Judge Proposes External Monitor in Apple eBooks Case
August 28, 2013 12:49 PM
Apple said this would be "extremely costly and burdensome"
The judge overseeing Apple's eBooks trial may force the Cupertino-based company to hire an external monitor to prevent further antitrust issues -- and
Apple isn't happy
U.S. District Judge Denise Cote in Manhattan suggested that an external monitor be used to review Apple's internal antitrust compliance program and recommend any changes. She could also require annual antitrust training for employees in Apple's eBooks businesses.
Apple, however, doesn't see the need for an external monitor. It even said that having one would be "extremely costly and burdensome."
But Cote's external monitor suggestion seems a lot more lenient than previous ideas. Cote said a final injunction would not restrict Apple from agreements with suppliers of other types of content (like movies, music and TV shows), and that a provision that would allow other e-book retailers to post a link to their websites or e-bookstores via an e-books app without having to pay Apple was unnecessary.
Cote said she would wait for the parties to offer suggestions for "final language" for her injunction, but she is expected to deliver an injunction next week.
Last month, Apple -- which was the only company to go to trial regarding eBooks while the book publishers had already settled with the DOJ -- was found guilty of conspiring to raise eBook prices. U.S. District Judge Denise Cote handed down the ruling, saying that consumers and competitors were negatively affected by the arrangement Apple had with the book publishers.
The publishers include Hachette Livre (Lagardère Publishing France), Harper Collins (News Corp., U.S.A.), Simon & Schuster (CBS Corp., U.S.A.), Penguin (Pearson Group, United Kingdom) and Verlagsgruppe Georg von Holzbrinck (owner of inter alia Macmillan, Germany).
Earlier this month, the U.S. Department of Justice and 33 U.S. states and territories proposed that
Apple be banned
from entering anti-competitive eBook distribution contracts for five years; end its business models with the five publishers it conspired with; use an outside monitor to make sure that its antitrust policies are effective, and allow retailers like Amazon and Barnes & Noble to provide links to their options for two years.
However, the publishers
filed a motion
in U.S. district court in Manhattan regarding the proposals. The motion said that the proposals don't place any limitations on Apple's pricing behavior, but instead punishes publishers by preventing them from having agency agreements with Apple.
Just last week, the government decided to change its proposed injunction to cover just five years instead of 10 -- although they can obtain up to five one-year extensions if necessary.
Apple is expected to go to trial in
for eBooks damages.
"A lot of people pay zero for the cellphone ... That's what it's worth." -- Apple Chief Operating Officer Timothy Cook
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