E-book publishers reach $69 million settlement with states

Apple and two other publishers remain holdouts in the attroneys generals' price-fixing case

Three book publishers will pay more than US$69 million to U.S. states to settle charges they collaborated to fix prices of e-books.

Hachette Book Group, HarperCollins Publishers and Simon & Schuster have agreed to an antitrust settlement with the attorneys general of 54 U.S. state, districts and territories, Connecticut Attorney General George Jepsen announced Wednesday. The three publishers also agreed to change the way they price e-books going forward, Jepsen said in a press release.

The same three publishers agreed to settle a U.S. Department of Justice e-book pricing-fixing case in April. Defendants Apple, Penguin Group and MacMillan have not settled either case.

The attorneys general filed a civil antitrust case Wednesday in U.S. District Court for the Southern District of New York against the five publishers. The lawsuit accused the five publishers of conspiring and agreeing "to increase retail e-book prices for all consumers."

The lawsuit and settlement come after a two-year antitrust investigation by the DOJ and the Connecticut and Texas attorneys general. The investigation allegedly found that the publishers worked with Apple to set prices for e-books and limit the discounts retailers could give. The publishers case consumers to pay "tens of millions" of dollars more for e-books, Jepsen said in the press release.

"While publishers are entitled to their profits, consumers are equally entitled to a fair and open marketplace," Jepsen said in a statement. "This settlement will provide restitution to those customers who were harmed by this price-fixing scheme, but it also will restore competition in the e-book market for consumers' long-term benefit."

Much of the money collected in the settlement will be returned to consumers.

A representative of Simon & Schuster called the settlement "fair."

"We're pleased to now have put this matter behind us, and moving forward, to continue our work with authors and accounts to grow the market for books of all formats -- and to take advantage of the many opportunities afforded us by publishing in the digital era," he said.

Representatives of the two other settling publishers weren't immediately available for comment.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

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