A compilation of PW's coverage of U.S. v. Bertelsmann SE & CO. KGaA, et al., the U.S. Department of Justice's bid to block Penguin Random House's acquisition of rival Big Five publisher Simon & Schuster, with the most recent coverage up top.

Post-Decision

Paramount Terminates PRH Bid for S&S: Penguin Random House’s bid to acquire Simon & Schuster has officially ended.

The Legacy of Penguin Random House's Markus Dohle: It was Dohle’s firm belief in the future of book publishing that made him doggedly pursue the acquisition of S&S. And though that attempt was deemed by the U.S. government to be one acquisition too many, with Dohle’s exit, publishing is losing one of its most charismatic and respected leaders.

Markus Dohle Steps Down as Penguin Random House CEO: As a primary architect of the move to acquire Simon & Schuster, Dohle is now the first Bertelsmann official to pay the price for the failed acquisition.

Decision

In Written Opinion, Judge Florence Pan Delivers Knockout Blow to PRH, S&S Merger: On November 7, Judge Florence Pan released her memorandum opinion blocking Penguin Random House from acquiring rival Big Five publisher Simon & Schuster. And in the final analysis, after a year of legal wrangling and a three week trial, it wasn’t a close case for her at all.

Court Blocks Penguin Random House, S&S Merger: "Upon review of the extensive record and careful consideration of the parties’ arguments, the Court finds that the United States has shown that 'the effect of [the proposed merger] may be to substantially to lessen competition' in the market for the U.S. publishing rights to anticipated top-selling books," concluded Judge Florence Pan, who held back the written opinion pending redactions to protect confidential information.

Post-Trial

Florence Pan Named to U.S. Court of Appeals in D.C.: The United States Senate voted to elevate the judge overseeing the lawsuit that will decide the fate of the proposed merger of Penguin Random House with Simon & Schuster to the influential U.S. Court of Appeals for the District of Columbia Circuit, filling the seat that belonged to Supreme Court Justice Ketanji Brown Jackson.

In Post-Trial Briefs, DOJ Says PRH Deal for S&S Must Be Blocked: In their post-trial briefs, lawyers for the U.S. Department of Justice said they have proven the proposed deal is anti-competitive, calling it “precisely the march toward concentration and monopsony power that Congress enacted the Clayton Act to prevent.”

In Post-Trial Briefs, PRH Attorneys Say DOJ Failed to Prove Its Case Against S&S Merger: In their post-trial briefs, PRH attorneys reiterated their claim that the government has manufactured a fatally flawed case against the nearly $2.2 billion merger—and then ultimately failed to prove it.

Trial: Week Three

DOJ v. PRH: "Ending Where We Started": The opposing parties in the Department of Justice’s lawsuit aiming to block Penguin Random House’s purchase of Simon & Schuster offered very different views of what a merger of the two would mean for authors and the industry in Friday’s closing arguments.

DOJ v. PRH: Challenges over Bid Competition, Market Share: As testimony wrapped up prior to closing arguments today, the defense and DOJ once again attacked each other's data analysis and methodology. The DOJ asserted that publisher competition, not imprint competition, is the surest way to lift advances, and that non-Big Five publishers face "significant barriers to expansion."

Lit Agents Say S&S Acquisition Would be Bad for Business: A survey released by the Association of American Literary Agents has found that 87% of respondents oppose the acquisition of Simon & Schuster by Penguin Random House, citing, among their chief concerns, that the deal would result in “less competition” for titles and “lower advances.”

'Agents Don't Have Guns, They Have Tactics': On Wednesday, following Judge Pan's decision to exclude the testimony of Manuel Sansigre, senior v-p and global head of M&A for PRH, defense expert witness Edward Snyder returned to the stand, where he and the government lawyer appeared to exasperate each other in a discussion of what constitutes competition.

Judge Tosses PRH Exec Testimony: After a lengthy presentation by Manuel Sansigre, PRH's global v-p for mergers and acquisitions, Judge Florence Pan decided to exclude his testimony, ruling that the data had not been independently verified.

