US DoJ sues to block Bertelsmann’s acquisition of S&S
The lawsuit, filed in the US District Court for the District of Columbia, argues the acquisition ‘would result in substantial harm to authors’. It also alleges the move would ‘enable Penguin Random House, which is already the largest book publisher in the world, to exert outsized influence over which books are published in the United States and how much authors are paid for their work’.
‘If consummated, this merger would likely result in substantial harm to authors of anticipated top-selling books and ultimately, consumers,’ the DoJ stated. ‘Post-merger, the two largest publishers would collectively control more than two-thirds of this market, leaving hundreds of authors with fewer alternatives and less leverage.’
The DoJ’s decision to sue to block the acquisition came following concerns from agents and authors that the deal will leave fewer major publishers able to acquire big-ticket titles. The acquisition received antitrust clearance from the UK Competition & Markets Authority in May.
PRH and S&S have both stated their intentions to fight the lawsuit, calling the proposed deal a ‘pro-consumer, pro-author and pro-bookseller transaction.’
In a memo to PRH employees, CEO Markus Dohle wrote that the publisher is ‘committed to vigorously defending this acquisition’, and that the deal will ‘benefit all constituents, including authors, agents, retailers, and, ultimately, readers, and will do nothing to undermine the robust, competitive publishing landscape that currently exists’.
‘DoJ’s lawsuit is wrong on the facts, the law, and public policy,’ PRH’s lead trial attorney Daniel Petrocelli said. ‘Importantly, DoJ has not found, nor does it allege, that the combination will reduce competition in the sale of books. The publishing industry is strong and vibrant and has seen strong growth at all levels. We are confident that the robust and competitive landscape that exists will ensure a decision that the acquisition will promote, not harm, competition.’
Category: International news