Psystar Halts Mac Clone SalesPsystar Halts Mac Clone Sales

Mac cloner Psystar appears to have voluntarily taken its systems off the market on the heels of what it says is a partial settlement of its legal battle with Apple. As of early Wednesday, Psystar's Web site listed all of the company's Mac OS X-based systems as "out of stock."

Psystar filed court papers on Monday in which it claimed it has reached an out-of-court settlement on a number of issues with Apple, which sued Psystar for copyright infringement.

Psystar said it agreed to pay Apple $2.7 million in damages, in exchange for a pledge from Apple not to attempt to collect the sum until all appeals in the case have been exhausted. Psystar also said Apple agreed to drop all claims with respect to trade dress, trademark, and state law issues.

Apple has not commented.

A judge last month ruled in favor of Apple in the computer maker's copyright infringement lawsuit against upstart Psystar.

In granting summary judgment for Apple, Judge William Alsup, of U.S. District Court for San Francisco, said Psystar violated Apple's copyright over the Mac OS by modifying it so it could run on third-party hardware and by distributing it to customers.

The ruling was significant in that, had Psystar prevailed, other PC makers—including giants like Dell and Hewlett-Packard—would presumably have been free to offer their own Mac clones. That fact led some observers, and even Apple itself, to speculate that tiny Psystar's activities and legal costs have been secretly funded by an outside party.

Psystar has now taken to selling a software product called Rebel EFI, which allows users to load any operating system, including Mac OS, onto any PC.

Rebel EFI may represent an attempt by Psystar to circumvent the court's ruling, as it would not be physically installing the Mac OS onto its customers' computers. However, the software, depending on how it works, could make the customers themselves guilty of copyright infringement.

In its court filing Monday, Psystar asked Alsup to exclude Rebel EFI from any injunction he might issue barring the sale of Mac clones. Psystar also asked Alsup to exclude clones based on Mac OS X 10.6, which is also known as Snow Leopard.

Psystar maintains that Rebel EFI and Snow Leopard are outside the scope of the current litigation. Psystar, which filed for bankruptcy protection earlier this year, operates from a non-descript industrial subdivision in the Miami, Florida area.

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