Apple Wants Trial in eBook Antitrust Lawsuit

By Alexandra Burlacu | Apr 20, 2012 09:49 AM EDT

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Last week, the anti-trust division of the U.S. Department of Justice (DOJ) accused Apple and five publishers of conspiring to break up Amazon's low-cost dominance of the e-book market. According to Reuters, Apple now wants to go to trial to defend itself against the DOJ's allegations, an attorney for Apple said in court on Wednesday.

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Two other publishers - Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck GmbH, and Pearlson's Penguin Group - also decided to go to trial on Wednesday, in the first hearing in the case.

"Our basic view is that we would like the case to be decided on the merits," Apple attorney Daniel Floyd told the U.S. District Judge Denise Cote, as reported by Reuters. "We believe that this is not an appropriate case against us and we would like to validate that." The next hearing is scheduled for June 22.

The issue of litigation seems to be far from over, especially since 15 U.S. states and the Commonwealth of Puerto Rico filed their own litigation last week and were reportedly in settlement talks with the three publishers. According to the Wall Street Journal, publishers HarperCollins and Hachette have already reached a tentative agreement with the states in question.

HarperCollins, Hachette Aim to Settle with All 50 States

At Wednesday's hearing, both HarperCollins and Hachette said they hoped to reach settlements with all 50 U.S. states within the next two months. "There could be something left of the class, or nothing left of the class," HarperCollins attorney Shepard Goldfein told the judge. An attorney for Simon & Schuster said the company was also in negotiations with the states, and it expects to reach a similar agreement.

According to the U.S. Government, the alleged price fixing tool place in 2010, when Apple introduced its iPad. The complaint further notes that e-book prices increased an average of $2 to $3 in just three days in early 2010.

Amazon Can Resume Discounting Books

The fact that three publishers have already settled will allow Amazon to resume its book-discounting practice, and will terminate the "most favored nation" contracts with Apple. HarperCollins Publishers Inc is owned by News Corp, Simon & Schuster is owned by CBS and Hachette Book Group is a subsidiary of Lagardere SCA.

HarperCollins and Hachette have also agreed to settle with a group of U.S. states, and will pay $1 million in restitution to consumers who purchased e-books. Simon & Schuster is still in talks with the states to join that settlement.

In a similar anti-trust investigation, the European Commission is also probing Apple and publishers. On Wednesday, the Commission said it has received settlement proposals from Apple, as well as from publishers Simon & Schuster, HarperCollins, Hachette Livre and Macmillan's parent company.

(reported by Alexandra Burlacu, edited by Dave Clark)

 

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