Judge Denies Apple’s Motion to Dismiss Antitrust Lawsuit

The judge presiding over the antitrust lawsuit against Apple and AT&T denied the defendants motion to dismiss the case. The lawsuit is seeking US$1.2 billion in damages because the iPhone is locked to AT&T's wireless network.

Judge James Ware of the United States District Court for the Northern District of California ruled that the plaintiffs in the case had shown sufficient monopolization of the iPhone voice and data services aftermarket and therefore denied the motion to dismiss.

Filed on behalf of Paul Holman in the State of Washington and Lucy Rivello in California, the lawsuit claims that Apple released iPhone software update 1.1.1 specifically to disable unlocked SIM cards. Applying the update would "brick" any phone that was unlocked or unauthorized by Apple and AT&T.

Apple did warn users a few days before the update was released that unlocking the phone could render it inoperable when future software updates were applied.

The judge also denied Apple's motion to dismiss the computer trespass claim. Apple argued the trespass claim only applies when there is an uninvited intrusion into a users computer. But even with the warning from Apple before applying the iPhone 1.1.1 update, the court said the plaintiffs claims could not be conclusively dismissed.

Act. Magnuson-Moss requires warrantors to "clearly and conspicuously disclose [warranty terms] in a single document in simple and readily understood language." Apple filed a motion to have this dismissed as well, but the court ruled that even though Apple warned users of the risks of installing version 1.1.1, "such a later disclaimer runs afoul of the single document rule."

One of Apple's motions was granted. A motion to dismiss a charge of unfair and deceptive trade practices was granted by the court.

Judge Ware also denied AT&T's motions to compel arbitration, a motion to dismiss and a motion to stay discovery.

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