Apple E-book Antitrust Lawsuit Essay Example | Topics and Well Written Essays - 1500 words

Apple E-book Antitrust Lawsuit - Essay Example They forced the Amazon to increase the e-books prices on the rival kindle. The five publishers were HarperCollins, Simon & Schuster, Penguin, Hachette, and Macmillan. HarperCollins, Hachette, and Simon & Schuster (owned by CBS) have cleared with the department of justice. Macmillan and Apple have declined to negotiate (Banks 127). They have said that they never colluded in the increase of the e-books prices. The publishers had already complained that the $9.99 price for e-books set by the Amazon was greatly discounted. This was before the introduction of the iPad and the iBookstore. After the iPads were unveiled into the market, Apple prices were set at $12.99 together with a Californian-based company (Cupertino).This allowed publishers to set the ‘agency model’, which was the individual prices for companies. Amazon took an immediate action to allow publishers to set their own prices too. This rose up the digital edition prices (Banks 129). The major allegations toward A pple Company are that it facilitated the collective efforts of the publishers to terminate retail price competition because it encouraged the agency model among the retailers. According to the CNN money report, the conspiracy was first alleged in a class action lawsuit in California District Court by kindle consumers during last summer. They argued that booksellers were terrified by the discounted price of the e-book structure launched by Amazon in 2007 (Ceruzzi 415). The department of justice could lose the e-book antitrust suit while targeting the Apple Company. The alleged suit stretches the antitrust law and could probably end in defeat. In 1982, embarrassed department of justice confessed its antitrust lawsuit against IBM.It abandoned the case because the case was â€Å"without merit† (Ceruzzi 437). In 2001, Microsoft Company had been divided into two different companies by a federal appeal court because of the department ambition to formulate the antitrust law. Accordin g to Geoffrey Manne, a lecturer at the Lewis and Clark School in Oregon, the case is harder against Apple than the publishers. As stated in the (justice department complaint 36), Apple was not present at the breakfast meeting at the London hotel and dinners at the Manhattan’s posh Picholine restaurant. He also said that it is not good for competing firms to meet without the presence of lawyers (Ellig 270). Other than Apple, the justice department has a better case against publishers. Dominick Armentamo; a professor in economics at Hartford University argued that the chief executive officers of the publisher who met at the hotel rooms to discuss the price changes can also settle the prices. According to Richard Epstein, a legal scholar and a law professor at the University of NewYork, there are difficulties in the department of justice case against the publishers because it will take time to hear the whole case. He says that the charge is a mistake. The attorney general (Eric Holder) accused the defendants to the case of creating a â€Å"conspiracy.† The version of events used by Holder did not blame the publishers on the agreement toward specified prices. If in any case they agreed on something, it was on the agency model. It meant that Apple’s iBookstore was better as compared to the Amazon.com wholesale model (Page and Lopata 340). Apple and other publishers had benefited from the serial precedents of the supreme court of the United States as from 1970s.This is the issue that the department of