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Patent Lawsuits, App Store Refund Fuss Bug Apple

Patent Lawsuits, App Store Refund Fuss Bug Apple
March 26, 2009 2:25PM

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Lawsuits and fears of developer bankruptcy are keeping Apple, Inc. busy. Affinity Labs and Accolade Systems have filed patent-infringement lawsuits for Apple's iTunes and the iPhone's camera. Another fuss has erupted about whether developers are liable for a full refund on Apple's App Store applications. Amid it all, a free app for students debuted.


Apple is all over the news this week, for better or worse. Two lawsuits have been filed against the company, a hubbub is brewing over the App Store refund policy, and a new application rolled out in the midst of it all.

First the lawsuits. Affinity Labs has filed suit against Apple for allegedly infringing on the 772 patent entitled Audio System and Method by "selling digital Relevant Products/Services audio through the iTunes software application on a personal computer Relevant Products/Services and through the iTunes mobile Relevant Products/Services software application on the iPhone and iPod touch line of products."

Affinity also alleges Apple has infringed on its patents that cover the System and Method for Communicating Selected Information to an Electronic Device and Content Delivery System and Method. Affinity is seeking financial recompense and a court order to stop Apple from violating its intellectual property.

iPhone Under Legal Fire

In a double whammy, Accolade Systems is also suing Apple. Accolade alleges that Apple is violating its patent indirectly by using CMOS image sensors in the iPhone's camera. Specifically, Accolade says Aptina Imaging and Micro are violating its CMOS sensor patent. Apple uses those technologies in its iPhone.

Apple wasn't immediately available to comment on the lawsuits.

"The fact that there are lawsuits against Apple is no surprise. If you want to sue someone, you go after someone with deep pockets, and it appears that Apple is the target of a lawsuit almost on a regular basis," said Michael Gartenberg, a vice president at Interpret. "At the end of the day the courts will decide which, if any, of these suits have any merit."

The App Store Refund

The next controversy centers on the App Store. Reportedly, the developer agreement could drive developers into bankruptcy if Apple decides to enforce it. News reports indicate a clause in the developer agreement concerning refunds. It seems the developer may have to return the full price paid to a user who decides to return the application within 90 days of the download.

Apple retains 30 percent from each application sold on its App Store.

"There are people who claim to have seen certain things. It's not something I've heard any developer talk about or that any named developer has talked about. So at this point you kind of have to treat the developer-agreement claims with skepticism," Gartenberg said. "It may be true. It may not be true. Until some developers are willing to go on record and discuss what the terms are, it's hard to say what's going on here."

Differentiating the iPhone

Amid the drama, yet another application is making its way into the App Store. Blackboard on Thursday released a free application that lets iPhone and iPod touch users access student course information Relevant Products/Services wherever and whenever they prefer. This application aims to help students engage in the educational experience by creating learning opportunities that are not bound by time or place.

"We continue to see more and more innovation coming from application developers," Gartenberg said. "The one thing that's clear is the next big wave of adoption is largely going to be driven by a critical factor: How does my phone differentiate itself from other phones through third-party software that gives it special functionality? This is where Apple is putting in a lot of time and effort and where it also appears to be yielding significant results."

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