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Antitrust Law

Apple vows appeal after judge's 'stern rebuke' of e-book strategy

Apple has promised to appeal a judge’s ruling Wednesday that the company colluded with five major U.S. publishers to drive up e-book prices as it entered the market in 2010.

“Apple did not conspire to fix e-book pricing and we will continue to fight against these false accusations,” an Apple spokesman tells the Wall Street Journal. “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.”

The Journal characterized Wednesday’s 160-page ruling (PDF) by U.S. District Judge Denise Cote as a “stern rebuke” to Apple’s electronic sales strategy. The antitrust ruling was a win for the Justice Department, which claimed Apple agreed with publishers to set higher prices to compete with Amazon. All the publishers have settled with the Justice Department and a separate suit brought by state attorneys general.

Noting that no one publisher could risk acting alone, Judge Cote found that “Apple created a mechanism and environment that enabled them to act together in a matter of weeks to eliminate all retail price competition for their e-books.”

Cote, of the Southern District of New York, further opined that, the “evidence is overwhelming that Apple knew of the unlawful aims of the conspiracy and joined that conspiracy with the specific intent to help it succeed.”

Read the opinion here.