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Is Apple Resisting E-Book Antitrust Settlement?

By Stephanie Rabiner, Esq. on April 11, 2012 | Last updated on March 21, 2019

Initial reports suggested that the joint U.S.-EU e-book antitrust investigation was close to settlement. But it seems Apple and two of the five publishers accused of conspiring to fix e-book prices are now refusing to sign.

The refusal comes just a month after the Justice Department warned that it was prepared to file suit against the six companies. If the government makes good on its threat, it will be the second time in recent months Apple has been sued for this very issue.

The first e-book antitrust suit was filed in August by two men. They accused HarperCollins Publishers, Hachette Book Group, Macmillan Publishers, Penguin Group and Simon & Schuster of working with Apple to keep e-book prices high. The agreement included two essential clauses -- a "most favored nation" clause and what is being called "agency pricing."

The "most favored nation" clause prevents the publishers from giving other sellers, like Amazon, a better price than Apple. Agency pricing allows the publishers to sell books at their own designated price. Apple then takes a 30% commission.

The companies seem to agree that the "most favored nation" clause needs to go, according to the Wall Street Journal. It is the agency pricing model that is causing problems.

The Justice Department wants the e-book antitrust settlement to go further. It wants to scrap agency pricing and impose a "cooling-off" period, reports the Journal. When that period ends, the group can resume using the pricing model.

Apple, Macmillan and Penguin don't appear inclined to accept these terms. They want to protect the pricing scheme, according to Bloomberg. And it looks like they're willing to go to court to do it.

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