Book Publisher Penguin announced on Wednesday that the company has reached a $75 “comprehensive agreement” with US State Attorneys General concerning the e-book price fixing allegation related to Apple and its iBookstore for iOS.
The respective settlement will solve the violation problems against Penguin related to e-book pricing. As far as Penguin Company is concerned, the company has announced that it had made a $40 million provision for settlement in its 2012 accounts.
Previously, the company sealed a separate settlement in December with the U.S. Department of Justice. However, this is not all. Apparently, the last agreement is connected to other 33 individual states that joined the antitrust suit. In April, the publisher offered an agreement to Apple in order to end the war between the European Union regulators and the Penguin Company. The respective deal allowed retailers to set prices and discounts on digital books for two years.
As far as Penguin is concerned, the publisher was among other five publishers who came under federal scrutiny after they approved an “agency model” pricing agreement with Apple. The agreement allowed publishers to set fixed prices for e-books content.
The online retailer Amazon, which allowed publishers to suggest a price, booksellers free to set their own prices and offer personal discounts, used a wholesale model. However, publishers considered this strategy to be harmful for the overall book selling business. On the other hand, regulators considered the switch from the “wholesale model” to the “agency model to be harmful for customers suggesting antitrust lawsuits.
When publishers are trying to reach a settlement with the U.S Department of Justice, Apple chose to stand on its ground and remained the target of a DOJ complaint in the U.S that is planned. As it was states before, Apple has named a facilitator in alleged collusion with major publishers to fix e-book prices. According to the Cupertino-based company, the accusation is false and unfounded offering the agreement that the company drafts separate consumer-friendly agreements with each publisher.
After Penguin publisher offered the $75 million settlement, a consumer-right law firm representing consumers in the case, issued the statement: “The proposed settlement is a powerful demonstration of what is possible when federal, state and private class antitrust enforcement lawyers work together”. Moreover, the Steve W. Berman responded: “In this case, the level of cooperation was unprecedented and the results that were able to deliver to the states and consumers demonstrate that”.