Judge concerned about Apple getting away with $70-mn settlement in ebook price-fixing case
26 Jul 2014
US federal judge Denise Cote is said to be concerned with Apple and its proposed $450-million settlement in an ebook price-fixing lawsuit as the odds are stacked against customers in the event the appeals process were to go Apple's way, The Register reported.
Apple and 33 US states and territories came to the deal on how much the company needed to pay after Cote found it liable for antitrust violations in a separate trial. The parties were due to go for another trial on the amount of damages before any settlement on agreement.
With the deal, ebook readers would net around $400 million, even as legal professionals received $50 million on top of that.
The settlement, however, would only move ahead if the appeals court declined Apple's arguments.
According to judge Cote, she found it ''most troubling'' that the settlement included a clause that would require Apple to part with a mere $70 million, if the case came back to her for further proceedings or a new trial.
She wondered if it was fair for customers if the appeals court only returned the case to her due to a minor issue.
She also questioned the lack of requirement for Apple for interest payment even as the appeals went ahead, according to Reuters.
In the original ruling Cote in April 2012, Apple was required to pay $674 million after the plaintiffs settled with the individual publishers, www.cultofmac.com reported.
However after several appeals, the size of Apple's settlement now depended on the outcome of the 2nd US Circuit Court of Appeals.
If Apple lost this appeal, it would pay $400 million to consumers, and $50 million to the states and plaintiffs' lawyers.
In the event of a successful appeal, although the 2nd Circuit Court returned the case to Cote for further proceedings or a new trial, Apple would only pay $70 million - the figure Judge Cote was disagreeing with.
However, if the 2nd Circuit reversed the judgment outright and ended the case, Apple would pay nothing.
Cote's concern related to the fact that the middle scenario described would be unfair to consumers. She also noted that Apple was not required to pay interest on the sum while the appeals went forward.
Although the case had been settled with 33 US states last week for a maximum of $450 million, the settlement had yet to be finally ratified by judge Cote, which meant that its terms could still be modified.
