Apple Computer Inc. is entitled to use the apple logo on its iTunes Music Store, a judge ruled Monday, rejecting a suit filed by Apple Corps Ltd., the guardian of The Beatles' commercial interests.
Apple Corps, which claimed that the computer company had broken a 1991 agreement in which each side agreed not to enter into the other's field of business, said it would appeal.
Judge Edward Mann of Britain's High Court ruled that Apple Computer used the fruit logo in association with the store, not the music, and thus did not breach the agreement. "I conclude that the use of the apple logo ... does not suggest a relevant connection with the creative work," Mann said in his written judgment. "I think that the use of the apple logo is a fair and reasonable use of the mark in connection with the service, which does not go further and unfairly or unreasonably suggest an additional association with the creative works themselves."
Though Apple Computer CEO Steve Jobs said he was "glad to put this disagreement behind us," the case appears far from over. Neil Aspinall, the manager of Apple Corps, said his company would immediately appeal.
"We felt that during the course of the trial we clearly demonstrated just how extensively Apple Computer has broken the agreement," Aspinall said in a statement.
Apple Computer has sold more than 1 billion songs through the iTunes Music Store, which is available throughout Europe as well as in the United States, Canada, Australia and Japan. Though there are more than 3 million tracks available for purchase in the U.S. - and 2 million in Britain - there are no Beatles' songs listed. The band's catalog is not available on iTunes.
In his brief statement, Jobs said he hoped the ruling would help rectify that situation: "We have always loved the Beatles, and hopefully we can now work together to get them on the iTunes Music Store."
Lawyers for Cupertino, Calif.-based Apple Computer had argued that the company was conducting its business legally and consumers are smart enough to tell the difference between the logos. Apple Corps uses a shiny green apple as its logo, while Apple Computer has a cartoon-like apple with a neat bite taken out.
Lawyers for each side tussled during the hearing over advertisements for iTunes featuring musical acts U2, Eminem and Coldplay, using the logo. The judge confessed early on that he owned an iPod.
The 1991 agreement ended previous lengthy litigation over the logo. Apple Computer told the court that it paid the Fab Four's company $26.5 million as part of the 1991 out-of-court settlement, and in return had received "a considerably expanded field of use." The terms of the deal were kept confidential at the time.
Mann refused Apple Computer's application for an immediate interim payment of 1.5 million pounds ($2.8 million) from Apple Corps toward its legal costs, pending further hearings. Apple Corps faces a similar bill for its own legal expenses.
While the case may have seemed glamorous because of the litigants, it really came down to the interpretation of a contract - the 1991 agreement - said Jonathan Riley, an intellectual property lawyer with London firm Lawrence Graham.
"It was watched with interest, but also some distance, because I don't think it's hugely significant for either the computer industry or the music industry," he said.
Apple Corps was started by the Beatles in 1968 and is still owned by Paul McCartney, Ringo Starr, the widow of John Lennon and the estate of George Harrison. Apple Computer was formed in 1976, when college dropouts Steve Jobs and Steve Wozniak filed partnership papers on April Fools' Day.
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