Apple 2.0

Covering the business that Steve Jobs built

Apple's Eddy Cue takes the stand in e-book antitrust trial

June 13, 2013: 1:45 PM ET

Hammered by the DOJ on the effect of higher e-book prices on consumers.

392837361076FORTUNE -- With Eddy Cue finally where the Department of Justice has long wanted to put him -- in the witness chair in federal court facing civil antitrust charges -- the government seemed more interested in shaming him for raising the prices of e-books than in parsing the details of the laws he is alleged to have broken.

According to the DOJ's theory of the case, Cue was the hands-on "ringmaster" -- answering directly to Steve Jobs -- of a conspiracy to violate the Sherman antitrust act.

But the toughest questions put to him by DOJ attorney Lawrence Buterman were variations of the e-mail a college student named Seth Humphrey sent to his boss in February 2010:

Buterman entered the exchange into evidence and read it aloud to the court:

"Hello Mr. Jobs," Humphrey began. "I don't really expect a reply from you, but here goes. I am a Mac and Kindle owner. And with Apple strong-arming Amazon into raising e-book prices, this is detrimental to my reading as a college student. You have so much. Wouldn't it be okay for us little guys to have something?... Peace."

Jobs, as was sometimes his wont, did reply, and he gave the same answer to Humphrey that Cue gave on the stand:

"It's the publishers that are raising prices, not Apple."

The government maintains -- as Humphrey did in his next e-mail to Jobs -- that it was Apple (AAPL) that allowed the publishers to set their own prices.

"That is correct," Cue cheerfully admitted.

Whether that is also illegal is something U.S. District Judge Denise Cote will have to decide.

Cue, who is a witness for the defense as well, will be questioned by Apple's attorneys in the afternoon. At the trial's current pace, however, it seems unlikely that his testimony will be completed before the court goes into recess for the weekend.

If that's the case, he'll be back on the stand on Monday. The trial is scheduled to wrap up on Thursday, June 20.

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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