Apple's motion to dismiss denied in antitrust case
A federal court last week denied Apple's motion to dismiss an antitrust suit brought by a disgruntled iTunes Music Store customer, AppleInsider has discovered.
In January, Thomas Slattery filed a class action suit against Apple in the U.S. District Court for the Northern District of California, alleging that the company is violating federal antitrust laws and California's unfair competition law by requiring that customers use an iPod in order to listen to music purchased from its industry-leading iTunes Music Store.
In the 9-page ruling dated Sept. 9th, United States District Judge James Ware did side with Apple in dismissing a few individual claims. Specifically, Ware threw out a claim arguing that Apple has been unjustly enriched from sales of iTunes and iPods. The Judge also dismissed two claims of attempted monopolization against the iPod maker, but granted Slattery and his attorneys a month to amend the two arguments.
However, the judge denied Apple's overall motion for a dismissal in the case and is allowing Slattery to proceed with seven of his ten original claims. These include allegations that Apple possesses monopoly power and has coerced customers into purchasing both iPods and iTunes files. Slattery also argues that Apple has violated state law under the Cartwright Act and California's unfair competition law.
Antitrust lawyers have said the key to such a lawsuit would be convincing a court that a single product brand like iTunes is a market in itself, separate from the rest of the online music market.
The court is requiring Slattery to file an amended complain on or before Oct. 11th. Apple will then have 15 days to respond.
In January, Thomas Slattery filed a class action suit against Apple in the U.S. District Court for the Northern District of California, alleging that the company is violating federal antitrust laws and California's unfair competition law by requiring that customers use an iPod in order to listen to music purchased from its industry-leading iTunes Music Store.
In the 9-page ruling dated Sept. 9th, United States District Judge James Ware did side with Apple in dismissing a few individual claims. Specifically, Ware threw out a claim arguing that Apple has been unjustly enriched from sales of iTunes and iPods. The Judge also dismissed two claims of attempted monopolization against the iPod maker, but granted Slattery and his attorneys a month to amend the two arguments.
However, the judge denied Apple's overall motion for a dismissal in the case and is allowing Slattery to proceed with seven of his ten original claims. These include allegations that Apple possesses monopoly power and has coerced customers into purchasing both iPods and iTunes files. Slattery also argues that Apple has violated state law under the Cartwright Act and California's unfair competition law.
Antitrust lawyers have said the key to such a lawsuit would be convincing a court that a single product brand like iTunes is a market in itself, separate from the rest of the online music market.
The court is requiring Slattery to file an amended complain on or before Oct. 11th. Apple will then have 15 days to respond.
Comments
Originally posted by crees!
That's all we need is another shoddy California court ruling.
This is just another looser trying to make a quick buck from the hard work of others, if he does not like having to listen to his iTunes music on an iPod then do not use it, do not purchase music from Apple, and sell your iPod.
Just my 2cents
But this, it seems to me, is wrong. iTunes and the iPod are two parts of the same product, not two separate markets (for purposes of the portable digital music player market). You can buy a Creative Zen, get the same songs (for the most part) online, and have all the fun you can have with a Zen. Apple is not preventing the music publishers from selling to the other vendors, and is not forcing anyone to use iTunes.
There is nothing inherently anticompetitive with achieving market dominance by selling the best (or at least most popular) product. Just because Apple has the most success, doesn't mean it's violating the antitrust laws.
The judge probably didn't dismiss the case because he/she wanted to hear more evidence before issuing a final ruling. Most likely this will be dealt with by a summary judgment motion, after the facts have been more fully fleshed out.
Originally posted by AppleInsider
requiring that customers use an iPod in order to listen to music purchased from its industry-leading iTunes Music Store.
Unfortunately, for this guy, this is not true.
oops...wrong site.
I can rip my own cd's and put them on my ipod....never really need iTMS...
I can buy music on iTMS, burn it to cd, never need an ipod...
these frivilous lawsuits are raising the cost of health care for everyone..
oops....A.D.D....
Originally posted by Chris Cuilla
Unfortunately, for this guy, this is not true.
How so? Are you going to argue that people can carry their PowerMacs and listen to them on-the-go?
'Cause he's talking about portable MP3 players. Not CDs. Or computers. Or whatever. Portable MP3 players. You tell me one portable MP3 player that's not an iPod, and that can play music purchased from iTMS legally, and I'll tell you that I agree.
Dismissed.
Originally posted by danielctull
"I bought music from *insert WMA client here* and I can't play it on my iPod."
Dismissed.
Seriously!
Originally posted by Gene Clean
How so? Are you going to argue that people can carry their PowerMacs and listen to them on-the-go?
'Cause he's talking about portable MP3 players. Not CDs. Or computers. Or whatever. Portable MP3 players. You tell me one portable MP3 player that's not an iPod, and that can play music purchased from iTMS legally, and I'll tell you that I agree.
The ROKR is a portable MP3 player. It isn't an iPod and it isn't sold by Apple, it is sold by Motorola.
Originally posted by Gene Clean
...You tell me one portable MP3 player that's not an iPod, and that can play music purchased from iTMS legally, and I'll tell you that I agree.
There's plenty. My YEPP plays 'em. I just have to follow the terms of the agreement and burn them to a CD, rerip them as an MP3, and it works. I could've sworn this horse was beat dead long time ago.
Originally posted by lssmit02
...iPod only plays protected songs from Apple...
I was always able to rip my CDs and play them on my 1st gen iPod. Have things changed where the latest iPods don't do this? Didn't think so.
Originally posted by Gene Clean
How so? Are you going to argue that people can carry their PowerMacs and listen to them on-the-go?
