ITunes bugs the Beatles

Computer giant taken to court again by label

The Beatles’ record company will return to London’s High Court on Wednesday in the third trademark case against Steve Jobs’ Apple Computers.

Apple Corp. is claiming that the computer manufacturer’s iTunes Music Store breaches a 1991 agreement not to enter the music industry.

Apple Computer contends that the agreement covers music tapes and CDs but not online data.

Last year 41% of Apple’s revenues came from iTunes and the sale of iPod music players and accessories. If the Beatles prevail in court, Jobs’ company could be hit with massive financial penalties for the trademark violation.

Ironically, Beatles fan Jobs chose the Apple name and logo as a tribute to his heroes — a decision that took a bite out of his company profits.

In 1978, after George Harrison spotted an ad for Apple’s Mac computers in a magazine, Apple Corp. sued the technology company for breach of trademark; three years later, after a reported settlement of $80,000, Apple Computer agreed to stay out of the music business.

The Fab Four’s lawyers swung into action again when soundcards were added to desktops, allowing CDs to be played on computers. They won a $26.5 million settlement in 1991 and a further pledge that Apple Computers would not enter the music business, although its equipment could be used to play and edit recorded music.

The current litigation dates back to April 2003 following the introduction of the iTunes Music Store and the iPod music players. Since then more than 1 billion tracks have been sold through iTunes.

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