Beatles’ Apple vs. Jobs’ Apple goes to UK High Court this Wednesday

“This week the Apple Corps goes to the High Court seeking multimillion-pound damages against Apple Computer, the creators of the iPod, over their hugely successful iTunes Music Store,” Liz Chong reports for The Times. “Apple Corps, owned by the former Beatles and their heirs, still owns the licensing rights to Beatles’ products. It is claiming that the introduction of iTunes broke a $26 million settlement under which Apple Computer agreed to steer clear of the music business, for which the Beatles’ company retains the famous trademark. It is the latest clash in one of Britain’s longest-running corporate legal battles.”

“Steve Jobs, chief executive of Apple Computer, founded his company in 1976 with a logo of a rainbow-coloured apple with a bite taken out of it. Apple Corps sued him five years later, accepting an $80,000 settlement and a promise that the computer company would stay out of the music business,” Chong reports. “The companies clashed again in 1989 after Apple Computer introduced a music-making program. The computer company settled in 1991, for $26 million. Apple Corps was awarded rights to the name on ‘creative works whose principal content is music’ while Apple Computer was allowed ‘goods and services . . . used to reproduce, run, play or otherwise deliver such content.'”

“Critically, however, the agreement prevented Apple Computer from distributing content on physical media. This was designed to cover CDs and tapes, but it is unclear whether it included later inventions such as digital music files or devices used to play them. Apple Computer will argue that its music service, which has sold more than a billion songs since 2002, is merely data transmission,” Chong reports. “The case is scheduled to begin on Wednesday at the High Court before Mr Justice Mann, a self-professed fan of music and computers. He is no stranger to the iPod, having inquired of both sides some time ago if he should disqualify himself from hearing the case because he owned one.”

Full article here.

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41 Comments

  1. This isn’t about the name Apple. It’s about a contractual limitation on the distribution of music.

    I’m not a lawyer (thanks be to heaven), and certainly not a judge, but I understand ‘physical’ versus ‘non-physical’, and my guess is that this clause doesn’t bode well for Apple Corps.

    I’m also thinking that Apple Computer may put this to rest once and for all, by making an offer for Apple Corps, after the High Court finds in its favor.

    The opnly problem with that, is that Apple Corps doesn’t own the rights to most Beatle’s songs. They were sold some time ago to Michael Jackson, who then sold half to Sony. I’m not sure what Apple Computer would get if they bought Apple Corps.

  2. Apple was “prohibited from distributing music on physical media”. There’s another way to say this that makes the issue much clearer. Apple was prohibited from operating a MUSIC LABEL.

    The iTunes Music Store is not a music label. It is a retailer. Apple is only “distributing digital music” in the same sense that Tower Records “distributes CDs”. In other words, the existing record labels are the ones actually distributing the music — iTMS merely provides a medium for this distribution.

    I will be cold-cock stunned if this lawsuit goes anywhere.

  3. I like the Beatles and all, but seriously, fuck them. Apple needs to go for the jugular on this one. And after they win they should offer to buy Apple Music and shoot for the moon, or refuse to sell their music from within iTunes under any circumstances, even if Apple Music decides that they want to after all. Don’t let them capitalize on Apple after all this bullshit.

  4. Gregg, you’re mistaking publishing rights, which are basically the sheet music (lyrics & notes), and the recordings, which are the tracks laid down in the studio by John, Paul, George, Ringo, and Co.

    The publishing rights are owned by Northern Songs Ltd. (40% owned by Wacko Jacko, 40% owned by Sony BMG, 1.6% owned by Ringo and George’s estate, and the rest publicly traded). Northern only owns the rights to the Lennon/McCartney tunes from With The Beatles on, and a handful of Harrison tunes. Despite the ownership, Sir Paul and Yoko still haul in writer’s royalties. Publishing rights for Lennon & McCartney tunes from Please, Please Me are owned by Sir Paul.

    The recordings from Please, Please Me on are owned by Apple Corps Ltd and licensed to Capitol Records. Earlier Beatles’ recordings are owned by Decca (now part of Universal), thus the Beatltes-Tony Sheridan collaboration available on iTunes.

  5. What if the Beatles started a music download service called Apple Music? Do you think that would cause confusion? Can you imagine people downloading Beatles music from the Apple Music Store but not being able to play them on an iPod? That is why the Beatles will win this case.

  6. It _is_ Sgt. Pepper’s – but y’all must have uncanny Beatles reflexes to sppot that in such a large stream of covers. ” width=”19″ height=”19″ alt=”smile” style=”border:0;” />

  7. From what I was reading at the time that this case started heading towards the courts, it’s not a particularly big dispute. The thing that made it seem big was that the press hyped it up.

    As others have pointed out, it relates to the dispute between the two Apples over how far the computer company can venture into the world of music. Their lawyers can’t come to an agreement over the precise details, so it was mutually agreed to get the court to clarify the position.

    While the press have made much of it and doubtless will again, I haven’t been aware of any reports directly from either Apple which claims that it’s anything other than an attempt to clarify the details of a much earlier agreement.

  8. Diamond:
    “What if the Beatles started a music download service called Apple Music? Do you think that would cause confusion? Can you imagine people downloading Beatles music from the Apple Music Store but not being able to play them on an iPod? That is why the Beatles will win this case.”

    Problem here is that Apple Records never had an established online music store presence. They are a record label that publishes music, which is not the same thing as an online music distributor.

    While there were some very unsuccessful attempts to commercially distribute digial music online, effectively it was started by Apple Computer in partnership with major US music labels. If Apple Records started an online music distribution service, they would not be allowed to call it “Apple Music Store” online. Because they own the rights to call themselves that in physical music distribution does not automatically mean they have the right to call themselves that in a new arena (digital music distribution).

    If that’s all they have to go on, they will lose this case.

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