FORTUNE — In a 160-page ruling following a three-week bench trial, U.S. District Judge Denise Cote has found that Apple (AAPL) did indeed violate the Sherman antitrust act by conspiring with five publishers to raise the price of e-books.
The key paragraph:
Although the judge had announced before the trial began that she believed the Department of Justice would prove its case, the ruling comes as a surprise to observers who heard Apple’s defense.
The facts were less in dispute than the rules governing a distributor like Apple, which recent antitrust case law treats differently than competitors — such as book publishers — forming a horizontal agreement to fix prices.
Although the judge is going to schedule a separate trial to determine damages, the case seems destined to be appealed, perhaps all the way to the Supreme Court.
UPDATE: We have statements from both sides.