Why a large number of companies and individuals have favored Apple and the publishers in the DoJ lawsuit is a question which has been circulating vigorously since last week. Apple and the publishers have been accused to lower their prices in order to drive traffic away from the giant ebook retailer that is Amazon. Without any doubt, this case gives a feel that one major retailer is out to get the other but there are some companies which are looking at the scenario with anticipation to see how this fight will end to affect their own businesses.
Barnes and Noble, another giant in the ebook business voiced the opinion over this lawsuit. Company’s general legal counsel Eugene DeFelice gave an interview to shed some light on the results this lawsuit will have on other retailers.
“There’s a process by which interested stakeholders who are not a party to the litigation can petition the court to be heard on what they think the court needs to know,” explained DeFelice of the amicus brief, or “friend of the court” brief, that B&N filed last week. “In this case, the court is looking to the possibility of approving the settlement that was entered into with three of the publishers. We asked the court if we could file briefs on this matter to be heard on why this settlement should not be approved.”
Barnes and Noble also came under fire as it had very elaborate and old contracts with the publishers which have been accused in the lawsuit.
“There’s no lawful basis for the DoJ to meddle in our contracts. If they find evidence of wrongdoing from someone else, they should go after those people instead of changing how we have to do business. Instead they would be saying, ‘You have to stop doing business the way you do,’ even though on July 23rd [in the Tunney Act], the DoJ said that the agency model is legal.”
In referring to the mode of business, the legal counselor is talking about the much debated wholesale model as opposed to the agency pricing model which is basically the whole point of discussion in this lawsuit. Amazon has worked on the wholesale model which introduced a lower price to customers in order to increase the sales of their Kindle reader, pushing a clash between Apple and five of the six publishers. The agency price refers to the price set by publishers on which retailers have to sell their books. About the agency price, there are no charges found against Apple or the publishers who have settled the case outside the court.
“I’m not sure what kind of damages they’re looking to get out of this, or that there are any damages… No one has received notice that they’re being investigated for criminal charges.”
As no criminal activity has been found, the fact of the matter would be that this lawsuit will only change the procedure of retailers’ business with the publishers. But according to the DeFelice, the outcome would be not this.
“Apple’s going to take them to court, and they’re going to win. If the best that the DoJ has was in their initial complaint, I don’t see Apple losing.”