A divided federal appeals court panel decision stated that Apple broke the antitrust laws by conniving with publishers to fix and raise the prices of e-books in 2010.
A two-to-one vote, Tuesday, by the Second U.S. Circuit Court of Appeals in Manhattan favors the lower court's decision of finding Apple accountable in violating the law to challenge Amazon's monopoly of the market, The Wall Street Journal reported.
An "injunctive relief" was ordered by U.S. District Judge Denise Cote to ensure that the company will not commit additional violations of the law. The court of appeals concurred with this decision, stating it was the right thing to do.
What does this decision mean for Apple, Inc.?
For one, it limits the agreement of the company with publishers. Secondly, it requires the company to pay $450 million — $400 million will be distributed to the consumers and $50 million for attorney fees and payment to the states, The Christian Science Monitor learned.
Atty. Bill Baer said, in a released statement, the decision affirmed that a company that is knowingly participating in price-fixing conspiracy is unlawful. The Assistant Attorney of the Justice Department's Antitrust Division also said that government was pleased with the decision.
The publisher that colluded with the company were Verlagsgruppe Georg von Holtzbrinck GmbH's Macmillan, Lagardere SCA's Hachette Book Group Inc., CBS Corp's Simon & Schuster Inc., News Corp's HarperCollins Publishers LLC and Penguin Group Inc., according to the Justice Department.
The plot resulted in some electronic book prices to rise from $9.99 — price charged by Amazon — to $12.99, as per the report of NDTV Gadgets.
Originally, the U.S. Justice Department and 33 states sued Apple and five publishers. Two publishers joined Apple's appeal, while the others signed a decreed consent forbidding them from stopping the e-book retailers to set prices.
Apple and these publishers wanted to eliminate price competition in the market. However, the consumers were the ones who suffered by paying high prices for many e-books.
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