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Final Court Approval for Apple's $450M eBooks Collusion Settlement

By Christmas Games - Saturday, November 22, 2014

Apple's $450M eBooks Collusion Settlement
Yorker News - Despite the peculiar nature of Apple's ongoing e-book lawsuit, a U.S. district judge allowed Apple yesterday to pay $450 million over claims that it had colluded with several publishers to increase the prices of electronic books.

U.S. District Judge Denise Cote referred to the case as "highly unusual," but nonetheless, she approved the agreement, which would have Apple paying $400 million to up to 23 million consumers, plus about $50 million in legal fees.  Apple is currently appealing Cote's decision, and if it is successful in its appeal to overturn the conviction, it will not be liable for any monies.  A retrial would have Apple paying a reduced amount of money as its settlement.

Prior to the decision, Apple had agreed to settle in June, as federal officials in 33 states and territories had chased the company for up to $840 million, due to the collusion with the publishers. With the agreement in place, Apple is allowed to contest Cote's previous ruling in July 2013 that had found Apple guilty of violating antitrust laws when it schemed with the publishers to undercut competitors such as Amazon by raising e-book prices.

The complaint alleges that Apple had teamed up with HarperCollins, Hachette Book Group, Penguin Group, Simon & Schuster, and Macmillan in 2009-10 to set e-book prices in an effort to thwart Amazon's erstwhile domination of the e-book space.  At that time, Apple had just introduced its iPad tablet, which was considered a competitor of sorts to Amazon's Kindle e-book reader.  Amazon was selling most popular titles at $9.99, which did not sit well with Apple and the aforementioned publishers, who then agreed to price these titles at $12.99 or $14.99.  Apple would eventually win a case that included a proviso allowing it to match the prices of competing retailers, Amazon included.

A federal appeals court will be hearing Apple's appeal on Monday, December 15.

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