able to keep hardware and software very compatible by keeping it on a specified platform. Leave the hacking to the hackers, and OS X on legit Macs, OSx86 is only a hobby and while hardware support can be perfect at times, nothing matches up to buying the real deal.

 

Sure that with the lack of hardware choice Apple is not taking risks when it comes to compatibility, the hardware choice in Macs is probably just one step higher than the hardware choice you have when you buy a XBOX360 hahaha. There is nothing special in a Mac hardware, exactly the same hardware can be had for a PC.

The only difference are on the software/bios side of things and that's why a properly built hackintosh can run just as fast or faster than a Mac (thanks again to the people developping the releases we use).

I guess the only thing that was special at the time was the Macbook air Intel cpu but Intel quickly made it available to other manufacturers anyway.

 

The real deal only brings you a nice looking case and bragging rights, like a nice car, a well trimmed lawn or that giant plasma in the living room...

 

Oh and by case I found this link about some Apple LCD screen quality issues... superior hardware... LOL

 

http://eyeonapple.wordpress.com/2008/04/01...screen-quality/

 

Haha wait a better one here, some fanboys are saying that if you don't like the glossy screen of the iMac you can just remove the glass panel over the monitor since it only holds with magnets hahaha fantastic. It is clear that the quality of the 20" screen is {censored} from comments of long time Mac users.

 

http://forums.dpreview.com/forums/read.asp...essage=24320201

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1: Nothing to stop you from doing that. I ran xp on my Powerbook for years before the laptop was stolen.

2: Technical Issue, not Legal Issue. If you figure out a way, everyone´s happy.

3: Again, technical issue, not Legal...

 

Got my message?

 

:-)

 

Exactly. I'd just like to add that the reason you couldn't run XP natively on your old PPC Mac wasn't because MS was restricting it. None of those points are relevant.

 

Sure that with the lack of hardware choice Apple is not taking risks when it comes to compatibility, the hardware choice in Macs is probably just one step higher than the hardware choice you have when you buy a XBOX360 hahaha. There is nothing special in a Mac hardware, exactly the same hardware can be had for a PC.

The only difference are on the software/bios side of things and that's why a properly built hackintosh can run just as fast or faster than a Mac (thanks again to the people developping the releases we use).

I guess the only thing that was special at the time was the Macbook air Intel cpu but Intel quickly made it available to other manufacturers anyway.

 

The real deal only brings you a nice looking case and bragging rights, like a nice car, a well trimmed lawn or that giant plasma in the living room...

 

Oh and by case I found this link about some Apple LCD screen quality issues... superior hardware... LOL

 

http://eyeonapple.wordpress.com/2008/04/01...screen-quality/

 

Haha wait a better one here, some fanboys are saying that if you don't like the glossy screen of the iMac you can just remove the glass panel over the monitor since it only holds with magnets hahaha fantastic. It is clear that the quality of the 20" screen is {censored} from comments of long time Mac users.

 

http://forums.dpreview.com/forums/read.asp...essage=24320201

 

I pretty much agree with you, but the bigger reason for that perception of quality over quantity is simply that apple wants the OS on it's own hardware precisely for comparability and quality control. Sure they do use higher end parts and probably get the cream of the crop when it comes to those parts, but this perception of quality is more from an ability to only have to support specific hardware rather than the quality of the parts they use.

 

I think on some level The Steve may actually admire this community and that's why apple doesn't do more to try and hinder it. He used to be somewhat of a hacker himself. I'm sure he's not thrilled about these OS X distros flying around but I think he and apple tolerate it to a point because they know it's pretty much free advertising. I say if you're using OSX86 at least go buy a legit copy of OS X as a sign to The Steve that you don't WANT to be screwing Apple (on the software side anyway).

 

As someone who has used macs for almost 10 years now, I gotta say I love the glossy screens and prefer them to the matte screens. You can't say they're bad quality because some people don't like them. It's more a matter of opinion than quality.

 

Also, I hate when people try to use gaming systems in this argument. Those ARE specialized hardware for the most part and are completely irrelevant to this discussion. It's like compairing apples to dairy cows...

