Apple Corps v Apple Computer
In 1978, Apple Corps filed a lawsuit against Apple Computer for trademark infringement. The Beatles-founded holding company owned the record label Apple Records and sought to protect its name from the computer manufacturer. This legal battle established the first boundary between music and computing businesses. The suit concluded in 1981 with an undisclosed payment of $80,000 to Apple Corps. As part of the settlement terms, Apple Computer agreed not to enter the music business. Simultaneously, Apple Corps promised to stay out of the computer market entirely.
Apple Computer added MIDI and audio-recording capabilities to its computers in 1986. The Apple IIGS model included the Ensoniq 5503 DOC sound chip from synthesizer maker Ensoniq. This technological shift triggered a new lawsuit in 1989 when Apple Corps claimed violation of the 1981 agreement. A settlement reached in 1991 involved a payment of around $26.5 million to Apple Corps. The agreement defined each company's rights to use the term Apple. Apple Corps retained rights for creative works whose principal content is music. Apple Computer kept rights for goods or services used to reproduce or deliver such content but could not distribute physical media.
In 1989, Apple Computer employee Jim Reekes worked on the System 7 operating system update. He had initially named a sampled system sound Chimes. Company legal department worried this name was too musical and would worsen the ongoing legal challenge. Reekes successfully resubmitted the name as sosumi without informing lawyers that it sounded like so sue me. Mac OS 7 released to the public in 1991, coinciding with the year the lawsuit settlement concluded. The alert sound became an iconic part of the user experience during the height of the legal conflict.
Apple Corps sued Apple Computer again in September 2003 over breach of contract allegations. The dispute centered on using the Apple logo in creating and operating the iTunes Music Store. Some observers believed previous settlement wording favored Apple Computer in this case. The trial opened on the 29th of March 2006 in England before a single judge of the High Court. On the 8th of May 2006 the court ruled in favor of Apple Computer. Mr Justice Mann held that no breach of the trademark agreement had been demonstrated. Neil Aspinall, manager of Apple Corps, stated they would file an appeal despite the decision.
The verdict coincided with the Guy Goma incident on BBC News 24. A job applicant mistakenly appeared on air after being confused with computing expert Guy Kewney. This real-world event occurred following the court ruling in May 2006. The confusion arose because both men shared similar names and backgrounds in technology fields. The broadcast error highlighted how the high-profile nature of the trial captured public attention beyond legal circles.
On the 5th of February 2007, Apple Inc. and Apple Corps reached a final settlement of their trademark dispute. Apple Inc. agreed to own all trademarks related to Apple while licensing certain rights back to Apple Corps. Newspaper accounts at the time stated Apple Computer was buying out Apple Corps' trademark rights for a total of $500 million. Steve Jobs commented that resolving this in a positive manner felt great. Neil Aspinall expressed hope for many years of peaceful cooperation between the companies. The settlement ended decades of litigation and allowed Beatles content to eventually appear on iTunes.
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Common questions
When did Apple Corps file a lawsuit against Apple Computer for trademark infringement?
Apple Corps filed the initial lawsuit in 1978 to protect its record label name from the computer manufacturer. The legal battle concluded in 1981 with an undisclosed payment of $80,000 to Apple Corps.
What happened when Apple Computer added MIDI and audio-recording capabilities to its computers in 1986?
The addition of these features triggered a new lawsuit in 1989 because it violated the 1981 agreement prohibiting entry into the music business. A settlement reached in 1991 involved a payment of around $26.5 million to Apple Corps.
Why did Jim Reekes rename the system sound Chimes to sosumi during the System 7 update in 1989?
Company legal department worried that the name Chimes was too musical and would worsen the ongoing legal challenge. Reekes resubmitted the name as sosumi without informing lawyers that it sounded like so sue me.
On what date did the court rule in favor of Apple Computer regarding the iTunes Music Store dispute?
The trial opened on the 29th of March 2006 before a single judge of the High Court in England. On the 8th of May 2006 the court ruled in favor of Apple Computer stating no breach of the trademark agreement had been demonstrated.
How much money did Apple Inc pay to settle the final trademark dispute with Apple Corps on the 5th of February 2007?
Newspaper accounts at the time stated Apple Computer was buying out Apple Corps' trademark rights for a total of $500 million. The settlement ended decades of litigation and allowed Beatles content to eventually appear on iTunes.