Locus Online News » Legal

DoJ Files Antitrust Lawsuit

LocusHQ — Fri, 13 Apr 2012 17:51:33 +0000

On April 11, 2012, the US Department of Justice made good on their threat to file an antitrust lawsuit against technology giant Apple and five of the Big Six publishers: Hachette, HarperCollins, Macmillan, Penguin, and Simon & Schuster. Hours after the suit was filed, three of the publishers — Simon & Schuster, Hachette, and HarperCollins — agreed to settle with the DoJ, allowing Amazon and other retailers to discount their e-book prices for at least two years, among other concessions.

Apple, Macmillan, and Penguin so far seem determined to fight in court, and all deny there was any collusion. In an open letter released after the suit was filed, Macmillan CEO John Sargent first stressed the company’s innocence, then explained that Macmillan could not settle because “the terms the DoJ demanded were too onerous.”

A complete story will appear in the May issue of Locus.

DoJ Threatens Antitrust Lawsuit

LocusHQ — Fri, 09 Mar 2012 20:06:00 +0000

The Department of Justice, which has been investigating several major publishers and Apple for possible antitrust violations related to e-book pricing, has indicated they intend to bring a lawsuit accusing Apple and the so-called Agency Five (Hachette, Macmillan, HarperCollins, Simon & Schuster, and Penguin) of colluding to fix prices on e-books.

Those publishers and Apple moved away from a wholesale model — where books are sold to the retailer, with retailers allowed to set their own price points — to an agency model, where publishers set the retail price and give retailers a 30% cut. The change was made partly in response to concerns over Amazon’s deep discounting of e-books, which publishers worried were “devaluing” e-books in the eyes of customers.

The US Justice department has concluded that the publishers colluded in their decision to switch to the agency model, which violates the Sherman Act against price-fixing.

Some of the publishers are in settlement talks, and such cases are rarely tried in court — it’s far more common for the companies accused of antitrust practices to make an agreement to change those practices.

This could be a major setback for publishers, as it threatens a pricing system which has allowed them to profit from higher e-book margins in the past year.

For more, see coverage in the Wall Street Journal.

Owner Forecloses on Dorchester

LocusHQ — Thu, 08 Mar 2012 21:30:19 +0000

Dorchester Publishing’s owner, The Backe Group Inc., founded by John Backe, filed a notice of foreclosure against Dorchester, after failing to collect on an outstanding $3.4 million loan. The notice signaled Backe’s intention to “foreclose its security interest in [Dorchester] and sell at public auction as a single unit,” including the company’s registered trademarks, related internet domain names, works of authorship, copyrights, copyright registrations, and even computer equipment. Because the owner is personally foreclosing against the company, proceeds will go to him, leaving little or no assets to pay creditors.

See Publisher’s Lunch for more on the Dorchester closing and resulting auction. Author Brian Keene has also been reporting on the Dorchester saga on his blog.

Dorchester Publishing No Longer SFWA Market

LocusHQ — Wed, 01 Feb 2012 18:51:44 +0000

The Science Fiction Writers of America announced to members yesterday that Dorchester Publishing, after failing to fulfill their contractual obligations to SFWA members, has been removed from the list of qualifying SFWA markets. Dorchester was put on probation on December 10, 2010 for not paying royalties when contractually specified and for distributing books in formats they had not legally secured rights to. Although some effort has been made, because Dorchester did not fulfill SFWA’s requirements during their probation period, their removal from the SFWA qualifying markets list is effective from the start of their probation period, December 10, 2010.

In related news, Dorchester’s sole remaining editorial staff, Chris Keeslar, is no longer employed with the company as of January 31, 2012. Keeslar sent an email to colleagues which directs general questions to Hannah Wolfson (hwolfson@dorchesterpub.com), rights questions to Sam Hazell (shazell@dorchesterpub.com), accounting questions to Loretta Falk (lfalk@dorchesterpub.com), royalties questions to Brian Chinn (bchinn@dorchesterpub.com), and the ordering of any trade paperbacks to Kelley Allen (kallen@dorchesterpub.com).

Dick Estate Lawsuit

LocusHQ — Mon, 31 Oct 2011 17:19:36 +0000

The Philip K. Dick estate has filed suit against Media Rights Capital, which bought the rights to Dick’s “Adjustment Team” in 2009. The estate claims MRC owes them half a million dollars and a percentage of profits from the 2011 film The Adjustment Bureau.

MRC now claims the story’s copyright has lapsed, citing a 1954 publication and subsequent failure to renew the copyright. If the story is public domain, they owe nothing. The Dick Estate contends the 1954 publication was unauthorized, and that the first official publication of the story was in 1973.

More details can be found at the New York Times.