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Federal appeals court dismisses Apple antitrust lawsuit

The US Court of Appeals for the Ninth Circuit [official website] on Tuesday affirmed [opinion, PDF] the dismissal of an antitrust lawsuit accusing Apple [corporate website] of maintaining a monopoly over music files purchased through its iTunes stores. The plaintiff argued on behalf of a class that Apple thwarted competition by issuing software updates that prevent syncing functionality with certain non-Apple media players while charging supracompetitive prices music prices. However, the court held that the plaintiff failed to plead sufficient facts to state a plausible antitrust injury. Writing for a three-judge panel, Judge Milan Smith, Jr. stated that the plaintiff's own allegations did not square with her overcharge theory because the price of music downloads has remained unchanged. "If Somers' overcharge theory were correct, then Apple's music prices from 2004 to 2008 were supracompetitive as a result of software updates that excluded competition, and the emergence of a large seller ... would have caused ... music prices to fall. But Somers alleges no such price reduction."

Apple has been embroiled in a separate antitrust case [JURIST report] brought by the Department of Justice (DOJ) since April 2012. The DOJ alleged that Apple, Hachette Book Group Inc., HarperCollins Publishers L.L.C., Macmillan and Penguin Group (USA) Inc. conspired to fix the prices of e-books in response to Amazon's discount pricing strategy. Last month a US district judge denied Apple's request [JURIST report] for a temporary suspension of the court's July ruling that Apple violated the Sherman Act. In May Judge Denise Cote gave a tentative opinion [JURIST report] that the government would be successful in its antitrust claim.

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