Apple’s attempt to overturn an anti-trust finding that it colluded to fix the price of e-books failed Tuesday with the Federal Appeals Court upholding the original 2013 decision.

The appeals court, in what was reported to be a 2-1 decision, found “that the district court correctly decided that Apple orchestrated a conspiracy among the publishers to raise e-book prices,” and that the conspiracy “unreasonably restrained trade” in violation of the Sherman Act, the Federal antitrust law.

The original case, back in 2013, exposed Apple’s evil marketing tactics in trying to break into the e-book marketplace which has long be dominated by Amazon. In that trial, the court heard that Apple’s agreements ceded the power to set prices to the publishers, whereas Amazon preferred a heavy discounting model.

The clause that got Apple into trouble was the exception clause: if another retailer were selling an e-book at a lower price, the publisher would have to match that price in Apple’s book store.

That may sound reasonable at first, but in effect what it allowed publishers to do, with Apple’s tacit support, was to give leverage to  threaten to remove their books from Amazon unless Amazon matched the price they were able to charge for the same books via Apple, and the court found that prices actually increased due to publishers doing this very thing.

“Apple understood that its proposed contracts were attractive to the publisher defendants only if they collectively shifted their relationships with Amazon to an agency model — which Apple knew would result in consumers facing higher e-book prices,” the original ruling against Apple found.

Pocket change

“Apple did not conspire to fix e-book pricing and this ruling does nothing to change the facts,” Apple said in a statement. “We are disappointed the court does not recognize the innovation and choice the iBooks Store brought for consumers.”

Apple’s position was supported by the one dissenting judge, who wrote that “Apple took steps to compete with a monopolist and open the market to more entrants, generating only minor competitive restraints in the process…its conduct was eminently reasonable; no one has suggested a viable alternative.”

The ruling is not the end of the world for the company, however, with the $450 million fine being pocket change from Apple’s vast cash reserves; it may look bad, but Apple CEO Tim Cook will barely lift an eyelid.

Apple has not yet announced whether it will appeal the ruling again in a higher court.

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