Apple’s request to suspend e-book ruling denied


Today’s a big day for Apple as the company faces some major legal showdowns. First, the United States International Trade Commission handed down its final ruling on the long-running complaint against Samsung, ordering an import ban on infringing Samsung smartphones and tablets, which will take effect at the end of the 60-day Presidential review period.

It’s a major win for Apple in its long-standing dispute against Samsung. However, the company is also waging another major battle, this one concerning the U.S. government’s e-book price fixing allegations.

Apple’s agency business model – where publishers get to price their iBooks themselves, with Apple keeping its standard 30 percent cut – has unfortunatelly suffered a major setback as its request to suspend Judge Cote’s ruling in e-book case has been denied…

Associated Press reported that Apple has been denied a request to temporarily suspend Judge Cote’s ruling saying Apple violated antitrust laws by conspiring with publishers to raise electronic book prices in 2010.

The judge ruled last month that Apple had conspired with publishers to spoil the $9.99 e-book price had established.

That ruling sided with government regulators’ contention that Apple joined five major book publishers to gang up on to the detriment of consumers.

The government earlier this morning accused Apple (again) of conspiring with publishers to fix prices.

Uncle Sam basically claims Apple and publishers HarperCollins, Hachette Book Group, Simon & Schuster, Holtzbrinck Publishers and Penguin Random House have “banded together once again”.

The iPhone maker previously called DoJ’s settlement offer a “draconian and punitive intrusion” into its business as it demands a complete restructuring of the agency business model.

Put simply, the government requests that Apple refrain from engaging in agency agreements for five years, which publishers said would violate their settlement agreements they had before the trial began.

Apple continues to fight the price fixing allegations ferociously and insists it did nothing wrong by exercising the agency model, which is also applied to music, apps and other types of content sold on iTunes.

Unless Apple’s luck in the courtroom changes, publishers will be prohibited from entering agreements with Apple using the agency model. In turn, publishers will be forced into accepting Amazon’s wholesale model that means lower price for consumers at the expense of publishers’ revenues.