Legal Briefing: DOJ Looks at Apple iTunes for Antitrust Violations
Did Apple Abuse iTunes' Market Power?
The Department of Justice is looking into the economics of selling music online, according to The New York Times. In particular, it quizzed people about a recent Apple power-play against Amazon revealed by Billboard magazine last March. Amazon (AMZN) asked music companies to give it one-day exclusivity to sell songs the day before their general release, as part of Amazon's "MP3 Daily Deal." Apple (AAPL) told the music labels to stay out of the Amazon promotion, and punished those who went ahead by not marketing the participating songs on iTunes. The Wall Street Journal notes that the inquiry is so preliminary it is not yet a formal investigation.
Don't Believe Everything You Read, Like Big Banks' Financial Statements
The Wall Street Journal just followed up its earlier report on the big banks' quarterly balance sheet "window dressing" with a more detailed analysis of eight banks' quarterly reports. The Journal looked at how much leverage the banks had, on average, throughout the quarter, and compared that amount to what the banks reported having a quarter's end. The analysis found that three banks in particular -- Bank of America (BAC), Citigroup (C) and Deutsche Bank (DB) -- "showed the most consistent, repeated pattern of quarter-end declines in repo debt from average levels for the same quarters." Neither the Journal nor anyone else is alleging illegality, but the Securities and Exchange Commission is investigating the practices, and is considering rule changes to address them. In the meantime, investors beware: The banks' quarterly reports apparently aren't giving you an accurate snapshot of their typical leverage and risk levels, however accurate they may be for the moment in time being reported.
Toyota Death Toll Rises Retroactively
Toyota (TM) is facing lots of litigation over its vehicles, but the most tragic cases are the wrongful death claims from families of those killed by out-of-control cars. A new government report identifies 89 deaths and 57 injuries in the last decade caused by unintended acceleration incidents, up from 52, according to The New York Times. Bloomberg notes that a judge assigned to some of the personal-injury lawsuits is trying to have them consolidated with other pending cases in the name of efficiency and consistency.
EMC Pays $87.5 Million Whistle-Blower Settlement
The Department of Justice announced that EMC (EMC) would pay $87.5 million to settle a whistle-blower's claims that it overcharged the government for its computer storage services, according to Am Law Litigation Daily.
David Byrne Sues Gov. Charlie Christ Over Song
Musicians often don't appreciate their works being conscripted into campaign materials, and the Talking Heads' David Byrne is no exception. Byrne just sued Florida Gov. Charlie Christ for using the song Road to Nowhere in a GOP Senate primary campaign attack ad. Byrne is seeking $1 million from the former Republican, who is now making his run for the U.S. Senate as an independent.
And in the Business of Law...
• Corporate Counsel reports that different companies get sharply different bills for the same work by the same law firms, reflecting the companies' negotiating skills. Once the numbers come out in a report to be released in September, I imagine widespread price decreases will follow, as companies paying more point to the lower rates and demand the same deals. Or perhaps clients will change firms en masse because they're irate at their relative overcharging.
• Duke University Law School is taking action to help its students deal with crushing student loans, by raising the maximum salary graduates can make and still get loan assistance from $35,000 a year to $75,000 a year, and removing a lifetime cap on the amount of assistance received, reports ABA Journal.