Apple Files Formal Complaint Over Monitor Fees in E-Book Antitrust Case

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iBooksBack in July, Apple was found guilty of conspiring to raise the retail price of e-books, following a lawsuit brought by the United States Department of Justice.

As part of its punishment, Apple was ordered to hire an external compliance monitor to ensure that the company complies with all antitrust requirements in the future.

Michael Bromwich, a former U.S. Justice Department inspector general, was appointed to the position and is apparently charging exorbitant fees that Apple is unhappy with (via Bloomberg). The company has filed a formal objection against Bromwich, who has proposed an hourly fee of $1,100 along with a 15 percent administrative fee and an additional cost for hiring extra lawyers to assist him.

Mr. Bromwich has proposed an hourly rate for himself of $1,100. And because he lacks any antitrust experience, Mr. Bromwich has also retained the law firm Fried Frank to assist him, whose partner's hourly rate is $1,025. Mr. Bromwich has made no attempt to justify why his lack of any substantive experience with the matter at issue justifies hiring another law firm with a four-digit billing rate.

Following two weeks of work, Bromwich sent Apple an invoice of $138,432, which Apple described as "unprecedented in Apple's experience." Apple has also filed other complaints against Bromwich, suggesting that he is overstepping his bounds by demanding interviews with Apple employees like CEO Tim Cook and lead designer Jony Ive.

In a letter to Tim Cook and Apple’s board, Bromwich noted that he had experienced "a surprising and disappointing lack of cooperation from Apple and its executives" and suggested that Apple had no say in what it pays for external monitoring.

Our requests to meet with key Apple personnel have been largely ignored, and when not ignored the responses have been extremely slow in coming. The company has spent far more time challenging the terms of our compensation and raising other objections related to administrative matters, even though the Court's Order provided no role for Apple in setting the monitor’s compensation.

According to Apple, both Bromwich’s suggested compensation and his attempts to contact Apple board members and senior executives directly are inappropriate, and the company asks that the court issue an order directing Bromwich to limit his monitorship.

Top Rated Comments

GadgetDon Avatar
93 months ago
First, the fact that he says he has no experience in anti-trust makes me wonder, WTF was he doing being placed in that position? Why not give the monitoring job to the guy he's hiring to actually DO HIS JOB.

Second, the guy has one area of authority. The Anti-trust behavior regarding the ebooks. The judge admitted that neither MFN nor agency model are inherently restraint of trade, so he can't use the idea of "but you use the agency model elsewhere" to expand his authority. John Ivy is involved in the design of the hardware and, most recently, the software. He has NOTHING to do with the agreements reached with content providers or suppliers or retailers or anyone.

Third, according to another article, not only is this guy insisting on interviewing top management at his leisure, he's insisting on interviewing them without any of Apple's lawyers present. Damn straight Tim Cook doesn't want an interview under those terms, he's got an IQ over 50 and he knows that's insane. This guy is also insisting on the ability to report to the judge without any representatives from Apple being present.
Score: 8 Votes (Like | Disagree)
DarkWinter Avatar
93 months ago
I'd like to hear the justification for requesting an interview with Ive given the subject matter.
Score: 8 Votes (Like | Disagree)
fredaroony Avatar
93 months ago
lol the irony...Apple complaining about overcharging
Score: 6 Votes (Like | Disagree)
gatearray Avatar
93 months ago

...even though the Court's Order provided no role for Apple in setting the monitor's compensation.

So why not charge $2,000 an hour? :)

These days, top lawyers in NYC seem to earn about $800/hr, so where does this guy get off billing $1,100? Oh that's right, he was appointed to this position by the judge who probably is a friend of his and Apple has deep pockets so he gets carte blanche with the bill.
Score: 6 Votes (Like | Disagree)
robbyx Avatar
93 months ago
Amerika at work. Punish the successful. Over regulate. And by all means, when you're part of the government, the new, untouchable political class, charge whatever you want for your middling skills.
Score: 4 Votes (Like | Disagree)
albusseverus Avatar
93 months ago
If you look at this as a shakedown of Apple by the administration and their friends, it makes more sense. Apple clearly isn't donating enough to political parties and they want their rightful slice of Apple's profits.

Book companies are pretty good at price fixing, without Apple.

Government isn't the only sector where people with no experience get appointed to jobs they can't do.

Filthy lucre. That's all it is.

The point is - the government wants control over Apple's business, that's why they weren't fined, which would have been the normal practise. A fine would have gone to those that suffered the book companies' greed, or to public funds.

The conviction was predetermined and wrong. Everything follows from my initial observation. It's a shakedown.
Score: 3 Votes (Like | Disagree)

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