Late last week, Judge Denise Cote, the judge who has presided over the Department of Justice lawsuit against Apple and five of the then-Big Six publishers, approved the terms of the settlements with the publishers, meaning the doors have finally been opened for the money to begin making its way back to the consumers who overpaid for ebooks.
But one person has been working to block the approval of those terms on the grounds that the publishers will not try to stand up for themselves (the publishers maintain there was no effort to bilk the public out of hundreds of millions of dollars, they quickly settled out of court to avoid what would end up costing them more in legal fees), meaning presumably someone must step in.
Bob Kohn, former CEO and founder of the digital solutions company RoyaltyShare who works with a number of major publishers, did not attempt to object to the settlements posed earlier this year with HarperCollins, Simon&Schuster, or Hachette, but objected Friday to the settlement terms for Macmillan and Penguin. His argument was that the actions of the publishers were not in violation of the Sherman Act (which is in place to prevent companies from colluding on the prices of goods to inflate them artificially, for example), but that their actions were necessary to prevent Amazon from growing even larger than it already is.
While some may feel that’s a “noble” reason for breaking the law, Judge Cote disagreed.
Kohn took a huge risk in posing his objection and asking for a Motion to Intervene. The states’ attorneys general were prepared to ask Kohn to foot the bill for a bond to return that money to consumers should he have succeeded in his motion to delay the settlement. While he was unsuccessful, Kohn’s motion in no way impacted the decision or proceedings against Apple for its part in this issue; Apple is appealing its own ruling, handed down by Cote earlier this year in which she found sufficient evidence of price fixing on the part of the company.
As the settlement with the publishers has been approved, consumers should soon start to see refunds–most likely issued in the form of credits on their accounts–for ebooks purchased during the time period of the stated collusion. Some studies of the case found that more than 20 million consumers were affected by the illegal price increases on ebooks.
UPDATE: Bob Kohn is no longer with RoyaltyShare, having left the company earlier this year.