By Terrence McCoy
By Scott Fishman
By Deirdra Funcheon
By Allie Conti
By New Times Staff
By Ryan Pfeffer
By Deirdra Funcheon
By Kyle Swenson
Apple doesn't comment about ongoing litigation, and a spokeswoman in California who wouldn't give her name declined to comment for this story other than to laugh and say, "Who asked you to do this story? These Psystar guys pitch you on it?"
Fact is, Apple is worried about Psystar.
"Apple is so successful because they integrate all their hardware and software," says Andrew Beckerman-Rodau, a law professor and intellectual-property expert at Boston's Suffolk University. "They've always gone hard after anyone who threatens that. Psystar, in their minds, is a threat."
East of downtown Los Angeles, just south of Pasadena, sits a two-story brick edifice at the corner of West Main Street and Primrose. Under the red tile roof is the reason the Pedraza brothers have Apple's executives sweating through their socks and Birkenstocks.
From a small showroom, 44-year-old Rashantha De Silva sells PCs with Mac operating systems at his new firm, Quo Computer. De Silva has been a Mac fanatic since the company's earliest days. He remembers eagerly reading about Psystar's business plan and thinking, This is the future.
"Competition is important," he says in a lilting Sri Lankan accent. "I'm afraid [without it, Apple is] going to end up another Microsoft. People will buy bad computers just because that's all they can get."
De Silva's storefront business, which opened in June, is just a hint of the tsunami that might follow if Psystar wins its court battles against Apple. Copycats such as the German firm PearC and the Moscow-based RussianMac are betting the Pedrazas pull out a legal victory.
It's not a situation that makes Rudy particularly happy. "These guys are riding our coattails, and we're shouldering all the court costs," he huffs. The company doesn't wield anything close to Apple's resources, but the Pedrazas think they have the law on their side — and several copyright and intellectual-property experts say they might be correct.
Apple's suit against Psystar argues that the Pedrazas violate copyright law by altering the operating system software. Psystar's transgression, the suit claims, is akin to illegally remixing a song and reselling it as one's own.
But the Pedrazas contend that an operating system is more like a CD than a song. Apple's attempt to dictate what kind of computer runs the software, they believe, would be akin to Def Jam insisting consumers play the latest Jay-Z only on Sony stereos.
Psystar pays full price — $29 — for each copy of OS that it installs on its computers. So once they pay for it, the Pedrazas ask, why can't they use it however they like? "It's like buying a book," Robert says. "Once I own it, I can tear pages out, underline sentences, even rewrite a whole section. And if I can find a buyer, I can resell that one copy however I please."
On a larger scale, the Pedrazas' legal team pitches the case against Apple as a battle for the future soul of the computer world. If the brothers win, Apple might be forced to allow its programs to run on any computer on the market. "This isn't just about some Florida startup versus Apple," says Kiwi Camara of the Houston law firm Camara & Sibley, which represents Psystar. "It's about recognizing a future where anything can be connected to anything else."
Apple's attorneys, however, claim that whenever people buy copies of Mac OS, they assent to a licensing agreement that pops up when the program is installed. The users promise not to alter the software or run it on anything but Apple hardware. Psystar clearly violated both promises, the lawyers contend.
What's more, Apple holds that consumers who purchase an operating system don't actually own the software. Instead, they purchase the disc and then are "licensed" to use the system. It's a dubious-sounding arrangement that courts, at least so far, have upheld. Many lawyers refer to a 1996 appeals decision, ProCD Inc. v. Zeidenberg, which found that click-through computer contracts were, in fact, binding.
"Apple feels that if it doesn't go after Psystar, it leaves the door open to all these other companies who want to do the same thing," says Jim Dalrymple, a blogger at Macworld.com. "They want to control the whole product, from software to hardware to advertising, because they present themselves as the one company that can give you everything you need. They don't want to lose that."
So the California case, in essence, comes down to whether Apple's licensing agreement trumps the Pedrazas' rights as consumers. Both Apple and Psystar have asked the judge to bypass a trial by issuing a summary judgment.
"There's a lot at stake in this case," says von Lohmann, from the Electronic Frontier Foundation. "If Psystar loses, it could set the stage for companies to have a lot more leeway to demand that you use their hardware."
It's not an impossible argument to win, experts say. "They've already put some really good arguments forward," says Randy Friedberg, an intellectual-property lawyer following the case in New York. "There's essentially one really interesting question here, and it's whether that licensing agreement holds up."
Apple also claims that Psystar is selling an inferior product that diminishes the company's standing in the marketplace. But several tech websites have reviewed Psystar's computers and say the company delivers quality.