Friday, June 22, 2012, 09:22 pm PT (12:22 am ET)
Apple e-book price fixing trial set for 2013A U.S. judge on Friday said that Apple will go to trial in 2013 over alleged collusion with a number of major publishing houses to fix the price of e-books sold through the iBookstore.
U.S. District Court Judge Denise Cote of the Southern District of New York said that Apple and two publishers will face a United States antitrust lawsuit in a bench trial on June 3, 2013 that will decide whether the companies conspired to fix e-book prices before the iPad was launched in 2010, reports Reuters.
The U.S. government first leveled its antitrust suit against Apple and the two publishing houses in early April following a Department of Justice investigation into the matter. Apple denies the allegations and goes further, saying that it broke up Amazon's purported e-book monopoly. Amazon was, and still is, the predominant leader in the e-book market thanks in part to the company's Kindle line of eReaders.
Fighting alongside Apple are Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck GmbH, and the Pearson-owned Penguin Group. The original U.S. complaint named five publishers, but News Corp's HarperCollins Publishers Inc, CBS Corp's Simon & Schuster Inc and Lagardere SCA subsidiary Hachette Book Group all settled out of court.
At the heart of the trial is Apple's so-called "agency model" which allows publishers set e-book pricing under a "most favored nations" clause that disallows them to sell the content to other resellers at a cheaper price. The system is the polar opposite of Amazon's "wholesale model" which allows retailers to set below-cost prices in hopes of drumming up sales.
The agency model is more attractive to publishers that have been stung by the quick adoption of relatively inexpensive e-books, though some argue that the scheme is anticompetitive and harms consumers. A number of class-action lawsuits have sprung up regarding the matter in both the U.S. and Canada.
Noted in the government's filing was an email from Apple founder Steve Jobs which is being used, some say improperly, as evidence to Apple's collusion.
The iPad maker appears up to the challenge and sought out a trial itself shortly after the government filed the antitrust suit.
According to court documents the government is giving nine months for fact discovery with a deadline set for March 22, 2013, a period deemed fair for an antitrust case of this size.
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