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Monday, July 15, 2024 | Back issues
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Court-Appointed Apple Monitor Accused of Bias

MANHATTAN (CN) - Apple says the lawyer appointed to monitor its compliance with this summer's e-book price-fixing verdict is messing with corporate culture in excess of his authority.

U.S. District Judge Denise Cote blasted Apple in her July 2013 ruling that found the company liable for conspiring with five major book publishers to raise e-book prices.

The verdict marked the culmination of antitrust lawsuits filed by the U.S. Department of Justice and 33 states alleging that Apple and the publishers raised, fixed and stabilized prices for new and bestselling e-books to take down the market's champ, Amazon.

Cote said the move "changed the face of the e-book industry."

In ruling a month later that Apple would have to be subjected to a compliance monitor, the judge emphasized the care she took against disturbing innovation.

"I don't want to do more than necessary to protect the market and consumers," while at the same time "allow the market to develop and change and prosper," Cote had said.

That fall, she appointed attorney Michael Bromwich to watch over antitrust issues at Apple for two years.

Apple later moved to stay the injunction pending its appeal. The company argued in a new brief Tuesday that Bromwich is biased and has overstepped his authority.

"Plaintiffs fundamentally misunderstand the legal and constitutional limits on a court-imposed monitor," the filing states.

The government removed any doubt about Bromwich's bias by filing a declaration that Bromwich signed against an Apple motion, the company continued.

"Mr. Bromwich's now-open opposition to Apple and collaboration with plaintiffs prevent him from legally and constitutionally serving as this court's agent under Rule 53," it added.

Bromwich also is not following Cote's guideline to tread lightly, according to the filing.

"Whereas this court intended 'to rest as lightly as possible on the way Apple runs its business,' Mr. Bromwich thinks he has a license to 'crawl into [the] company,' and as a result continues to demand that Apple 'take down barriers' to his access so he can set up shop in Apple's boardroom and executive offices in Cupertino for two years in order to monitor and change the corporate culture," Apple wrote.

While Apple advances its appeal of the price-fixing verdict, it "should not be harmed by a monitor acting far outside his legal and constitutional authority in a way that could not be repaired if Apple prevails on appeal," the filing continues.

Apple is represented by Gibson, Dunn & Crutcher attorney Theodore Boutrous.

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