Ebook-buying consumers in 49 states (all except Minnesota) and five territories are set to receive $69 million as the result of a settlement between the states and HarperCollins, Hachette and Simon & Schuster. If the settlement is approved, the three publishers, who are also settling with the Department of Justice in the federal antitrust suit, will pay a total of $69 million to consumers who bought agency-priced ebooks between April 1, 2010 and May 21, 2012.
The states accuse Apple (s aapl) of colluding with publishers to set ebook prices. Apple and the other two publishers in the case — Macmillan and Penguin — are not settling, but the states’ settlement would provide payouts to consumers who bought ebooks from Macmillan and Penguin as well.
“This action sends a strong message that this sort of anticompetitive behavior will not be accepted,” said Connecticut Attorney General George Jepsen, who led the states’ investigation into ebook pricing along with the state of Texas. “Through our ongoing litigation, we hope to provide additional restitution to consumers. Additionally, I’m especially proud of the exemplary bipartisan cooperation on both the state and federal level on this matter, which involved 54 states and jurisdictions working together on behalf of consumers across the country.”
The states’ proposed settlement with publishers is not yet available online, but reports from various state newspapers are trickling out this evening. If the settlement is approved, eligible Connecticut ebook buyers would receive up to $1.26 million in total compensation, for example, while Washington ebook buyers would receive up to $2 million, Maryland ebook buyers would receive up to $1.64 million and Hawaii ebook buyers would receive up to $300,000. In addition, the settling publishers would pay $7.5 million in court fees.
How will consumers be paid? Baltimore’s ABC News reports that “in most cases, consumers may choose to receive the value of their restitution by check or by crediting the amount to future purchases of e-books. E-book retailers Amazon (s amzn), Barnes & Noble (s bks), Apple and Kobo have agreed to identify and contact each eligible customer by email. Retailers Google (s goog) and Sony (s sne) will also notify affected customers. Sony will inform customers that checks will automatically be issued. Google customers will be directed to submit a claim on a settlement website.”
Payments are set to begin 30 days after the settlement’s approval.
The Department of Justice’s proposed settlement with HarperCollins, Hachette and Simon & Schuster, which is vehemently opposed by many in the book publishing industry and related fields, is still awaiting approval from U.S. District Judge Denise Cote. The DOJ received 868 public comments on the proposed settlement, with the majority of them against it. Cote has granted Barnes & Noble, the American Booksellers Association, the Authors Guild and attorney and music industry executive Bob Kohn, all of whom oppose the settlement, permission to act as “friends of the court” and weigh in on the settlement in amici curiae briefs.
Photo courtesy of Shutterstock user Mohd Hasmi Hamidi.