Federal Judge rejects Apple and publishers’ attempt to dismiss civil case alleging e-book price-fixing

Today a United States District Court judge denied court petitions by several of the nation’s largest book publishers and Apple to dismiss a nationwide class-action lawsuit that accuses the companies of conspiring to illegally fix the prices of e-books.

The 56-page ruling, issued by Judge Denise Cote of the United States District Court for the Southern District of New York, is the first substantive ruling in the litigation. It denies the companies’ motion to dismiss the case, allowing the civil litigation to move forward.

The case was originally filed on Aug. 9, 2011, and seeks to represent purchasers of e-books who the complaint says were forced to pay tens of millions of dollars more for electronic books because of a price-fixing scheme organized by the e-book publishers and Apple.

“We thought that Judge Cote’s ruling was spot on, especially when she noted that we’ve gone above and beyond in illustrating the legitimacy of our case,” said Steve Berman, lead counsel representing consumers in the nationwide class action and managing partner of Hagens Berman, a consumer-rights law firm, in a press release issued by the law firm. “We are eager to push forward with the case.”

In April, the U.S. Justice Department filed a lawsuit in U.S. District Court in New York making very similar allegations to the civil case and citing much of the same evidence. It describes Apple and the publishers actively conspiring to wrestle control of the e-book market from Amazon while artificially driving up prices for consumers.

Unlike the criminal actions filed by the DOJ and the states, Hagens Berman’s case was filed without discovery. “We look forward to uncovering additional evidence in the discovery phase of this litigation,” said Berman in the firm’s press release. “We litigated this case because we strongly believe that consumers were harmed by Apple and the publishers’ tactics and we will not settle without an effective plan to repay consumers for their losses.”

According to the class-action suit, the publishers believed that Amazon’s wildly popular Kindle e-reader device and the company’s discounted pricing for e-books would increase the adoption of e-books and permanently set consumer expectations for lower prices, even for other e-reader devices.

“Fortunately for the publishers, Apple was also terrified of Amazon’s pricing and the popularity of its Kindle device,” said Berman in the firm’s press release. “Rather than compete on merit, price and convenience, we intend to prove that the cabal simply tried to game the system.”

The case seeks to compensate e-book purchasers for losses incurred as a result of the alleged price-fixing scheme.

Source: Hagens Berman Sobol Shapiro LLP

Related articles:
Court documents reveal Steve Jobs email pushing e-book agency model; 17 more states join class action suit – May 15, 2012
Apple vs. Amazon: Who’s really fixing eBook prices? – April 17, 2012
Apple: U.S. DOJ’s accusation of collusion against iBookstore is simply not true – April 12, 2012
Apple not likely to be a loser in legal fight over eBooks – April 12, 2012
16 U.S. states join DOJ’s eBook antitrust action against Apple, publishers – April 12, 2012
Australian gov’t considers suing Apple, five major publishers over eBook pricing – April 12, 2012
DOJ’s panties in a bunch over Apple and eBooks, but what about Amazon? – April 12, 2012
Antitrust experts: Apple likely to beat U.S. DOJ, win its eBook lawsuit – April 12, 2012
Why the market shrugged off the Apple antitrust suit – April 11, 2012
What’s wrong with the U.S. DOJ? – April 11, 2012
Macmillan CEO blasts U.S. DOJ; gov’t on verge of killing real competition for appearance of competition – April 11, 2012
U.S. DOJ hits Apple,major publishers with antitrust lawsuit, alleges collusion on eBook prices – April 11, 2012
U.S. DOJ may sue Apple over ebook price-fixing as early as today, sources say – April 11, 2012

6 Comments

  1. Unbelievable. The government will win not because they are right but because they are the government. I hope against all odds that I’m wrong.

  2. Amazon was winning by subsidizing cost and putting competitors out of business. Abusing its monopoly. Now laughing all the way to the bank at the expense of everyone every book seller.
    Government intervention at its worst. This whole thing sickens me.

  3. “wildly popular Kindle”? Research shows that 80% of high school graduates will never read a book again after they leave and 50% of college graduates are in the same boat. Magazines and news papers are a different matter but they are not the main component of this law suit.

    Kindle is the new ‘fruit cake’ that we give at Christmas but nobody ‘eats’ them.

  4. Can someone tell me why setting your own price on a digital book is any different than setting your own price on a physical book a practice that has been going in since the dawn of printing? Also why is setting the price (one that carries widely in a free market) is worthy of a law suit but setting the price of gas (that is obviously set in colusion as prices go up and down in unison) something that is required by everyone is not.

  5. The case seeks to compensate e-book purchasers for losses incurred as a result of the alleged price-fixing scheme.

    Bull.

    This is all about making some scum sucking lawyers a boat load of money.

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