Apple to Begin Paying Out $400 Million as E-book Price-Fixing Settlement is Approved

Apple's iBooks app (Credit: Mario Tama/Getty Images)
Apple’s iBooks app (Credit: Mario Tama/Getty Images)

A federal judge on Friday approved a settlement in which Apple could begin paying $400 million to as many as 23 million consumers related to charges that it violated antitrust law by conspiring with publishers to raise e-book prices and thwart efforts by Amazon.

In the hearing on Friday, Judge Denise L. Cote of Federal District Court in Manhattan approved an unusual settlement reached this summer in which Apple agreed to pay $400 million to consumers in cash and e-book credits, and $50 million to lawyers.

Those figures could still change, however, if an appeals court overturns a 2013 verdict in the case, in which Apple was found to have conspired with five major publishers to fix the price of e-books. The court, which will hear Apple’s challenge on Dec. 15, is not expected to change its previous ruling.

In the event the court overturns the verdict and returns the case to Judge Cote, Apple would pay $50 million to consumers and $20 million to the lawyers.

Apple initially agreed to pay up to $400 million to settle the class action in June, ahead of a damages trial set for two months later in which attorneys general in 33 states and class-action lawyers were expected to seek up to $840 million.

In the hearing, Judge Cote called the deal an “unusually structured settlement, especially for one arrived at on the eve of trial.” The Justice Department initiated the suit in 2012.

The settlement appeared to reflect fatigue by Apple, the Justice Department, state attorneys general and class-action lawyers eager to conclude a case that has dragged on, largely because of delays by Apple.

An Apple spokeswoman declined to comment on the deal.

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