Amazon and Big Five Accused of Charging E-Book Prices

Amazon and the Big Five, have been accused of conspiring to drive e-book prices. The Big Five are Penguin Random House, Hachette, HarperCollins, Macmillan, Simon & Schuster. That’s in a class action lawsuit brought by the same law firm that sued Apple and the Big Five in the same case 10 years ago and won, Hagens Berman.

The law firm sued on behalf of consumers in several US states, citing Amazon as the sole defendant in the case, but adding that the publishing companies are seen as complicit in the conspiracy.

According to the lawsuit, Amazon and publishers are using a clause known as “Most Favored Peoples” or “MFN” to keep e-book prices artificially high by agreeing to price restrictions that force consumers to pay higher prices for e-books they buy from non-Amazon platforms.

The lawsuit states that 90% of all e-books sold in the US are sold by Amazon, as well as 50% of all printed books.

Although e-book prices fell in 2013 and 2014 after Apple and major publishers were sued for conspiring to set prices for e-books and prove the charge, they rose again after Amazon renegotiated its contracts in 2015.

Now the lawsuit seeks damages and compensation for consumers who bought e-books from Amazon’s competitors, requiring it and the publishers to stop imposing price controls to keep out competition in the book market.

On Wednesday, Amazon cooperated with a subpoena that requested documents and documents relating to the company’s dealings with Big Five companies, knowing that the past case ended with the publishing companies being fined $166 million, while Apple lost the trial and was fined $450 million in 2016, after a lengthy legal process that ended when the US Supreme Court refused to hear the company.

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