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Apple Found Guilty of Conspiring to Fix Prices in E-Book Trial [Updated]

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MacRumors

macrumors bot
Original poster
Apr 12, 2001
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Reuters briefly reports that a U.S. federal judge has found Apple guilty of price fixing in the lawsuit brought by the U.S. Department of Justice and state governments.
A federal judge on Wednesday ruled that Apple Inc conspired to raise the retail prices of e-books, and said a trial for damages will follow.

The decision by U.S. District Judge Denise Cote in Manhattan is a victory for the U.S. government and various states, which the judge said are entitled to injunctive relief.
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The government had argued that Apple served as a "ringmaster" in conspiring with publishers to raise prices of e-books as part of an effort to change the business model of the industry and weaken Amazon's dominant position in the market. All of the publishers ultimately settled the case, but Apple fought to the end, insisting that it could not admit to doing something it did not do.

A separate trial will need to be held in order to determine damages to be levied against Apple.

We've uploaded the full 160-page decision by Judge Denise Cote for those interested in reading more.
The question in this case has always been a narrow one: whether Apple participated in a price-fixing scheme in violation of this country's antitrust laws. Apple is liable here for facilitating and encouraging the Publisher Defendants' collective, illegal restraint of trade. Through their conspiracy they forced Amazon (and other resellers) to relinquish retail pricing authority and then they raised retail e-book prices. Those higher prices were not the result of regular market forces but of a scheme in which Apple was a full participant.
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Update 7:13 AM: Unsurprisingly, Apple has announced that it will appeal the decision.
Apple spokesman Tom Neumayr says Apple didn't conspire to fix e-book pricing and would continue to fight the "false accusations." He says Apple brought much needed innovation and competition into the market in 2010.
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Article Link: Apple Found Guilty of Conspiring to Fix Prices in E-Book Trial [Updated]
 
Article Link
https://www.macrumors.com/2013/07/10/apple-found-guilty-of-conspiring-to-fix-prices-in-e-book-trial/
M

Macboy Pro

macrumors 6502a
Feb 16, 2011
730
52
This was OBVIOUS after the email from Jobs was released. I am not typically a fan of the word "greedy" to describe companies since they are in business to make money. Unfortunately Apple takes it to a new level, but they have been successful at it.

My guess is that they will pay less than they already paid their counsel.
 
S

samcraig

macrumors P6
Jun 22, 2009
16,779
41,982
USA
If you looked at the evidence (emails, time and date stamps, sequence of events, etc) there was little to no doubt this would not end well for Apple.
 
P

pmz

macrumors 68000
Nov 18, 2009
1,949
0
NJ
Yes, they did it. For a good reason.

Sometimes you have to take a stand to do what's right, even if you get in "trouble".

BTW, is anyone else sick of all this silly posturing of legal system against Apple? What is the point of all this? Besides making a few rich lawyers richer?

So what if Apple is levied a fine for, say, $20,000,0000. That would EXORBITANT, and yet would have no effect on anything. Apple would argue it down, cut a check, and everyone would move on.
 
ValSalva

ValSalva

macrumors 68040
Jun 26, 2009
3,783
259
Burpelson AFB
So this is the end of companies being able to hammer out deals behind the scenes. I guess companies collaborating is going to be a thing of the past :confused:
 
T

thepowerofnone

macrumors member
Apr 10, 2011
97
7
If I were Apple right now I'd be talking to my accounting department to determine how to compensate for whatever fine they get by no longer going beyond the bare minimum for US tax and copying the model they use in the rest of the world to dodge tax laws, at least until they recover the value of the fine (which I imagine will be large).
 
napabar

napabar

Suspended
Jun 12, 2008
316
513
Where did she get her law degree at? Night School with Luis Tully?

A publisher setting the price for an eBook in the iBookstore is no different than me, as a developer, setting the price for my app in the App Store.

#EpicFail
 
D

DotComCTO

macrumors 6502
Aug 17, 2006
311
41
Frankly, from what was reported, it looked like the government's case was falling apart - especially based on the testimony of execs from other companies. Very surprised at the decision.

--DotComCTO
 
I

ifij775

macrumors regular
Nov 6, 2012
154
0
Boston, MA
I chalk this up to "evil company theory", ie companies are evil and steal dollars out of your wallet. Lets sue over that!
 
Boston007

Boston007

macrumors 6502
Apr 9, 2010
458
145
DotComCTO said:
Frankly, from what was reported, it looked like the government's case was falling apart - especially based on the testimony of execs from other companies. Very surprised at the decision.

--DotComCTO
Click to expand...

That's because what's reported is never the full details of what goes on inside the trial.
 
S

Saturn1217

macrumors 65816
Apr 28, 2008
1,270
846
GOOD!

Excellent news. I doubt the damages will be that bad for Apple and I don't really want to see them punished but what they did was setting a dangerous precedent and it is good to see that corrected.

I was an avid Kindle user at the time that Apple introduced iBooks and their purchasing model and I remember quite clearly the outrage it caused me and many others on Amazon's discussion boards that all of a sudden ebook prices almost uniformly were hiked for kindle users even though we weren't participating in anyway in anything to do with Apple. It felt really wrong and I'm glad the judge agrees.

Damage is still probably already done though. I shop around for ebooks these days since I got a tablet (no more being locked to my kindle) and ebook prices are almost always set by the publisher and exactly the same for all stores. Sigh...
 
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