Apple reaches $400 million settlement with states over ebook price-fixing
Though Apple maintains that the fix was not in, the company has reached a settlement deal with 33 U.S. states and territories over allegations of collusion in ebook pricing. That settlement, first mentioned last month, would send up to $400 million in payments to consumers—though it’s not a done deal yet.
The case in question is one of three cases over the matter of pricing for ebooks. The first was brought in federal court by the Department of Justice, where a judge ruled in July 2013 that the company had unfairly worked with publishers to set prices. Among the terms of that deal was a court-appointed independent monitor, who Apple tried and failed to remove earlier this year, and restrictions on the deals Apple can make with publishers over the next several years. Apple, however, appealed the case in October of last year. A class action, related to these cases, was also being pursued in 18 additional states.
The settlement announced today, meanwhile, was for a case brought by New York and several other states and territories seeking redress for consumers. However, the outcome of the settlement announced on Wednesday depends on the pending appeal in the DOJ case—and no date has yet been given for when that appeal will take place.
Should the decision in the earlier case be upheld, Apple will pay out that $400 million to consumers across the various states and territories. The office of New York Attorney General Eric Schneiderman states that New York customers who overpaid for ebooks are expected to receive as much as 7 percent of the resulting settlement. In the case that the appeal requires revisiting the case, a smaller settlement of $50 million will apply instead; and if Apple is cleared, no money will change hands.
All this money is just icing on the cake provided by the publishers, many of whom settled independently before going to court. Payments from those companies have reached $166 million to date, from all five major publishers.