Apple is fighting a request for a deposition given by its late founder, Steve Jobs. The deposition, which relate to Apple’s relationship with Universal Music Group, would unveil trade secrets and cause damage to the company, Apple says.
A class action lawsuit between Universal Music Group and musicians, including Rob Zombie and the estate of Rick James, alleges that UMG has underpaid royalties on digital downloads and ringtones. The artists want such downloads to be treated as “licenses” rather than “sales” — and hence subject to higher royalty rates.
The plaintiffs submitted a discovery request for a 2010 deposition given by Steve Jobs as part of an earlier case against Aftermath Records. That company is a division of UMG, and was sued by F.B.T. Productions, who produced many of Eminem’s songs.
At issue there was how digital music should be treated — either as a sale or a license. The designation had far-reaching effects, since sales and licenses were reimbursed differently under recording contracts, many of which were written before digital downloads in general (and iTunes in particular) became wildly popular.
The 9th Circuit Court of Appeals reversed a lower court ruling and sided with the plaintiff, saying “a contract between the parties should be read as treating digital music as ‘licenses’ rather than ‘sales,’” noted The Hollywood Reporter.
UMG believes that the appeals court ruling applies narrowly, only to that particular case and contract.
Jobs’s testimony was veiled in secrecy from the start. When he gave the deposition, the judge made many people leave the courtroom, including employees of Universal Music Group.
The courtroom was again closed when the deposition was read to the jury. At this point, Apple contends, it doesn’t see why this deposition is needed.
