Apple loses US court appeal on ebook price-fixing decision

1 July 2015 Books+Publishing

In the US, the Second Circuit Court of Appeals has upheld Judge Denise Cote’s 2013 finding that Apple conspired to fix ebook prices with publishers, reports Publishers Weekly. Cote previously ruled that Apple colluded with HarperCollins, Simon & Schuster, Penguin, Macmillan and Hachette to fix ebook prices when it launched its iPad and iBookstore in the US in 2010. The appeals court endorsed Cote’s verdict, saying it was ‘amply supported and well-reasoned’. Apple’s appeal argued that Judge Cote’s finding was evaluated as a ‘per se’ case, which meant the US Department of Justice only needed to prove that price-fixing occurred, and that this was presumed to be anti-competitive without accounting for the pro-competitive effects on the market. Judge Dennis Jacobs, who dissented on the ruling, agreed that it should not have been evaluated as a ‘per se’ case: ‘Apple took steps to compete with a monopolist and open the market to more entrants … [its] conduct was eminently reasonable’, wrote Jacobs. The majority opinion, written by Judge Debra Ann Livingston on behalf of the court, rejected Jacobs’ argument: ‘Plainly, competition is not served by permitting a market entrant to eliminate price competition as a condition of entry, and it is cold comfort to consumers that they gained a new e-book retailer at the expense of passing control over all e-books to a cartel of book publishers.’ Apple is now assessing its options, which could include an appeal to the Supreme Court. Should the verdict be upheld at the Supreme Court, Apple will have to refund consumers US$400 million, as per their settlement deal.

Category: International news