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If Porsche did that you'd have a lot of people not buying Porsche engines because they could get something else. This is not possible with OS X because there isn't enough competition. You're analogy is valid but it's using an example from a much more diverse market. Technically I could install Windows (blah) or Linux (meh), but OS X is the best OS out there. The problem with Apple, as cutting edge as they are, is that they refuse to offer a mid-level tower that is upgradable by the consumer. That's what we in this community want, and it's why we do this. Again, we don't ask that Apple support it, just that they don't forbid it (which they can't enforce anyway) or try and sabotage it. The EULA should simply read, "Apple does not recommend installing OS X on non Apple hardware, but if you do, it will not be supported by Apple," along with all the junk about not making copies and selling them and all that jazz. Also, nobody is asking Apple to make OS X work on all hardware configurations, just that it be allowed to run on comparable hardware. To use your car analogy, a Porsche engine wouldn't fit in a toyota anyway, so it wouldn't happen, just like OS X won't run on all configurations either.

 

I dissagree. I still think anology does not stand. Many of the car tuning companies are doing just that. With or without car manufacturer's approval. If Porsche was to sell their enginess separate, the car that I make on my own is still not a Porsche even though it has ones engine. You can buy a Renault with performance of a Porsche, but that doesnt mean they are competitors because of some other aspects of the product. If I'm to have such an engine fited in my toyota, both companies can argue that I can't put their badges on it as they are not the ones who built it. And I feel that is OK. But I don't think it's OK for them to forbid me doing what I want with the product I bought. First diesel Opel Vectra had an ISUZU diesel engine. Does it make it an ISUZU? The way I see it, I can take all the parts that I can find in a dell computer, even the ones I bought in a DELL store, but since I built it, I can't put a DELL label sticker on it and call it Dell Inspirion. As I see it, if Apple wants us not to install Leopard on other systems, they shouldn't sell it separate. We'll see what court will have to say abot that. Modifing the software is another thing. But if I'm able to legaly modify my hardware to be able to install retail Leopard I don't see why I shouldn't do that. Also, if I do such a thing I don't expect Apple to give me support or to recognize my computer as a Mac Pro or wathever. It's a PC runnig OSX.

On the other hand I do agree exactly about what You sad EULA should look like.

 

I'm not a lawyer, so I'm waiting to see what the courts say.

 

Good point. Neither am I. That we can both agree on.

But that does not stop us to express our opinions on the matter.

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Psystar has officially filed the "Answer and Counterclaim".

(http://www.psystar.com/attachments/218_Psy...ounterclaim.pdf).

Check it out it has some rather entertaining legal interpretations of comupter operation, ie.

 

"On information and belief, PSYSTAR alleges that APPLE intentionally embeds code in the Mac OS that causes

the Mac OS to recognize any computer hardware system that is not an Apple-Labeled Computer Hardware System. Upon

information and belief, PSYSTAR alleges that upon recognizing that a computer hardware system is not an Apple-Labeled

Computer Hardware System, the Mac OS will not operate properly, if at all, and will go into what is colloquially known as

'kernel panic.' Through kernel panic, the operating system believes that it has detected an internal

and fatal error from which the operating system cannot recover. As a result, the operating system

discontinues operation. As noted above, without a functioning operating system, functionality of

the corresponding computer is reduced to near zero.

"

;)

 

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Hi all

Didn't Microsoft try this tactic in the early 90's with the AARD code(hope that's right) found in windows 3 so when anybody installed this version of windows with anything other then MS-DOS ie DR-DOS, the installation would fail.

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I am all for OS X being available on non-Apple hardware platforms, but legally I think Apple has got this one.

 

Is it considered unfair business practice for Sony to protect the OS that is designed for the PSP, or Microsoft to protect the OS which drives the XBox 360? Apple will argue that they are not discouraging other businesses from creating their own hardware/software competitors. I think people are looking at OS X licensing like Windows licensing (I can install on any brand PC), but it is more like hardware specific bundled licensing. Like when I buy my phone, I am also licensing the OS that runs the phone. They may also argue that by allowing other companies to use OS X how they like, it would discourage other developers from creating new and better orignal OS's. Unless Apple wants there licensing opened up cross-platform, I dont think it will happen by force.

