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Jury Rules on iTunes Antitrust Trial

Case demonstrates how juggling conflicting demands can sometimes get businesses in trouble.

Jury Rules on iTunes Antitrust TrialAfter 10 years in court, a class action suit accusing Apple of anti-competitive practices has finally been closed. The case, which was brought on behalf of 8 million iPod owners, alleged that Apple deliberately engaged in practices designed to force out competition and maintain its position as the dominant company in the digital music industry.

The attorney for the plaintiffs presented evidence showing that Apple issued an update that deleted music off of customers’ iPods without telling them. The update accomplished this by requiring users to reset their iPods every time they downloaded music from certain iTunes competitors. When the device rebooted after the reset, the non-iTunes tracks were suddenly missing.

Apple defended its actions as being inspired not by a plan to dominate the market but by a need to abide by the provisions of its contractual obligations to record labels. Apple founder Steve Jobs characterized the company’s position as “very scared” of being in non-compliance with the record labels. Apple had promised the record labels that they would protect the DRM (digital rights management) rights of artists and labels. Therefore, the company believed it could not allow tracks that had been downloaded from other sources and most likely lacked copyright encryption to be used.

The plaintiffs requested $350 million dollars in damages, covering not only deleted music but also the increase in the cost of Apple music products that the company’s alleged anti-competitive tactics caused. However, Apple will not have to pay a dime because in this case the jury found the company not guilty.

This case is interesting on multiple different levels. One important lesson for business owners is that attempting to balance conflicting demands from vendors and customers can sometimes lead to situations where it seems there is no “right” choice that will satisfy everyone. For example, in this case Apple had the choice of taking actions that could violate extremely important contracts or taking actions that would frustrate and alienate consumers. Either way, the action could potentially lead to a legal dispute. In this case it seems Apple made the right choice based on the jury’s decision.

How to Resolve Your Contract Dispute Out of Court

If you own a business, the idea of being tied up in court fighting out a contract dispute or other legal issue for 10 years probably fills you with dread. Fortunately, there are other options that can be utilized to bright contract disputes to an acceptable resolution without wasting years in court.

The very first thing to do is consult a business attorney like Torrence L. Howell with experience in contract law. Your attorney can review the details of your case and advise you of the strength of your legal position. This will help you decide what outcome to pursue in the case and how hard to push for it.

Once prepped by your attorney, you can then engage the services of an arbitrator or negotiator to help you work out a deal with the other party. In most cases, the other party doesn’t want to go to court either and you should be able to reach some kind of resolution in this way.


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