MO attorney general joins antitrust suit against U.S. publishers

Missouri Attorney General Chris Koster yesterday joined 15 other state attorneys general in filing a suit seeking restitution from Apple Inc. and three of the largest U.S. book publishers for colluding to fix electronic book sales prices.
 
The antitrust lawsuit stems from a two-year investigation into allegations that the publishing companies conspired to raise e-book prices, according to a news release from Koster’s office. For years, retailers sold e-books via a traditional wholesale distribution model through which retailers, not publishers, set the sales prices of e-books. The investigation revealed, however, that publishers Penguin, Simon & Schuster and Macmillan allegedly conspired with other publishers and with Apple to raise prices artificially by imposing a distribution model in which publishers set prices for best-sellers at $12.99 and $14.99.
 
The publishers and Apple relied on contract terms forcing all e-book outlets to sell their products at the same price to enforce the price fixing-scheme, the release said. According to the lawsuit, the coordinated agreement to fix the prices resulted in e-book customers paying more than $100 million more than they would have paid without the agreements.
 
“This conduct was both illegal and fraudulent under Missouri law,” said Koster, who serves as the national co-chairman of the antitrust committee of the National Association of Attorneys General, in the release. “When companies compete, consumers benefit from lower prices, and in Missouri we will continue to protect consumers by identifying and stopping this type of anticompetitive behavior.”
 
Other states participating in the lawsuit are Connecticut, Alaska, Arizona, Colorado, Illinois, Iowa, Maryland, Ohio, Pennsylvania, Puerto Rico, South Dakota, Tennessee, Texas, Vermont and West Virginia.
 
The lawsuit claims the publishers violated the states’ antitrust laws and the federal Sherman Antitrust Act and seeks injunctive relief to reverse the effects of the defendants’ anticompetitive conduct. The suit also seeks damages for customers who paid artificially inflated prices for e-books.

The states participating in the suit already have reached an agreement in principle with publishers Harper Collins and Hachette for significant customer restitution and injunctive relief, the release said.[[In-content Ad]]