logo
Share SHARE
FONT-SIZE Plus   Neg

U.S. DoJ Files Lawsuit Against Apple, Publishers Regarding E-book Pricing

The United states Department of Justice announced Wednesday that it has reached a settlement with three of the largest book publishers in the United States- Hachette Book Group (USA), HarperCollins Publishers L.L.C. and Simon & Schuster Inc.-and will continue to litigate against Apple Inc. (AAPL) and two other publishers-Holtzbrinck Publishers LLC, which does business as Macmillan, and Penguin Group (USA)-for conspiring to end e-book retailers' freedom to compete on price, take control of pricing from e-book retailers and substantially increase the prices that consumers pay for e-books.

The department said that the publishers prevented retail price competition resulting in consumers paying millions of dollars more for their e-books.

The civil antitrust lawsuit was filed in U.S. District Court for the Southern District of New York against Apple, Hachette, HarperCollins, Macmillan, Penguin and Simon & Schuster.

The department said that at the same time, it filed a proposed settlement that, if approved by the court, would resolve the department's antitrust concerns with Hachette, HarperCollins and Simon & Schuster, and would require the companies to grant retailers-such as Amazon and Barnes & Noble-the freedom to reduce the prices of their e-book titles.

According to the complaint, the five publishers and Apple were unhappy that competition among e-book sellers had reduced e-book prices and the retail profit margins of the book sellers to levels they thought were too low. Before the companies began their conspiracy, retailers regularly sold e-book versions of new releases and bestsellers for, as described by one of the publisher's CEO, the "wretched $9.99 price point." As a result of the conspiracy, consumers are now typically forced to pay $12.99, $14.99, or more for the most sought-after e-books, the department said.

The complaint stated that the companies accomplished their conspiracy by agreeing to stop the longstanding practice of selling e-books, as they long sold print books, on wholesale to bookstores, and leaving it to the bookstores to set the price at which they would sell the e-books to consumers.


The department noted that the publishers also agreed with Apple to pay Apple a 30 percent commission for each e-book purchased through Apple's iBookstore and promised, through a retail price-matching most favored nation (MFN) provision, that no other e-book retailer would sell an e-book title at a lower price than Apple.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Quick Facts

Editors Pick
A Pennsylvania woman has sued Chick-fil-A after she claimed a dead rodent was found baked into her chicken sandwich. Ellen Manfalouti of Northampton has filed a lawsuit in Bucks County Court against Chick-fil-A, seeking more than $50,000 for the physical and psychological damages that she endured after the incident occurred. Early Uber investor Shervin Pishevar has alleged that venture capital firm Benchmark Capital is seeking to remove Arianna Huffington from the ride-hailing company's board of directors. Pishevar also accused Benchmark of holding Uber hostage by threatening to block investments in the company and urged it to step down from Uber's board of directors. A class-action lawsuit has been filed against Nestle's marketing and sales of Poland Spring bottled water, accusing it of not meeting the federal definition of spring water and of being "a colossal fraud perpetrated against American consumers."
comments powered by Disqus
Follow RTT