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Justice Department Proposes Ways for Apple to Remedy “Brazen” e-Book Price Fixing

Justice Department Proposes Ways for Apple to Remedy “Brazen” e-Book Price Fixing

The United States Justice Department has come up with a series of proposals to fix what it calls Apple’s “brazen” efforts to setup an e-books price-fixing scheme among major book publishers.



The Justice Department is calling on a federal judge to force Apple to allow competitors in the ebook market to provide prices and links to their e-bookstores within apps on Apple’s devices, a move that is likely to anger the iPhone maker and increase the stakes in an anti-trust investigation that has already produced a damning judgment against Apple in early July. 

The remedies would be applied via a final judgement in a high-profile trial between Apple and the Justice Department that ended in july with U.S. District Judge Denise Cote ruling that Apple had orchestrated a conspiracy with five publishers to increase prices and win control of the e-book market from Amazon.

While it was expected that the Justice Department would request that Apple’s ability to use pricing tactics such as “most favored nation” be limited, in an additional twist, the Justice Department also wants Apple to make it easier for its users to compare prices at other e-book vendors.

Apple must also for two years allow other e-book retailers like Amazon and Barnes & Noble to provide links from their e-book apps to their e-bookstores, allowing consumers who purchase and read e-books on their iPads and iPhones easily to compare Apple’s prices with those of its competitors.

This requirement would stay in effect for two years in an effort to “reset competition to the conditions that existed before the conspiracy.”

The proposal also calls for Apple to end its deals with the five publishers that were also part of the original suit. Also, for a period of five years, Apple would  be barred from signing fixed pricing agreements with e-book distributors

The Justice Department also asks the court to appoint an “external monitor” (Apple would pay the salary for that) to assist in improving the company’s internal antitrust policies. The court is scheduled to hold a hearing on possible remedies on August 9th.

(UPDATE – 08/06/2013) Apple has responded to the Department of Justice’s proposed restrictions on it ebook and digital content businesses, condemning them as unwarranted, overreaching, and unconstitutional. The full text of Apple’s response is below, via AllThingsD:

8.2.13 Apple’s Brief Opposing Injunctive Relief

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