Apple 2005 Annual Report Download - page 24

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MacTech Systems v. Apple Computer, Inc.; Macadam v. Apple Computer, Inc.; Computer International, Inc. v. Apple Computer, Inc.; Elite
Computers and Software, Inc. v. Apple Computer, Inc.; The Neighborhood Computer Store v. Apple Computer, Inc. MacAccessory Center, Inc.
v. Apple Computer, Inc.; MacAccessory Center, Inc. v. Apple Computer, Inc. (all in Santa Clara County Superior Court)
Six resellers have filed similar lawsuits against the Company for various causes of action including breach of contract, fraud, negligent and
intentional interference with economic relationship, negligent misrepresentation, trade libel, unfair competition and false advertising. Plaintiffs
request unspecified damages and other relief. The Company answered the Computer International complaint on November 12, 2003, denying
all allegations and asserting numerous affirmative defenses. The Company filed an answer in the Macadam case on December 3, 2004 denying
all allegations and asserting numerous defenses. Three of the other plaintiffs filed amended complaints on February 7, 2005, and on March 16,
2005 the Company filed answers to these claims denying all allegations and asserting numerous affirmative defenses. A sixth Plaintiff,
MacAccessory Center, filed a complaint on February 23, 2005. The Company filed an answer to this complaint on April 20, 2005 denying all
allegations and asserting numerous affirmative defenses. These cases are in discovery.
On October 1, 2003, one of the reseller Plaintiffs, Macadam, was deauthorized as an Apple reseller. Macadam filed a motion for a temporary
order to reinstate it as a reseller, which the Court denied. The Court denied Macadam’s motion for a preliminary injunction on December 19,
2003. On December 6, 2004 Macadam filed for Chapter 11 Bankruptcy in the Northern District of California, which placed a stay on the
litigation as to Macadam only. The Company filed a claim in the bankruptcy proceedings on February 16, 2005. The Company took
Macadam’s debtor examination in April 2005. The Company, joined by another creditor of Macadam, filed a motion to convert the bankruptcy
to Chapter 7 (liquidation) on April 29, 2005 and that motion was granted. Plantiffs’ counsel in four of the six other reseller cases, was recently
appointed litigation counsel for the Macadam Estate by the bankruptcy court. The Company has moved for reconsideration of that decision.
Premier International Associates LLC v. Apple Computer, Inc.
Plaintiff Premier International Associates LLC (Premier) filed this action on November 3, 2005 in the United States District Court for the
Eastern District of Texas, Marshall Division, alleging infringement by the Company of U.S. Patents 6,243,725 and 6,763,345 both entitled
“List Building System.” The complaint seeks unspecified damages and other relief. The Company’s response is not yet due.
Slattery v. Apple Computer, Inc.
Plaintiff filed this purported class action on January 3, 2005 in the United States District Court for the Northern District of California alleging
various claims including alleged unlawful tying of music purchased on the iTunes Music Store with the purchase of iPods and vice versa and
unlawful acquisition or maintenance of monopoly market power. Plaintiff’s complaint alleged violations of §§1 and 2 of the Sherman Act (15
U.S.C. §§1 and 2), California Business and Professions Code §16700 et seq. (the Cartwright Act), California Business and Professions Code
§17200 (unfair competition), common law unjust enrichment and common law monopolization. Plaintiff seeks unspecified damages and other
relief. The Company filed a motion to dismiss on February 10, 2005. On September 9, 2005, the Court denied the motion in part and granted it
in part. Plaintiff filed an amended complaint on September 23, 2005 and the Company filed an answer on October 11, 2005. The case is in
discovery.
Stamm v. Apple Computer, Inc./Allen v. Apple Computer, Inc.
Plaintiff Stamm filed a purported class action on November 12, 2004 in Circuit Court, Cook County, Illinois alleging that a defect in Apple’s
17-inch Studio Display monitors results in dimming of half of the screen and constant blinking of the power light. The Company removed the
case to Federal Court on December 22, 2004. The Court remanded it to State Court on March 22, 2005 on Plaintiff’s motion. The Company
had filed a motion to dismiss on January 27, 2005 which was taken off calendar due to the
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