Apple Guilty in Ebook Price-Fixing Conspiracy
A judge rules that the consumer tech giant colluded with five publishers to help drive up the price of ebooks from $9.99 to as much as $14.99.Apple conspired with five publishers to fix the prices of ebooks when the technology giant entered the Amazon-dominated market in 2010, according to a federal judge. U.S. District Court Judge Denise Cote's July 10 ruling came after a three-week trial in June, during which federal prosecutors argued that Apple played a central role in a conspiracy with the publishers to drive up the prices of ebooks beyond the $9.99 set by Amazon, the dominant ebook seller at the time. Cote said the federal government and several states that acted as plaintiffs in the case were entitled to injunctive relief. The date for a trial to determine damages will be set later. In her 160-page ruling, the judge rejected claims by Apple's attorneys that the consumer tech giant should not be held responsible for any price fixing that the publishers may have done, and that Apple executives were unaware that the publishers—after meeting with Apple regarding ebooks and the company's upcoming iPad tablet—threatened to withhold books from Amazon.
"Without Apple's orchestration of this conspiracy, it would not have succeeded as it did in the Spring of 2010," Cote wrote. "Apple and the Publisher Defendants shared one overarching interest—that there be no price competition at the retail level. Apple did not want to compete with Amazon (or any other ebook retailer) on price; and the Publisher Defendants wanted to end Amazon's $9.99 pricing and increase significantly the prevailing price point for ebooks. With a full appreciation of each other's interests, Apple and the Publisher Defendants agreed to work together to eliminate retail price competition in the ebook market and raise the price of ebooks above $9.99."