The law firm handling the consolidated class-action lawsuits against publishers over agency pricing filed an amended complaint on January 20th. This complaint, filed against the “Agency Five” excluding Random House, goes into more detail about the alleged pricing conspiracy to force Amazon to raise prices, costing consumers millions of dollars.

The complaint details how Hachette Livre CEO Arnaud Nourry first met with an Amazon executive in December 2009 and asked Amazon to raise its e-book prices by $2 or $3—showing that publishers had already been discussing how to fix e-book prices among themselves. Subsequently, these publishers all approached Amazon to say they were going to start windowing their titles—a risky move none of them would have tried unless they knew that their competitors were going to do so also.

Then the publishers found their biggest price-fixing ally: Apple, who was notably reluctant to compete with 800-lb e-book gorilla Amazon on its own terms.

According to the complaint, Apple’s desire to enter the e-book market on more favorable business terms aligned with the Agency 5’s goal of raising e-book prices, and a plan was set in motion in January 2010 with the announcement of the launch of the iPad. Simultaneous with the iPad announcement, the Agency 5 said they were switching from the wholesale model of selling e-books to the agency model. Given that Amazon controlled most of the e-book market at that point while Apple was just entering the field, the complaint says that no individual publisher would have risked angering its largest e-book customer unless they knew other publishers were prepared to follow suit. 

Essentially, the suit alleges that no single publisher would have done the things the Agency 5 did if it were not certain the others would do the same thing.

I look forward to seeing the outcome of this lawsuit. I have my doubts that it will unseat agency pricing, but it should at least be a heck of a fight.

(Found via The Bookseller.)


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