Apple granted final approval for $450 million ebooks settlement despite judge’s concerns

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Following preliminary approval it received in August, Apple has been granted the final court approval it needed in its $450 million ebook settlement, according to a Reuters report.

During a hearing in Manhattan, U.S. District Judge Denise Cote approved what she called an “unusual” accord. It calls for Apple to pay $400 million to as many as 23 million consumers if the company’s appeal of a ruling finding it liable for antitrust violations is unsuccessful.

U.S. District Judge Denise Cote previously expressed concern over the proposed settlement citing a clause in the agreement that she called “most troubling”, but today called the settlement agreement “within the range of those that may be approved as fair and reasonable.” Read more

Apple provides update on government requests as tech companies reach settlement with DOJ

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Just a few days later after Apple CEO Tim Cook expressed his thoughts about the NSA and data collection transparency, Apple has posted an update to its website with new information regarding account data requests. The company’s press release comes as US Department of Justice comes to a settlement with technology companies over how they are allowed to disclose information about government data requests.

A statement from the DOJ explains the agreement will allow “detailed disclosures about the number of national security orders and requests issued to communications providers, and the number of customer accounts targeted under those orders and requests including the underlying legal authorities.” Due to these new guidelines, Apple has now been able to report FISA and National Security Letters separate from law enforcement requests as show in its graphics above and below.  It also notes the new data released today replaces the U.S. data from its Feb. 5 2013 Report on Government Information Requests.

Apple-National-Security-orders-02Apple has been working closely with the White House, the U.S. Attorney General, congressional leaders, and the Department of Justice to advocate for greater transparency with regard to the national security orders we receive. We believe strongly that our customers have the right to understand how their personal information is being handled, and we are pleased the government has developed new rules that allow us to more accurately report law enforcement orders and national security orders in the U.S.

Apple CEO Tim Cook said in a recent interview that he would push congress for more transparency regarding controversial surveillance programs and how companies can disclose information related to information requests. At the time, Cook said that there was much the company couldn’t speak about due to gag orders:

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Apple granted temporary relief from external monitor in ebooks antitrust dispute

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In what is quickly becoming the next big ongoing back and forth between Apple and [insert third party here] of 2014, a new development has unfolded in the antitrust dispute over Apple’s iBooks practices. Michael Bromwich, the external monitor assigned to ensure Apple complies to antitrust laws relating to its iBooks program, has been temporarily removed, Reuters reports, following an “administrative stay” granted to Apple following a recent complaint filed by the Cupertino tech company against the attorney.

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Using Steve Jobs email as evidence, DOJ says Apple changed in-app purchase policy to retaliate against Amazon

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As first spotted by GigaOm, the US Department of Justice has submitted a revised remedy proposal in the ongoing ebook case that previously found Apple guilty of conspiring with publishers to control ebook pricing. While much of the proposal remains the same as the proposal it first submitted at the beginning of this month, the report points out that the DOJ has added more information and a Steve Jobs email as an exhibit showing that Apple changed its in-app purchasing policies specifically “to retaliate against Amazon for competitive conduct that Apple disapproved of.”

While referencing the email above in which Steve Jobs and Apple marketing chief Phil Schiller discuss forcing Amazon to go through Apple’s payment system, the DOJ claims Apple “misrepresented the factual circumstances” since it allows other retailers to bypass its 30% cut: Read more

DOJ says publishers once again colluding as Apple faces ITC/patent cases today

This afternoon, Apple and the DOJ will be in court to decide the fate of the agency model implementation in the iBookstore. The court has already ruled that Apple has been working with publishers to price-fix and raise the prices of ebooks, but now a punishment must be determined.

This morning, the DOJ responded to publishers’ concerns about the remedies and claimed that, since they are even responding together, they have shown once again how they are banded together (PDF of full response – via GigaOM):

Indeed, the very fact that the Publisher Defendants have banded together once again, this time to jointly oppose two provisions in the Proposed Final Judgment that they believe could result in lower ebook prices for consumers, only highlights why it is necessary to ensure that Apple (and hopefully other retailers) can discount ebooks and compete on retail price for as long as possible.

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DOJ proposes settlement in Apple ebook price fixing case: end current agreements, link to other stores

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After reaching settlements with just about every publisher involved in the long-running Apple/Amazon e-book price fixing case, The United States Department of Justice today published its proposal to end the case with Apple after finding the company guilty of conspiring to fix ebook prices during trial earlier this month:

“The court found that Apple’s illegal conduct deprived consumers of the benefits of e-book price competition and forced them to pay substantially higher prices,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division.  “Under the department’s proposed order, Apple’s illegal conduct will cease and Apple and its senior executives will be prevented from conspiring to thwart competition in the future.”

Among the key points in the proposal: Read more

US DOJ/States wins e-book pricing case against Apple, damages to follow

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Update: Apple provided a comment to AllThingsD and confirmed it will appeal the decision:

“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.”

Reuters reports that a judge just ruled that Apple conspired to raise the retail prices of e-books and said a trial for damages will soon follow:

The decision by U.S. District Judge Denise Cote[pictured, right] in Manhattan is a victory for the U.S. government and various states, which the judge said are entitled to injunctive relief. The publishers have already settled with the federal government on e-book pricing. Cote ruled after a non-jury trial that ended on June 20.

Apple warned that a guilty verdict in its e-book price-fixing case could have a negative impact on how digital media deals are negotiated in the US and Apple CEO Tim Cook even called the suit ‘bizarre':

The e-book case to me is bizarre. 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. … So we’re going to fight.

The DOJ had argued that Apple had conspired to raise prices with all of the publishers and hurt rival Amazon.

