A federal appeals court has refused to stay an order that imposes an antitrust monitor on Apple, despite the company’s complaints that the monitor has been conducting an illegal roving investigation.
In a ruling published on Monday, the Second Circuit Court of Appeals wrote that the dispute came down to a disagreement over what the monitor was empowered to do, and adopted the Justice Department’s position that the monitor was limited to verifying whether Apple was informing its employees about their duty to comply with an anti-trust order from last year.
The original order imposing the monitor came as part of a larger decision last year in which a New York federal judge concluded that Apple had violated antitrust laws by brokering an illegal conspiracy with publishers to fix the price of ebooks.
Apple, which is appealing the overall decision, has accused the monitor, Michael Bromwich, of starting his duties prematurely, and of over-stepping his authority by demanding multiple interviews with senior Apple executives and board members — including designer Jony Ive and Al Gore, neither of whom have any apparent role in ebook pricing. The company also argued that Bromwich, who is billing Apple $1,100 per hour to investigate it, has an incentive to run up his bill as a high as possible. Bromwich has already billed over $130,000, in part because he had to hire another lawyer to help him since he lacks a background in antitrust law.
Monday’s ruling amounts to a face-saving measure for U.S. District Judge Denise Cote, who has been criticized harshly in the Wall Street Journal for appointing Bromwich, who is reportedly her friend and political ally. The appeals court decision serves to remind Bromwich of the limits of his investigation, even as it sides entirely with Cote and the Justice Department.
Meanwhile, Apple and the Department of Justice are still preparing to make arguments in the appeal of Judge Cote’s decision. The appeal is expected to take place sometime this spring.
Here’s the ruling: