Apple Gets Half A Loaf Of Bread In “Losing” Appellate Challenge Of Antitrust Monitor
Although the U.S. Court of Appeals for the Second Circuit has denied Apple’s motion to suspend a court-appointed antitrust compliance monitor, Apple actually achieved part of its goal of reining in the monitor.
Apple had asked the appellate court to stay the monitor, Michael R. Bromwich, from doing any more work pending Apple’s appeal of that appointment in United States v. Apple, Inc. While the court denied Apple’s motion on Monday, it gave Apple some of what it asked for by writing a one-page order that should effectively put some limits on how far the monitor can reach in demanding documents and interviews with Apple employees.
Significantly, the appellate court premised its denial of the motion to stay the monitor on a narrow reading of Judge Denise Cote’s order appointing the monitor.
The Second Circuit’s order explained that the monitor’s job was to ensure that Apple is putting antitrust compliance policies in place. The Second Circuit noted that the district court’s order of appointment “should be interpreted narrowly,” and highlighted that at oral argument the government “conceded” that the monitor was not allowed “to investigate whether [Apple’s] personnel were in fact complying with the antitrust or other laws.”
The Second Circuit gave the government’s concession added importance by stating that “we take counsel’s statement as a formal representation that appellees also accept that interpretation, and that the monitor will conduct his activities within the bounds of that order, absent further action by the district court or by the panel that will in due course hear the merits of the appeal.”
It is not surprising that the Second Circuit chose the easy path of textual interpretation to cabin the monitor’s activities. As this blog noted when Apple moved the district court to suspend the monitor for allegedly overstepping his bounds, “under the court’s own order, the external compliance monitor’s mandate extends only to reviewing and assessing Apple’s internal compliance policies, procedures, and practices,” and not to “ seeking-out and uncovering possible antitrust violations.”
While the Second Circuit declined to stay the external monitor, its reining in of the monitor gave Apple at least a partial victory in this round. As we have previously discussed, one of Apple reason’s for taking grand issue with what it characterized as outrageous conduct and overreaching by the monitor may have been to bolster its appeal on the merits, which is challenging Judge Denise Cote’s decision that Apple conspired to raise e-book prices. Although Apple did not convince the Second Circuit to stay the appointment of the monitor, it apparently did convince the appellate court there was reason to rein in the monitor.
To the extent that Apple is seeking to convey to the Second Circuit an impression of overreaching by the district court and its monitor, Apple may well have furthered its ultimate objective with its “loss” here.
— Edited by Gary J. Malone