New DOJ Proposal Would Let Publishers Renegotiate With Apple on a Staggered Schedule

The Department of Justice today filed a revised proposed injunction against Apple that would still require that publisher defendants’ court-approved ebook contracts be thrown out, but would allow those publishers to begin renegotiating agreements sooner and on a staggered schedule.

The DOJ originally asked for a five-year ban on agency pricing. This new proposal calls for a two-year ban (from the date the judgment is final), after which publishers would take turns–one every six months–working out new deals with Apple. Hachette would go first, at 24 months after the agreement goes into effect; Macmillan would be last at 48 months.

The schedule, which reflects the order in which the publishers settled with the DOJ in the price-fixing case, are among the generally modest changes made in response to Judge Denise Cote’s comments at an Aug. 9 conference.

In its filing today, the DOJ said, “Plaintiffs agree with the Court that staggering the negotiations helps ensure that the Publisher Defendants will not be able to ‘negotiate collectively’ with Apple in order to effectuate contracts that will result in higher e-book prices.”

The DOJ reiterated its demand for an external monitor to ensure Apple adheres to antitrust rules. But it did revise its proposal to cut the length of the injunction from 10 years to five–with the option of extending it if necessary.

Apple is expected to file its revised proposal with the court today.

Cote has asked for the new proposals ahead of a court hearing scheduled for Aug. 27. Considering how far apart Apple and the DOJ were in their initial proposals, unless Apple’s new filing holds substantial changes, the two sides will share little common ground when they meet in court next week.

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