Apple to Pay $400 Million in Refunds to E-Book Buyers

Photo (cc) by r reeve

Here’s some good news for e-book readers: A refund from Apple could be coming your way.

Now that the U.S. Supreme Court has rebuffed Apple’s request for an appeal, the tech giant will finally be forced to pony up $450 million to settle a class-action lawsuit filed by private plaintiffs and 33 states claiming that Apple conspired with a handful of book publishers to increase prices on electronic books.

Of the $450 million e-book price-fixing settlement, $400 million will be used to refund electronic book buyers, $20 million will be paid out to 33 states and $30 million will go toward legal fees, Reuters reports.

According to the U.S. Justice Department, most consumers who purchased e-books through Apple’s iBookstores platform will receive refunds through automatic credits at their e-book retailers. The credits can be applied to future purchases.

The Supreme Court decision finally brings an end to a nearly four-year legal battle in which Apple was accused of violating federal antitrust laws by conspiring with publishers to inflate the prices of digital books. The alleged price-fixing – which caused some book prices to jump from $9.99 to $12.99 or $14.99 – occurred in 2010, when Apple was trying to gain a foothold in the Amazon-dominated e-book market.

The publishers involved in the illegal price-fixing scheme – Hachette, Penguin, HarperCollins, Simon & Schuster and Macmillan – settled claims against them for $166 million, but Apple opted to try its luck in the courtroom.

The $450 million settlement, which received preliminary court approval in 2014, was appealed by Apple but subsequently upheld by a federal appeals court in 2015. The court called Apple’s transgressions “the supreme evil of antitrust.”

Apple opted to appeal the second court’s decision to the Supreme Court. By denying to hear its case, the Supreme Court upheld the lower court’s ruling, finally putting an end to Apple’s legal fight.

“Apple’s liability for knowingly conspiring with book publishers to raise the prices of e-books is settled once and for all,” Assistant Attorney General Bill Baer of the Justice Department’s Antitrust Division said in a statement. “And consumers will be made whole. The outstanding work of the Department of Justice team – working with our steadfast state attorney general partners – exposed this cynical misconduct by Apple and its book publisher co-conspirators and ensured that justice was done.”

What do you think of Apple’s $450 million settlement for the alleged e-book price-fixing scheme? Share your comments below or on our Facebook page.

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