Penguin and US justice department reach eBook price-fixing settlement

The US Department of Justice has reached a settlement with the Penguin Group in a case that accused it, Apple, and several other book publishers of colluding to fix the price of eBooks.

Under the deal, Penguin will end the eBook deals it has with Apple and other eBook sellers. It will also be banned for two years from entering into agreements that prohibit retailers from offering discounts or promotions on eBooks.

Penguin must also notify the DOJ of any eBook ventures it enters into with publishers, and keep the agency updated about any communications it has with other publishers. For the next five years, meanwhile, Penguin is banned from "agreeing to any kind of most favored nation (MFN) agreement that could undermine the effectiveness of the settlement."

In April, the DOJ announced that it had filed suit against Apple and five other publishers over an alleged "illegal conspiracy" involving eBook price fixing. Apple, as well as publishers Macmillan and Penguin, fought the charges, while Hachette, HarperCollins, and Simon & Schuster agreed to a proposed settlement.

With Penguin agreeing to a settlement, a trial against Macmillan and Apple is scheduled to begin in June 2013, the DOJ said today. The court still has to approve the Penguin deal, though.

In September, a judge approved the agreement between the DOJ and Hachette, HarperCollins, and Simon & Schuster.

The European Commission also examined the issue. Last week, the EU's year-long antitrust investigation into eBook pricing collusion ended, when it adopted a proposal from Apple and four book publishers that offers more pricing freedom to eBook retailers like Amazon.