Apple’s top dealmaker Eddy Cue told a federal court that he and Steve Jobs, Apple’s then chief executive, expected that its deal with book publishers would encourage them to change their contracts with retailers such as Amazon.com and allow them to increase prices.

The Department of Justice alleges that Mr Cue, a 24-year Apple veteran, was the “chief ringleader of the conspiracy” between the tech group and publishers to fix ebook prices, which led to consumers paying “dramatically” higher prices for digital books.

When Apple launched its iPad device and iBookstore in 2010, Amazon controlled nearly 90 per cent of an ebook market in which publishers were increasingly angered by the $9.99 price point the etailer charged for ebooks. The DoJ alleges that publishers struggled to increase prices on their own and that Apple saw the opportunity to gain a foothold in the market by creating a scheme to help.

Before Apple entered the market, publishers had sold ebooks to retailers such as Amazon through a wholesale model. Amazon bought the books for $10 and would sell them to consumers for $9.99 – breaking even on the sale.

After meeting publishers, Mr Cue proposed a so-called “agency model”, where the publishers would set the prices and Apple would take a 30 per cent cut. But to ensure that Apple would be competitive with other retailers, Mr Cue said Apple introduced the “most favoured nation” clause to contracts, where Apple would be able to match the ebook prices with other retailers.

Lawyers from the DoJ presented a draft email to Mr Cue from Jobs in which he said he could live with the agency model as long as the publishers agreed to move Amazon on to a similar arrangement. Mr Cue said he did not remember receiving the email.

An excerpt from Jobs’ biography was also presented in court. “So we told the publishers, ‘We’ll go to the agency model, where you set the price and we get our 30 per cent and, yes, the customer pays a little more but that’s what you want anyway’,” Jobs is quoted as saying. “So they went to Amazon and said, ‘You’re going to sign an agency contract or we’re not going to give you the books’.”

During his testimony, Mr Cue said that neither he nor Jobs knew for certain that publishers would change their contracts with Amazon but that was the outcome they had both expected.

Mr Cue presented himself as a newcomer to the book industry who reached agreements with publishers after hard-fought negotiations with the goal of selling ebooks at the lowest prices available on the market. He said he was not aware of meetings and dinners between publishing executives nor a series of phone calls between them during the negotiations.

An email exchange between Jobs and a college student was also introduced during Thursday’s proceedings. Weeks after the launch of the iPad, Sethh Humphrey told Jobs that he was an owner of both an Apple computer and a Kindle, Amazon’s reader, and that Apple’s “strong arming Amazon into raising ebook prices” was “detrimental to his reading as a college student”.

Jobs replied three hours later, saying that it was the publishers raising prices, not Apple.

In response, Mr Humphrey said that the price increase came after Apple allowed publishers to set their own prices. “Greed does not beget most, even for those at the top,” he wrote.

Jobs responded, again within hours, asking: “How do we stop the publishers from setting their own prices and terms?”