Attorney General Chris Koster today announced that a Federal District Judge in New York entered an order that thirty-three state Attorneys General and the United States Department of Justice showed that Apple, Inc. conspired with publishers to increase retail prices of e-books.
Judge Denise Cote’s decision after the three-week trial means the case will now move to a remedy-phase. Koster said that Missouri joined the investigation prior to the filing of the lawsuit, served on the expert committee and assisted with discovery and preparing the case for trial.
In her ruling, Judge Cote found that the states and the Department of Justice had proven that five leading publishers - Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster - conspired to eliminate retail price competition in order to raise e-book prices, and that Apple played a key role in facilitating the conspiracy, which would not have succeeded without their involvement.
“I am proud of my office’s role in this case to protect Missouri consumers of e-books,” Koster said. “The court’s ruling that the e-book price increase was not the result of market forces, but rather an orchestrated scheme involving publishers and directed by Apple, Inc., is a clear victory for consumers. We look forward to the next phase of this case to determine appropriate damages.”
Attorneys representing thirty-three states and the Department of Justice argued that Apple used the impending launch of the iPad as a vehicle to secure agreements with the five major publishers that effectively eliminated e-book price competition, undercutting other retailers of e-books and e-book devices.
Several of the publishers have already settled separate lawsuits brought against them for their role, agreeing to terminate agreements that prevent e-book retailers from lowering prices.
The court has not yet scheduled a hearing to determine the amount of damages.