November 2, 2022
Antitrust: Federal Judge Permanently Enjoins Simon & Schuster Deal
On Monday, U.S. District Judge Florence Pan permanently enjoined Penguin Random House’s proposed acquisition of Simon & Schuster. In doing so, Judge Pan found that the deal would substantially lessen competition in the market for publishing rights to anticipated top-selling books. Here’s an excerpt from the DOJ’s press release on the decision:
“Today’s decision protects vital competition for books and is a victory for authors, readers, and the free exchange of ideas,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “The proposed merger would have reduced competition, decreased author compensation, diminished the breadth, depth, and diversity of our stories and ideas, and ultimately impoverished our democracy.”
“The decision is also a victory for workers more broadly,” said AAG Kanter. “It reaffirms that the antitrust laws protect competition for the acquisition of goods and services from workers. I would like to thank the talented, hardworking staff of the Antitrust Division for their steadfast efforts to safeguard competition in this important case.”
It’s been a tough couple of months for federal antitrust agencies, which have taken it on the chin when it comes to their efforts to persuade federal courts of the merits of some of their more novel approaches to antitrust enforcement. That makes this case a particularly big win for the DOJ – because the “monopsony” theory under which it brought the case is as novel as it gets.
While the decision is undoubtedly gratifying to the DOJ, the fight is far from over, because Penguin Random House’s parent company, Bertelsmann, issued a statement in which it said that it “believes the district court’s decision is wrong and plans to file an expedited appeal against the ruling.”
– John Jenkins