The dispute over Apple’s alleged price-fixing of e-books comes to a head today as a case brought against the company by the U.S. Justice Department in 2012 goes to trial in federal court in Manhattan.
Apple is accused of conspiring with book publishers to raise prices on e-books via the iBookstore. The Justice Department claims that a set of agreements between publishers and Apple constitute a violation of the Sherman Anti-Trust Act.
Those agreements, primarily signed in 2010 around the launch of the iPad, were designed to combat Amazon’s hold on the e-book market at the time.
Apple was originally charged alongside book publishers Hachette, HarperCollins, MacMillan, Penguin and Simon & Schuster. The five publishers chose to settle with the Justice Department, leaving Apple as the sole defendant for the case that starts today.
Apple, for its part, has denied any wrongdoing.
“Apple did not conspire to fix eBook pricing,” spokesman Tom Neumayr said in a statement issued last month. “We helped transform the eBook market with the introduction of the iBookstore in 2010 bringing consumers an expanded selection of eBooks and delivering innovative new features. The market has been thriving and innovating since Apple’s entry and we look forward to going to trial to defend ourselves.”
According to statements made by Tim Cook, who called the case “bizarre,” the opposition to settlement with the government is philosophical.
“We’re not going to sign something that says we did something that we didn’t do, so we’re going to fight,” Cook said at last week’s D11 conference.
Opening the trial this morning, a lawyer for Apple echoed Cook’s statements, according to an Associated Press report from the courtroom.
While Apple’s chief may believe Apple didn’t do anything wrong, the judge assigned to the case, Denise Cote, has already indicated that she disagreed.
“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, and that the circumstantial evidence in this case, including the terms of the agreements, will confirm that,” Cote said, according to a Reuters report on a pretrial hearing about the case.
In the event Apple loses the case, the company may be fined up to $100 million under the provisions of antitrust law.
What do you think? Has Apple run afoul of federal law?