Apple says DOJ’s tempered e-book penalties still go too far

Apple fired back — again — at the Department of Justice over the latest reforms it proposed to protect competition in the e-books market following the computer maker’s conviction of a price-fixing conspiracy in July.

In a letter to the court filed Monday, Apple attorney Orin Snyder called the government’s revised remedies a “broadside masquerading as a brief” that largely ignores the court’s instructions to find a compromise with Apple and rein in a request for an external antitrust monitor.

The DOJ’s brief aims to justify measures that would give rival Amazon a “significant competitive advantage over Apple,” the letter said, adding that restraining the company’s dealings with Amazon and other e-book retailers in its App Store is outside the scope of what the government pursued at trial.

Snyder asked the court to order the department withdraw its latest proposals and instead file a document in line with what the court requested, or at least give Apple “a chance to respond in full.”

Tuesday afternoon, the two sides will face Judge Denise Cote in U.S. District Court in the Southern District of New York at a hearing to hash out the latest proposed remedies.

The Justice Department didn’t immediately respond to a message seeking comment.

After winning its antitrust suit against Apple last month, the government filed an initial set of reform proposals that asked for an injunction of 10 years, an external antitrust monitor to keep tabs on Apple, and a requirement that other e-book retailers like Amazon be allowed to link to their e-bookstores from iOS apps.

That stoked a outcry from Apple that the proposed measures were vague, overreaching, and unwarranted. At a hearing this month, Cote told the two sides to meet, find common ground on the remedies, and report back to her.

Last week, the DOJ filed a brief stating is willingness to cut the length of injunction to five years, with the ability to seek a limited number of one-year extensions. It followed Judge Cote’s suggestion that the injunction stagger Apple’s negotiations with publishers going forward to minimize the possibility of future collusion. It also removed some language regarding app hyperlinks for rival retailers that Apple had complained effectively regulated its App Store.

However, the DOJ said having an external monitor is required, despite remarks by Judge Denise Cote earlier this month that such oversight may not be needed. It also disagreed with Apple about two other areas — that Apple allow e-book retailers to provide links to their Web sites without compensating Apple and that the injunction includes provisions prohibiting Apple from taking similar actions in other content markets.

In the Monday filing, Apple said the government’s rejoinder simply disregarded the court’s instruction earlier this month.

Cote last month ruled that Apple conspired with publishers to hurt competition and raise e-book prices. As a result of that ruling, the court will impose certain sanctions on Apple, and a separate trial will determine the amount of monetary damages Apple must pay. Lawyers have estimated those damages in the hundreds of millions of dollars.

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