Apple Won’t Get a Break in E-Book Lawsuit
Apple (NASDAQ:AAPL) has failed to get the U.S. Justice Department’s antitrust lawsuit against it and several booksellers over the pricing of e-books dismissed. The Department had sued Apple and five book publishers in the U.S. District Court in New York in April, alleging they conspired to raise the price of e-books. In a written ruling, U.S. District Judge Denise Cote said on Tuesday that as alleged in the complaint, “it is presumed that the conduct by all parties would be unlawful under the rule of reason.”
Of the five publishers, Hachette, HarperCollins (NASDAQ:NWSA), and Simon & Schuster (NYSE:CBS) have already settled, and Macmillan and Penguin (NYSE:PSO) are now the only ones fighting alongside Apple.
“We allege that these executives knew full well what they were doing,” Sharis Pozen, the acting head of the Justice Department’s antitrust division, had said at the time of the filing of the case. “That is, taking steps to make sure the prices consumers paid for e-books were higher.”
Amazon (NASDAQ:AMZN), which despite not being directly involved in the legal case has been portrayed as the victim of the alleged price setting, had cheered the lawsuit when it was first filed. “This is a big win for Kindle owners, and we look forward to being allowed to lower prices on more Kindle books,” the company said in April. The three companies that settled were required to allow Amazon and Barnes & Noble (NYSE:BKS) to reduce the price of the books they sold.
Earlier, it was revealed that evidence linking Apple co-founder Steve Jobs to the alleged price setting conspiracy had been presented to the court. According to the complaint, Jobs told a publishing executive to join Apple in creating “a real mainstream e-books market at $12.99 and $14.99.”
The government has said that the price-fixing took place in early 2010 as Apple was introducing its iPad, and e-book prices went up an average of $2 to $3 in a three-day period.
The judge has scheduled the next pre-trial hearing for June 22.
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