Barnes & Noble blasts U.S. DOJ e-book settlement proposal

“Barnes & Noble has come out firing against the U.S. government’s proposed settlement of an e-book price-fixing lawsuit,” Michael Krey reports for Investor’s Business Daily. “The settlement, proposed in April, is with three big book publishers: HarperCollins, Simon & Schuster and Hachette.”

“Apple and two other big publishers — Macmillan and Penguin Group — didn’t settle and are fighting the Justice Department’s antitrust suit, which charges they colluded to raise e-book prices, looking to break’s dominance,” Krey reports. “The proposed settlement would harm consumers and help one company only, says B&N —”

“Key to the issue is something called the ‘agency model,’ which lets publishers set the price of e-books, which they share with e-book sellers such as Apple, Barnes & Noble and Amazon. Apple’s cut is 30%, according to the DOJ, but that apparently was less than what Amazon was getting under different arrangements it had with publishers,” Krey reports. “‘This new regulatory regime will injure innocent third parties, including Barnes & Noble, independent bookstores, authors, and non-defendant publishers; hurt competition in an emerging industry; and ultimately harm consumers,’ B&N said in its filing. ‘The proposed settlement seeks to end agency arrangements that are commonplace in many industries and that have brought more competition to the sale of e-books.'”

Krey reports, “B&N’s complaint begins: ‘The proposed settlement represents an unprecedented effort by the Antitrust Division of the U.S. Department of Justice … to reject its traditional role of ending alleged collusion and to become instead a regulator of a nascent technology industry that it little understands.’ B&N says in its filing that as a result of moving to the agency model, Amazon’s share of e-book sales has fallen to 60% from 90%.”

Read more in the full article here.

MacDailyNews Take: As we’ve said from the very beginning of this fiasco: “The U.S. DOJ is plainly inept.”

Related articles:
Apple: U.S. government’s e-book antitrust lawsuit ‘is fundamentally flawed as a matter of fact and law’ – May 24, 2012
Federal Judge rejects Apple and publishers’ attempt to dismiss civil case alleging e-book price-fixing – May 15, 2012
Court documents reveal Steve Jobs email pushing e-book agency model; 17 more states join class action suit – May 15, 2012
Apple vs. Amazon: Who’s really fixing eBook prices? – April 17, 2012
Apple: U.S. DOJ’s accusation of collusion against iBookstore is simply not true – April 12, 2012
Apple not likely to be a loser in legal fight over eBooks – April 12, 2012
16 U.S. states join DOJ’s eBook antitrust action against Apple, publishers – April 12, 2012
Australian gov’t considers suing Apple, five major publishers over eBook pricing – April 12, 2012
DOJ’s panties in a bunch over Apple and eBooks, but what about Amazon? – April 12, 2012
Antitrust experts: Apple likely to beat U.S. DOJ, win its eBook lawsuit – April 12, 2012
Why the market shrugged off the Apple antitrust suit – April 11, 2012
What’s wrong with the U.S. DOJ? – April 11, 2012
Macmillan CEO blasts U.S. DOJ; gov’t on verge of killing real competition for appearance of competition – April 11, 2012
U.S. DOJ hits Apple, major publishers with antitrust lawsuit, alleges collusion on eBook prices – April 11, 2012
U.S. DOJ may sue Apple over ebook price-fixing as early as today, sources say – April 11, 2012


  1. The scope of the DoJ’s misstep on this issue is absolutely staggering – even for a government agency. And they picked the wrong tech company to mess with. I hope Eric Holder enjoyed his tenure, because he’s coming to the end of it.

    1. It’s quite possible some of the publishers are guilty of some of the charges brought against them. Better for them to settle early. I believe Apple had nothing to do with it, so better for them to fight…

  2. Most DoJ lawyers have little or no business experience. So it’s no wonder they get so much wrong.

    Publishers might want to consider holding out, as a new Administration could simply drop the case. That’s what happened in 1981 when a new Administration came in that threw out the long-running case against IBM.

  3. Question: In this case did the five CEO’s meet for lunch to discuss Apple’s offer? If so isn’t that a problem for those five companies, not Apple but those five companies involved. Oh, and doesn’t the government work for the highest lobbyist company (Amazon, BOA, Enron, Chase, AT&T, Verizon etc…) party membership or whose president at anytime doesn’t seem to matter. Amazon was first to call the police and Apple wasn’t.

  4. “MacDailyNews Take: As we’ve said from the very beginning of this fiasco: “The U.S. DOJ is plainly inept.””

    For different reasons, I could not agree more.
    When about half the Bush (Dubya) Cabinet is perp walked for numerous crimes against the Bill of Rights, War Crimes, FISA crimes and he rest I might give Holder a B.

  5. There’s something very wrong in Washington…

    There’s this case about the DoJ and eBooks.

    And there’s another case where the Supreme Court decision in an AT&T case has effectively allowed M$ to emasculate the individual consumer by removing the right to join a class action…

    Something very, very wrong in Washington…

  6. Being from little old Ireland is no excuse, but why has nobody mentioned his middle name is “Himpton”, he he he he he he! You U.s.of a guys are really funny.

  7. Price fixing is price fixing – and it’s illegal. If Barnes and Noble can’t run with the big boys then they need to get out of the game. Like Apple they’re nothing but whiners who want to fix the game in order to gain the upper hand. Whatever happened to the “free market” the right is always harping on? The book deal Jobs struck strangles the free market and looks like something Kruschev would come up with.

  8. MDN, and the original story, kinda buries a significant wrinkle to the story:

    The guy who filed this objection to the court for B&N? David Boies, the guy who led the government’s antitrust case against Microsoft back in the day.

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