U.S. Has Plans for Apple|on E-Book Price-Fixing

     MANHATTAN (CN) – Apple should end its agreements with major publishing houses and throw a bone to its competitors to remedy its price-fixing conspiracy in the e-book industry, the Justice Department told a federal judge Friday.
     Thirty-three state attorneys general signed the proposed remedy that the Justice Department filed with the Southern District of New York.
     The filing comes nearly a month after U.S. District Judge Denise Cote capped off a three-week bench trial by convicting Apple of conspiracy to fix the e-book prices in the United States, a violation of Section 1 of the Sherman Act.
     Apple had been the last defendant standing in the government’s antitrust case against six of the world’s leading publishers and two subsidiaries. Hachette, HarperCollins, and Simon & Schuster all settled in April 2012. Penguin settled in December, and Macmillan settled two months later.
     Federal prosecutors say Apple should now halt its anticompetitive conduct, restore lost competition and prevent the illegal activities from happening again.
     “The department’s proposal, if approved by the court, will require Apple to terminate its existing agreements with the five major publishers … and to refrain for five years from entering new e-book distribution contracts which would restrain Apple from competing on price,” it said in a statement. “Under the department’s proposed remedy, Apple will be prohibited from again serving as a conduit of information among the conspiring publishers or from retaliating against publishers for refusing to sell e-books on agency terms. Apple will also be prohibited from entering into agreements with suppliers of e-books, music, movies, television shows or other content that are likely to increase the prices at which Apple’s competitor retailers may sell that content. To reset competition to the conditions that existed before the conspiracy, Apple must also for two years allow other e-book retailers like Amazon and Barnes & Noble to provide links from their e-book apps to their e-bookstores, allowing consumers who purchase and read e-books on their iPads and iPhones easily to compare Apple’s prices with those of its competitors.”
     The Justice Department also wants the court to appoint an external monitor over Apple’s internal antitrust compliance policies.
     Apple would have to pay the salary and expenses of this monitor who would work with an internal antitrust compliance officer, according to the proposal
     The outside directors in Apple’s audit committee would hire and consult with that officer, who “will be responsible for training Apple’s senior executives and other employees about the antitrust laws and ensuring that Apple abides by the relief ordered by the court,” the Justice Department explained.
     Judge Cote will hold a hearing on remedies on Aug. 9.

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