Interestingly, according to the NYTimes, one of the most damning pieces of evidence in the government’s case is the video below of Steve Jobs talking with Walt Mossberg. Per Daring Fireball: Mossberg asks Jobs why someone would buy a book for $14.99 from the iBookstore when they could buy the same book from Amazon for $9.99.

Jobs: Well, that won’t be the case.

Mossberg: Meaning you won’t be $14.99, or they won’t be $9.99?

Jobs (smiling): The prices will be the same.

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DOJ publicizes its case against Apple on first day of ‘ebook pricing fix’ trial

(via AP)

(via AP)

The U.S. Department of Justice has released its case against Apple in the alleged ‘ebooks pricing fix’ case (via CNET) that claims Apple made deals with book publishers to manipulate the price of ebooks.

The Justice Department believes Apple moved to raise ebook prices before Apple launched the iPad and the iBookstore so the company could benefit at the cost of the consumer.

Notably, everyone mentioned in the complaint has settled out of court ahead of this week’s trial, but Tim Cook has remained adamant that Apple is innocent of any wrongdoing.

Apple’s iBookstore has established deals with all of the major book publishers and sells ebooks on its proprietary store for viewing on Apple’s iOS devices including the iPhone, iPad, and iPod touch.

As we noted this morning, Tim Cook echoed this message at last week’s D11 conference:

The e-book case to me is bizarre. 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. … So we’re going to fight.

The Justice Department released all 81 slides outlining its case against Apple, which you can view in its entirety below. Read more

Apple’s to DOJ: Publishers already decided to fix prices before iBookstore came along

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In the ongoing e-book price fixing case with the Department of Justice, in which Apple is accused of conspiring with publishers to fix eBook pricing and cut out Amazon, Apple has again responded to the DOJ’s claims detailing the “tough negotiations” it went through with publishers. To further prove its point that it was not colluding with publishers to fix e-book pricing, Apple said it “one-on-one” and “contentious negotiations” at a time when publishers were already considering methods of getting Amazon to increase pricing: Read more

Apple calls DOJ settlement with publishers unlawful, says trial is necessary

The U.S. Department of Justice announced a settlement in April with three of the publishers involved in the eBook price-fixing antitrust suit against Apple. Hachette, HarperCollins, and Simon & Schuster were part of the settlement, which would allow Amazon to return to its previous wholesale model and the publishers to set and reduce prices for eBook titles freely. PaidContent provided an update today on the case by reporting Apple has filed a document with the Southern District of New York. It called the proposed settlements with the three publishers “fundamentally unfair, unlawful, and unprecedented.” Apple argued that since it is not settling, the settlement would unlawfully end contracts those publishers have with Apple.

The proposed settlement would require the three settling publishers — HarperCollins, Hachette and Simon & Schuster — to terminate their existing agency pricing contracts with Apple. Apple says that isn’t fair: “The Government is seeking to impose a remedy on Apple before there has been any finding of an antitrust violation.” This case, the company states, revolves around “an alleged conspiracy to force Amazon to adopt agency.” So a settlement “enjoining collusion or precluding publishers from forcing agency on Amazon would be appropriate,” but Apple is entitled to defend its contracts in court.

Apple is hoping the courts decide to reject the settlements or delay a ruling until after the June 2013 trial. Apple also discussed Amazon’ role in the case. It claimed the government has “unwittingly placed a thumb on the scales in favor of Amazon”:
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Cue on agency model: ‘I don’t think you understand. We can’t treat newspapers or magazines any differently than we treat FarmVille.”

By now you probably know that the U.S. Department of Justice launched an antitrust lawsuit against Apple and two publishers this month following an investigation into Apple’s eBook pricing agency model. Three publishers, including Hachette, HarperCollins, and Simon & Schuster, decided to reach a settlement with the Department of Justice to return to Amazon’s set-your-own price wholesale model. Meanwhile, Apple, Macmillan, and Penguin will take the fight to court.

Interestingly, a report from The Wall Street Journal, which is owned by the HarperCollins’ parent company News Corp, suggested Apple was only ever trying to continue its App Store business model. The Wall Street Journal’s L. Gordon Crovitz described visiting Senior Apple Executive Eddy Cue to discuss changing Apple’s policies for publications. He quoted Cue as comparing book pricing to apps and not wanting to treat publications differently than app developers:
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Analysts: Apple has a strong case in DOJ’s lawsuit over eBook price-fixing

Yesterday, the U.S. Department of Justice filed a lawsuit against Apple and five other publishers over eBook price-fixing. The Department of Justice reached a settlement with three of the publishers in the suit, but Apple, MacMillan, and Penguin are standing strong (the U.S. is also after Simon and Shuster). Yesterday, MacMillan’s CEO released a letter on the matter and explained why the publisher chose not to settle. In the note, he said the Department of Justice’s settlement demands “could have allowed Amazon to recover the monopoly position it had built before our switch to the agency model.” He also said it is “hard to settle a lawsuit when you know you have done no wrong” and called the agency model the future of an “open and competitive market.”

As CNET noted, the Department of Justice may have a more difficult case against Apple. For one, Apple does not have a strong-hold in the eBook market, because Amazon has the commanding lead with its Kindle sales. The Department of Justice has a case against the publishers rather—and that is most likely why three of them have already chosen to settle. Apple only holds open the store, while publishers are the ones who choose the prices to set.

The settlement reached with three of the publishers yesterday is said to give them “freedom to reduce the prices of their e-book titles,” which allows Amazon to go back to its previous wholesale model.

A key point that the Department of Justice is using in its lawsuit is when all five of the publishers met together at a hotel in London to talk over eBook prices. Apple was not present at the meeting, so this may give the Department of Justice a harder time to press the Cupertino-based Company. Of course, the Department of Justice could still come out victorious, but it may have to dig a little deeper against Apple than it did with publishers. We are sure there will be more out of this case as time goes on.

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