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Feds accuse Apple of “character assassination” over antitrust monitor – UPDATE

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UPDATE: Late Monday afternoon, Reuters reported that U.S. District Judge Denise Cote refused Apple’s request to dismiss the court-appointed monitor, and said she would not stay her order imposing antitrust remedies. Original story below.

The U.S. Department of Justice had harsh words for Apple(s aapl) in an ongoing dispute over the behavior of a monitor appointed to oversee the company’s ebook pricing practices.

“Apple has chosen a campaign of character assassination over a culture of compliance,” the government stated in a new letter to the court (embedded below), which also accused Apple of missing a chance to “change its corporate tone” by working with court-appointed monitor Michael Bromwich.

The new letter comes after Apple filed a formal request last week to remove Bromwich, citing his excessive fees and a spirit of mission creep that led him to demand interviews with a long list of the company’s senior executives.

Bromwich was appointed last year by U.S. District Judge Denise Cote to ensure that Apple complied with new pricing rules. She imposed the requirements upon ruling that Apple had brokered a conspiracy to fix the price of ebooks, a decision that Apple is appealing.

Apple is seeking to remove Bromwich in part over his decision to immediately launch a roving investigation despite a narrow mandate that was supposed to start only 90 days after his appointment. Apple also objected to Bromwich’s $1,100 an hour billing rate, which Apple must pay in addition to the fees of a second lawyer who Bromwich had to hire because he lacks experience in antitrust law.

The situation brought withering criticism from the Wall Street Journal (sub req’d) who called Judge Cote a “disgrace” and said she should resign from the case for appointing a “greenhorn” who is a personal friend. It also ridiculed Bromwich’s demands to interview Apple executives like Jony Ive, who have nothing to do with pricing, asking, “Does he want to disinter Steve Jobs too?”

The outcry has produced a pushback from the Justice Department and from Bromwich, who this week filed a short letter stating he had no professional or financial interests that would affect his ability to act as a monitor.

The Justice Department, in the new filings, is attempting to characterize Apple as a recalcitrant price fixer that won’t acknowledge its wrongdoing. To support its case, its letter includes emails that purport to show Bromwich has been reasonable (but it’s not clear that they do this).

Lawyers have suggested to me that the behavior of Bromwich and Cote is “not normal” and reminiscent of a prosecutor.

Here’s the government’s new filing with some of the relevant bits underlined:

DOJ Response to Apple Request to Remove Bromwich

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6 Responses to “Feds accuse Apple of “character assassination” over antitrust monitor – UPDATE”

  1. Kay Arkay

    The case reeks of nepotism.
    Judge Cote’s unseemly coziness with the monitor Bromwich.
    DoJ used by Amazon for its own anti-competitive ends.
    And quite so ironic that a monopolist Amazon has managed to cement its dominance by having the Judge & DoJ twist the spirit of anti-trust laws in a Humpty-Dumpty manner “to mean what I choose it to mean”.
    A “Through the Looking Glass” spectacle of American Justice.

  2. Regrettably, I have come to realize that, were I required to state my opinion of the performance of the DOJ concerning the “price fixing” case against Apple, of the judge, of the lawyer designated to monitor Apple, and especially of Lawrence E. Buterman in characterizing Apple’s position, those parties would likely charge me with character assignation. So be it.

  3. James Katt

    To protect itself, Apple should have every meeting with the monitor videotaped. This way, the monitor will be aware that their own conduct is subject to prosecution.

  4. James Katt

    The Justice Department is simply being EVIL in defending Bromwich.

    Bromwich has ZERO expertise in monitoring antitrust matters. This is why he has to hire a SECOND lawyer at $1000+ an hour to do Bromwich’s job.

    Judge Cote deserves the criticism she is receiving for hiring an incompetent monitor. She should have hired Bromwich’s lawyer instead.