Apple Found to Violate Antitrust Law in E-Book Pricing
By David McLaughlin - Jul 10, 2013 9:07 AM ET
Apple Inc. (AAPL), the world’s biggest technology company, violated antitrust law by engaging in a scheme to fix the prices of electronic books, a federal judge ruled in a suit brought by the U.S. government.
U.S. District Judge Denise Cote, who tried the case without a jury, ruled against Apple in a decision filed today in federal court in Manhattan.
An Apple Inc. logo sits outside a new store ahead of its opening on Kurfurstendamm Street in Berlin. Photographer: Krisztian Bocsi/Bloomberg
“The plaintiffs have shown that Apple conspired to raise the retail price of e-books and that they are entitled to injunctive relief,” Cote said in her opinion. The judge ordered a trial on potential damages.
The U.S. sued Apple and five publishers in April 2012, claiming the maker of the iPad pushed publishers to sign agreements letting it sell digital copies of their books under what’s known as the agency model. Under that model, publishers, and not retailers, set prices for each book, with Apple getting 30 percent.
Apple, based in Cupertino, California, was the last defendant left in the case after the publishers avoided trial by settling.
The settling publishers are Verlagsgruppe Georg von Holtzbrinck GmbH’s Macmillan unit, CBS Corp.’s Simon & Schuster, Lagardere SCA’s Hachette Book Group, Pearson Plc’s Penguin unit and News Corp.’s HarperCollins. The No. 1 publisher, Random House Inc., wasn’t involved in the U.S. suit.
The case is U.S. v. Apple Inc. (AAPL), 12-cv-02826, U.S. District Court, Southern District ofNew York (Manhattan).
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