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Judge approves a settlement between DOJ and publishers in landmark opinion

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(Read caption) The Authors Guild, the American Booksellers Association, Barnes & Noble, and other e-book retailers who oppose the settlement predict that it will return the e-book marketplace to where it was several years ago when Amazon controlled almost 90 percent and all other players were marginalized.

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It’s being called “a move that could reshape the publishing industry” and “a decision that could start an e-book price war.”

Late Thursday, Federal Judge Denise Cote approved a settlement between the Justice Department and three major publishers in a landmark opinion in the e-book price-fixing case.

The settlement includes Hachette Book Group, Simon & Schuster, and HarperCollins and orders the three publishers to terminate their contracts with Apple within a week. It also orders them to terminate contracts with “most favored nation” clauses, which prohibit other retailers from selling books for less. The publishers must also refrain for two years from entering any new contract that puts limits on a retailer’s ability to price e-books.

The settlement comes as a result of the Justice Department’s accusation that Apple and five publishers illegally conspired to fix the price of e-books in an attempt to unseat Amazon from market dominance. Penguin Group USA, Macmillan, and Apple did not agree to the settlement and will fight the suit in court next summer.


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