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

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