Apple loses bid to block antitrust monitorship

NEW YORK Mon Jan 13, 2014 5:33pm EST

The Apple logo is pictured on the front of the company's flagship retail store near signs for the central subway project in San Francisco, California January 23, 2013. REUTERS/Robert Galbraith

The Apple logo is pictured on the front of the company's flagship retail store near signs for the central subway project in San Francisco, California January 23, 2013.

Credit: Reuters/Robert Galbraith

NEW YORK (Reuters) - Apple Inc lost a bid on Monday to block an antitrust monitor appointed after a judge's finding that the company conspired to fix e-book prices.

At a hearing, U.S. District Judge Denise Cote in Manhattan denied Apple's request to stay an order requiring an external compliance monitor pending the company's appeal.

"I want the monitorship to succeed for Apple," she said.

The judge also said there was "nothing improper" about a declaration filed by a lawyer chosen to serve as monitor, Michael Bromwich, that became the basis of Apple seeking his disqualification.

Cote said she will promptly issue a decision explaining her reasoning. Apple will then have 48 hours to seek an emergency stay from the federal appeals court in New York, she said.

Theodore Boutrous, a lawyer for Apple, at the hearing said Apple would appeal. A spokeswoman for the Justice Department declined immediate comment.

The hearing was the latest to spill out of a growing dustup stemming from Apple's objections to the monitor. Cote appointed Bromwich to that role in October, three months after she found Apple liable for conspiring with five publishers to raise e-book prices.

In November, Apple complained he had been trying aggressively to interview top executives, even though his mandate called for him to review the company's antitrust policies 90 days after his appointment.

Apple also complained about his proposed hourly fee rate of $1,100, which Apple said gave him an incentive to run "as broad and intrusive investigation as possible."

The Justice Department came to Bromwich's defense. He himself meanwhile filed a declaration disputing Apple's claims he had engaged in a "roving" investigation and detailing a series of unsuccessful attempts to gain Apple's cooperation.

Apple subsequently moved for his disqualification, saying Bromwich had a personal bias against the company and had engaged in "grossly inappropriate behavior" through filing the declaration.

The case is U.S. v Apple Inc et al, U.S. District Court, Southern District of New York, 12-2826.

(Reporting by Nate Raymond in New York; Editing by Leslie Adler, Bernard Orr)

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