Judge Denise Cote, who ruled this summer that Apple’s agreements with publishers violated the Sherman Antitrust Act, has issued a five-year injunction against Apple that comes with a host of penalties. First and foremost, Apple will be prevented from entering into any contract with e-book publishers that contain “most favored nation” clauses, which were a key issue in the antitrust case. In addition, the company will have to renegotiate its contracts with the big five publishers who were Apple’s co-defendants in the antitrust case on a court-mandated schedule.
Furthermore, Apple will have to employ the services of a court-appointed antitrust monitor for the next two years, whose job will be to prevent the company from entering into other anticompetitive agreements.
The injunction does not, however, require that Apple allow competitors to sell e-books on iOS devices without paying Apple 30 percent of the sale price, something the Justice Department sought in its proposed remedies. That’s bad news for Amazon and Barnes and Noble, who would have had a much easier time selling their books through the iBookstore if the DoJ had its way.
Apple has said that it plans to appeal the decision. The injunction will go into effect in 30 days, unless Apple can secure a stay on it while seeking the appeal. The injunction can also be extended for one or more “one-year periods” if the judge deems such action necessary.
What do you think? Are Cote’s remedies fair punishment for Apple?