Last night on the Talkcast, we talked about the big news last week that Psystar seemed to be down for the count, and the consensus was that we’d heard the last of them. But not so fast: their lawyer now says that they’re not calling it quits just yet. The company that has gotten pummeled by Apple for selling Mac clones apparently “does not intend to shut down permanently,” according to K. A. D. Camera of legal firm Camera & Sibley. According to him, they’re still working on selling their Rebel EFI product (also currently entangled in legal problems), and they’re planning on pushing forward on their antitrust case against Apple (which has already been thrown out once). We’re not sure where they’ll get the money for all of this legal action after already being ordered to give a couple million dollars to Apple, but maybe those 768 computers they sold made more than we thought.
There is one bright point in all of this: while Rebel EFI is still listed as out of stock on their website, they are selling official Psystar t-shirts for $15 which they say will also include a Rebel EFI authorization code later on and now those appear to be gone too! I don’t know about you (and I don’t really want to give these guys any credit card information), but one of those shirts would look great sitting under my tree later this week. If this whole installing-OS X-on-unauthorized-hardware-in-violation-of-Apple’s-EULA thing doesn’t work out for Psystar, maybe they can have a second life as a merch vendor.
Psystar’s attorneys have had some truly bumbling moments in the past year or so, and the hits keep coming: now they’re disagreeing over whether or not the would-be Mac cloner is out of business. Lead law firm Camara & Sibley is now denying yesterday’s Dow Jones report, which quoted Psystar’s California counsel Eugene Action as saying the company would be shutting down “immediately,” and insists that the company is still is business selling Rebel EFI. That would be the end of the story for now… except it’s not true. Although Psystar’s site still offers the software for download, it’s listed as “out of stock,” and you can’t buy a license. What’s more, Psystar was just ordered by the California court to stop helping anyone install OS X and warned that it continued to sell Rebel EFI “at its peril,” so it’d be pretty ballsy to offer it for sale once again. Camara & Sibley also says it’s going to appeal the California decision while it presses forward with the second lawsuit in Florida, but we’ve seriously got to wonder who’s going to pay all these bills — Psystar is already on the hook for $2.67 million in fines to Apple, and appeals and a second round of litigation don’t come cheap. We’ll see what happens next, but we can’t say we’re too surprised that the end of Psystar’s story is as shady as its start
P.S.- Eugene Action might be the single best thing to come out of this whole mess — his website, located at (seriously) myharvardawyer.us, is a treasure trove of embarrassing hilarity. Choice unedited quote:
Has the saga finally come to an end? Dow Jones is reporting that Psystar will be firing its eight employees and then “shutting things down immediately,” in the words of the company’s attorney with the bad-ass name, Eugene Action. Besides, after the latest round of losses at the hands of Apple, this should come as a shock to nobody. Now that we’ve put all that behind us, can we concentrate on something of importance — like Tweeting swears from the Zune HD Twitter app?
After Apple’s sweeping permanent injunction, Psystar has officially ceased operations. The company’s CEO Rudy Pedraza told the Dow Jones Newswire last night that he is “shutting things down immediately.” The company has also released its eight employees, and shuttered its website last night.
The actions came after Apple’s permanent injunction against Psystar earlier this week, which gave Psystar until December 31st to stop selling its Mac clones. The clones violated Apple’s End User License Agreement for Mac OS X, which expressly forbids use of the operating system on non-Apple hardware.
And it’s all over, folks: The US District Court for the Northern District of California has just permanently forbidden wannbe Mac cloner Psystar from selling modified versions of OS X, providing any tools that enable users to bypass the OS X kernel encryption, and / or intentionally aiding anyone else from infringing Apple’s OS X copyrights in any way. We knew this was coming following Apple’s decisive victory against Psystar last month — the only open questions were whether the court would include Snow Leopard and Psytar’s Rebel EFI software in the ban, since the lawsuit was specifically about Leopard and Rebel EFI wasn’t the subject of any proceedings. Both issues were predictably resolved in favor of Apple: the court specifically included Snow Leopard and any future versions of OS X in the scope of the injunction, and while Judge Alsup couldn’t address Rebel EFI directly, he did expressly forbid Psystar from “manufacturing, importing, offering to the public, providing, or otherwise trafficking” in anything that circumvents Apple’s OS X hardware locks — which we’d say covers Rebel EFI’s functionality pretty thoroughly. Psystar has until December 31 to comply, and the Judge Alsup isn’t kidding around: “Defendant must immediately begin this process, and take the quickest path to compliance; thus, if compliance can be achieved within one hour after this order is filed, defendant shall reasonably see it done.” Psystar can still appeal, obviously, but it’s already got it’s own hefty legal bills and a $2.67m fine to pay to Apple, so we’ve got a feeling this one might have reached the end of the line.
