Judge rubber-stamps U.S. e-books settlement

“In a move that could reshape the publishing industry, a federal judge [U.S. District Judge Denise Cote] has approved a settlement with three of the nation’s largest book publishers over alleged collusion in the pricing of e-books,” Chad Bray and Jeffrey A. Trachtenberg report for The Wall Street Journal. “The approval comes as Apple Inc. and two other publishers are preparing to defend themselves next June over antitrust allegations by the U.S. Department of Justice that they agreed to keep e-book prices artificially high in response to steep discounting by Amazon.com Inc.”

“Lagard re SCA’s Hachette Book Group, CBS Corp.’s Simon & Schuster Inc. and News Corp.’s HarperCollins Publishers LLC all agreed in April as part of the settlement to terminate their agreements with Apple and refrain from limiting any retailer’s ability to set e-book prices for two years,” Bray and Trachtenberg report. “Apple had hoped to stave off final approval, and termination of the agreements, until after next year’s trial. The approval opens the door for Amazon and other retailers to steeply discount e-book titles.”

Bray and Trachtenberg report, “Bob Kohn, an antitrust lawyer who has filed objections to the settlement, on Thursday said that ‘it appears that the District Court deferred to the Justice Department in its analysis. It’s very disappointing that the court has rendered a judgment that will cause great harm to consumers of e-books because the judgment reverses the pro-competitive effects of the agency pricing model.’ Mr. Kohn suggested that the decision will eventually be appealed. ‘It’s devastating to bookstores,’ said Paul Aiken, executive director of the Authors Guild. ‘For two years the settling publishers must allow vendors to discount e-books at any price they want. The court acknowledges that this restores the status quo conditions before 2010, when Amazon was able capture 90% of the e-book market. The Justice Department is reshaping the literary marketplace without submitting a single economic study to the court to justify its actions.’”

Read more in the full article here.

MacDailyNews Take: Hachette, Simon & Schuster, and HarperCollins are weak-kneed pushovers, as U.S. District Judge Denise Cote, and the U.S. DOJ is plainly inept. For this fiasco alone, they ought to rename it the Department of Injustice.