As part of the remedy for Apple’s antitrust violations relating to the sale of e-books, Judge Cote in September required that Apple employ an antitrust monitor to evaluate its antitrust policies and compliance. On November 21, Judge Cote, apparently sua sponte, proposed amendments to her final judgment that would allow the monitor, Michael Bromwich, to interview Apple employees and to report to Judge Cote without the participation of Apple’s lawyers. In a filing Wednesday, Apple vigorously objected:
Michael Bromwich is already operating in an unfettered and inappropriate manner, outside the scope of the Final Judgment, admittedly based on secret communications with the Court, and trampling Apple’s rights; the Court’s proposal out of the blue to grant him even greater powers as monitor would only make things worse.
Apple argues (among other things) that “the Court lacks jurisdiction to substantively amend the September 5 Final Judgment during the pendency of Apple’s appeal,” and that “the unilateral investigation the Court has empowered Mr. Bromwich to undertake is not a judicial function, and therefore cannot be delegated by the Court.” According to Apple:
If the proposed amendments were adopted, Mr. Bromwich’s powers would exceed those of the [the Justice Department and state Attorneys General], because he would be authorized to interview witnesses ex parte, and report ex parte to the Court. Roving investigations with a commission to ferret out wrongdoing—including the powers to “interview,” “inspect,” and “discover evidence”—are well outside the boundaries of judicial power.” Rather, they are prosecutorial powers vested in the President by Article II, § 1.
Finally, Apple objects to Mr. Bromwich’s pay:
Mr. Bromwich has proposed an hourly rate for himself of $1,100. And because he lacks any antitrust experience, Mr. Bromwich has also retained the law firm Fried Frank to assist him, whose partner’s hourly rate is $1,025. Mr. Bromwich has made no attempt to justify why his lack of any substantive experience with the matter at issue justifies hiring another law firm with a four-digit billing rate. As Apple explained to Mr. Bromwich, of all known past Apple matters, “not a single partner had an effective billing rate as high as or higher than those that [Mr. Bromwich has] proposed.” And Mr. Bromwich’s rates in this matter dramatically exceed what he has quoted in the past. For instance, in a proposal to monitor the New Orleans Police Department five months ago, he suggested a $495 hourly rate, without an administrative fee, which the Department of Justice termed “relatively expensive.” On top of these rates, Mr. Bromwich proposes to charge a 15% “administrative fee” to be applied to all fees generated by him, Fried Frank, and other lawyers from other firms he proposes to include on his team. This is unprecedented in Apple’s experience; no law firm Apple has ever engaged has charged a 15% administrative fee on top of the billing rate, and Mr. Bromwich has not identified a single other instance in which he has collected such a fee from a corporate client or monitored entity. 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. . . . . As a result of the foregoing and Mr. Bromwich’s overbroad view of his mandate, Mr. Bromwich’s invoice for his first two weeks of work was for $138,432.40. (As a supposed agent of the Court, he racked up nearly 75% of a district judge’s yearly pay in only two weeks.) These charges were incurred before any documents were exchanged, interviews scheduled, or meaningful travel conducted, and indeed before the 90-day deadline triggering his review of Apple’s compliance and training programs under the injunction. The Final Judgment does not give Mr. Bromwich a blank check to unilaterally impose his billing practices.