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Summary:

Apple and book publishers already have their hands full after the Justice Department sued them in New York today for allegedly fixing the price of e-books. Now, state governments are seeking their own pound of flesh.

Pile Of Books and Sony E-reader
photo: Flickr / Jukka Zitting

Apple and book publishers already have their hands full after the Justice Department sued them in New York today for allegedly fixing the price of e-books.

Now, state governments are seeking their own pound of flesh. Connecticut Attorney General George Jepsen has just announced that his state and 15 others have filed an antitrust lawsuit against Apple and five publishers in Texas.

Jepsen says that two of the publishers — Hachette and Harper Collins — have already capitulated and agreed to pay $52 million in “consumer restitution.”

The case turns on the publishers’ decision in 2010 to switch to “agency pricing” in which they set the prices and give retailers like Apple and Amazon a commission. The states allege that agency pricing cost e-book buyers $100 million overall.

Unlike the states’ lawsuit, the federal complaint doesn’t seek money but instead asks the court to order the publishers’ and Apple to abandon their current pricing model. HarperCollins, Hachette and Simon & Schuster have settled with the Justice Department. Macmillan and — presumably — Penguin will fight the suit in court.

The publishers and Apple are also facing a massive class action brought by lawyers who seek refunds for customers who allegedly overpaid for e-books.

The other states joining the lawsuit are: Texas, Alaska, Arizona, Colorado, Illinois, Iowa, Maryland, Missouri, Ohio, Pennsylvania, South Dakota, Tennessee, Vermont and West Virginia and the Commonwealth of Puerto Rico.

The Connecticut Attorney General release can be found here.

  1. Yes, it’s ok for Amazon to sell below cost, drive physical stores our of business, create a monopoly for Kindle, then later raise prices to what ever it wants. That’s ok! Apple asks publishers to sell to everyone for the same price and that’s bad. Ok?

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    1. nail hit on head … news at 11

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