Apple guilty of conspiracy to fix e-book prices, judge rules
APPLE has been found guilty of ebook price-fixing by the US Department of Justice. The trial began after the tech giant was accused of colluding with five major publishers to raise the price of ebooks in late 2009.
In his ruling, US District Judge Denise Cote said: "Apple played a central role in facilitating and executing that conspiracy. Without Apple's orchestration of this conspiracy, it would not have succeeded as it did."
A further trial will be arranged to allot damages. The publishers accused have already settled their claims, with Penguin paying $85m (£49m); Hachette, HarperCollins and Simon & Schuster setting aside $69m for customer refunds, and Macmillan settling for $26m.
After the publishers agreed to settle out of court, Apple chief Tim Cook claimed "We've done nothing wrong there, and so we're taking a very principled position. We're not going to sign something that says we did something we didn't do."
During the trial, Apple's lawyer Orin Snyder said that if the company was found guilty it would "send shudders through the business community."
Evidence in the trial included extracts from Steve Jobs' own biography, detailing how Amazon "screwed up" the market by paying the wholesale price for books - selling them below cost at $9.99. Jobs then describes how he gathered a consortium of publishers to raise prices:
"So they went to Amazon and said, 'You're going to sign an agency contract or we're not going to give you the books.'"
In her ruling Judge Cote said that the evidence brought before her showed "a clear portrait of a conscious commitment to cross a line and engage in illegal behaviour."
She continued: "Compelling evidence of Apple's participation in the conspiracy came from the words uttered by Steve Jobs, Apple's founder, CEO, and visionary. Apple has struggled mightily to reinterpret Jobs's statements in a way that will eliminate their bite. Its efforts have proven fruitless."
Apple have since announced that they intend to appeal the decisions, with company spokesman Tom Neumayr giving the following comment to tech blog All Things D: "Apple did not conspire to fix ebook pricing and we will continue to fight against these false accusations.
"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 and we will appeal the judge's decision."