Apple E-Books Judge Says U.S. Can Show Pricing Conspiracy

The U.S. has evidence that Apple Inc. (AAPL) participated in a conspiracy to raise the prices of electronic books, the federal judge overseeing the government’s civil antitrust case against the company said.

“I believe that the government will be able to show at trial direct evidence that Apple knowingly participated in and facilitated a conspiracy to raise prices of e-books, and that the circumstantial evidence in this case, including the terms of the agreements, will confirm that,” U.S. District Judge Denise Cote in Manhattan said yesterday.

Cote is overseeing claims by the Justice Department and a group of states that Apple conspired with publishers to raise the price of e-books and to strip retailers, including Amazon.com Inc., of the ability to set prices. Cote made the remarks today in what was to be the last court conference before a June 3 trial, which is to take as long as three weeks.

The judge, who will decide the case without a jury, stressed that her view was tentative before she has heard testimony and argument from the parties’ lawyers.

“We strongly disagree with the court’s preliminary statements about the case,” Orin Snyder, Apple’s lead lawyer in the case, said yesterday in an e-mailed statement. “The court made clear that this was not a final ruling and that the evidence at trial will determine the verdict. This is what a trial is for.”

Photographer: Kiyoshi Ota/Bloomberg

U.S. District Judge Denise Cote is overseeing claims by the Justice Department and a group of states that Apple Inc. conspired with publishers to raise the price of e-books and strip retailers of the ability to set prices. Close

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Photographer: Kiyoshi Ota/Bloomberg

U.S. District Judge Denise Cote is overseeing claims by the Justice Department and a group of states that Apple Inc. conspired with publishers to raise the price of e-books and strip retailers of the ability to set prices.

‘Benefited Consumers’

He said the “evidence will show that Apple benefited consumers by injecting much-needed competition and innovation into an emerging market.”

The trial is expected to feature evidence including e-mails from Steve Jobs, Apple’s late co-founder.

The U.S. sued Apple and the publishers in April 2012. Apple, based in Cupertino, California, is the only defendant remaining in the case. Verlagsgruppe Georg von Holtzbrinck GmbH’s Macmillan unit, CBS Corp. (CBS)’s Simon & Schuster, Lagardere SCA (MMB)’s Hachette Book Group, Pearson Plc (PSON)’s Penguin unit and News Corp.’s HarperCollins have settled with the government.

The case is U.S. v. Apple Inc., 12-cv-02826, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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