03 May 2013

Oswald Cobblepot Was Here

A Penguin Company???As Writer Beware notes (and if you're not reading Writer Beware and you're an author, you're seriously harming your own interests), Penguin's newly acquired Author Solutions unit has been sued for fraud in a class action. I won't say I have nothing but praise for the complaint — I think it's less clear on a couple of nuances than it could be — but it's so vastly better than the usual complaint in publishing that it should be studied fairly carefully. (It's also a lot better than most commercial-transaction-based class-action complaints.) Victoria includes a link to the complaint in her WB announcement.

The James complaint, of course, is not entirely complete; it can't be. For one thing, it has to limit itself to the specific causes of action for which the plaintiffs have standing. That means that, for example, this set of plaintiffs can't point out the appearance of collusion in setting authors' share of e-book royalties as a standard, essentially nonnegotiable 25% of net.


Presuming the truthfulness of the complaint (and I've got plenty of documentation indicating that it is, if anything, an understatement), the James complaint does have implications for the settlement in the e-book antitrust matter that the corporate parent signed. Given the immense market share of Author Solutions (and, hence, of its corporate parent) in the egregiously misnamed "self-publishing service bureau" market, anything that Author Solutions does that restricts price competition or availability of goods — that is, implicates the Sherman or Clayton Antitrust Acts — may breach Penguin's settlement agreement with the United States. That settlement agreement requires the settling publishers to refrain from antitrust violations. The allegations in the James complaint at least raise the question, and are probably sufficiently detailed to survive a motion to dismiss even without further investigation.

No physically deformed orphans were harmed in the writing of this post.