Apple’s $450M plan to settle ebook price-fixing gets green light

Apple could begin paying out $400 million worth of cash and ebook credits to consumers by the end of the year, after a federal judge approved an unusual deal related to an Apple-led conspiracy to fix the price of ebooks.

On Friday, Reuters reported that U.S. Distrct Judge Denise Cote approved a settlement reached this summer under which Apple agreed to pay $400 million to consumers and $50 million to lawyers.

Those numbers are conditional, however, on an appeals court upholding a 2013 verdict in the price-fixing case, in which Apple was found to have colluded with five big publishers to fix the price of ebooks. The appeals court will hear Apple’s challenge on December 15, but few expect that the court will disturb the verdict.

In the event the appeals court does send back the verdict to be reconsidered, Apple will instead pay only $50 million to consumers plus $20 million to the lawyers instead.

The unusual structure of the settlement appears to reflect a desire on the part of everyone involved — Apple, the Department of Justice, state attorneys general and class action lawyers — to expedite a process that has been dragging on for years.

The upshot is that the appeals court will come to a decision on, or shortly after, December 15, and consumers will get an email notice letting them know how much they will receive.

The payout format will resemble what occurred earlier in the case when book publishers likewise agreed to a series of settlements. Those arrangements saw customers receiving around $3 for any New York Times bestseller they bought between April 1, 2010, and May 21, 2012, and less than $1 for other books. Most of the payments came in the form of credits to customers’ iTunes, Kindle or Barnes & Nobel accounts.