Class-Action Antitrust Lawsuit Against Apple Revealed

A class-action lawsuit has been launched against Apple in the United States over mandatory links between its iTunes music store and iPod music players. The action follows similar charges in Europe, brought by a French consumer rights group. News of the suit, filed in California in July, came via a disclosure by Apple that formed part of its report to the US Securities and Exchange Commission last week.

The suit was filed by a user, Melanie Tucker, and seeks class-action status. It alleges that Apple violates antitrust laws by refusing to allow music bought in its iTunes store to be played on any digital music player besides the iPod. It also charges Apple with not making it clear to customers that music from the iTunes store and the iPod are incompatible with music and devices offered by other companies.

The suit asks that Apple be forbidden to continue to support the exclusive tie-in between iTunes and the iPod and that Apple pay damages to anyone who has bought an iPod or music from the iTunes store after April 28, 2003. In November, Apple filed a motion with the court to dismiss the suit but on Dec. 20 the court denied that request.

A consumer group in France filed a similar suit in early 2005 that is still ongoing. France’s new copyright law, which was approved last June, states that companies that use DRM (digital rights management) technologies to protect music downloads will be required to provide information about their technology to competitors wishing to create interoperable systems. Now Apple Computer may have to relinquish its tight control of the FairPlay DRM technology it uses to tie songs downloaded from the iTunes Music Store in France to its iTunes jukebox software and iPod music player. Or Apple can tell France to stick its new copyright law up its DRM and pull French access to both iTunes and the iPod.

So far, Apple has licensed the technology only to Motorola Inc. for use on a small number of cell phones. Vendors that use DRM do have one way around the law: They can sell songs for proprietary systems as long as the copyright holders agree.

Author: FutureMusic

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