Apple settles lawsuit against Corellium as iOS platform dictatorship looks more precarious

Challenge to VMs abandoned amid legal and regulatory threats

Updated Apple has agreed to settle its copyright lawsuit against Corellium, a Florida-based provider of iOS virtual machines and other developer-oriented services.

The iBiz sued Corellium two years ago, after abandoning an attempt to acquire the firm, claiming its virtual iPhones – used for security research and mobile development – infringe its copyrights and violate the anti-circumvention provision (section 1201) of the US Digital Millennium Copyright Act.

On December 29 Judge Rodney Smith of the Southern District of Florida ruled in part for Corellium, finding that its virtualized iOS devices qualify as fair use under copyright law. The judge, however, allowed Apple to continue pursuing its DMCA claim that Corellium's software unlawfully bypasses Apple's security.

As of Tuesday, the companies were wrangling in legal filings about how the case would be described to prospective jurors during the jury selection process of the trial, scheduled to begin next week.

Apple objected to the wording of Corellium's proposed statement because "it discusses Corellium’s defenses in an argumentative fashion," ostensibly contrary to court requirements.

Though the two companies were at odds on how to describe their dispute, they nonetheless managed to resolve their differences, as first reported by The Washington Post. The terms of the settlement have not been disclosed.

Corellium did not respond to a request for comment.

In its complaint, Apple challenged Corellium's claim that its virtualized iOS devices enhance security.

"Although Corellium paints itself as providing a research tool for those trying to discover security vulnerabilities and other flaws in Apple’s software, Corellium’s true goal is profiting off its blatant infringement," Apple said in its amended complaint [PDF].

"Far from assisting in fixing vulnerabilities, Corellium encourages its users to sell any discovered information on the open market to the highest bidder."

Corellium meanwhile countered that Apple was seeking to monopolize security research related to its products.

"Corellium’s technology does what Apple clearly wants to prohibit any entity from doing – open up the security research and application development fields to third parties," the security firm argued in its answer to Apple's complaint [PDF].

"Why else would Apple introduce new exclusive devices for security researchers and then – within days – file this lawsuit against Corellium? To stifle competition by preventing Corellium from offering third party researchers a more efficient alternative."

A bridge too far?

In a blog post, David Heinemeier Hansson, creator of Ruby on Rails, co-founder of Basecamp and HEY, and occasional Apple antagonist, speculated that the lawsuit was a bridge too far for the beleaguered iDevice maker.

"Apple has been taking on too many fights on too many fronts," he said, arguing that the company, despite its deep pockets, cannot take on everyone at a time when regulators are looking seriously at the company's business practices.

Apple has been taking on too many fights on too many fronts

Apple may have something to say on the subject. But if so, the company's rumored comms staff remained as unresponsive as ever – we tossed an inquiry over the transom and have not heard back.

Soon, Judge Yvonne Gonzalez Rogers of the Northern District of California is expected to decide whether Apple has been abusing its control over its App Store ecosystem, as alleged by Epic Games. The outcome of that decision, if unfavorable to Apple and upheld through any appeals, could reshape the mobile software market.

US lawmakers, however, may transform the competitive landscape before the legal process plays out. On Wednesday, Senators Marsha Blackburn (R-TN), Richard Blumenthal (D-CT), and Amy Klobuchar (D-MN) introduced a law bill [PDF] called the Open Markets Act that, if enacted, will change everything.

The bill limits the ability of companies with app stores that have more than 50m users (e.g. Apple, Google, and Microsoft, among others) from implementing anticompetitive platform rules and it requires those app stores to support the installation (side-loading) of apps from outside the store. ®

Updated to add on August 17

Apple has filed an appeal in its lawsuit against Corellium.

While some parts of the lawsuit were settled – those involving the DMCA – other parts involving copyright were thrown out by the judge, and now Apple is seeking to overturn that dismissal to keep its legal fight against Corellium going.