Apple 1999 Annual Report Download - page 64

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 8--COMMITMENTS AND CONTINGENCIES (CONTINUED)
the Company's current release of its Mac OS operating system, Mac OS 9, infringes Microware's trademark for its real time operating system,
OS-9. Microware asserts claims for trademark infringement, false designation of origin, dilution and common law trademark infringement and
unfair competition. On October 14, 1999, Microware filed a motion for preliminary injunction seeking to enjoin the Company from using the
designation "Mac OS 9" and to order the Company to cancel and withdraw all packaging and advertisements that mention "Mac OS 9." The
Company has opposed the motion for preliminary injunction and has filed a motion for summary judgment against all of Microware's claims.
The Court has not yet scheduled a hearing date for the motion.
OTHER LITIGATION
The Company is also subject to certain other legal proceedings and claims that have arisen in the ordinary course of business and have not been
fully adjudicated. The results of legal proceedings cannot be predicted with certainty; however, in the opinion of management, the Company
does not have a potential liability related to any legal proceedings and claims that would have a material adverse effect on its financial
condition or results of operations.
NOTE 9--SEGMENT INFORMATION AND GEOGRAPHIC DATA
The Company manages its business primarily on a geographic basis. The Company's reportable segments are comprised of the Americas,
Europe, and Japan. The Americas segment includes both North and South America. The European segment includes European countries as
well as the Middle East and Africa. Other operating segments include Asia-
Pacific, which includes Australia and Asia except for Japan, and the
Company's subsidiary, Filemaker, Inc. Each reportable operating segment provides similar products and services, and the accounting policies
of the various segments are the same as those described in the Summary of Significant Accounting Policies in Note 1.
The Company evaluates the performance of its operating segments based on net sales and operating income. Operating income for each
segment includes revenue, cost of sales, and operating expenses directly attributable to the segment. Net sales are based on the location of the
customers. Operating income for each segment excludes other income and expense and certain expenses that are managed outside the
reportable segment. Costs excluded from segment operating income include various corporate expenses, income taxes, and nonrecurring
charges for purchased in-process research and development, restructuring, and acquisition related costs. Corporate expenses include research
and development, manufacturing expenses not included in segment cost of sales, corporate marketing expenses, and other separately managed
general and administrative expenses. The Company does not include intercompany transfers between segments for management reporting
purposes. Segment assets exclude corporate assets. Corporate assets include cash, short-term and long-term investments, manufacturing
facilities, and intangible assets. Capital expenditures for long-lived assets are not reported to management by segment.
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