Apple Inc. (NASDAQ:AAPL) obtained a preliminary court approval for the proposed $400 million settlement to resolve the e-book price-fixing claims for consumers by more than 30 U.S. states and territories. The settlement is contingent with outcome of the tech giant’s appeal on the case.
‘Fair and reasonable’
In her ruling, United States District Judge Denise Cote said, “The proposed settlement agreement is within the range of those that may be approved as fair and reasonable, such that notice to the class is appropriate. Preliminary approval is granted.”
Last year, Judge Cote ruled that Apple Inc. (NASDAQ:AAPL) violated antitrust laws by conspiring with publishers to fix the prices of e-books prior to its entry in the market. The iPhone and iPad maker strongly denied the allegations.
In a previous statement, Apple spokesperson Kristin Huguet emphasized that the company did not conspire with publishers. She said, “We did nothing wrong, and we believe a fair assessment of the facts will show it.
The Office of New York Attorney General Eric Schneiderman announced the settlement early this month, weeks prior to the damages trial wherein Apple Inc. (NASDAQ:AAPL) could face as much as $674 million claims for consumer damages and civil penalties.
At the time, Attorney General Schneiderman said, “This settlement proves that even the biggest, most powerful companies in the world must play by the same rules as everyone else. In a major victory, our settlement has the potential to result in Apple paying hundreds of millions of dollars to consumers to compensate them for paying unlawfully inflated E-book prices.”
Under the settlement agreement, Apple Inc. (NASDAQ:AAPL) will pay $400 million to consumers nationwide if the court of appeals uphold Judge Cote’s ruling that it violated antitrust laws. The iPhone and iPad maker will also pay $20 million to the 33 states to resolve claims for costs, fees and civil penalties.
On the other hand, if the court of appeals sends back the case for re-trial, Apple Inc. (NASDAQ:AAPL) will pay a small recovery fee of $50 million. In the event that court of appeals finds that Apple did not violate antitrust laws, it will not pay anything.