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Archive for Tag “antitrust”
The headline sums it up: “Judge scolds Apple for lack of remorse in e-book antitrust case.” The article quotes Judge Denise Cote’s statements to lawyers at a hearing last week. “None of the publishers nor Apple have expressed any remorse,” said Judge Cote, who recently found Apple liable for a Sherman Act violation. “They are, in a word, unrepentant.”
Apple intends to appeal, and so higher courts will decide the legal issue. But the moral issue is for each of us to decide. Regardless of what Judge Cote says, do you think Apple has behaved badly and should apologize? Here are some basic facts and legal considerations to help you decide.
Apple was found legally liable for having “restrained trade.” How? By offering five large publishers a great deal on e-book retailing, a deal so attractive that they all signed on, talked about it among themselves, and insisted that Amazon match it. In other words, the defendants’ illegal acts consisted of a series of entirely voluntary transactions in which each company set prices and terms for its own products and services only. There was no “restraint” that deprived any company or consumer of full control over their own property.
In short, there were no victims, and Apple did nothing wrong. But in the Kafkaesque world of antitrust law, business trading that violates no one’s rights can nevertheless be legally forbidden. In the e-book case, the defendants’ blameless conduct was transformed, by the linguistic alchemy of antitrust, into Apple being the “ringleader” of a “conspiracy” to “fix prices.” Under these circumstances, does Apple have a moral obligation to admit guilt and demonstrate repentance?
I say no. Whatever the company decides to do in the face of legal compulsion, the general public should not demand contrition from Apple. Quite the contrary—whether we use Apple products or not, we should voice admiration and appreciation for a company that is willing to succeed or fail in the marketplace solely on the value of its products and services, despite the omnipresent threat of punishment under this nation’s antitrust laws.
“This is all about asserting control over big business and nothing more.”
In this recent interview with Butler On Business, Tom Bowden gives his most in depth interview on the Apple antitrust case to date.
Tom’s segment starts 29 minutes in.
My colleague Tom Bowden dissects the Apple antitrust case on a recent episode of the Schilling Show. His segment starts about 24 minutes in.
Having been found liable for violating the Sherman Act in the e-books case, Apple will now be subjected to whatever remedies the court chooses. As the prevailing party, the Department of Justice has filed its wish list for so-called injunctive relief (orders that regulate conduct). Money damages, which could approach $500 million, will be the subject of a separate proceeding.
According to its recent filing, the DOJ wants the federal court (among other things) to:
- Prohibit a broad range of contracts and information-sharing between Apple and content providers (such as book publishers, music publishers, movie and TV distributors, and the like) having to do with prices;
- Forbid any agreements that are “likely” to influence the prices at which others (besides Apple) sell movies, TV shows, books, music, etc.;
- Forbid agreements that allow the content provider to set prices;
- Force Apple, without compensation, to market apps that link to its rivals’ e-bookstores;
- Force Apple to modify or terminate many of its present contracts;
- Require Apple to snitch on inform authorities about any companies it thinks could be prosecuted for antitrust violations in content sales, and
- Require Apple to cover the costs of hiring two stool pigeons an in-house “Antitrust Compliance Officer” and an “External Compliance Monitor.” These will be highly paid, well-connected individuals who (armed with blanket court-ordered access to documents and personnel) will be empowered to look over Apple executives’ shoulders, second-guess their competitive decisions, and run to the authorities in Washington with tales of any conduct that could support another antitrust attack against Apple (not just pertaining to e-books but to any line of business Apple engages in). As Apple’s lawyers put it, the DOJ “effectively requests a decade-long roving mandate to parse all of Apple’s business conduct, across all of its myriad businesses, for antitrust compliance.”
Confusing? Paralyzing? Well, yeah—that’s part of the point, in my opinion. It’s also galling, because Apple is being penalized for its business virtues.
(Cross-posted from Voices for Reason)