E-Book Price Escalation Lawsuit Settled By Penguin Group

Not very late we heard about the news of settlement of e-books price fixing by publishers with the European Commission. The settlement was reached between the European Commission on the one hand and Apple and Hachette Livre, HarperCollins, Simon and Schuster and Macmillan on the other hand. Meanwhile, the Commission is still engaged in discussions with a fifth publisher – Penguin’s owner Pearson.

In a related development, the United States Justice Department has declared that it has reached a settlement with the US situated Penguin Group. The Penguin Group has been facing a lawsuit accusing it of colluding with Apple to raise e-book prices. This would ultimately affect the consumers with an increased price for the respective e-books.

Once the Penguin Group settlement is approved by a Federal Judge, only Apple and Holtzbrinck Publishers LLC, which does business as Macmillan, would be facing the Federal Government’s charges.

It is alleged by the Government that Apple conspired with several publishers in the fall of 2009 to force e-book prices several dollars above the $9.99 charged by Amazon on its Kindle device.

The Justice Department has already settled with Hachette Book Group, HarperCollins Publishers LLC and Simon and Schuster earlier this year. The trial is scheduled to begin in June.

Under the settlement, Penguin will be prohibited for two years from entering into new agreements that constrain retailers’ ability to offer discounts or other promotions to consumers to encourage the sale of the Penguin’s e-books. The settlement also says that Penguin must also submit to “a strong antitrust compliance program” that includes telling Federal Officials about any joint e-book ventures or any communications with other publishers.

Meanwhile, Penguin Books is scheduled to merge with Random House, which is owned by German media company Bertelsmann. The resulting combination will have around a quarter of the market for consumer books. The proposed terms of settlement would also apply to any new joint venture entity that may ultimately emerge.

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  1. Pingback: Apple Fined In Beijing Court For Unauthorised E-Book Sales | Techno Legal Thoughts

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