Jun 29th, 2013, 1:25 am

Apple will appear in court today to face possible charges over allegations that the company conspired with publishers to fix e-book prices.





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Apple Chief Executive Tim Cook denies allegations that the company fixed e-book prices.




SANTIAGO — In New York today, United States government lawyers will face off against Apple in an attempt to prove that the company secretly worked with publishers to raise the prices of e-books.


The case was filed by the Justice Department in April 2012, pinning Apple, as well as five of the six largest American book publishers, against the rumored charges that the two parties worked together to illegally break Amazon.com Inc’s hold on e-books by raising the prices of the e-books from Amazon’s average price of US$10 to US$14 or US$15 per title.


While it is clear that Apple worked with these companies – Pearson Plc’s Penguin Group, News Corp’s HarperCollins Publishers Inc, CBS Corp’s Simon & Schuster Inc, Hachette Book Inc, and MacMillan – over-pricing e-books, the tech company will face the court alone today, as all publishing companies already agreed to get rid of wholesale discounts and collectively pay US$164-million.


According to David Balto, a former policy director for the US Federal Trade Commission, “This case will effectively set the rules for internet commerce.” Should Apple be found guilty of price fixing by the federal court, it may also face the state attorney general and consumers in a separate trial.


US District Judge Denise Cote will hear the case today without a jury. Said Cote, “I believe that the government will be able to show at trial direct evidence that Apple knowingly participated in and facilitated a conspiracy to raise prices of e-books.”


Though Cote appears confident that the company will be found guilty, since the charges were filed a year ago, Apple’s response has been defensive and stubborn. “We’re taking a very principled position on this,” commented Apple Chief Executive Tim Cook. “We were asked to sign something that says we did do something, and we’re not going to sign something that says we did something we didn’t do. And we’re going to fight.”


Among Apple’s defensive moves leading to trial has been throwing Amazon.com Inc under the bus, alleging that some documents redacted by Amazon may reveal that the retailing company had also considered the same pricing model. As Apple and Amazon are direct competitors in the e-book market (iPad vs Kindle readers), Apple is hoping to ensure that any possible handicaps resulting from the trial do not yield any advantages for its competitor. Commented Apple’s attorney, “Amazon seeks to shield from public disclosure evidence that undermines [the Justice Department's case].”


And while this long-awaited trial has received significant national and international attention, analysts say that consumers have not felt much of a difference. Prices have gone down slightly for some titles, but it is not possible to determine whether this is a direct result of the lawsuit.


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






Jun 29th, 2013, 1:25 am