In a motion made Wednesday, the Department of Justice says that arguments made by Apple, Macmillan and Penguin as well as the friend of the court brief filed by the ABA and Barnes & Noble objecting to the final judgment reached between the government and Hachette, HarperCollins and Simon & Schuster over e-book price fixing charges raise no real new issues and therefore asks that the court approve the agreement without further hearings.
The DoJ maintains that arguments made by the parties that the government doesn’t understand the e-book business is just a variation made by other industries at other times. “While e-books are a relatively new arrival on the publishing scene, a plea for special treatment under the antitrust laws is an old standby,” the DoJ wrote. “Railroads, publishers, lawyers, construction engineers, health care providers, and oil companies are just some of the voices that have raised cries against ‘ruinous competition’ over the decades. Time and time again the courts have rejected the invitation to exempt particular businesses from the reach of the Sherman Act.”
The new brief rebuts the separate filings made by Apple, Macmillan, Penguin and the ABA/Barnes & Noble. In dismissing the Penguin brief that argues that, overall, e-book prices have come down since the implementation of the agency model, the DoJ points to its own study that shows that the average price of a Penguin title sold through Amazon rose 17% after the implementation of the agency model and that the average price of new releases rose 21%. The DoJ provided two exhibits to support its claim of price increases, but continued to assert that it does not need to produce its internal economic analyses.
The DoJ counters Apple’s objections by claiming that what troubles Apple the most is that the decree returns e-book pricing not only to Apple but to its competitors as well. “Apple’s desire to avoid price competition for as long as possible is the unstated reason why it seeks to undo or forestall the settlements,” the DoJ wrote.
The DoJ also said there was little evidence to suggest that if the settlements are approved Amazon will return to a more dominant position in the e-book market, given the increased competition from a number of players including Microsoft’s pending partnership with B&N.
The DoJ’s position on the agreements and the position it has taken in the case is best summed up in the following declaration: “Suggestions that the antitrust laws are of no use when it comes to e-books are especially remarkable in light of the unmistakable consumer harm that resulted from the conspiracy in this case. The conspirators eliminated the “wretched $9.99 price” that so attracted the reading public and so infuriated publishers, and made sure that Apple would not have to contend with what it viewed as senseless competition as it entered the e-book market. Now those conspirators that have not settled with the United States seek to upset the settlements that have been reached, and thereby delay the restoration of competition. Those efforts have no basis in law, and this Court should reject them.”
