It may be a way to clean Apple's name after failing the eBook issue.
No, they will clear their name when the next higher court with a competent judge has to look at a case. The destruction caused by Amazon is clear for everybody to see.
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Why exactly is it illegal?
Just guessing: Like most things, mining tin can be done in a way that is clean and expensive, or cheap and dirty. If you do it cheap and dirty, you make a lot of profit and the dirt destroys the health and livelihood of your neighbours; plus you drive the companies that do it in a clean and expensive way without causing environmental damage out of business.
Since the country where this happens doesn't benefit if one company makes a million profit by causing ten millions in damages (to other people in the same country), it is made illegal.
In addition, that kind of business is very strongly against Apple's published principles, so it doesn't really matter whether it is legal or illegal; Apple would avoid doing business with them anyway. Like with employment situations, where Apple requires contractors to avoid things that Apple deems unacceptable, whether they are legal in that country or not.
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I might be wrong here, but I do not believe that it is right or correct to judge every other country in the world by what are currently american standards. For instance, there was a mention of apple firing a supplier because they were using child labor. That sounds really great on the surface, but is it really? What if those jobs were the only option for those children and without those jobs the children simply starve to death.
That idiotic opinion has come up and was refuted again and again. For a start, if your argument was right then by hiring a fifteen year old, that company would save a 15 year old but would be damning a 16 year old to starvation. In reality, there could be siblings, 15 and 16 year old, and the company hired the 15 year old to pay them less so that the family is actually worse off. Next, this is China; people are poor in many areas but not starving to death. Next, that 15 year old hasn't finished school, so by hiring him before he's got an education you are damning him to a life in poverty instead of giving him a chance to finish school and rising up. And last, it's illegal in China. So you are saying politicians in China are convicting the children of their country to starvation?