Apple
Apple
Wins Antitrust Case Over Competition for iPod
A jury ruled in favor of Apple Inc. on Tuesday in a class-action
lawsuit that accused the technology giant of violating antitrust
laws by suppressing competition for its iPod music players.
After deliberating for only about three hours, an eight-person
jury in U.S. District Court in Oakland, Calif., found that Apple's
iTunes 7.0 was a genuine product improvement, and therefore didn't
violate antitrust laws. The decision was unanimous.
Apple applauded the jury's verdict. "Every time we've updated
those products--and every Apple product over the years--we've done
it to make the user experience even better," the company said in a
statement.
The plaintiffs had said Apple made changes to its iTunes music
service so it was incompatible with other companies' devices,
driving up the price of iPods. The plaintiffs, representing
potentially eight million harmed consumers, were seeking $350
million in damages, which could have been tripled under antitrust
laws.
For now, the verdict closes a 10-year legal battle over the
iPod.
Apple's lawyers said it was a rare case where a jury was allowed
to make the key decision of whether a product was a genuine
improvement from earlier versions. Usually, a judge makes that
decision.
Patrick Coughlin, an attorney for the plaintiffs, said they were
happy that the case went to the jury, but that it was a "very tough
case." He said the plaintiffs plan to appeal the jury's
decision.
"Very few of these cases make it this far," said Michael
Carrier, a law professor at Rutgers University in New Jersey,
because defendants such as Apple only need to show "a little bit of
a product improvement and then it gets thrown out."
The 10-day trial took jurors back in time. The key events at
issue took place in 2006 and 2007, as music downloads and iTunes
grew in popularity. More recently, iTunes downloads have fallen, as
users switch to streaming music services.
The trial also included a never-before-seen video of Apple
co-founder Steve Jobs from a deposition in April 2011, about six
months before he died. Mr. Jobs argued that Apple was scared of
iTunes hackers and that it needed to add security features to
appease record labels concerned about piracy.
Initially, the plaintiffs had argued that Apple's iTunes 7.0 and
7.4 updates in 2006 and 2007, respectively, were anticompetitive.
During the trial, Judge Rogers narrowed the plaintiffs' case to
only the iTunes 7.0 update.
Plaintiffs said security changes made by Apple in the iTunes 7.0
update weren't improvements, but maneuvers to block other music
from playing on iPods. Plaintiffs said those changes made all other
improvements irrelevant.
In closing arguments on Monday, Mr. Coughlin compared the update
to a new Snickers bar that was bigger and had more chocolate, but
included a preservative that was toxic.
Apple's lawyers said it made no sense for the company to harm
its own product. Apple said the security fixes that disabled
rivals' software were necessary to patch a potential vulnerability.
In the iTunes 7.0 update, Apple also added the ability to play
movies on iTunes and scan through album art with Cover Flow.
Mr. Carrier said the plaintiffs' case suffered after their two
class representatives were dropped because neither had bought a
relevant iPod during the period covered by the suit. The plaintiffs
scrambled, finding an amateur ice dancer from the Boston area to
become the face of their case
Daisuke Wakabayashi NEW YORK--BlackBerry Company Launches Phone
With Keyboard and Trackpad
NEW YORK-- BlackBerry Ltd. unveiled a new device on Wednesday
meant to appeal to the smartphone maker's traditional customers
with signature BlackBerry phone features like a physical keyboard
and trackpad.
Dubbed the Classic, the new phone is part of the Canadian
company's plan to reignite sales and return to profitability by
focusing on business customers after its previous attempt to appeal
to consumer customers fell flat. The plan also focuses on increased
sales of management-device software and security services to
enterprise customers.
The Classic has a traditional qwerty keyboard, a row of
navigation keys to manipulate the device's operating system and a
trackpad to scroll through lists--features that made the company's
Bold device popular with lawyers, bankers and other
professionals.
BlackBerry said the Classic upgrades the Bold with a screen that
is 60% larger, a browser that is three times faster and access to
Amazon.com Inc.'s Appstore.
After last year's failed attempt to expand into the
consumer-smartphone market, BlackBerry aims to return to cash flow
break-even status by the end of February and to be profitable in
fiscal 2016, as its software and services business start to gain
traction. It will release its latest results, for the fiscal third
quarter, on Friday.
"We listened closely to our customers' feedback to ensure we are
delivering the technologies to power them through their day--and
that feedback led directly to the development of BlackBerry
Classic," BlackBerry Chief Executive John Chen said in a statement.
"It's the secure device that feels familiar in their hands, with
the added performance and agility they need to be competitive in
today's busy world."
In the U.S. the Classic will cost $449 unlocked. That is $50
more expensive than a BlackBerry Bold 9900 but less than Apple
Inc.'s latest iPhone 6 and iPhone 6 Plus phones, which started at
$649 and $749, respectively.
Ben Dummett Leighton Holdings Construction Firm Sells Half Of
Services Arm to Apollo
SYDNEY--Australia's biggest construction company, Leighton
Holdings Ltd., has agreed to sell half of its services arm to
private-equity firm Apollo Global Management for 700 million
Australian dollars (US$570 million) in cash.
Leighton said Wednesday it will form a 50-50 joint venture
partnership with Apollo comprising the combined operations of its
Thiess Services and Leighton Contractors Services units, which
build and manage communications, energy and infrastructure projects
across Australia.
Apollo's purchase will help it further expand its focus on
construction and engineering services firms, branching out beyond
its traditional focus on real estate and debt. In May, Apollo
invested US$500 million in CSV Midstream Solutions Corp., a
Canadian engineering and construction firm servicing oil and gas
projects.
Leighton, controlled by Germany's Hochtief AG, which is run by
Spain's Actividades de Construcción y Servicios SA, has been
selling off assets this year as it looks to shore up its balance
sheet following years of financial losses and steep
write-downs.
The company had previously been a large beneficiary of
Australia's mining-fueled economic boom, which saw a raft of
spending by firms and government on new mines, infrastructure and
property. Though Leighton has a market capitalization of A$7.1
billion, its shares have lost about two-thirds of their value since
2007, when shares briefly topped A$60.
The deal gives the services business an enterprise value of
A$1.075 billion and will reduce Leighton's gearing by about 10
percentage points, the company said in a statement to the
Australian Securities Exchange.
The sale of Leighton's services business comes just days after
it offloaded its John Holland building division to China
Communications Construction Co. for about A$1.15 billion. The
company is also looking to sell its property division, and has been
chasing money it is owed for construction work, particularly in a
Dubai-based joint venture Habtoor Leighton Group, which has
suffered significant write-downs.
Leighton Chief Executive Marcelino Fernandez Verdes announced
the asset sales in June, saying he wanted to streamline the
business and restructure its sprawling group of companies to avoid
overlaps and bring similar operations together. The strategic
review came soon after owner Hochtief upped its stake in the
business to 70%, and then swiftly moved to oust the company's
chairman and chief executive in an attempt to stem losses.
The deal with Apollo is subject to regulatory approvals
including from the Foreign Investment Review Board and the New
Zealand Overseas Investment Office.
Rebecca Thurlow and Daniel Stacey
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