Judge: Apple Violated Antitrust LawBy: Chris Crum - July 10, 2013
The U.S. District Court for the Southern District of New York ruled on Wednesday that Apple violated Section 1 of the Sherman Act by conspiring to raise e-book prices and hurt e-book retailer competition.
Reuters reports that U.S. District Judge Denise Cote cited “compelling evidence” that the company violated antitrust law and played a “central role” in said conspiracy. Quoting from the decision, Reuters reports:
“Apple chose to join forces with the publisher defendants to raise e-book prices and equipped them with the means to do so. Without Apple’s orchestration of this conspiracy, it would not have succeeded as it did.”
Apple, of course, intends to appeal the decision, with a company spokesperson saying:
“Apple did not conspire to fix e-book pricing. When we introduced the iBookstore in 2010, we gave customers more choice, injecting much needed innovation and competition into the market, breaking Amazon’s monopolistic grip on the publishing industry. We’ve done nothing wrong.”
Assistant Attorney General Bill Baer in charge of the Department of Justice’s Antitrust Division made this statement following the ruling:
“This result is a victory for millions of consumers who choose to read books electronically. After carefully weighing the evidence, the court agreed with the Justice Department and 33 state attorneys general that executives at the highest levels of Apple orchestrated a conspiracy with five major publishers – Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster – to raise e-book prices. Through today’s court decision and previous settlements with five major publishers, consumers are again benefitting from retail price competition and paying less for their e-books.
“As the department’s litigation team established at trial, Apple executives hoped to ensure that its e-book business would be free from retail price competition, causing consumers throughout the country to pay higher prices for many e-books. The evidence showed that the prices of the conspiring publishers’ e-books increased by an average of 18 percent as a result of the collusive effort led by Apple.
“Companies cannot ignore the antitrust laws when they believe it is in their economic self-interest to do so. This decision by the court is a critical step in undoing the harm caused by Apple’s illegal actions.
“I am proud of the outstanding work done by the trial team. The Antitrust Division will continue to vigorously protect competition and enforce the antitrust laws in this important business, and in other industries that affect the everyday lives of consumers.”
You can read the full decision below (via Jeff John Roberts):