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Psystar Found Liable for Infringing Apple’s Copyright in the Mac OS X Operating System

In Apple Inc. v. Psystar, a California District Court granted Apple’s motion for summary judgment for copyright infringement against Mac clone manufacturer Psystar, finding that Psystar had violated Apple’s reproduction right, distribution right and right to create a derivative work in its Mac OS X operating system. It also dismissed Psystar’s cross-motion.

Psystar developed and sold clones of Apple’s Macintosh brand of computers with a modified version of Mac OS X. Psystar bought a copy of the Mac OS X and installed it on a Mac mini. It then copied the OS onto a non-Mac computer which became the imaging station. Psystar removed and replaced the Mac OS X bootloader as well as the OS X kernel extension files. The kernel extensions were responsible for locating the hardware decryption keys.

Psystar unsuccessfully relied on Section 117a of the US Copyright Act, which allows the owner of a copyrighted program to modify or copy the program for a limited purpose without incurring liability for infringement. The court found that this defence could not be asserted as it had not been pled, and further found that the defence was frivolous in any event. The court also rejected Psystar’s fair-use defence, noting that the defence did not address the fair-use factors. In addition, Psystar’s attempted reliance on the first-sale doctrine failed, as the court ruled that this doctrine could only be relied upon where copies are "lawfully made."

The court denied Psystar’s cross-motion for summary judgment on copyright misuse. The crux of Psystar’s argument was that Apple’s attempt to tie the copyright in Mac OS X to Apple hardware constituted misuse. The court rejected this argument, holding that Apple did not violate the public policy underlying copyright as "Apple has not prohibited purchasers of Mac OS X from using competitors’ products. Rather, Apple has simply prohibited purchasers from using Mac OS X on competitors’ products … Apple’s [licensing] agreement did not seek to control all competition in an area outside the copyright. Rather, Apple’s agreement simply attempt[ed] to control the use of Apple’s own software — an area that is the focus of the copyright."

The court also found Psystar liable for circumvention of Apple’s decryption key, a technical protection measure designed to prevent access to Mac OS X and to prevent it from running on a non—Apple computer. Psystar unsuccessfully argued that the decryption key was publicly available on the Internet and thus ineffective.

After the ruling, Apple successfully obtained a permanent injunction against Psystar, prohibiting Psystar from copying and selling copies of the Mac OS X software without Apple’s permission, from circumventing Apple’s technological measures used to prevent unauthorized copying of Mac OS X on non-Apple computers, and from aiding and abetting others to infringe the Mac OS X software. Psystar has reportedly filed an appeal against the permanent injunction.