March 28, 2024

Judge Issues Injunction Against Apple in E-Books Case

U.S. District Judge Denise Cote in Manhattan said Apple could not enter into agreements with five major U.S. publishers that would impede its ability to reduce e-book retail prices or offer price discounts.

The judge also said she would appoint an external monitor to review Apple’s antitrust compliance policies, procedures and training for two years.

The terms of the judgment will expire after five years, but Cote’s order allows for extensions in one-year increments if necessary.

The injunction followed a July 10 ruling by Cote finding Apple conspired with five publishers to undermine e-book pricing established by the dominant retailer in the market, Amazon.com Inc.

The five publishers, all of which have settled with regulators, include Lagardere SCA’s Hachette Book Group Inc, News Corp’s HarperCollins Publishers LLC, Penguin Random House LLC, CBS Corp’s Simon Schuster Inc and Verlagsgruppe Georg von Holtzbrinck GmbH’s Macmillan.

The U.S. Justice Department, which sued Apple in April 2012, had initially sought an even broader injunction that could have touched on the company’s agreements with suppliers of other types of content, such as movies, music and TV shows.

But Cote had made clear at a hearing last week that she would not go that far, saying she wanted the injunction “to rest as lightly as possible on how Apple runs its business.

The Justice Department nonetheless welcomed the injunction.

“Consumers will continue to benefit from lower e-books prices as a result of the department’s enforcement action to restore competition in this important industry,” Assistant Attorney General Bill Baer said in a statement.

Apple said on Friday that it would appeal the injunction.

“Apple did not conspire to fix e-book pricing,” said company spokesman Tom Neumayr. “The iBookstore gave customers more choice and injected much-needed innovation and competition into the market.”

Shares of Apple were down 0.1 percent at $494.64 in morning trading.

The case is U.S. v. Apple Inc et al, U.S. District Court, Southern District of New York, No. 12-02826.

(Reporting by Nate Raymond in New York; Editing by Gerald E. McCormick and Lisa Von Ahn)

Article source: http://www.nytimes.com/reuters/2013/09/06/business/06reuters-apple-ebooks.html?partner=rss&emc=rss

U.S. Settles With Macmillan in E-Books Case

Macmillan and the Justice Department filed the proposed settlement, which requires a judge’s approval, in U.S. District Court in Manhattan.

A small firm that is also known as Holtzbrinck Publishers LLC, Macmillan was the lone holdout among five publishers that the government sued in April 2012. Three publishers settled immediately and the fourth, Pearson Plc’s Penguin Group, settled in December.

The Justice Department will continue to litigate conspiracy allegations against Apple Inc, the department said in a statement. It accuses Apple of conspiring with the publishers to raise prices and fight the dominance of Amazon.com Inc.

Apple rejects the allegations, saying it did not collude but signed agreements with publishers individually. Apple has also said in court papers that the government’s suit “sides with monopoly, rather than competition,” by shoring up Amazon’s early advantage in electronic books.

A civil trial for Apple is scheduled to begin in June.

Bookseller Barnes Noble Inc has sided with Apple, telling the federal court that it, too, is concerned about a monopoly by Amazon.

Macmillan Chief Executive John Sargent was a defiant critic of the suit, saying when it was filed that his company did not collude and that settlement terms required by the Justice Department “would have a very negative and long term impact on those who sell books for a living.”

Sargent did not immediately return a message left at his office on Friday. Macmillan is a unit of Verlagsgruppe Georg von Holtzbrinck GmbH, based in Germany.

Under the proposed settlement agreement, Macmillan must lift restrictions on discounting by e-book retailers and must report to the Justice Department its communication with other publishers.

Justice Department lawyers “expect the prices of Macmillan’s e-books will also decline,” as happened after settlements with the other publishers, Jamillia Ferris, chief of staff of the department’s Antitrust Division, said in the news release.

(Editing by Gerald E. McCormick, Nick Zieminski and Dan Grebler)

Article source: http://www.nytimes.com/reuters/2013/02/08/business/08reuters-usa-ebooks-macmillan-settlement.html?partner=rss&emc=rss