Publishing/Writing: Insights, News, Intrigue

06/07/2012

DOJ’s Proposed Settlement RE publishers’ Alledged Price Fixing — Right or Wrong?


What about this DOJ settlement, anyway?

The legal department of Barnes and Noble, in a complaint filed with the DOJ today, says the proposed settlement with some of the big six publishers “represents an unprecedented effort” to become “a regulator of a nascent technology that it little understands” — and “the national economy, our nation’s culture, and the future of copyrighted expression” are at stake.

B&N’s legal beagles further state “in essence, the proposed settlement substitutes one alleged cartel for a new cartel on the industry, albeit one run by the [DOJ].”  

, reporting for PaidContent (the economics of digital content), discusses the B&N’s complaint with its accompanying charts and figures: 

B&N: DOJ e-book suit endangers consumers, bookstores and copyrighted expression

In a complaint sent to the Department of Justice this morning, Barnes & Noble says that the DOJ’s proposed settlementwith HarperCollins, Hachette and Simon & Schuster for allegedly colluding to fix e-book prices “represents an unprecedented effort” to become “a regulator of a nascent technology that it little understands” — and “the national economy, our nation’s culture, and the future of copyrighted expression” are at stake. In fact, B&N argues, e-book and hardcover prices have fallen under agency pricing.”

“You’re going to end up having choice control from a server farm in Washington state,” Barnes & Noble’s general counsel Gene DeFelice told me, referring to Amazon.

“In essence, the proposed settlement substitutes one alleged cartel for a new cartel on the industry, albeit one run by the [DOJ],” B&N says. The bookstore chain’s complaint joins others sent to the DOJ during the settlement commenting period, which ends on June 25.

The proposed settlement, B&N says in a brief filed by its in-house counsel and law firm Boies, Schiller & Flexner, “warrants an exacting review because of its potential impact on the national economy and culture, including the future of copyrighted expression and bookselling in general, not only electronic books.” And “many millions of Americans, as well as all levels of the distribution chain for books (from authors to publishers to distributors, and especially brick-and-mortar stores), stand to be affected by this case’s resolution.”

B&N argues that the proposed settlement is a government action “analogous to a cartel imposing a detailed business model on publishers.” It would transform the DOJ “into a regulator” and would “injure innocent third parties, including Barnes & Noble, independent bookstores, authors, and non-defendant publishers; hurt competition in an emerging industry; and ultimately harm consumers.”

The punishment doesn’t fit the crime

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