Supreme Court rejects Apple’s appeal over e-book price fixing
The turning of pages is demonstrated on the Apple iPad, which launched in 2010 with an emphasis on its e-book collection.
The Supreme Court rejected an appeal from Apple Inc. on Monday, leaving in place a ruling that Apple conspired with publishers to raise electronic book prices when the company sought to challenge Amazon.com’s dominance of the market.
The justices’ order lets stand an appeals court ruling that found Apple violated antitrust laws in 2010.
Cupertino, Calif.-based Apple wanted to raise prices to wrest some book sales away from Amazon, which controlled 90% of the market and sold most popular books online for $9.99. Amazon’s share of the market dropped to 60%.
The 2-1 ruling by the New York-based appeals court sustained a trial judge’s finding that Apple orchestrated an illegal conspiracy to raise prices.
In that June decision, Judge Debra Ann Livingston wrote that Apple pressured publishers to band together to prevent price drops for books, both electronic and print. Apple had leveraged publisher frustration with Amazon’s $9.99 e-book pricing, she said.
The publishers then “combined forces to grab control over price,” she wrote, referring to Simon & Schuster, HarperCollins, Macmillan, Penguin and Hachette.
“A coordinated effort to raise prices across the relevant market was present in every chapter of this story,” she added.
Judge Dennis Jacobs disagreed, writing in a dissent that Apple joined with publishers as the only way to force a lower barrier to the e-book industry.
“No one publisher alone could counter Amazon,” he wrote. “Apple’s conduct … was unambiguously and overwhelmingly procompetitive.”
Apple disagreed with the ruling at the time and denied that it fixed e-book prices.
The Justice Department and 33 states and territories originally sued Apple and five publishers. The publishers all settled and signed consent decrees prohibiting them from restricting e-book retailers’ ability to set prices.
In settlements of lawsuits brought by individual states, Apple has agreed to pay $400 million to be distributed to consumers and $50 million for attorney fees and payments to states.
The case is Apple v. U.S., 15-565.
Times staff writers contributed to this report.
