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Apple settles e-book price fixing class action suit, dodges possible $840M in claims

post #1 of 26
Thread Starter 
In a court filing on Monday, an attorney representing the plaintiffs in a class action suit seeking damages from Apple's e-book price fixing scheme informed federal Judge Denise Cote that the company has agreed to settle.

Summation
Apple's closing slide in its e-book antitrust case. | Source: U.S. District Court


The letter addressed to Judge Cote was handed in by plaintiffs' representative Steve Berman, a well-known class-action attorney who told Bloomberg that all parties involved agreed to the settlement. This includes Apple, general consumers and state attorneys general representing citizens in 33 U.S. states and territories.

Details of the arrangement have not been revealed as the memorandum containing the specifics of the deal is sealed pending each party's preparation and filing of the final settlement agreement for preliminary approval by the court. All parties must file their version of the agreement within 30 days.

Judge Cote later filed an order recognizing the letter, effectively halting a trial scheduled for July that was set to determine damages suffered from Apple's e-book price fixing scheme. The class was seeking as much as $280 million in claims associated to the Cupertino, Calif. company's actions, which could have been trebled to $840 million.

Apple is in the process of appealing a ruling by the U.S. District Court for the Southern District of New York -- the same court overseeing the class-action suit -- that found the company guilty of colluding with major book publishers to falsely inflate pricing of content sold through the iBookstore.

The U.S. government leveled the suit after an investigation into Apple's "agency model" price structure, which operates on a "most favored nations" basis that disallows content owners to sell their wares to another retailer for a lower price. Apple's model ran counter to Amazon's "wholesale model" that allows retailers to buy content from publishers in bulk, then set resale prices at or below cost as they see fit.

As it stands, the settlement payable to state attorneys general and consumers announced today is contingent on the outcome of Apple's appeal.

Prior to today's settlement agreement, Apple attempted to dismiss or stay the class-action suit, but both motions were shot down by Judge Cote.

post #2 of 26
OK. Now Apple can focus on the Appeal of the "Amazon DOJ" case.
post #3 of 26
Pathetic!

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post #4 of 26

I highly recommend everybody boycott all Department of Justice products immediately.

 

Avoid justice at all costs.

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post #5 of 26
Originally Posted by GTR View Post

Avoid justice at all costs.

 

At times like this, I'm reminded of the statue of Justice at Dublin Castle.

 

You know, (well, not you. Ireland will know.) the one with her back to the city, sword raised, and with no blindfold.

Originally Posted by Slurpy

There's just a TINY chance that Apple will also be able to figure out payments. Oh wait, they did already… …and you’re already f*ed.

 

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Originally Posted by Slurpy

There's just a TINY chance that Apple will also be able to figure out payments. Oh wait, they did already… …and you’re already f*ed.

 

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post #6 of 26
Quote:
Originally Posted by Tallest Skil View Post

At times like this, I'm reminded of the statue of Justice at Dublin Castle.

You know, (well, not you. Ireland will know.) the one with her back to the city, sword raised, and with no blindfold.

You mean like as in a firing squad?

😉
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post #7 of 26
I think it would be a riot if the States settled their suit based on the notion that they wouldn't be able to double dip anyway after this DOJ case (which would likely force Apple to pay back every penny over $9.99 that anyone paid for a book since the iBooks store opened) and was set up in such a way that they couldn't try to sue again.

And then Apple won their appeal against the DOJ and didn't have to pay up to anyone.

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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post #8 of 26
Quote:
Originally Posted by charlituna View Post

I think it would be a riot if the States settled their suit based on the notion that they wouldn't be able to double dip anyway after this DOJ case (which would likely force Apple to pay back every penny over $9.99 that anyone paid for a book since the iBooks store opened) and was set up in such a way that they couldn't try to sue again.

And then Apple won their appeal against the DOJ and didn't have to pay up to anyone.

That would be sweet, but the DOJ and the courts have shown they will find Apple guilty no matter the evidence.
post #9 of 26
The DOJ and Judge Cote are simply evil when they go after Apple yet ignore the punishing monopoly that Amazon has and wields.
post #10 of 26

Apple was branded guilty before the trial began. It was just a farce. It is sad that Apple had to settle. Cote did Amazon proud. Hatchette is the first one that is being forced to bend over now. Things are going to get a lot worse.

post #11 of 26
This article uses bulk pricing in referring to the wholesale model. I never thought about it like that, but it makes even less sense, because bulk discounts were given to ensure inventory was sold in advance. When there is no physical product that model is useless.
post #12 of 26
Quote:
Originally Posted by charlituna View Post

I think it would be a riot if the States settled their suit based on the notion that they wouldn't be able to double dip anyway after this DOJ case (which would likely force Apple to pay back every penny over $9.99 that anyone paid for a book since the iBooks store opened) and was set up in such a way that they couldn't try to sue again.

And then Apple won their appeal against the DOJ and didn't have to pay up to anyone.

