Decision leaves computer giant Apple alone in fighting federal government’s civil antitrust case

Macmillan reached a settlement with the U.S. Department of Justice (DOJ) in its civil antitrust lawsuit accusing the nation’s five largest book publishers of colluding with Apple to raise e-book prices. 

Announced Feb. 8, the settlement, in which Macmillan—named in the April 2012 suit as Holtzbrinck Publishers—agreed to pay up to $20 million, leaves Apple as the only defendant standing in the case. The federal government charged the publishers and Apple with conspiring to force e-book prices several dollars above the $9.99 charged by Amazon.com on its Kindle device.

Under Macmillan’s settlement with the DOJ, the publisher will remove restrictions on discounting and other promotions by e-book retailers. It will also be prohibited from forging new agreements with similar restrictions until December 2014, Associated Press reported. 

“We settled because the potential penalties became too high to risk even the possibility of an unfavorable outcome,” Macmillan CEO John Sargent wrote in an online letter to authors, illustrators and agents. “Our company is not large enough to risk a worst-case judgment.” 

The Justice Department settled with Hachette Book Group, HarperCollins Publishers, Simon & Schuster and Penguin Group (USA) last year. Macmillan’s settlement is expected to be finalized in early July.

The trial against Apple is scheduled to begin in June. Barnes & Noble has sided with Apple out of concern about a monopoly by Amazon.

The publishers’ settlements in the case have not resulted so far in a noticeable decline in e-book prices, as publishers had feared, AP reported.

The DOJ’s lawsuit stems from agreements reached between major publishers and Apple in 2010 that allowed publishers to set their own prices for e-books, an effort to counter Amazon’s deep discounts of best-sellers.

The department and 15 states said Apple and the publishers cost consumers more than $100 million in the past two years by adding $2 or $3, sometimes as much as $5, to the price of each e-book. 

Macmillan also struck a deal to settle a similar suit brought by Connecticut and 32 other states.

Connecticut Attorney General George Jepsen said the deal grants e-book retailers greater freedom in pricing the digital books and provides $12 million to compensate affected customers.

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