Though 92 Percent of Comments Oppose Settlement, Justice Is Unmoved

PublishersLunch

Per our report on Friday, the Department of Justice published the public comments on the proposed ebook pricing settlement with Hachette Book Group, HarperCollins, and Simon & Schuster on Monday morning, along with a 64-page summary and response. DOJ received 868 comments in all, 92 percent of which opposed the settlement, while "nearly [but not quite] seventy of those comments favored the suit and settlement." Of those writing in favor, "several" of the submissions from 52 "readers and consumers" were similar to an online form letter.
It will be no surprise that the DOJ is unpersuaded by any of the comments in opposition. Their filing combines direct responses to some of the issues raised, and extensive attempts at directing Judge Cote as to how much discretion she has under the Tunney Act (as Justice did in their original competitive impact statement). They say that "after carefully considering the comments received, the United States has concluded the settlements meet" the test of "whether the proposed Final Judgment provides effective and appropriate remedies for the antitrust violations alleged in the complaint" and in their view, that's all the court should consider. "Overall, the United States is entitled to broad discretion to settle with antitrust defendants, so long as the settlements are within the reaches of the public interest."
The overarching theme of Justice's response is clear: they see their job as ensuring that consumers pay the lowest possible price for individual ebooks: "Critical comments generally were submitted by those who have an interest in seeing consumers pay more for e-books, and hobbling retailers that might want to sell e-books at lower prices." Justice is merciless, as is the free market: "that position is wholly at odds with the purposes of the federal antitrust laws--which were enacted to protect competition, not competitors." DOJ does reiterate, however--more clearly than ever--that in their view the agency model itself is legal: "The United States does not object to the agency method of distribution in the e-book industry, only to the collusive use of agency to eliminate competition and thrust higher prices onto consumers."