Five book publishing companies of US, on Wednesday afternoon, objected to a proposal made by Department of Justice (DoJ) in New York’s Southern District court to punish and put restrictions on Apple for fixing e-book prices. The fruity company was found guilty of raising its e-book prices last month.
The five publishing companies including Hachette, HarperCollins, Simon & Schuster, Lagardere, Macmillan and Penguin Random House along with Apple were the main accused in the e-book price fixing case. Except Apple, the other five companies agreed to settle the charges against them and paid $164 million collectively to the consumers who were charged high for the e-books, but Apple lost the trial and is planning to appeal the decision.
According to the proposal made by Department of Justice (DoJ), Apple will be prevented from differentiating against Barnes & Noble, Amazon and other e-book app makers by asking them to pay a 30 percent fee as “in-app purchases” on e-book sales. Also Apple would be asked to terminate its agency model, in which publishers are free to charge prices for their e-books and not the retailers who sell them.
In the filing made on Wednesday in the Manhattan federal court, the publishers have objected to the restrictions imposed on Apple saying that the restrictions would also prevent them to use the agency price model. Publishers’ lawyer wrote, “In other words, the provisions do not impose any limitation on Apple’s pricing behavior at all; rather, under the guise of punishing Apple, they effectively punish the [publishers who settled the case] by prohibiting agreements with Apple to use the agency model.”
Decision now rests with the court which is to decide whether to agree with the publishers’ objection or not.