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Apple vs. Psystar: Why Must the Startup Persist?

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Earlier this week, Psystar released yet another Mac clone -- choosing to ignore the copyright infringement lawsuit pending against it in federal court in San Francisco. InformationWeek's Antone Gonzalves points out that the move is a risky one given that Apple is asking the court to require the Florida-based startup to recall the clones it has sold. Never mind the compatibility problems that could crop up running OSX on non-Apple hardware.

 

Try as I might, I don't understand this one. Why would a small company like this invite trouble from the likes of Apple? And in the middle of a lawsuit, no less?


Gary Kaplan is a partner in the law firm of DeForest Koscelnik Yokitis Kaplan & Berardinelli in Pittsburgh. His practice includes IT law, antitrust and commercial litigation, among other things. Having recently written on "the circumstances and motives that lead to costly, and often wasteful, litigation" in his book, Executive Guide to Managing Disputes, he offered his insight.

 

In an e-mail, he said,"[Psystar] may be banking on PR pressure to persuade Apple to relent. Alternatively, it may be based on short run expediency and a hope of making it too costly for Apple to maintain full control over its systems, regardless of any right to do so." Either way, he says, the startup is facing an uphill battle.

 

He explained the short-run gain strategy this way:

Psystar doubtless recognizes that losing the lawsuit will likely end its business. If, however, the lawsuit (including appeals) takes several more years, it can continue to generate revenue (and presumably cover the cost of the litigation). Further, Psystar may be thinly capitalized with modest assets that its owners are willing to gamble and lose. In the event of a loss, it could declare bankruptcy leaving Apple with little in the way of tangible recovery.

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