Apple, the world’s largest public company by market capitalisation, has a problem. The lawyer appointed to ensure it is not price-fixing e-book sales is just too expensive.
The iPhone and iPad maker complained to the New York court this week that Michael Bromwich’s $1,100 an hour fee is “excessive” and he has not justified it as either “reasonable” or customary”.
The fees, which could buy the lawyer a MacBook every hour, are higher than Apple has ever paid before in any of its many legal tussles, the company said in a filing. They are also more than double a rate Mr Bromwich quoted for another recent case, to monitor the New Orleans Police department.
“Mr Bromwich appears to be simply taking advantage of the fact that there is no competition here or, in his view, any ability on the part of Apple, the subject of his authority, to push back on his demands,” Apple’s lawyers wrote, adding Mr Bromwich’s personal financial interest in the proceedings was “unconstitutional”.
“Mr Bromwich’s extraordinary fee demand has already generated nearly 75 per cent of a yearly judicial salary (almost $140,000) over the course of only two weeks, and he has refused to propose any sort of budget going forward,” they said.
Apple may have a market cap of over $500bn and $130bn net cash sitting in its coffers but it clearly believes that if you look after the pennies, the billions will look after themselves.
Mr Bromwich is charged with tracking Apple’s progress as it complies with a court ruling to change its agreements with publishers to create more price competition. The company was found guilty in July of acting as a ringleader in a price-fixing conspiracy as it launched its digital books business.
Apple also complained that the monitor was acting in an “unfettered and inappropriate manner” outside the scope of the final judgement and “trampling Apple’s rights”.
He has pressed for immediate interviews with Tim Cook, chief executive, and other top executives. These include those Apple says have “nothing whatsoever to do” with the day-to-day operation of the e-book business including Jony Ive, the lead designer, and Al Gore, board member and former US vice president.
Apple said it should not even have to deal with these “incredibly disruptive” requests this early in the process, as the court had given the company a deadline of January 14 to put in place new compliance systems.
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