Apple ebook price-fixing scandal trial gets off to dramatic start

The case against Apple kicked off today, accusing the technology giant of engaging in an ebook price-fixing scandal that included five of the biggest publishers in North America.

Priority one for Apple’s lawyer, Orin Snyder, is to make sure his client gets a fair trial, after U.S. District Judge Denise Cote made comments that seemed to indicate otherwise at a pretrial hearing last week.

“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 ebooks,” Cote said, according to The Verge. “And that the circumstantial evidence in this case, including the terms of the agreements, will confirm that.”

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Snyder brought up those comments today, suggesting that Cote’s “tentative” view of Apple wouldn’t grant the company a fair trial, but Cote assured Snyder that she would treat Apple fairly, and her current views were simply based on the pre-trial evidence she had reviewed – something that Apple had agreed to in order to speed up the trial.

“This isn’t a vote about whether I like Apple,” Cote told the court, “the deck isn’t stacked against Apple unless the evidence stacks against Apple.”

Even though Snyder seemed satisfied with Cote’s assurances of Apple getting a fair trial, he still faces a very tough battle ahead, in light of evidence from the late Steve Jobs, and the fact that all five publishers who were involved in the case settled out of court.

The lawsuit against Apple alleges that the company engaged in price-fixing with major publishers in the U.S. in order to sell books for the price they wanted without Amazon undercutting their prices. In 2009, Apple allegedly met with Hachette, HarperCollins, Simon & Schuster, Macmillan and Penguin Group ahead of the iPad launch, encouraging them to be the ones to set the prices for their ebooks instead of retailers like Amazon. At the time, Amazon was selling many of its most popular ebooks for $9.99 USD, which was substantially lower than the hardcover prices for the books.

“Apple wanted to sell ebooks to the public, but did not want to compete against the low price Amazon was setting,” the government wrote in its court papers, CBC reports. “Apple knew that the major publishers also disliked Amazon’s low prices and saw Apple’s potential entry as a pathway to higher retail prices industry wide.”

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To further suspicion of these allegations, Steve Jobs was quoted as all but confirming this shortly after the launch of the iPad. The Department of Justice quoted a statement Jobs made, The Verge reports, that he knew Apple’s ebook prices, which would be $12.99 and $14.99 USD, would not be higher than Amazon's. Reporters who were presented pointed out to Jobs that many of Amazon’s ebooks were actually $9.99, but Jobs assured that the prices would be the same. The government now alleges that Jobs played a role in outing their conspiracy, and go so far as to call him “incredibly stupid” in an email that was presented by the Department of Justice.

The trial is expected to last three weeks, and will likely see top executives from Apple, Amazon, and the publishers involved in the lawsuits all testify.

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