Digital Rights Management and Technology Supersector Index Essay

Submitted By lisalu267
Words: 797
Pages: 4

The following graph shows a five-year comparison of cumulative total shareholder return, calculated on a dividend reinvested basis, for the Company, the S&P 500 Index, the S&P Computer Hardware Index, and the
Dow Jones U.S. Technology Supersector Index. The graph assumes $100 was invested in each of the Company’s common stock, the S&P 500 Index, the S&P Computer Hardware Index, and the Dow Jones U.S. Technology
Supersector Index as of the market close on September 30, 2008. Data points on the graph are annual. Note that historic stock price performance is not necessarily indicative of future stock price performan
Item 3. Legal Proceedings
The Company is subject to the various legal proceedings and claims discussed below as well as certain other legal proceedings and claims that have not been fully resolved and that have arisen in the ordinary course of business. In the opinion of management, there was not at least a reasonable possibility the Company may have incurred a material loss, or a material loss in excess of a recorded accrual, with respect to loss contingencies.
However, the outcome of legal proceedings and claims brought against the Company is subject to significant uncertainty. Therefore, although management considers the likelihood of such an outcome to be remote, if one or more of these legal matters were resolved against the Company in a reporting period for amounts in excess of management’s expectations, the Company’s consolidated financial statements for that reporting period could be materially adversely affected. See the risk factor “
The Company could be impacted by unfavorable results of legal proceedings, such as being found to have infringed on intellectual property rights
” in Part I, Item 1A of this
Form 10-K under the heading “Risk Factors.” The Company settled certain matters during the fourth quarter of
2013 that did not individually or in the aggregate have a material impact on the Company’s financial condition and results of operations.
The Apple iPod iTunes Antitrust Litigation (formerly Charoensak v. Apple Computer, Inc. and Tucker v. Apple
Computer, Inc.); Somers v. Apple Inc.
These related cases were filed on January 3, 2005, July 21, 2006 and December 31, 2007 in the United States
District Court for the Northern District of California on behalf of a purported class of direct and indirect purchasers of iPods and iTunes Store content, alleging various claims including alleged unlawful tying of music and video purchased on the iTunes Store with the purchase of iPods and unlawful acquisition or maintenance of monopoly market power under §§1 and 2 of the Sherman Act, the Cartwright Act, California Business &
Professions Code §17200 (unfair competition), the California Consumer Legal Remedies Act and California monopolization law. Plaintiffs are seeking unspecified compensatory and punitive damages for the class, treble damages, injunctive relief, disgorgement of revenues and/or profits and attorneys fees. Plaintiffs are also seeking digital rights management free versions of any songs downloaded from iTunes or an order requiring the
Company to license its digital rights management to all competing music players. On September 3, 2013, the
U.S. Ninth Circuit Court of Appeals upheld the District Court’s dismissal of the indirect purchaser case, Somers
v. Apple Inc. The remaining