NEW YORK — Apple’s showdown with the Justice Department on alleged price-fixing of e-books begins Monday morning, in a case closely watched across media and entertainment industries grappling with their transitions to digital businesses.
It is rare for a Justice antitrust suit to go to court; the five major publishing houses that were sued along with Apple have all settled with the government. The government’s suit, filed one year ago, has not significantly altered prices of e-books for consumers so far. But analysts say the case is significant because it shows federal officials are stepping up their patrol of the largely unregulated digital economy.
As opening arguments take place in the no-technology Manhattan courtroom of the U.S. District Court, here are five key things to watch from the first day of trial:
Witnesses: Federal Judge Denise Cote may release lists of potential witnesses from both sides, with all eyes on which top level executives will be called to testify from Apple, publishing houses and e-books giant Amazon. Watch for executives that have been featured in pretrial arguments from both sides, including Penguin chief executive David Shanks. Also watch for witnesses to include executives such as David Naggar, vice president of Amazon’s publishing business, analysts say. Apple’s top lawyers are expected to defend remarks by late founder Steve Jobs that they say were taken out of context in Justice’s suit.
Apple on Amazon: Apple has tried to uncover what it calls evidence that implicates and is embarrassing to Amazon. The opening arguments by Apple attorneys is not just about slinging mud. It hopes to show the agency pricing model it struck with publishers was industry-wide and included Amazon.
Schedule and more witnesses: The trial is expected to last for three to four weeks. Later this month, more executives may be called to testify.
Dirty laundry and secrets: Trials often shed light on more than the dispute at hand. We could learn about corporate trade secrets, internal strife and backroom deals during the questioning.
Future: With all the executives testifying from the publishers, Apple and Amazon look for any clues to how the e-commerce market for books is shaping up and what that could mean for other industries.