P.S.- Amusingly, Judge Alsup appears to be pretty sick of Apple’s shenanigans as well: in the section discussing Snow Leopard, he says Apple first tried to block any discovery of Snow Leopard before the OS was released, and then pushed to include the software in the case after it launched. That’s why the Florida case over Snow Leopard wasn’t merged into this case — Alsup thought it was a “slick tactic” that “smacked of trying to ‘have it both ways,’ and offended [his] sense of fair play.” Ouch.
What ride, eh? In what may have provided more blog fodder than a golfer hitting a tree, the end may have finally come for the storied life of Pystar’s Mac clone business. AppleInsider, Gizmodo and The Loop are reporting U.S. District Judge William Alsup just put the smackdown on Psystar’s selling of derivative works of OS X, doing anything to circumvent several things — all of which wind up putting OS X on your non-Apple hardware. Still no ruling on the Rebel EFI software.
Bottom line: Psystar has until December 31, 2009 to stop selling Mac clones forever. Word is they have already started to comply.
It didn’t take long, but it seems that sometime in the night, following their agreement with Apple, Psystar has mysteriously run out of stock on all of their Mac clones. Apparently their settlement with Apple on the order of $2,000,000USD has caused them to accept defeat. Given that they only sold 768 clones over the course of the past two years, I don’t imagine the inability to sell their hardware will have much of an impact on their financial statements.
Down but not out, however, Psystar is still selling its Rebel EFI product which is used to circumvent OS X’s EFI requirements for installation. In other words, it aims to make it dead simple to install Snow Leopard on any PC. Psystar’s basis for continuing to sell Rebel EFI is that it was not included as part of the original case in San Francisco.
It looks like the first phase of the Apple / Psystar Mac cloning saga is winding towards a conclusion, as the two sides have just filed to wrap up their case with the California court that ruled decisively in favor of Apple last month. As you probably expect, Apple hasn’t ceded much ground here: Psystar’s agreed to be deemed liable for illegally copying OS X Leopard, bypassing the OS X kernel encryption in violation of the DMCA, and breaching Apple’s EULA, all to the tune of $2,675,050. In return, Apple’s dropping its various trademark and unfair competition claims, and has promised to hold off on collecting any cash until the various appeals have run their course. Now, considering Apple and Psystar are currently engaged in pretty much the exact same case in Florida over Snow Leopard, we’d say that this agreement isn’t much more than a way for both sides to save money and move on to that fight: Apple’s already won the bulk of its case against Psystar in California, and spending money to litigate trademark claims we thought were weak when we first read them doesn’t really buy Steve any leverage he doesn’t already have, while Psystar probably needs to scrimp all the coin it can right now.
There’s one other little wrinkle here, and that’s exactly what Apple’s eventually going to be able to prevent Psystar from doing. It’s certain that the California court will bar Psystar from preloading machines with Leopard, but Psystar’s arguing that its new Rebel EFI software shouldn’t be covered by any decision, since it wasn’t part of the case. That’s an interesting argument and definitely worth some consideration — but it’s got some holes in it since Psystar’s now admitted that it’s liable for contributory and induced copyright infringement and violating the DMCA. As we’ve said before, Psystar’s essentially doing with Rebel EFI what Grokster got smacked by the Supreme Court for doing in 2005: it’s trying to build a business around the knowing copyright infringement of customers, and that usually doesn’t fly. We’ll see what happens — and Florida awaits.
Details are still sketchy, but apparently Apple and Psystar have reached partial settlement in the ongoing saga between the two companies. It appears that in return for paying Apple unspecified damages on its copyright claims (most of which were ruled in Apple’s favor in a summary judgment motion last month), Apple will drop its remaining claims against Psystar, including those for trademark violation. Apple also agreed not to execute on those damages until all appeals have been exhausted.
A more detailed document is due to be filed later, but the idea is that the matters before the court will be reduced to only the issue of permanent injunction, a motion Apple filed last week. If the court accepts the terms of the settlement, there will be no need for a trial. Psystar appears to completely concede (though it’s not like it had any further leg to stand on) copyright violation, by arguing that whatever the court decides to do with the permanent injunction barring sale of its computers with OS X pre-installed, that it not extend such an injunction to Psystar’s Rebel EFI software product.
More and more information is coming out about Psystar and their legal issues with Apple. Some new documents have been leaked with some numbers and predictions from Psystar themselves.
According to these documents, the company planned on selling 1.45 million Mac clone computers by 2011. The actual number sold so far: 768. What’s even better is that these numbers are their “conservative” estimates. If you take a look at their more aggressive numbers, Psystar plans to sell 12 million by the end of 2012. Yes, you read that correctly: 12 million.