updated 02:00 am EST, Tue December 31, 2013
Cites previous experience, but had to hire anti-trust assistant
Michael Bromwich, a friend of Judge Denise Cote and her appointed antitrust monitor ordered to review changes to Apple's antitrust policies, reiterates in his latest legal brief in a war of words with Apple that the company has been "uncooperative" with regards to his extra-legal investigations and denying Apple's claim that he was conducting a "broad and amorphous inquisition" that had little to do with Apple's e-book business.
While it is perhaps unsurprising that Apple would be hostile to a court-ordered monitor in a case that Apple feels strongly they did not deserve to lose (and is looking at a very strong case for appeal), the company only went back to court originally to complain about various abuses of Bromwich with regards to both his mandate and his fee. Apple, which interprets the judge's order as specifying that Bromwich has no formal duties until a mid-January adjustment to Apple's antitrust policy statement is due, complained to the court that Bromwich lacks experience in the job to which he has been appointed, has been disruptive at Apple, has exceeded his authority in asking to talk to officers and executives with no connection at all to the e-book portion of Apple's business, is begin grossly overpaid for what his duties are supposed to be, and that the judge had originally allowed for secret, "ex-parte" meetings between Bromwich and herself in which Apple would be unable to rebut or defend itself, with no transcript or witnesses to the meetings allowed.
Apple was able to get the judge to reverse her ruling on the "ex parte" secret meetings, but as has often been the case with Judge Cote, she ignored or failed to address the rest of Apple's various complaints, referring the company to its adversary in the case, the Department of Justice for the first round of disputes. Because she is still handling the damages case related to the first e-book bench trial that is being brought by various state attorneys general and consumer groups, she admitted that such meetings might improperly influence her and dropped the meetings, claiming that she had not already had any with Bromwich.
For his part, Bromwich has a long relationship with the judge -- she wrote letters to the Congress helping him get his previous job at the Department of Justice despite Congressional concerns about his numerous conflicts of interest. Bromwich was an Inspector General for the DOJ during the Clinton adminstration, and has ties to the BP oil scandal and the Iran-Contra affair. That Judge Cote nominated someone formerly employed by the prosecution in the case will likely be a key point Apple's attorneys will make when they get before an appeals court in an effort to get Bromwich removed or at least suspended until the outcome of the appeals trial.
Appointing a monitor in a case where the guilty party has no history of similar behavior is in itself unusual, and when combined with his background working for the prosecution was seen by many as a vindictive move by the judge, who had pre-announced her likely findings before the trial even began.
The DOJ successfully sued Apple earlier this year, alleging that the company joined an existing "horizontal" price-fixing conspiracy among publishers against Amazon's abusive-monopoly behavior and price model. Apple argued (and will argue in its appeal) that it did not participate in any conspiracy, and that its proposed "agency" model for e-book pricing in fact levelled the playing field, allowing more publishers and more e-book sellers to enter the market.
In its objections, Apple pointed out that Bromwich required a second lawyer with actual experience in antitrust issues to assist him. Bromwich demanded an $1,100 per hour rate, as well as a 15 percent "administrative fee" to his consulting firm -- on top of the $1,025 per hour for the antitrust lawyer assistant. Though the hourly rate is typical for top-flight lawyers, both the "administrative fee" and his need for an assistant is unusual. For his first two weeks on the case, Bromwich billed Apple over $138,000.
Apple claimed that Bromwich went well outside his remit, demanding interviews with engineers and board members that had no connection to the e-book business, such as product designer Sir Jonathan Ive and former US Vice President Al Gore, on his own schedule and terms. Bromwich also demanded access to confidential Apple documents that had no direct bearing on the e-book business, and Apple subsequently also objected to a portion of Cote's November 21 order in which she gave herself the right to publicly file materials the monitor obtains from Apple "in the interests of justice."
In his rebuttal to Apple's complaints, Bromwich denied that his investigation was a "broad and amorphous inquisition," but did not explain the discrepancy of asking to speak to executives unconnected to the e-book business. He reiterated (numerous times) his previous experience in monitoring three separate corporate and governmental agencies, though none of the previous cases dealt with antitrust issues. Bromwich included emails from from Apple's senior director for competition law and policy Kyle Andeer that rebuffed or postponed meetings.
Though Apple has said that Bromwich has no official duties until mid-January, it has thus far granted him 11 interviews with various officials for a total of 13 hours. Most, Bromwich points out, were lawyers involved in the case rather than "business people," but he also spoke to an unnamed Apple board member. "This is far less access than I have ever received during a comparable period of time in the three other monitorships I have conducted," he said in his declaration. An example of Apple being "uncooperative" is its refusal to make Sir Jonathan Ive available for interviews on the grounds that he has no connection, past or present, to the e-book case.
Bromwich has further complained that Apple has not provided requested documents in a timely manner, a claim Apple has already rebutted by calling the requests "voluminous historical documents" that have no relation to the e-book business. It has provided some 300 pages of documentation to Bromwich already.
He also admitted he has been the subject of "profane" emails regarding his qualifications and charges against Apple, presumably by people who feel that Judge Cote -- and by extension, Bromwich -- have handled the case unfairly with a pre-trial presumption of guilt. That position is widely held outside Judge Cote's courtroom, with a recent Wall Street Journal editorial excoriating Cote and Bromwell for extra-Constitutional overreaches of judicial power as well as poor handling of their respective duties.