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Judge unhappy with Apple’s ebook settlement

by on25 July 2014

You are not going to get out of it that easily

It looks like Apple’s attempts to avoid facing the music for its anti-trust antics in the book trade might not work after all. Apple, which had always claimed that it was innocent of orchestrating a conspiracy to screw over customers by jacking up the prices of ebooks, had negotiated a settlement with those states that sued it. However, the settlement was conditional on it losing its appeal.

Now U.S. District Judge Denise Cote who handled the case said that she did not like the settlement at all particularly a clause which would mean that Apple to pay only $70 million if an appeals court reversed her finding that the company is liable for antitrust violations and sent it back to her for further proceedings.

Speaking on a teleconference, Cote questioned if that would be fair and what might happen if the appeals court reversed her ruling on a minor issue. She also took issue with the lack of any requirement for Apple to pay interest while the appeals go forward.

If Apple loses its appeal, it would pay $400 million to consumers and $50 million to the states and plaintiffs' lawyers. If Apple's appeal is successful but the 2nd Circuit returns the case to Cote for further proceedings or a new trial, the company would pay just $70 million, with $50 million for consumers. If the 2nd Circuit reversed Cote outright and ended the case, Apple would pay nothing. 

Cote said that would be unfair to everyone other than Apple. Steve Berman, a lawyer for the consumers, told her that such an outcome would result in a "much bleaker universe" for his clients so it was better for them to take the deal. Berman said the parties would consider Cote's concerns and see if the clauses need to be re-negotiated.

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