This settlement with the States won't be affected by any future Appeal results including even a total reversal, This is a settlement Apple agreed to and not one imposed on them by a court decree.
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post #13 of 26
Quote:
The class was seeking as much as $280 million in claims associated to the Cupertino, Calif. company's actions, which could have been trebled to $840 million.

 

Not if Dr. Dre has anything to say about it.

post #14 of 26
Quote:
Originally Posted by Gatorguy View Post

Quote:
Originally Posted by charlituna View Post

I think it would be a riot if the States settled their suit based on the notion that they wouldn't be able to double dip anyway after this DOJ case (which would likely force Apple to pay back every penny over $9.99 that anyone paid for a book since the iBooks store opened) and was set up in such a way that they couldn't try to sue again.

And then Apple won their appeal against the DOJ and didn't have to pay up to anyone.

This settlement with the States won't be affected by any future Appeal results including even a total reversal, This is a settlement Apple agreed to and not one imposed on them by a court decree.

Read the last part of the article. It explicitly says it is contengent on the outcome of Apple's appeal. Pretty sure Apple would ask for that.
post #15 of 26
Colluding plain and simple. Anyone who's raises my price on snything including Apple deserves it.
Rescuing greedy publishers from Amazon- not that's a pathetic excuse.
 
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post #16 of 26
Quote:
Originally Posted by Phone-UI-Guy View Post

Read the last part of the article. It explicitly says it is contengent on the outcome of Apple's appeal. Pretty sure Apple would ask for that.

Thanks for that! Just finished a read of the proposed settlement doc itself and you are 100% correct. 1smoking.gif
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post #17 of 26
Quote:
Originally Posted by pazuzu View Post

Colluding plain and simple. Anyone who's raises my price on snything including Apple deserves it.
Rescuing greedy publishers from Amazon- not that's a pathetic excuse.

Publishers should be able to set minimum prices for their own goods.
Who allowed Amazon to set market prices when they had a near monopoly?
post #18 of 26
Quote:
Originally Posted by pazuzu View Post

Colluding plain and simple. Anyone who's raises my price on snything including Apple deserves it.
Rescuing greedy publishers from Amazon- not that's a pathetic excuse.

Pathetic and greedy reply.
post #19 of 26
Injustice for all!

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #20 of 26
Quote:
Originally Posted by pazuzu View Post

Colluding plain and simple. Anyone who's raises my price on snything including Apple deserves it.
Rescuing greedy publishers from Amazon- not that's a pathetic excuse.

So use torrents to get free ebooks and steal library books, that way 'greedy publishers' get nothing.
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post #21 of 26

Considering that the damages trial was going to be under Judge Denise Cote, yeah, Apple saw the writing on the wall on this one. 

post #22 of 26
A lot of legal experts think that the District Court will uphold the verdict and when it's sent up to the Supreme Court, the ruling will be reversed. The Supreme Court tends not to buy into the monopoly approach that DOJ has been pushing when a company like Apple has such a small share of the ebook market. And Amazon's heavy-handed treatment of Hatchette and Warners in the last few weeks suggests that they already have too much power in the market.

If the Supreme Court overturns the ruling, Apple pays the States NOTHING. That would be sweet.
post #23 of 26

Many of those "greedy publishers" are on the edge of bankruptcy and Amazon's policies are driving them further under. As a result, publishers are reducing the already low advances they offer to most writers and avoiding books that aren't sure moneymakers.

It's easy to lump every company into the "greedy corporation" bucket. But Random House and Knopf are about as far from Exxon and Monsanto as you can get. And acting like all corporations are the same just hurts the writers who are trying to get by in their chosen profession.

post #24 of 26
Quote:
Originally Posted by genovelle View Post

This article uses bulk pricing in referring to the wholesale model. I never thought about it like that, but it makes even less sense, because bulk discounts were given to ensure inventory was sold in advance. When there is no physical product that model is useless.

 

Not really. Wholesale is basically buying a certain size lot for a better discount. For non-physical products it simply means you're committing to paying as if you've sold that lot. A lot of licensing deals work the same way, where you have a certain minimum guarantee of payment. The more you commit to, the better deal you get per piece. If a publisher gets Amazon to prepay for 100 000 copies sold and the product tank and they sell 20 000, the only real difference is that the retailer isn't stuck with 80 000 paperweights. 

post #25 of 26
Quote:
Originally Posted by hill60 View Post

So use torrents to get free ebooks and steal library books, that way 'greedy publishers' get nothing.

That's illegal and then I get sued. No thanks.
 
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post #26 of 26
Quote:
Originally Posted by TimT999 View Post

Many of those "greedy publishers" are on the edge of bankruptcy and Amazon's policies are driving them further under. As a result, publishers are reducing the already low advances they offer to most writers and avoiding books that aren't sure moneymakers.
It's easy to lump every company into the "greedy corporation" bucket. But Random House and Knopf are about as far from Exxon and Monsanto as you can get. And acting like all corporations are the same just hurts the writers who are trying to get by in their chosen profession.

And that's their own fault for not taking their houses under control and into the digital age with their own direct distribution or whatever.
Just like Kodak. Either adapt or bye, bye.
Too bad.
No tears shed.
 
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