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Beatles' Record Firm, Apple Computer Return to Court

RENEE MONTAGNE, Host:

A courtroom in London has been specially wired so that a high court judge can quite literally hear the case. It was brought by the Beatles record label Apple Core, which claims Apple computer has violated a 1991 agreement not to use the Apple logo to sell music.

NPR's Rob Gifford reports from London.

ROB GIFFORD: In the fruit basket of trademark names, there's one that's proved a little too popular. Apple Core, started by John, Paul, George and Ringo in 1967, and Apple Computers, started by Steve Jobs and Steve Wosniak in 1976, have already two legal fights about slicing up the apple pie.

In 1991, Apple Computer agreed to pay Apple Core $26 million dollars, and to limit use of the name essentially to computer hardware. But London media lawyer Mark Stevens says this new case is really about technology moving faster than lawyers' brains.

MARK STEVENS: Since then, the problem that we've had is that we've had convergence. We've not got the iPod, we've got iTunes, and so what happens is that we've now got a situation where Apple Computers want to move into the valuable trade area of content, and, of course, that's the Beatles' home territory.

GIFFORD: While Apple Core lawyers have been arguing just that, Apple Computer's lawyers have counted that their client is not creating content at all. The Beatles' lawyer, Geoffrey Vos, took the courtroom on a virtual tour of Apple Computer's iTunes music store. He couldn't download a Beatles tune to play, because Apple Core hasn't licensed Beatles songs to any online music stores, so he chose something completely different.

(SOUNDBITE OF SONG, "LE FREAK")

CHIC: (Singing) Ahh freak out, le freak, says Chic. Freak out.

GIFFORD: The Judge Justice Edward Mann didn't seemed freaked out in the least by counsel's choice of the '70's disco hit. He said he had an iPod himself, though he wasn't giving away any of his play lists. The lawyer for Apple Computer, Anthony Grabiner, denied his client had broken the 1991 agreement, saying it has used the name merely to distribute music.

Even a moron in a hurry could not be mistaken about that, he said. Musically, his iTunes choice was a little more high brow.

(SOUNDBITE OF MUSIC, VIVALDI'S GLORIA)

GIFFORD: It is obvious that Apple Computer is not the source of content like Vivaldi's Gloria, he said. But many legal experts in London seem to have their money on Apple Core, in part because of the 1991 contract dividing up uses of the name. David Hooper is a partner at law firm Reynolds, Porter, Chamberlain.

DAVID HOOPER: The general view seems to be that the court should uphold this contract, because it was freely entered into between the parties. There've been previous disputes. These terms were carefully and negotiated, and unless you exclude future forms of technology, if you make an agreement in such wide terms, you would expect the court to uphold Apple Core's case.

GIFFORD: This is not the only legal problem facing Apple Computer. A French consumer group is trying to force Apple to allow its iTunes site to download onto portable devices made by its competitors.

Rob Gifford, NPR News, London.

(SOUNDBITE OF SONG, "LE FREAK")

CHIC: (Singing) Have you heard about the new dance craze? Listen to us, I'm sure you'll be amazed. It's thought to be heard by everyone, it's up to you, it surely can be done. Young and old are doing it, I'm told. Just one try and you too will be sold. It's called the freak, they're doing it night and day. And now, we'll show you the way.

MONTAGNE: This is NPR News. Transcript provided by NPR, Copyright NPR.