New York judge denies Apple Inc. request in e-books case


Judge Denise Cote, ruling from the bench in Manhattan federal court, declined to withdraw the effect of last month's ruling while Cupertino, Calif.-based Apple Inc. appeals.

The maker of iPods, iPads and iPhones continues to fight what it calls "false accusations."

The judge ruled last month that Apple had conspired with publishers to spoil the $9.99 e-book price had established. That ruling sided with government regulators' contention that Apple joined five major book publishers to gang up on to the detriment of consumers.

Apple, determined to protect one of the world's most beloved brands, has steadfastly denied it did anything wrong, even as the book publishers involved in the case settled to avoid a trial. Apple didn't waver from its insistence of innocence after the judge drew an unflattering portrait of the company in her ruling.

The trial revealed e-book prices rose after Apple signed with publishers so-called agency agreements, in which publishers rather than retailers set prices for each title.

Earlier this week, publishers that have settled the e-book pricing dispute with the federal government objected to penalties the government wants to impose on Apple, saying they will hurt publishers rather than the personal electronics company.

In court papers submitted Wednesday, five publishers said the government's plans to ban Apple from engaging in agency agreements for five years would not restrict Apple's pricing behavior.

"Rather, under the guise of punishing Apple, they effectively punish the settling defendants by prohibiting agreements with Apple using an agency model," lawyers for the publishers said.

As recommended by the government, a court order would require Apple to terminate any agency agreement with publishers.

The publishers said the proposed remedy conflicts with consent decrees the publishers agreed to when they settled their cases with the government. Those deals permit the publishers to enter agency deals with e-book retailers with some agreed-to limitations.

The publishers said the Department of Justice "induced publishers to enter these agreements on the condition that publishers could continue to use the agency model." As a result, the court papers said, the publishers entered agency agreements with Apple and other e-book retailers under the agency model. Breaking those deals would be costly and disrupt business, they said.

The court papers were submitted on behalf of HarperCollins Publishers LLC, Hachette Book Group Inc., Simon & Schuster Inc., Holtzbrinck Publishers LLC and Penguin Random House LLC.

A Department of Justice spokeswoman has said the proposed settlement with Apple would prohibit the company from entering deals that limit retail price competition during a defined period.

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