AN APPLE A DAY

It came to light at the end of last week that Apple Corp, the Beatles’ record company, has lodged papers in the High Court, accusing Apple Computers of breaching an agreement made in 1991 to settle a dispute over the Apple trade mark. According to apple-history.com, Apple was chosen as the name of the computer company because the managing director admired the Apple Corp record company:

“Steve Jobs [co-founder of the computer company] had worked during the summer at an apple farm, and admired the Beatles' record label, Apple. He also believed Apples to be the most perfect fruit. He and Steve Wozniak were trying to figure out a name for their new company, and they decided that if they couldn't think of one by the end of the day that was better than Apple, they would choose Apple. They couldn't think of anything better, so on April 1, 1976, Apple Computer, Inc. was born.”

The computer company’s choice of name came to the attention of Apple Corp and in 1981 the computer company signed an agreement undertaking not to go into the music business in order to safeguard Apple Corp’s trade mark rights in the name and logo. By the mid-eighties though, the computer company had started producing music files and software for its machines, much to Apple Corp’s displeasure and in 1991 the computer company once again agreed not to involve itself with music, paying Apple Corp $26million along the way. The latest court action pertains to this agreement and the computer company’s decision to launch iTunes, a music download service service that allows consumers to download songs for 99 cents each onto their computer or iPod person music systems. The computer company blames the action on “differing interpretations” of the 1991 agreement.

The IPKat notes that in 1981, when Apple Computers was producing this rather lovely specimen, computers with the ability to play or manipulate music must have seemed a long way off. However, multimedia and downloading facilities are the norm for computers and it would seriously damage Apple’s competitive abilities if it was completely excluded from that market because of a trade mark delimitation agreement entered into more than two decades ago. Having said that, presumably the computer company entered the agreement voluntarily and the need for it to be able to enter the download business is not as pressing as its need to be able to bundle multimedia features into its computers.

This case also highlights the difficulties that occur when two companies simultaneously build their brands around an everyday idea such as an apple. Finally, the IPKat wonders whether choosing your mark because you “admire” another company with the same mark (as Steve Jobs, co-founder of the computer company did) where there’s no prospect of confusion between the two parties’ goods counts as unfair advantage of the admired mark’s distinctive character or repute under Article 5(2) of the Trade Mark Directive.

Read Fox New’s prophetic article about the case (published in June) here
Apple record labels here
Bad apples here and here
Good apples here
Mushy apples here
Make sure your nearest and dearest eats an apple a day