Apple Corp v. Apple Computer

Citation: Apple Corps Limited v. Apple Computer, Inc., [2006] EWHC 996 (Ch)[http://www.hmcourts- service.gov.uk/judgmentsfiles/j4226/apple_v_apple_hc0

3c02428_0506.htm]

Factual Background
The Beatles’ record company has been known as “Apple Corps” since 1968. Apple Computer was founded eight years later, in 1976. In the beginning, the two companies’ businesses were so different, that the existence of two “Apples” caused few if any problems. That was so, however, only in the very beginning.

By 1981, enough conflicts had occurred that the two companies entered into a written agreement with one another concerning the manner in which each of them could use the “Apple” name and logo. That agreement did not resolve things for all time, though.

By 1989, Apple Computer was using the name and logo in ways that Apple Corps contended violated their agreement. As a result, Apple Corps sued Apple Computer. The case went to trial in 1991; but after 100 days of testimony, the two companies settled their suit. So, when Apple Computer began using the “Apple” name and logo in connection with its iTunes online music store in 2003, Apple Corps sued again. This time, the case was tried to the end, and Apple Computer emerged victorious.

Trial Court Decision
Apple Corps claimed that the computer company breached the 1991 agreement, which it alleged gave the record company the exclusive right to use the “Apple” name and logo in the music business. In a lawsuit filed in London, Apple Corps asserted that Apple Computer violated their 15-year-old agreement by using the “Apple” name and logo in connection with the operation of its iTunes online music store.

Apple Corp objected to the appearance of the Apple logo that appears at the top of the browser window when users connect to the iTunes website. It also objected to the use of the name and logo in connection with iTunes’ distribution of several types of music content. It further objected to the use of the name and logo in iTunes video advertising. And it relied on speeches given by Steve Jobs, and documents filed with the SEC by Apple Computer, in an attempt to show that the computer company had indeed gone into the music business.

In a lengthy opinion, Justice Mann interpreted the 1991 agreement to bar Apple Computer from using the “Apple” name and logo in connection with the sale of music “content” owned by the computer company itself. But the Justice concluded that the agreement did not prevent Apple Computer from using the name and logo in the retail sale of music content owned by others.

Justice Mann then considered all of the uses to which Apple Corps objected. He concluded that each of them was a use in connection with the retail sale of content owned by others. From that, the Justice concluded that Apple Computer had not breached the 1991 agreement.

Contract