Overview
Yesterday, Judge Cote denied a motion to dismiss a class action suit claiming that Apple and five publishing companies conspired to fix prices for eBooks in violation of the antitrust laws. Plaintiffs had alleged that Apple and the publishers colluded to increase the prices for eBooks by entering into agreements to sell the eBooks using an agency model that was “heretofore unknown in the publishing industry.” In its motion to dismiss, Apple contended that it had legitimate business reasons for entering into the agreements and that its entry into the eBook market increased, not restrained, competition. The publishers argued that the complaint contained no direct allegations of an explicit agreement to raise prices and that their parallel conduct in entering into the agreements did not support a plausible inference of a conspiracy. Judge Cote rejected those arguments and refused to dismiss the complaint, finding that the plaintiffs had plausibly alleged “that Apple and the Publisher Defendants took part in a conspiracy in restraint of trade, that an object of this conspiracy was to raise prices for eBooks, and that this restraint was unreasonable per se.”