Apple Takes eBook Price Fixing Case to the Supreme Court

| News

Apple is taking its fight to overturn a ruling that it engaged in a price fixing conspiracy to the U.S. Supreme Court. U.S. District Court Judge Denise Cote ruled in 2013 that Apple did, in fact, work with publishers to artificially raise the price of books—a claim the company has steadfastly denied.

Apple turns to Supreme for ebook price fixing rulingApple turns to Supreme for ebook price fixing ruling

Apple along with publishers Penguin, MacMillan Simon & Schuster, HarperCollins, and Hachette Book Group were named in a Department of Justice lawsuit claiming the companies worked together to push up the price of books by forcing resellers to charge set prices instead of buying wholesale and determining their own prices. The publishers settled out of court to avoid potentially devastating fines, but Apple stood its ground and squared off against the DOJ in court.

In the end, Judge Cote ruled in favor of the DOJ and placed a court appointed monitor in the company to ensure it didn't engage in anticompetitive practices. Putting a monitor in Apple's offices was an unprecedented move because the company didn't agree to allow it, and monitors are typically used when there's a long history of related violations.

In this case, Apple was accused of conspiring with publishers ahead of the original iPad launch in 2010 to drive up book prices. Amazon did—and still does—control the book market by selling titles below cost. Competitors can't absorb the losses that go along with price matching Amazon, and publishers were facing what they feared was an unsustainable business model.

Barnes & Noble executives said they were working with other publishers to put together the agency-style deals Apple championed before the iPad maker approached them, and Penguin CEO David Shanks said Apple seemed to have a "take it or leave it attitude" towards getting into the ebook reselling market. Both testimonies seem to back up the notion that Apple wasn't a ring leader in a publisher-wide price fixing conspiracy, but Judge Cote clearly didn't see it that way.

Apple's appeals in the case have so far failed, leaving the U.S. Supreme Court as its final option in the fight to overturn Judge Cote's ruling. The company's filing said, "This case... presents issues of surpassing importance to the United States economy," according to Fortune. It goes on to say that Apple was trying to break into a market Amazon controlled, and that working these deals was a necessary part of that.

Apple filed a motion on Wednesday asking for a 30-day extension on its formal submission, which would change the deadline to October 28, because other Supreme Court assignments its legal team is dealing with.

Once the request is presented to the Supreme Court, the judges must then decide if they're willing to hear the case or leave the lower court's ruling in place. Assuming the Supreme Court does take on the case, there isn't any guarantee they'll side with Apple and overturn Judge Cote's ruling. Apple is arguing that Judge Cote ruled incorrectly based on the evidence presented, and now it's hoping it can convince the Supreme Court it's right. That is, of course, assuming the Justices agree to hear the case.

Popular TMO Stories



Graphic doesn’t match the article. Unless somehow Samsung is in this fight…


Love it!!! The funny thing is, with the pro-business SCOTUS that is in place, Apple has I’d guess a 70-80% chance of winning (if the case is heard).


I doubt the SC will take up this case.


If both Apple & Amazon were to sell that same book, and Amazon was cheaper, wouldn’t iPad users just use iOS Kindle reader app and buy from Amazon ?

Log in to comment (TMO, Twitter or Facebook) or Register for a TMO account