carnegie

vesalius said:

Some one needs to lecture Apple/Cook and the bad politics of evading ceo taxes. Apple and Tim offer opinions on a multitude of nonfinancial sociopolitical topics why not this one? 

In what way are they evading CEO taxes?

foregoneconclusion said:

I'm not sure this ruling will hold up under appeal. If the App Store isn't really a monopoly, why would Apple be disallowed from anti-steering clauses that are standard practice for web retailers and online sellers? 

A defendant doesn't have to have monopoly power to violate California's Unfair Competition Law in the way that they do in order to violate, e.g., certain parts of the Sherman Act.

Apple wasn't found to have violated the federal Sherman Act or even California's Cartwright Act.

This is a pretty long opinion with a lot going on in it. I haven't finished reading it yet, but on the whole I'd say this result is pretty good for Apple. It could have been better for Apple, and I disagree with some of Judge Rogers' reasoning, but if I were Apple I'd count this decision more as a win than a loss. My quick take is that Apple loses in some narrow strokes while it wins in the broad ones.

I'd also note that, as I read (what I've read so far of) the opinion and orders, Apple can continue to exclude Epic from the App Store based on Epic's breach of contract. It looks like Apple is also now free to terminate the account used for Unreal Engine. I need to finish reading the whole opinion to be sure about that though.

dmskalnm said:

Not sure how his award works, but did he just pay short term capital gains tax on $751 million of stock? Nice of him to donate to Uncle Sam I guess, but he couldn't wait a year?

He’s taxed on $754 million as ordinary income. That’s the value of the shares when they vested on Tuesday, based on the closing price that day. He owes taxes on that income whether he sells the shares or not. Apple typically withholds a portion of the shares - a little over 50% in Mr. Cook’s case - and remits their value to taxing authorities to cover withholding requirements. Those share don’t actually get sold. Instead Apple remits their value for tax purposes and they effectively were never issued.

Mr. Cook would also have a short term capital loss of about $2.5 million because the shares he sold went down in value (on average) by the time he sold them the next day. In the alternative, he might have a long term capital gain on those shares. It depends on how he accounts for stock sales - first in, first out (FIFO) or last in, first out (LIFO). The shares he sold on Wednesday could be considered to be the shares he just got on Tuesday or they could be considered to be shares he had previously.

Mr. Cook's tenure as Apple's CEO has demonstrated once more one of Mr. Jobs' most remarkable, and differentiating, abilities: His ability to see what was going to matter going forward and to focus on that rather than, and often at the expense of, what had mattered in the past. So many focus on what has mattered in the past because, e.g., it's easier or seems safer or requires less true insight. Mr. Cook was a great choice to be Mr. Jobs' successor.

On another note, Mr. Cook is set to receive 5.04 million Apple shares - worth around $750 million - today as the last vesting shares from the first equity compensation package he received as CEO of Apple.