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Apple settles $840m ebook price-fixing case

June 17, 2014

Settlement avoids trial judgment over conspiracy with publishers to raise the price of ebooks in the US

Apple has settled its case with US states and consumers over ebook price fixing, according to a filing with a New York court made on Monday.

The attorney Steve Berman, representing US consumers and some states, told the US district judge Denise Cote that Apple had reached an agreement in principle with the plaintiffs. Cote ruled against Apple in a non-jury trial in 2013. Full details of the settlement are being kept under seal before approval by the court.

The settlement avoids a trial that could has seen as much as $840m (£495m) in claims against Apple and follows similar settlements made by the fivebig publishers also involved in the price fixing. The plaintiffs claimed Apple overcharged consumers by $280m for books and that the company should have to pay three times that amount.

Apple following suit

Penguin Group, Harper Collins, Simon & Schuster, Hachette and Macmillan have already settled with the US Department of Justice, agreeing to pay a total of $164m and not to ban wholesale discounting of their ebooks.

The US government sued Apple and the five biggest publishers in April 2012 for pushing for an “agency model”, where publishers set the price and Apple just took a 30% cut, which resulted in most ebooks costing more.

The case alleged that in 2009 Apple and the publishers conspired to set ebook prices across the industry in an attempt to break Amazon’s hold of the market, which at the time saw the Seattle-based company claim around 90% of ebook sales, sometimes selling them at a loss to boost sales of its Kindle ebook reader and tablets.

Apple declined to comment on the ongoing legal case.

(By Samuel Gibbs)