'Cause he's talking about portable MP3 players. Not CDs. Or computers. Or whatever. Portable MP3 players. You tell me one portable MP3 player that's not an iPod, and that can play music purchased from iTMS legally, and I'll tell you that I agree.
Apple allows you to legally burn any song you buy from iTMS onto a CD. Any of a slew of utilities can convert these songs to mp3, which can be transferred to any player you want. It's not illegal to rip songs you own to mp3. Where do you think most people get music to fill their non-Apple-branded mp3 players from (leaving aside p2p)? CDs. If ripping is illegal, then every mp3 player maker should be shut down for encouraging an illegal activity.
Originally posted by DeaPeaJay
apple doesn't stop mp3 makers from having the capabilities to play their protected music do they? Can't they make their players iTMS compatible if they wanted to?
No, non-Apple players can't play apple protected music.
I actually think that it's in Apple's best interests to lose this case. Not to settle, but to lose the case.
2 reasons
1) I want my iPod to work with any music store - if one store doesn't have what I want go to another. iTMS will always have a better service for my iPod of course (note that my country doesn't have iTMS!). I also think iTMS should sell to any music player.
Why make buying Apple an all or nothing proposition? Let them buy whatever Apple stuff they want and gradually increase their Apple gear. (I know that iTunes on Windows is already part of this!).
2) This ruling would lock Microsoft into offering Office for Mac. For now, Word on Mac is my preference, I'd hate to be forced to use Word on Windows as my only option.
Greg
Originally posted by JimDreamworx
There's plenty. My YEPP plays 'em. I just have to follow the terms of the agreement and burn them to a CD, rerip them as an MP3, and it works. I could've sworn this horse was beat dead long time ago.
Why would I want to *buy* my music as AAC, burn it to a CD, then *re-rip* that to MP3 and *then* upload that to my other non-iPod player?
Why not just go and buy a normal CD and rip that using, oh I don't know, one out of a gazillion rippers out there?
The point of having iTMS, or using it rather, is that you don't have to go through all that trouble. You just buy the music, plug-in your mp3 player and all of it is updated for you.
So no, this horse was not beat dead long ago. You're not only confusing horses, you quite possibly missed the entire race.
But I digress, and anyone pointing to ROKR as a non-Apple mp3 player, should know that non-Apple means non-related to Apple in any way, shape or form. ROKR is just an iPod with a phone slapped to it.
But as I said, I digress.
Originally posted by Gene Clean
ROKR is just an iPod with a phone slapped to it.
Hardly. ROKR is a second-rate phone with a crippled music player that has an iTunes skin.
iPods actually have a decent user interface, a click wheel, and quality components. They are designed for playing music -- it's not merely a afterthought, as on the ROKR.
-Single Seller: A single entity is the sole producer/provider of a good/service. Apple is not this. That they provide the most popular services does not imply a lack of viable alternatives.
-No Close Substitutes: There is no product/service that fills a similar void, which is absolutely not the case. There are scads of other portable digital audio players and scads of other retailers of digital music, copy protected and not.
-Price Maker: One entity controls the supply of a good/service for an entire industry or market and is able to significantly alter the price by controling the supply/access to material. Apple does not do this. They are not the sole supplier of either digital music players or online music downloads. They are not even the sole supplier of online music downloads for their player.
-Blocked Entry: The monopolist has no competitors and has some method to block competition. This is also not the case. Apple is guilty of nothing but offering the most popular product in both the digital music player market and the digital music download market. They are not preventing other players from entering either market, and many have, nor are the preventing other music stores from entering the market, and many have. Apple has not engaged in any anti-competetive practices. They simply offer products that consistently attract a greater number of consumers. This is a successful business practice.
This lawsuit is a sham and a load of bollocks. He is suing because his player lacks a feature he desires and his digital music files lack a feature he desires, that being the ability to play any audio format on his iPod and transfer his iTunes to any player, respectively. Unfortunately, the fact that a product does not provide all the features you WISH it did, does not constitute grounds for a lawsuit.
I just don't understand what form of legal voodoo allows cases like this to be heard. This suit is asinine on so many levels, how does it slip past a competent judge and into validity?
Originally posted by Gene Clean
Why would I want to *buy* my music as AAC, burn it to a CD, then *re-rip* that to MP3 and *then* upload that to my other non-iPod player?
Why not just go and buy a normal CD and rip that using, oh I don't know, one out of a gazillion rippers out there?
Because you can't buy individual songs on "normal" CDs. You buy the whole album or you don't buy it at all.
BTW, if you're being intentionally dense and/or lazy, there are applications out there that can short-circuit the process, ripping directly from AAC to mp3.
Originally posted by Kolchak
[B]Because you can't buy individual songs on "normal" CDs. You buy the whole album or you don't buy it at all.
And the process of performing 5 steps, burning tens of CDs, and wasting time burning & ripping songs doesn't seem like a good trade-off to you? An album is usually meant to be listened entirely, because a lot of musicians create a flow of songs that overlap, and while doing so, create the theme of the album. Because there are musicians that make 9 songs so they can package their 1 hit into an "album" does not mean that it's ok to go through hell with buying AAC, burning into CDs, re-ripping that to MP3 and then uploading that to your iPod, and all of this so you can listen to them on an iPod, which is just an MP3 player after all.
Hey, I understand Apple must protect its iPod sales, and that in doing so, it's choosing to limit the options available, but that doesn't make this guys complaint unreasonable.
BTW, if you're being intentionally dense and/or lazy, there are applications out there that can short-circuit the process, ripping directly from AAC to mp3.
I never realized that you can *rip* music from an AAC, which is just an already ripped digital file. I thought that process was called encoding, or re-encoding, but people never cease to amaze me these days.