U.S. Proposes Termination of Apple Publisher Agreements
By Phil Mattingly - Aug 2, 2013 10:10 AM ET
Apple Inc. (AAPL), the world’s biggest technology company, should be ordered to terminate agreements with five publishers in the wake of a federal judge’s ruling that it conspired to fix prices of electronic books, the U.S. Justice Department told the court.
The Justice Department, along with 33 state attorneys general, submitted the proposal today in U.S. District Court in Manhattan. Its plan would require a court-appointed external monitor and allow competitors to provide links from their electronic book applications to their electronic bookstores.
A digital book is displayed on an Apple Inc. iPad for a photograph in New York. Photographer: Scott Eells/Bloomberg
“Under the department’s proposed order, Apple’s illegal conduct will cease and Apple and its senior executives will be prevented from conspiring to thwart competition in the future,” Bill Baer, the assistant attorney general in charge of the department’s antitrust division, said in a statement.
U.S. District Judge Denise Cote ruled on July 10 in the suit brought by the Justice Department that Apple lost the case and would face a trial to set damages. The proposal submitted today would require court approval.
The U.S. sued Apple and five of the biggest publishers in April 2012, claiming the maker of the iPad pushed publishers to sign agreements letting it sell digital copies of their books under a model that raised prices and harmed consumers.
In that so-called agency model, publishers, not retailers, set book prices, with Apple getting 30 percent.
The case is U.S. v. Apple Inc., 12-cv-02826, U.S. District Court, Southern District of New York(Manhattan).
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