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Inside US lawsuit: How Apple, publishers allegedly brought Amazon to heel

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The lawsuit is the result of cooperation between the Justice Department’s Antitrust Division and the European Commission. The attorneys general of Connecticut, Texas, and 13 other states also played a role in the investigation.

In addition to Apple, the publishers named in the pending suit are Macmillan and Penguin Group, both based in New York City.

Hachette Book Group, HarperCollins, and Simon & Schuster, all New York-based, have agreed to settle the lawsuit and end anticompetitive practices alleged by the government.

The alleged conspiracy revolved around the emerging market for e-books and a perceived threat to the future of the book publishing business as it presently exists.

Publishing executives were worried that Amazon’s deep-discount pricing of e-books might significantly undercut their ability to continue to sell hardcover books for $25 or more.

In addition, they worried that if e-books became too popular, upstart digital publishers – including Amazon itself – might enter the e-book industry and push the long-dominant publishers aside, according to court documents.

“Amazon’s move threatened the publisher defendants’ traditional positions as the gate-keepers of the publishing world,” the suit says.

To rein Amazon in, the suit says, executives from the five book publishers decided to change the way they sold their books to book retailers.

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