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Apple Response to Class Action

Apple Response to Class Action

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Published by jeff_roberts881

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Published by: jeff_roberts881 on May 30, 2012
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11/20/2012

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UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF NEW YORK 
 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -IN RE ELECTRONIC BOOKS ANTITRUSTLITIGATION- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -This Document Relates to :ALL ACTIONS- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x::::::::::x No. 11-md-02293 (DLC)
APPLE INC.’S ANSWER TO CONSOLIDATEDAMENDED CLASS ACTION COMPLAINT
For its Answer to Plaintiffs’ Consolidated Amended Class Action Complaint (“Com- plaint”), Defendant Apple Inc. (“Apple”) states as follows. Except as specifically admitted,Apple denies the allegations in the Complaint.
I. RESPONSE TO INDIVIDUAL PARAGRAPHS
1.
 
Apple admits that eBook sales have increased rapidly since November 2007,when Amazon released the Kindle, but denies that the Kindle “revolutionized the book publish-ing industry.” Apple lacks sufficient information and belief to admit or deny whether there are“major” economic advantages to eBook technology or whether eBook distribution costs are“massively” lower than those associated with “brick-and-mortar publishing.” Apple admits thatthere are costs associated with print books that are not present with eBooks. Apple specificallydenies that it “decided free market competition should not be allowed to work.” Except asotherwise admitted, Apple denies the allegations in paragraph 1.
Case 1:11-md-02293-DLC Document 165 Filed 05/29/12 Page 1 of 39
 
22.
 
Apple lacks sufficient information and belief to respond to the allegations in thefirst sentence in paragraph 2, and on that basis denies them. Apple admits, on belief, that Ama-zon generally sets eBook prices below prices for print books and that Amazon has, at times, set a$9.99 price level for certain newly released titles. Apple lacks sufficient information and belief to respond to the remaining allegations in paragraph 2, and on that basis denies them.3.
 
Apple lacks sufficient information and belief as to the state of mind of the Pub-lisher Defendants to respond to the allegations in paragraph 3, and on that basis denies them,except Apple admits that publicly and privately in their individual discussions with Apple,representatives of each of the publishers separately expressed varying degrees of unhappinesswith Amazon’s tactics, including its pricing. Apple further admits that Amazon is the dominanteBook retailer and wields “market power” over eBooks.4.
 
Apple lacks sufficient information and belief to respond to the allegations in para-graph 4 relating to the Publisher Defendants, and on that basis denies them. Apple specificallydenies that it “coordinated” with the Publisher Defendants “to force Amazon to abandon its pro-consumer pricing.” Apple denies the remaining allegations in paragraph 4.5.
 
Apple admits that the allegations in paragraph 5 purport to recite excerpts from al-leged news articles and avers that, if and to the extent the alleged documents are ever held to beadmissible, they will speak for themselves.6.
 
Apple lacks sufficient information and belief to respond to the allegations in para-graph 6, and on that basis denies them.7.
 
Apple lacks sufficient information and belief to respond to the allegations in para-graph 7, and on that basis denies them.
Case 1:11-md-02293-DLC Document 165 Filed 05/29/12 Page 2 of 39
 
38.
 
Apple admits that it announced the launch of the iPad in January 2010. Applefurther admits that its iPhone, iPad, and iPod touch devices offer functions which include theability to distribute, store, and access digital media through the App Store and the iTunes Store.Apple denies the remaining allegations in paragraph 8, and specifically denies the allegation thatApple had “strong incentives to help the Publisher Defendants restrain trade and increase the price of eBooks.”9.
 
Apple admits that, prior to finalizing its eBook distribution agreements with pub-lishers, news articles reported that the agreements would adopt an agency pricing model. Appledenies that the adoption of an agency model worked a “radical” or “fundamental” change in pricing “that had existed for more than a hundred years.” Apple also denies that its distributionagreements with publishers prevented other retailers from setting consumer prices for eBooks.Apple denies the remaining allegations in paragraph 9.10.
 
Apple lacks sufficient information and belief to respond to the allegations in par-agraph 10, and on that basis denies them, except that Apple admits that it entered into an indi-vidual bilateral distribution agreement with each of the Publisher Defendants.11.
 
Apple admits that it conducted bilateral negotiations with each Publisher Defend-ant prior to announcing the launch of the iPad. Apple denies the remaining allegations in para-graph 11.12.
 
Apple admits that the allegations in paragraph 12 purport to recite excerpts fromalleged news articles and avers that, if and to the extent the alleged documents are ever held to beadmissible, they will speak for themselves. Apple further admits that it engaged in individual bilateral contract negotiations with the Publisher Defendants during January 2010. Apple deniesthe remaining allegations in paragraph 12.
Case 1:11-md-02293-DLC Document 165 Filed 05/29/12 Page 3 of 39

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