Publisher defendants Penguin and Macmillan filed their first answers to the Department of Justice’s antitrust law suit in Federal Court on Tuesday, with both companies categorically denying the charges. Most broadly, Penguin repeats its contention that it “did not conspire to fix the prices of eBooks with other publishers or with Apple. Penguin, at the invitation of Apple, independently negotiated and ultimately entered into a vertical distribution agreement with Apple.” They argue “a vertical distribution agreement is presumptively pro-competitive. New entry is presumptively pro-competitive. Broader distribution is presumptively pro-competitive. Lower barriers to entry are presumptively pro-competitive. Yet the Government intentionally […]
Legal
Apple Denies Justice’s Pricing Conspiracy Charges, Says “The Government Sides with Monopoly”
On Tuesday, Apple filed their answer the Department of Justice’s complaint against the company in the agency ebook pricing action, taking direct aim against the government’s choices and motives. “The Government sides with monopoly, rather than competition, in bringing this case. The Government starts from the false premise that an eBooks ‘market’ was characterized by ‘robust price competition’ prior to Apple’s entry. This ignores a simple and incontrovertible fact: before 2010, there was no real competition, there was only Amazon. At the time Apple entered the market, Amazon sold nearly nine out of every ten eBooks, and its power over […]
As Expected, HMH Files For Pre-Packaged Chapter 11 Bankruptcy
Houghton Mifflin Harcourt filed for chapter 11 bankruptcy in New York’s Southern District Court Monday morning, listing debt of more than $1 billion each in the initial court filing. As previously reported, HMH is going through a pre-packaged bankruptcy to eliminate more than $3 billion in debt left over from the initial $7 billion accrued when Riverdeep merged Houghton Mifflin and Harcourt together several years ago, and hopes to complete its financial restructuring by the end of June. Court documents filed by HMH’s counsel Paul, Weiss, Rifkind and Garrison lists assets of “between $10 million and $50 million,” as well […]
Simon & Schuster Agrees to Settle with States
As expected would happen, Simon & Schuster has signed a memorandum of understanding with the original group of state attorneys general who filed suit against the company as part of the action over ebook pricing. That memo was executed May 10, the parties told Federal Judge Denise Cote, in a motion for dismissal without prejudice of the original complaint. They wrote in the filing that “plaintiff States and Simon and Schuster intend to enter into a settlement agreement, and plaintiff States will subsequently file with the Court a proposed notice and distribution plan.” The court docket confirms the federal case was “terminated” […]
Judge Cote Rejects Motions to Dismiss Agency Class Action Suit; Shows Sympathy for the Plaintiffs
US District Judge Denise Cote formally denied motions by the five agency publishers and Apple to dismiss the class action suit on behalf of ebook consumers over the alleged conspiracy to raise ebook prices via the agency model. The ruling was not unexpected, given the relatively low standards of “stat[ing] a plausible claim” for such a suit to go forward: “Proving conspiracy requires demonstrating ‘a unity of purpose or a common design and understanding, or a meeting of minds in an unlawful arrangement.’ The [complaint] plausibly alleges that each of the defendants shared the twin purposes of raising the price […]
Responses to the Georgia State University Fair Use Ruling
A number of plaintiffs and interested parties have responded Monday to last week’s ruling in the Georgia State University e-reserves lawsuit that found 5 instances of infringement but otherwise dismissed more than 64 instances, and AAP president Tom Allen and the organization’s lead attorney in the case Bruce Rich convened a press briefing by phone on Tuesday morning. Allen that the AAP alone has invested “several million dollars” in the case so far. He underscored that “our members are very conscious that the universities and their libraries are our customers.” Allen added, “our hope is that this is an important […]