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Did you get one of these in your email inbox yesterday? Perhaps yours was from Barnes & Noble.

Shows that I spent way too much on eBooks
during the period covered by the lawsuit.
It is a credit that I can only spend on eBooks or paper books at Amazon. Still, it beats a poke in the eye with a sharp stick.

In April of 2012, the Department of Justice filed a Civil Complaint (pdf) against Apple, Hachette SA, HarperCollins, Macmillan, Penguin and Simon & Schuster for restraint of trade. A complete description of that action can be found in All Things Bookstore: e-books, Amazon, Apple, the Big Six and the Independent Bookstore.

Basically, in order to raise the prices of eBooks from the $9.99 that Amazon was charging, the publishers conspired with Apple to change the marketing of eBooks from the traditional wholesale model to an agency model. The purpose of the change was to allow the publishers to set the prices on all eBooks, depriving the retailers of any ability to discount eBooks. The retailers would receive 30% of each sale. Apple also wanted price tiers with price caps and, in order to avoid being beaten by Amazon, they demanded a Most Favored Nation clause that would prevent Apple prices from being undercut by discounts from other eBook retailers.

According to Adam C. Engst, writing for TidBITS, there isn't anything legally wrong with any or all of these requirements, the problem is their combination in negotiating deals with the six publishers that control nearly 50% of the book market and over 90% of the New York Times bestsellers. (Random House did not join the conspiracy.)

Once the agency model was in place, ebook prices from those publishers rose immediately. Roughly two weeks after the move, prices at Amazon rose 14.2 percent for new releases, 42.7 percent for New York Times bestsellers, and 18.6 percent overall. Publishers raised prices for their hardcovers as well, to bump them into higher price tiers, and increased prices for their backlist books, older titles that sell relatively few copies each, but which form the long tail of book sales.

TidBITS:Explaining the Apple Ebook Price Fixing Suit

By February of 2013 all five publishers had agreed to a settlement with the DOJ that required them to cease their anti-competitive practices. Apple refused to settle, lost in court and has been appealing the loss ever since. Bloomberg Businessweek speculates that Apple is preparing to take its case to the Supreme Court.

Meanwhile, lawsuits were brought by the Class Plaintiffs and Attorneys General of thirty three jurisdictions against the publishers and Apple, seeking monetary damages. A settlement in these cases was reached with the five publishers and was approved by Judge Denise Cote of the US District Court for the Southern District of New York in December of last year. That settlement included the sum of $166 million in damages. This is the source of the credit you may have received from B&N or Amazon.

Eligibility for a share of the settlement is based on your purchase of one or more eBooks from one of the five publishers (including their imprints) between April 1, 2010 and May 21, 2012 and your residency in the United States, DC, or one of the US Territories at the time.

According to the terms of the settlement, how much you get, if you live outside of Minnesota,

...will be affected by how many qualifying E-books you purchased. There will be two levels of payments, based on categories of E-books. The amount to be paid per eligible E-book are as follows:
  • New York Times bestsellers: $3.17 per E-book. These include titles that were New York Times bestsellers at any time, irrespective of when you purchased the E-book.
  • Non-New York Times bestsellers: $0.73 per E-book. These E-books include any titles that were not New York Times bestsellers.

Attorneys General and Class E-book  Settlements

Minnesota reached a separate agreement whose terms can be found at Minnesota E-book Settlements.

But it is not over yet because Apple is not included in this settlement. Plaintiffs can recover up to triple the damages that were established at trial. In the cases against the publishers, because they never went to trial but settled with the DOJ, triple damages did not apply, and the sum of $166 million is only about 70% of the actual damages. But since Apple's guilt was established at trial, the damages come to $840 million according to the lawyer representing eBook customers. This phase is expected to take place later this summer and will also be presided over by Judge Denise Cote.

In the meantime, I have some shopping I need to do.

Readers & Book Lovers Series Schedule:

DAY TIME (EST/EDT) Series Name Editor(s)
SUN 6:00 PM Young Reader's Pavilion The Book Bear
2:00 PM What's on Your E-Reader? Caedy
2:00 PM Bibliophile's Wish List Caedy
Sun (occasional) 9:30 PM SciFi/Fantasy Book Club quarkstomper
Bi-Monthly Sun Midnight Reading Ramblings don mikulecky
MON 8:00 PM Monday Murder Mystery michelewln, Susan from 29
Mon 11:00 PM My Favorite Books/Authors edrie, MichiganChet
TUES 5:00 PM Indigo Kalliope: Poems from the Left bigjacbigjacbigjac
alternate Tuesdays 8:00 AM LGBT Literature Texdude50, Dave in Northridge
alternate Tuesdays 8:00 AM All Things Bookstore Dave in Northridge
Tue 8:00 PM Contemporary Fiction Views bookgirl
WED 7:30 AM WAYR? plf515
Wed 2:00 PM e-books Susan from 29
Wed 8:00 PM Bookflurries Bookchat cfk
THU 8:00 PM Write On! SensibleShoes
Thu (first each month) 11:00 AM Monthly Bookpost AdmiralNaismith
alternate Thursdays (on hiatus) 11:00 PM Audiobooks Club SoCaliana
FRI 8:00 AM Books That Changed My Life Diana in NoVa
alternate Fridays 8:00 PM Books Go Boom! Brecht
Fri 10:00 PM Slightly Foxed -- But Still Desirable shortfinals
SAT (fourth each month) 11:00 AM Windy City Bookworm Chitown Kev
Sat 12:00 PM You Can't Read That! Paul's Book Reviews pwoodford
Sat 9:00 PM Books So Bad They're Good Ellid

Originally posted to Readers and Book Lovers on Wed Mar 26, 2014 at 11:00 AM PDT.

Also republished by Community Spotlight.

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