Court to Psystar: Hand over the missing docs

Fri, May 8, 2009

Legal, News

A few days ago, Apple filed a motion with the court seeking to compel Psystar to hand over financial documents pertaining to revenues, profits, purchase receipts, and invoices.  Psystar responded by saying that it wasn’t in possession of the documents sought by Apple, and that some of mentioned financial records didn’t even exist.

In a somewhat dubious series of claims, Psystar asserted that a) it lost pertinent documents in a move and b) it doesn’t keep basic financial records such as profit/loss statements because they’re a relatively new and small company.  Not surprisingly, the court didn’t buy what in my opinion was blatant BS and granted Apple’s motion to compel.

Psystar has until May 18 to produce the following array of documents:

  • All the underlying documents used to prepare the June 2008 profit and loss statement and balance sheet bates stamped PS010327-328, to the extent the documents have not been produced
  • All the underlying documents used or being used to prepare the aggregated financial statement referenced in Psystar’s opposition letter brief
  • All of the tabulations created by Jennifer Perez regarding the components needed to build Psystar’s products
  • Documents bates stamped PS01383-2000
  • Bank statements for all of Psystar’s accounts from Commerce Bank and TD Bank from April 2008 through September 2008.  To the extent that said statements are not immediately in the possession of Psystar either in physical or electronic form, Psystar shall ask Commerce Bank and TD Bank for these statements on an every other day basis until Commerce Bank and TD Bank provide said statements
  • A copy of all attachments to all previously produced emails and a copy of the corresponding email in hard copy or in electronic form

Apple had also complained that during his deposition, Psystar president Rudy Pedraza was curiously unable to recall even basic financial information about the company he’s in charge of running.  Consequently, Apple requested that Psystar make available for deposition, at their own expense, an individual who could answer those questions.

In regards to the above request, the court again sided with Apple, and Psystar has until June 3, 2009 to provide a Psytar representative capable of speaking about and knowledgeable of Psystar’s financials.

All in all, Psystar was on the receiving end of a legal beatdown from the court.  Well maybe that’s a bit extreme, but the bottom line is that the court simply isn’t buying into Psystar’s overtly half-ass attempts to skirt around Apple’s discovery requests.

I think that once Apple gets a hold of Psystar’s bank statements, things will get real interesting real quick (I’ve of course bought into the theory that some person or company is bankrolling Psystar’s operation).

Related: What Psystar might be trying to hide from Apple

Related: The Psystar Myth – Not as cheap as advertised



9 Comments For This Post

  1. brock Says:

    Its pretty obvious who this will reveal.

    If they don’t have the financial info being asked for they are in for more legal trouble. This time it will be the government stepping in. Haha.

  2. Howard Says:

    I think it’s ridicuous, they’re a tiny company and Apple wants all these massive financial records, I bet STEVE didn’t keep these kinds of records in his garage when they started Apple

  3. @ Howard Says:

    “I think it’s ridicuous, they’re a tiny company and Apple wants all these massive financial records, I bet STEVE didn’t keep these kinds of records in his garage when they started Apple”

    Umm… but Steve wasn’t stealing other people’s software and installing it on dubious-quality hardware…

    And “all these massive financial records” are actually pretty fundamental to any business–even businesses in garages have a shoebox full of paper saying, basically, “We owe X, people owe us Y, therefore we’re making (or losing) Z.”

    It boggles the mind to think that ANY company director couldn’t have at least a basic idea of that…

