Thursday, August 30, 2012

Kansans to receive $628,000 in e-book refunds

Kansans who purchased certain electronic books will share more than $628,000 in refunds, Kansas Attorney General Derek Schmidt announced today.

Attorney General Schmidt, along with attorneys general from 54 other states, districts and U.S. territories, reached a settlement with three of the largest U.S. book publishers to resolve alleged antitrust violations. Hachette Book Group Inc., HarperCollins Publishers LLC and Simon & Schuster Inc. have agreed to pay more than $69 million to U.S. consumers.

The attorneys general alleged the publishers unlawfully conspired to fix the prices of electronic books (e-books).

As part of the settlement, the publishers have agreed to change the pricing of e-books going forward.

“We take anticompetitive action that harms Kansas consumers very seriously,” Schmidt said. “Colluding to fix prices raises costs for customers, who here have paid millions of dollars more than they would have for popular e-book titles. Today’s settlement provides restitution for consumers harmed by the scheme. True competition is essential to the working of the free market.”

The settlement occurs in conjunction with a civil antitrust lawsuit filed Wednesday in U.S. District Court for the Southern District of New York against Hachette, HarperCollins and Simon & Schuster. A separate suit has been filed against two other publishers and Apple Inc., which are not part of this settlement.

Under the proposed settlement agreement, which must be approved by the Court, publishers Hachette, HarperCollins and Simon & Schuster will compensate consumers who purchased e-books from any of the five conspiring publishers between April 1, 2010 and May 21, 2012.

Payments will begin 30 days after the court’s approval of the settlement becomes final. Kansas consumers are expected to receive approximately $628,319 in total compensation. Consumers will be notified electronically if they are eligible for refunds.

In addition, the publishers have agreed to terminate their existing agency agreements with certain retailers that allow the publishers to set the prices for e-books.

The publishers are also prohibited from making new, similar agreements for two years.

The case against non-settling publishers — Penguin Group, Inc. and Holtzbrinck Publishers LLC dba Macmillan — and Apple, Inc., remains pending in the Southern District of New York.

Consumers can contact the Attorney General’s Consumer Protection Division at 1-800-432-2310 or online at for further information.