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Biden Announces $69 Million Agreement with E-Book Publishers over Price-Fixing Allegations

Department of Justice | Date Posted: Thursday, August 30, 2012



Delaware consumers estimated to receive over $235,000 in total compensation

Wilmington — Attorney General Beau Biden, along with 54 other state attorneys general, announced today that they have reached an antitrust settlement with three of the nation’s largest book publishers.  Hachette Book Group, Inc., HarperCollins Publishers L.L.C. and Simon & Schuster Inc. will pay more than $69 million to consumers to resolve the states’ antitrust claims of an alleged unlawful conspiracy to fix the prices of electronic books (E-books).  The publishers have also agreed to follow a court order designed to reestablish price competition in the retail market for E-books. 

The settlement agreement occurred in conjunction with a civil lawsuit filed by the states today in US District Court against Hachette, HarperCollins, and Simon & Schuster.  In the lawsuit, the states allege that the three settling publishers and others, including non-settling publishers Macmillan and Penguin (collectively, the “Agency Five” publishers), “conspired and agreed to increase retail E-book prices for all consumers” and “agreed to eliminate E-book retail price competition between E-book outlets, such that retail prices to consumers would be the same regardless of the outlet patronized by the consumer.” 

“Competition lowers prices for consumers, but in this case, the publishers’ collusive actions denied consumers that benefit,” Attorney General Beau Biden said.  “This settlement with three of those publishers begins the process of helping consumers harmed by the publishers’ scheme.”   

The lawsuit and related settlement stem from a two-year antitrust investigation conducted jointly by the Connecticut and Texas Attorneys General and U.S. Department of Justice’s Antitrust Division. That investigation developed evidence that the Agency Five conspired to end E-Book retailers’ freedom to compete on price.  Once they took control of pricing, the publishers substantially increased the prices consumers paid for E-Books. This action resulted in consumers paying millions of dollars more for their e-books.

Under the proposed settlement agreement, which must be approved by the court, Hachette, HarperCollins and Simon & Schuster will compensate consumers who purchased E-books from any of the Agency Five between April 1, 2010 and May 21, 2012.  Delaware consumers are estimated to receive over $235,000 in total compensation. The settling defendants will also pay approximately $7.5 million to the states for fees and costs.

Delaware continues to seek compensation for consumers who have purchased E-books from other participants in the conspiracy.  Biden’s office has joined with other states in a separate lawsuit against E-book publishers Macmillan and Penguin and E-book seller Apple, with a trial date set for early June 2013.

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Biden Announces $69 Million Agreement with E-Book Publishers over Price-Fixing Allegations

Department of Justice | Date Posted: Thursday, August 30, 2012



Delaware consumers estimated to receive over $235,000 in total compensation

Wilmington — Attorney General Beau Biden, along with 54 other state attorneys general, announced today that they have reached an antitrust settlement with three of the nation’s largest book publishers.  Hachette Book Group, Inc., HarperCollins Publishers L.L.C. and Simon & Schuster Inc. will pay more than $69 million to consumers to resolve the states’ antitrust claims of an alleged unlawful conspiracy to fix the prices of electronic books (E-books).  The publishers have also agreed to follow a court order designed to reestablish price competition in the retail market for E-books. 

The settlement agreement occurred in conjunction with a civil lawsuit filed by the states today in US District Court against Hachette, HarperCollins, and Simon & Schuster.  In the lawsuit, the states allege that the three settling publishers and others, including non-settling publishers Macmillan and Penguin (collectively, the “Agency Five” publishers), “conspired and agreed to increase retail E-book prices for all consumers” and “agreed to eliminate E-book retail price competition between E-book outlets, such that retail prices to consumers would be the same regardless of the outlet patronized by the consumer.” 

“Competition lowers prices for consumers, but in this case, the publishers’ collusive actions denied consumers that benefit,” Attorney General Beau Biden said.  “This settlement with three of those publishers begins the process of helping consumers harmed by the publishers’ scheme.”   

The lawsuit and related settlement stem from a two-year antitrust investigation conducted jointly by the Connecticut and Texas Attorneys General and U.S. Department of Justice’s Antitrust Division. That investigation developed evidence that the Agency Five conspired to end E-Book retailers’ freedom to compete on price.  Once they took control of pricing, the publishers substantially increased the prices consumers paid for E-Books. This action resulted in consumers paying millions of dollars more for their e-books.

Under the proposed settlement agreement, which must be approved by the court, Hachette, HarperCollins and Simon & Schuster will compensate consumers who purchased E-books from any of the Agency Five between April 1, 2010 and May 21, 2012.  Delaware consumers are estimated to receive over $235,000 in total compensation. The settling defendants will also pay approximately $7.5 million to the states for fees and costs.

Delaware continues to seek compensation for consumers who have purchased E-books from other participants in the conspiracy.  Biden’s office has joined with other states in a separate lawsuit against E-book publishers Macmillan and Penguin and E-book seller Apple, with a trial date set for early June 2013.

image_printPrint


Graphic that represents delaware news on a mobile phone

Keep up to date by receiving a daily digest email, around noon, of current news release posts from state agencies on news.delaware.gov.

Here you can subscribe to future news updates.