The U.S. Court of Appeals ruled on Tuesday that Apple masterminded a conspiracy involving five e-book publishers that led to the pricing increase of e-books in 2010. The court ordered the tech giant to pay $450 million as settlement which will be distributed to most of its e-book consumers and those who filed the antitrust lawsuit.
In April 2012, a lawsuit was filed against Apple and the publishers including Pearson PLC's Penguin Group, News Corp's HarperCollins Publishers Inc., CBS Corp's Simon & Schuster Inc., Hachette Book Group Inc. and MacMillan. The tech giant allegedly introduced a pricing model to the publishers that made the e-books' prices higher than Amazon.com's standard $9.99 price tag.
When the lawsuit came out, the publishers opted to pay $164 million to benefit the consumers and offer discounts on their sites to settle the lawsuit. However, Apple firmly denied the "false accusations" and offered to settle for only $70 million. U.S. judge Denise Cote, who reviewed the case, refused to accept the offer arguing that it was an unfair amount for the affected consumers.
Apple brought the case to the court of appeals and after almost a year of waiting, today's 2-1 ruling from the Second U.S. Circuit Court of Appeals in Manhattan agreed with the $450 million settlement.
"We conclude that the district court correctly decided that Apple orchestrated a conspiracy among the publishers to raise e-book prices," wrote Second Circuit Judge Debra Ann Livingston in a document obtained by the Wall Street Journal.
"Apple understood that its proposed contracts were attractive to the publisher defendants only if they collectively shifted their relationships with Amazon to an agency model -- which Apple knew would result in consumers facing higher e-book prices."
Apple could still appeal the case to the U.S. Supreme Court. The tech giant maintained that they didn't conspire with the publishers and expressed their disappointment of the court's decision.
"While we want to put this behind us, the case is about principles and values. We know we did nothing wrong back in 2010 and are assessing next steps," said Josh Rosenstock, an Apple spokesman, to the New York Times.
