The US District Court for the Northern District of California granted computer maker Apple a permanent injunction against Psystar Corporation, a Florida-based firm that had been selling clone PCs running Apple's Leopard and Snow Leopard operating systems. Judge William Aslup wrote allowing Psystar to continue would "irreparably harm the competitive position and market share" of Mac OS X, noting Apple's marketing campaign for the operating system "centers around promises of quality and customer support" that Psystar does not provide to its customers
"After full briefing and oral argument, Psystar was found liable for infringement of Apple's copyrights in Mac OS X by violating Apple's exclusive reproduction right, distribution right, and right to create derivative works," Aslup wrote in his 17 page judgment, first posted on law blog Groklaw. "Psystar was also found liable for contributory copyright infringement by intentionally inducing and encouraging its customers to directly infringe Apple's copyrights through its sale of unauthorized copies of Mac OS X to the public."
Aslup also ordered Psystar to destroy the equipment it used to circumvent Apple technologies by the end of the year, and warned the company could find itself in contempt if it continues to sell Rebel EFI, a $50 application that allows customers to install Mac OS X onto their own PCs. "As Psystar readily admits, Rebel EFI has not been litigated in this action and was not subject to discovery. Moreover, Psystar's opposition brief appears to purposefully avoid providing a straightforward description of what Rebel EFI actually does," he wrote. "Thus, it is not only inappropriate, but impossible to determine on this record whether Rebel EFI falls within "the same type or class of unlawful acts" found at summary judgment. This order declines to "bless" a product about which it knows little of substance. Psystar's second argument is therefore rejected, and Psystar - if it continues to do so - sells Rebel EFI at its peril."
In its motion for summary judgment filed in July 2008, Apple contended that Psystar's reproduction, modification, and distribution of Mac OS X on non-Apple computers constituted direct and contributory copyright infringement under the Copyright Act, and multiple violations of the Digital Millennium Copyright Act (DMCA). Psystar also moved for summary judgment on a number of affirmative defenses. In November, Apple won a copyright infringement claim against Psystar; Aslup rejected the basis of Psystar's countersuit, that Apple was misusing its copyright claims.
Apple claimed Psystar violated three of its exclusive rights in Mac OS X: its reproduction right, its distribution right and its right to create derivative works. In November 2008, Psystar's countersuit, claiming monopolistic practices and copyright misuse, was dismissed. However, in December of 2008 Psystar charged Apple was prohibited from bringing action against Psystar due to a failure to register certain copyrights, and claimed their actions did not amount to creating a derivative work because of modifications made to the source code and kernel extensions. Earlier this month, Psystar agreed to pay Apple $2.7 million in damages and legal fees to partially settle a dispute over the sale of such computers.