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I am all for OS X being available on non-Apple hardware platforms, but legally I think Apple has got this one.

 

Is it considered unfair business practice for Sony to protect the OS that is designed for the PSP, or Microsoft to protect the OS which drives the XBox 360? Apple will argue that they are not discouraging other businesses from creating their own hardware/software competitors. I think people are looking at OS X licensing like Windows licensing (I can install on any brand PC), but it is more like hardware specific bundled licensing. Like when I buy my phone, I am also licensing the OS that runs the phone. They may also argue that by allowing other companies to use OS X how they like, it would discourage other developers from creating new and better orignal OS's. Unless Apple wants there licensing opened up cross-platform, I dont think it will happen by force.

 

I'd say thats apples and oranges comparison again, here's why:

The keyword here is x86. They can't say they are using a "proprietrary" hardware because their hardware _is_ x86 pc that can run x86 instruction set binnaries. Anything they attepmt to modify on it so that they can (ilegally) tie their code to their labeled x86 and not other x86 can be legaly interpreted and, in fact _is_, a delibarate market sabotage, an attempt to destroy competition and monopolize a certain part of the market (this is their EFI rom code which is in no way neccessary to have osx software run on x86 as we know here but is developped with malicios intentions of locking out competition). Psystar has a pretty strong case here it seems.

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Pedraza is nothing more than a thief stealing developers' work and selling it for profit.

 

Right on! Steve is nothing more than a thief who stole XEROX research development and built a Mac from it.

Bully Gates Pacman is nothing more than a thief who stole Apple's stolen Idea and developed Windows, then claim

Microsoft really stole from Xerox instead, then proceeded to grab all the little guys ideas and pacman it into Win.

 

All computer programmers are thieves who use other people's development work and ideas to build their

own code. I never met a programmer who wrote any code from scratch off the top of his head without taking

a computer course, reading other people's code, and incorporating previously existing ideas "developed by others"

to produce his own work.

 

AMD stole INTEL's microprocessor ideas for a long time, until they forged ahead, and Intel had to borrow AMD's

64/32 design to include in their own EMT64 cpus. So it goes...

 

When will people stop stealing from each other and making a profit from other peoples works? .... damm! :(

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As one poster put it, if Apple had really intended for the consumer to install OS X on no-apple systems then they would have modified the EULA to support that fact 'Apple will not support this software if installed on non-apple hardware'. In my opinion the bigger picture here is Apple wanting to protect potential IP's (patents for one). The world of OSX86 either officially or unoffically is moving very fast and if Apple is looking to the future to port there OS to more x86 hardware (i know there are a few offical Intel machines that run OS X) new methods of how to do this will be required and these new methods could mean potential millions in IP revenue but for IP's to work they need to be registered and as we have seen in the past, many potential big money spinners have failed because 'prior usage' has been found and therefore the registered IP has been rendered invalid.

 

Apple could have in the pipeline various IP's that could be related to x86 hardware but having a company like Psystar already out there selling x86 computers working with OS X could render some of those IP's invalid because anyone objecting could use Psystar as 'prior usage'. Apple making sure that anyone other than themselves working on OSX86 practices is seen to be doing so illegally because 'prior usage' obtained by illegal practices renders it invalid so anyone objecting has nothing to base there objection on and Apple's IP gets registered.

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Haha I didn't want to hurt your feelings and give a too bad image of the country LOL (I'm half Sicilian from Siracusa).

 

As the saying goes in the south "E tutta na Mafia"...

 

That is exactly where I live, in a little town near Siracusa :D

 

But you live in Switzerland, lucky you, one of my favorite countries.

 

Pedraza is nothing more than a thief stealing developers' work and selling it for profit.

 

Does he buy a legal copy of Leopard to put it on each of his hacks? If he does, you are talking nonsense.

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.

Does he buy a legal copy of Leopard to put it on each of his hacks? If he does, you are talking nonsense.

 

I think this is in reference to the accusation that he is using Netkas' work to build his machines. Although if he isn't buying a copy of OSX for each machine he's definitely in some deep sh*t.

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