updated 01:45 am EST, Sat January 21, 2012
Hagens Berman amends Apple suit over collusion
Hagens Berman's class-action over iBookstore prices was expanded on Friday with potentially more serious evidence. New claims from the law firm allege that Hachette Livre (incorrectly described as Hatchett) chairman Arnaud Noury met with an unnamed Amazon executive on December 3, 2009 several weeks before the iPad unveiling to convince him to raise the price of e-books on the Kindle Store. According to the anecdote, Noury had said that a $2 to $3 price hike over the existing $10 would solve not just Hachette's problems but those of its competitors, suggesting that it was aware of and working together on raising prices.
The amendments to the complaint also turn Walter Isaacson's biography of Steve Jobs against Apple. Jobs had said that Amazon had "screwed it up" by not only picking the wholesale model where it set the price but of selling below cost, often at $10 or less. The late CEO had seen the "desperation" at the publishers and took advantage, not only moving them over to the agency model of publishers setting prices but establishing a most-favored-nation policy where Amazon would have no choice but to agree to publishers' price increases if it wanted the books at all.
Book prices climbed an average of more than 30 percent, and 40 percent for the hottest new books, lead counsel Steve Berman said, in some cases leading to prices higher than paper.
Also collected were quotes from various publishing executives, including Hachette US' chief David Young observing that it would be "game over" if readers got too used to books costing $10. Macmillan CEO John Sargent had argued that it would only be "stable and rational" under the agency model.
To Hagens Berman, the collective evidence showed that publishers were jointly determined to raise Amazon's price "one way or another."
Neither Apple, Amazon, nor publishers had commented on the updated lawsuit.
The lawsuit is partly an instance of sensationalist lawsuits, which often take advantage of issues with popular companies to draw the limelight to themselves. Unlike most such lawsuits, though, both public and private records are believed to exist that would show at least a mutual desire to keep prices high, if not direct teamwork between them.