Apple Found Guilty of Fixing E-Book Prices: What You Need to Know

The U.S. Department of Justice has won a case against Apple.

Earlier today in a quick turnaround, the southern court of New York City in a non-jury trial ruled that the computer company was guilty of raising the price of e-books. Eric Holder’s DOJ filed this suit back in April 2012 on the grounds of anti-trust violations. Reuters reported that this conspiracy began back in 2009 in possible preparation for the release of the first iPad. At the time, Steve Jobs was still at the helm of his firm, but this is another headache Tim Cook has to handle.

The Silicon Valley stalwart had allegedly worked with five publishers to possibly undercut Amazon’s blossoming dominance in the e-book marketplace.

Publishers included Hachette Book Group and Simon & Schuster but Tim Cook’s company was the one that went to trial since the other “co-conspirators” had settled out of court. The final argument was the Apple had worked with these publishers to artificially raise the cost from $12.99 and $14.99 compared to the standard $9.99. The proverbial final nail in the coffin for Apple may have been an email Steve Jobs had sent to HarperCollins CEO James Murdoch that suggested the initial prices were just “caps” that companies did not need to adhere to.

Executive Eddy Cue has acknowledged these misdeeds under-oath and has been considered to be the “mastermind” behind this plan. Gizmodo notes that Cue’s high profile testimony discussed his team leading the charge on research when it came to this section of retail.

U.S. District Judge Denise Cote presided over this case. Her engrossing 160-page ruling, which can be read below, highlights the key points of this deliberation. Cote had felt that Jobs’ email to Murdoch gave a clear example of “conspiratorial” intent, according to The Verge. However, her closing statement makes her judgment clear. Among other reasons, she felt that Apple had played an active role in this conspiracy instead of a passive one. The DOJ celebrated this victory claiming this was a “big victory for consumers“.

Apple has disputed the final verdict, claiming this would impact the negotiation process for digital media.U ltimately, this probably will not impact Apple’s reputation that much. It still is a leader in innovation and design will continue to attract business and new partnerships. Apple isn’t out of the woods yet as the court declared another trial was needed to figure out what the company would owe in damages. That will be decided on a later date.