The U.S. Department of Justice (DOJ) filed an antitrust suit against Apple and five of the largest publishers in the United States (Simon \& Schuster, HarperCollins, Hachette, Penguin, and Macmillan), alleging that Apple conspired with the five to battle Amazon, the market leader on e-book sales, by agreeing ahead of the release of the iPad tablet and iBook to raise prices for e-books. The move by the publishers was undertaken to force Amazon, if it wanted the books in electronic form, to raise its prices. Amazon has traditionally charged \(\$ 9.99\) for its e-books, a price that other publishers could not compete with. (Simon \& Schuster, HarperCollins, and Hachette settled the suit with the DOJ before the suit was even announced.) The government antitrust case was based on its theory that the agreement caused e-book prices to climb to \(\$ 2\) to \(\$ 3\) per book in early 2010 when the iPad was released. The subsequent trial outlined the communication between and among the CEOs of Apple and the publishing houses. During December 2009 and January 2010, the publisher defendants' U.S. chief executives placed at least 56 phone calls to one another. Apple went to trial, was found guilty of engaging in price-fixing (a violation of Section 1 of the Sherman Act) in relation to e-book prices. As part of the penalty phase of the case, the Justice Department asked for and the court ordered the presence of a monitor at the company to be sure that Apple did not engage in price-fixing again and that the company was putting the types of tools in place that would prevent price-fixing in the future. \({ }^{44}\) Since the time of the appointment of Michael Bromwich as the monitor, there has been significant contention between him and company officials. Apple took the matter to court for a decision on three issues: (1) getting rid of the monitor until Apple exhausts its appeals on the guilty verdict; (2) limiting the work and access of the monitor because of his demands for interviews with board members as well as CEO, Tim Cook, and the rest of the executive team; and (3) curbing the billable hours and rate of Mr. Bromwich. Mr. Bromwich bills at a rate of \(\$ 1,100\) per hour and billed Apple \(\$ 138,432.40\) for his first two weeks of work as a monitor. \({ }^{45}\) Apple and its monitor have been arguing and posturing since the final decision in the trial court case.........

 Discussion Questions
1. What strikes you about the methods of competition in the publishing world? Any ethical issues?
2. What are the implications when a company is found guilty of antitrust law violations? What types of penalties are imposed?
3. Is Amazon's failure to sell certain books as a means of controlling pricing ethical?
4. What conflict of interest exists when Mr. Bezos is the owner of a newspaper?