U.S. judge OKs class action in e-book suit against Apple

NEW YORK Fri Mar 28, 2014 6:30pm EDT

A man use his iPad inside a local coffee shop in downtown Shanghai November 28, 2013. REUTERS/Carlos Barria

A man use his iPad inside a local coffee shop in downtown Shanghai November 28, 2013.

Credit: Reuters/Carlos Barria

NEW YORK (Reuters) - A federal judge in New York granted class certification on Friday to a group of consumers who sued Apple Inc for conspiring with five major publishers to fix e-book prices in violation of antitrust law.

U.S. District Judge Denise Cote said the plaintiffs had "more than met their burden" to allow them to sue as a group. She rejected Apple's contentions that the claims were too different from each other, or that some plaintiffs were not harmed because some e-book prices fell.

"This is a paradigmatic antitrust class action," wrote Cote, who has scheduled a trial later this year to determine damages, which could reach hundreds of millions of dollars.

An Apple spokeswoman declined to comment.

In July 2013, Cote found the technology company liable for colluding with the publishers after a separate non-jury trial in a case brought by the U.S. Department of Justice. Cote found that Apple took part in a price-fixing conspiracy to fight online retailer Amazon.com Inc's dominance in the e-book market.

Apple is appealing that decision.

Thirty-three states and U.S. territories have separately sued on behalf of their consumers, while individual consumers in other states and territories filed the class action lawsuit that Cote addressed on Friday. The plaintiffs are seeking more than $800 million in damages.

The publishers previously agreed to settle related antitrust charges for $166 million before trial.

Apple has asked the 2nd U.S. Circuit Court of Appeals to throw out Cote's ruling from last year, as well as her decision to appoint an external monitor to oversee the company's antitrust compliance, a move Apple has called "radical" in court filings.

The 2nd Circuit last month rejected Apple's request to halt the monitor's oversight while its appeal is pending.

Cote on Friday also denied Apple's motion to exclude the opinions of the plaintiffs' damages expert. In a separate ruling, Cote largely threw out the opinions of Apple's two damages experts, saying they were not based on "rigorous application of economic methods."

Steve Berman of Hagens Berman Sobol Shapiro, the plaintiffs' lead lawyer, said, "We are thrilled with the win."

The trial will likely take place in either July or September.

The consolidated case is In Re: Electronic Books Antitrust Litigation, U.S. District Court for the Southern District of New York, No. 11-md-02293.

(Reporting by Joseph Ax; Editing by Jonathan Oatis)

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Comments (3)
AlkalineState wrote:
“This is a paradigmatic antitrust class action,” wrote the Judge.

I like that judge. She’s a class act.

Mar 28, 2014 6:43pm EDT  --  Report as abuse
paintcan wrote:
All this judge is doing, if the court finds in favor of the plaintiffs, is driving the big remaining publishers into bankruptcy and Amazon will be left with nearly monopoly control of book publishing. Then Bezos can raise prices or squeeze as much out of content providers as he thinks they can bear. Then the consumers can turn around and try to sue Amazon for creating a monopoly, I suppose?
Apple wasn’t being as ruthless to the paper publishers as Amazon was.
Bezos should have been charged with dumping but I don’t think there is a law for domestic manufacturers who purposely under price to theaten the industry. Apple was trying to establish a less cut-throat price of about $10.00. The charge of price fixing may be obsolete in the new digital publishing world.

Consumers are bringing this suit and claiming enormous damages. But they don’t have to buy Apples books. They can always buy Amazon’s 99 cent editions. It made more sense for Amazon to claim damages. It doesn’t sound like “consumers” are really behind the suit at all. They could all be Amazon employees, for all we know? He has over 30,000 of them. This is a country that can sue as an act of war, and does the Judge really know who’s providing the ammunition?

For a better examination of this, the New Yorker ran an article about it in the Feb 17&24 issue. You can probably read it free online. I subscribe and read the paper copy. I don’t have to worry about dropping and breaking the glass of my “book”. And a few years subscription doesn’t cost nearly as much as an ebook reader. Paper books have come down in price so much they almost aren’t worth producing. And unlike a regular library of paper books, that require no maintenance and can remain intact for decades if printed on good paper, the ebook isn’t readable without the enormous expense of an electronic reader. When they start selling those gadgets for the few dollars they actually cost to produce and they last as long as a real library (I have a few books that are over 150 years old) that will be the day I convert to ebooks. But I already have a few hundred books in this computer that are too difficult to read on the little screen and I have to sit here to do that.

Bookstore owners may become extinct as well.

However, as a spin off the ebook publishing wars, I am finding discards and clean second hand editions all over the place for a tiny fraction of what they used to cost. So keep fighting wanna-be tsars of the industry, as I stock up on the dead and wounded.

Mar 28, 2014 8:16pm EDT  --  Report as abuse
Pete58 wrote:
I agree with your assessment that the real problem is Amazon selling at a loss until they kill off the competition. But why the need to attack eBooks in general? You speak as if reading books is the only use for eBook-compatible devices. Many have already purchased such devices for multiple purposes, so your cost analysis is misleading at best.

Mar 29, 2014 3:41pm EDT  --  Report as abuse
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