Madeline McIntosh Details PRH's Publishing Process: As the Department of Justice’s case against the proposed acquisition of Simon & Schuster by Penguin Random House entered its third week, the defense called PRH US CEO Madeline McIntosh, plus merger and acquisition executives from ViacomCBS and PRH, to the stand to discuss why approval of the deal would benefit all parties.

Trial: Week Two

Agents Have Their Say: In a day dominated by testimony from some of publishing's leading agents, the overall theme was that the biggest advance is not the only thing that is important in reaching an agreement with a publisher, and that these agents believe that S&S authors would benefit from becoming part of PRH.

Agents, Publishers Move Center Stage: As attorneys for Penguin Random House and Simon & Schuster took their turn to defend PRH's purchase of S&S, William Morris Endeavor's Jennifer Rudolph Walsh, Gallery publisher Jennifer Bergstrom, and Norton's John Glusman found themselves in the witness chair.

Brian Murray Still Wants S&S at HarperCollins: HarperCollins CEO Brian Murray, testifying in the trial over whether the Penguin Random House-Simon & Schuster trial will go through, said he was “shocked” by the price PRH offered for S&S. Later in the day, the defense cross-examined the government's economic witness. more...

Don Weisberg, Government's Economist See Danger in PRH-S&S Merger: As the government's case against Penguin Random House's acquisition of Simon & Schuster winds down, Macmillan CEO Don Weisberg and government economist Nicholas Hill laid out reasons why they are concerned about the impact of the proposed merger.

Trial: Week One

Markus Dohle's Silicon Valley of Media: On day four of the trial, the government called Penguin Random House CEO Markus Dohle who described publishers as the "angel investors in our authors and their dreams, their stories."

Karp's Second Day of Testimony: On day three of the trial, S&S CEO Jonathan Karp finished his testimony as a government witness. Also taking the stand, DOJ statistician Adriana Porro.

Jonathan Karp and Stephen King Take the Stand: The second day of the DOJ's trial featured a little star power: bestselling author Stephen King took the stand. But in terms of the case before the court, the highlight of the day was the testimony of S&S CEO Jonathan Karp. Also taking the stand, literary agent Ayesha Pande, who finished her testimony; S&S CFO Dennis Eulau; and a portion of Kansington CEO Steve Zacharius's video testimony was played in court.

Opening Arguments, Pietsch Testimony on Day One of DOJ Trial to Block PRH/S&S Merger: After months of anticipation, the government’s bid to block Penguin Random House’s acquisition of rival Big Five publisher Simon & Schuster got off to tedious start. In addition to Pietsch, literary agent Ayesha Pande began her testimony.

Trial to Block PRH/S&S Merger Begins; Evidence Dispute Looms: The trial got underway on August 1 in Washington, D.C., with the case expected to run about three weeks. Meanwhile, filings made public late on July 29 shed light on a lingering pre-trial evidence dispute that could impact PRH’s defense.

Pre-Trial Coverage

In Final Briefs, DOJ, PRH Flesh Out Arguments Ahead of Trial: With oral arguments set to begin on August 1 in Washington, D.C., the parties on July 25 filed their final pre-trial briefs outlining their cases for trial.

Showdown: DOJ’s Bid to Block PRH Acquisition of S&S Is Heading to Trial: PW previews the U.S. Department of Justice’s bid to block Penguin Random House’s acquisition of rival Big Five publisher Simon & Schuster.

Justice Department Sues to Block Penguin Random House Acquisition of S&S: On November 2, 2021 the U.S. Department of Justice sued to block Penguin Random House parent company Bertelsmann’s proposed acquisition of Viacom CBS subsidiary Simon & Schuster, arguing that it “would result in substantial harm to authors.”

Bertelsmann to Buy S&S for $2.2 Billion: On November 25, 2020 Bertelsmann emerged as the winning bidder for Simon & Schuster. In an announcement, the parent company of Penguin Random House said it had reached an agreement to buy S&S from ViacomCBS for $2.175 billion.

Is Simon & Schuster a Bargain at $1.7 Billion?: The New York Times reported that HarperCollins and Penguin Random House were the favorites to acquire Simon & Schuster with the expected purchase price to be at least $1.7 billion, the top end of original estimates of $1.2 billion–$1.7 billion for the price of the country’s third-largest trade publisher.

This story will be updated as events warrant.