The Law Office of Lynnette Ariathurai A Professional Corporation

Apple to defend itself in contract dispute in California court

Most transactions in the economy are based upon some type of legal contract. Companies and individuals depend upon contracts to keep their end of the bargain. However, sometimes an individual may believe that a company has not fulfilled the terms of a contract for services or products. This is what happened in a recent contract dispute involving Apple, which is being litigated in a federal court in California.

The dispute centers on how Apple sold the final season of the hit show "Breaking Bad" to its customers on iTunes. The company sold a "season pass" for access to the show's final season to its iTunes customers. Apple's advertising included all current and upcoming episodes of the show's fifth season. The company allegedly advertised this for a one-time fee of $21.99 for high-definition, while charging $13.99 for a standard definition version.

However, the company decided to split up the last season into halves, thus creating two separate seasons. The customers who had already purchased the fifth season with the season pass were then required to pay for access to the second half of the fifth season. The company argued in court that the second half of the fifth season was considered a different season and, therefore, should not be considered a part of the terms of the contract between the company and its iTunes customers.

After a failed attempt to move for dismissal of the complaint, Apple will now have to prepare to defend itself for a trial in federal court in California. However, there could be various legal defense arguments available for the company to use in the breach of contract dispute. Also, the burden will be on the plaintiff to prove the allegations in the class-action lawsuit. On the other hand, if the plaintiff does succeed, it can be costly to the company, since all members of the class will be able to receive monetary reimbursement.

Source: Courthouse News Service, "Apple Fails to Neutralize 'Breaking Bad' Dispute", Elizabeth Warmerdam, Sept. 5, 2014

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