Judge says Apple could renegotiate iBook contracts with publishers

iBooks Bookshelf on iPad

The judge in the government’s antitrust lawsuit has weighed in on settlement negotiations between the Department of Justice and Apple.

The iPhone maker could reopen staggered renegotiations with e-book publishers, U.S. District Court Judge Denise Cote reportedly said Monday.

Government lawyers had recommend that Apple agree to drop its current e-book contracts and abstain from a new agreements for five years. Judge Cote, who ruled Apple conspired with publishers to raise prices of e-books ahead of the iPad’s launch, also wants to hold another hearing, possibly to review guidelines she is suggesting…

Although Cote’s comments were not part of a ruling (via Bloomberg), the statements are just the latest regarding a set of settlement recommendations offered by the DOJ last week. On Friday, a Justice Department lawyer charged Apple and the publishers “had banded together once again.”

The five publishers, who had earlier settled with the government, believe the DOJ’s settlement offer “effectively punish[es] the settling defendants by prohibiting agreements with Apple using an agency model,” according to papers filed with the court.

For it’s part, Apple would like to have Cote’s ruling stayed while it appeals. The company charges the government’s settlement offer is a draconian and punitive intrusion into its iBookstore operations. In the meantime, Apple has submitted arguments on how it believes the trial was flawed due to testimony by Google and Amazon.

iPad 3 advert (flipping e-book page)

During the trial, one of Apple’s chief critics was Google.

A Google executive testified that he heard directly that Apple and publishers wanted to work against Amazon. However, that direct word quickly dropped to second-hand hearsay under withering Apple questioning. If Apple must refrain from contracts with publishers for five years, Google’s Android would gain an advantage.

Since the introduction of both the iPad and the iBookstore, we’ve seen the paths of Apple and Google’s Android diverge. Android has sought domination of smartphones through a sheer numerical lead.

However, despite the numerical advantage, Android suffers under both intense fragmentation as well as losing the overall usage battle. Indeed, Apple’s superiority in revenue is seen in App Store comparisons and in iPhone usage (not to mention developer loyalty, which drives everything).

iBooks (three up, MacBook, iPad, iPhone)

Increasingly, courts are seen as a weapon wielded against competitors that cannot be stopped commercially. We saw this practice rebuffed recently when the U.S. Trade Representative to the U.S. International Trade Commission issued a last-minute reprieve.

That reprieve overturned a ban on Apple’s older iPhone 4 and iPhone 4S – which just so happens to be the iPhone maker’s most-sold handsets. A five-year ban on Apple negotiations could make Android-based tablets the only game in town for publishers looking to get their e-books on tablets.

Little wonder then that publishers are against the ban, removing the most-used and most-popular tablet from the e-book market for a half-decade.