  4. Jocca Says:

    This is a small company most likely acting at the behest of a huge company with the intent to force Apple to be opened up to the clone market. Apple will not do so because it is the surest way for these predatory box makers to cannibalize its carefully managed, vertically integrated product lines. The company is not interested in market share for the sake of market share. It is intent on protecting its main and most important asset from being dragged down into a line of cheap looking boxes. Apple to this date has spent billions of dollars acquiring and refining MacOS X. Psystart should not be allowed to get away with this blatant behavior because if it succeeds, the Chinese box makers are going to step in and have a field day taking over everything with their even cheaper way of making boxes. Apple intellectual property will be wide open to cannibalization by everybody and will be destroyed in the process. It is one thing to buy a copy of Leopard and install it on an individual PC, so long as you do not start a MacOS clone business in the process. Who knows if Psystar is not receiving money from these foreign companies even. It is a tiny company and it is spending a lot of money battling one of the most successful electronic company on the planet and I for one am very interested in finding what is Psystar’s financial basis which allows it to behave like this. Its outrageous explanation that it does not keep any of its financial records is very revealing of a company trying to hide information big time. I am sure that the big boys behind it want it that way too and I am glad that the judge is seeing a pattern emerging from Psystar ridiculous assertions. For one thing everybody living in this country has to report taxes. I as a private non-business entity keeps record of my financial affairs carefully because I don’t want to open myself up to some unpleasant run in with the IRS. Psystar as a business entity has to report taxes on a quarterly basis and it is hard to believe that these guys do not keep track of the money coming in and out of their outfit. Therefore neither the judge nor Apple are satisfied with its lame and pathetic explanations.

  5. JS Says:

    ” I think it’s ridicuous, they’re a tiny company and Apple wants all these massive financial records, I bet STEVE didn’t keep these kinds of records in his garage when they started Apple”

    What planet are people like you from?

  6. david Says:

    this is a bizarre case.

  7. Joe Says:

    I hope Apple crushes the shit out of these thieves. And yes, if they find who is behind this BS, I hope Apple goes after those responsible for Psystar to keep this case bankrolled.

  8. Terrin Says:

    Wow, small companies don’t have bank statements?

  9. Demon Says:

    You own a tiny company and you think and then thumbed your nose at a company that is not a huge company but plays a competitive game with the big boys because it’s easier to sell a product that will generate free publicity just offering it as opposed to just OEMing Windows and having a Linux option of two that Microsoft wouldn’t like if you really started making a stink, started cutting into DELL, HP and some of the other big boys market-shares. By offering Mac OS an OS that they have no license to resale and no license to OEM Install, then they take a Robinhood type stand on the issue. They knew full well from day one that any legal action is going to end up in court and their financial records will be examined under a Microscope. It doesn’t matter if the operation is out of a Garage or a $10 Billion assembly plant. The facts are they knew what they were doing they knew and even invited the legal fight if I remember correctly “Their claim was that Apple had an illegal Monopoly on Mac OS and they were in the right and they would win in court.
    The time for court came and Psystar hires one of the most expensive law firms in Silicon Valley to represent them. Is Psystar really selling enough computers (all OS versions combined) to pay their legal fees. Carr & Ferrell LLP are not known for being generous to it’s clients for not paying their legal fees on time. Nor are they known for their small business discount rates or pro bono work for financially strapped companies.
    Who stands to benefit the most for dilution of the Mac OS and the Apple Brands?
    Microsoft – Not really, Clones of Mac OS just puts more pressure on MS Windows Share.
    Dell – Maybe but, so much of their bread is butter by Microsoft the Dell Board would stroke out if Microsoft even became a tiny bit upset at Dell.
    Tiger Direct – Has the motive after Apple Spanked them in court over Apple’s Use of the word Tiger to identify a Mac OS X release. When Apple restructured it’s reseller and distribution channel the first time after Jobs was made iCEO. Tiger Direct lost it’s Apple Authorized reseller status, Tiger Direct was also one of the largest resellers of all the other Mac Clone systems the Mac Clones (& upgrades) made up about 70% or more of it’s sells about 5% was Apple’s Macs (& upgrades), about 20% of it’s sells were in software with a big chunk of that being Mac Software and the rest was Windows based PC’s. Loosing the Mac Clones, then the Mac, and attempting to move your business from a high profit segment to a low margin everyone sells them and everyone else is selling more so they are selling them for less.
    Tiger Direct is also a Miami, Florida based company. So, If I were going to bet on a Psystar backer I’d be betting on Tiger Direct connections. If Psystar Wins in a freak some how Tiger Direct will either Buy Psystar or will start selling it’s Mac OS Clones.

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