Atty. Gen. George Jepsen, along with 54 attorneys general in other states, districts and U.S. territories, announced that they have reached an antitrust settlement with three of the largest book publishers in the U.S. Hachette Book Group, Inc., HarperCollins Publishers L.L.C. and Simon & Schuster Inc. have agreed to pay a total of more than $69 million to consumers to resolve antitrust claims of an alleged unlawful conspiracy to fix the prices of electronic books (eBooks). They will also change the way they price eBooks going forward.
The settlement occurs in conjunction with a civil antitrust lawsuit filed Wednesday in U.S. District Court for the Southern District of New York against Hachette, HarperCollins, and Simon & Schuster, which alleges 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 eBook prices for all consumers” and “agreed to eliminate eBook retail price competition between eBook outlets, such that retail prices to consumers would be the same regardless of the outlet patronized by the consumer.”
The lawsuit and settlement stem from a two-year antitrust investigation conducted jointly by the U.S. Department of Justice’s Antitrust Division, Jepsen, and Texas Atty. Gen., Greg Abbott. That investigation developed evidence that the Agency Five conspired to end eBook retailers’ freedom to compete on price by taking control of pricing from eBook retailers and substantially increasing the prices that consumers paid for eBooks. The attorneys general said that the publishers prevented retail price competition resulting in consumers paying tens of millions of dollars more for their eBooks.
Under the proposed settlement agreement, which must receive court approval, Hachette, HarperCollins and Simon & Schuster will compensate consumers who purchased eBooks from any of the Agency Five during the period of April 1, 2010, through May 21, 2012. Payments will begin 30 days after the court approval of the settlement becomes final.
Consumers in Connecticut are expected to receive up to $1,264,658 in total compensation. The settling defendants will also pay approximately $7.5 million to the states for fees and costs.
