Mikey CampbellU.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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Wesley Hilliard
AppleInsider Staff
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83 Comments
Apple better have it's ducks in order and considering his track record, I don't think Mr Sewell is up to the task. [URL=http://forums.appleinsider.com/image/id/169077/width/512/height/512][IMG]http://forums.appleinsider.com/image/id/169077/width/512/height/512[/IMG][/URL]
Good
Maybe the first thing they can discover is the net effect of Apple's entry into the eBook market. Prices have either fallen, risen or remained the same. The price of ALL eBooks should be included not just a few examples which may have had discounts applied in the past. It is up to the free market to decide fair prices, not the government to dictate them.
It[quote name="hill60" url="/t/150863/apple-e-book-price-fixing-trial-set-for-2013#post_2133047"]Maybe the first thing they can discover is the net effect of Apple's entry into the eBook market. Prices have either fallen, risen or remained the same. The price of ALL eBooks should be included not just a few examples which may have had discounts applied in the past. It is up to the free market to decide fair prices, not the government to dictate them.[/quote] And is ok for Apple to set prices like when they set the price for songs? The prices of ebooks have risen, fallen, and remained the same. That leads me to believe that Amazon was under-pricing some while over-pricing others. There's nothing wrong with the agency model but there's a problem when one agreement conflicts with another.
Please don't say "cheaper price" A price doesn't cost anything. A price is either "high" or "low", and therefore "higher" or "lower".