This merger would have eliminated competition, leading to lower pay for authors, fewer books, and less variety for readers.
A Judge in the United States issued an order on Monday that prevents Penguin Random House fromthe largest publisher in the country, acquire rival Simon & Schusterclaiming that the merger violated antitrust laws.
The union of the two companies “would have reduced the competitiondiminished compensation to authors, dwarfed the breadth, depth, and diversity of our stories and ideas, and ultimately impoverished our democracy,” Justice Department Antitrust Division Assistant Attorney General Jonathan Kanter wrote in a statement. .
The decision to block the acquisition of Simon & Schuster, which It was valued at $2.2 billion.was announced by a federal court in the District of Columbia in a case filed by the US Justice.
Judge Florence Pan, who issued the ruling, argued that prosecutors succeeded in proving that the merger would negatively affect competition in the market for publishing rights to the best-selling books.
The verdict comes after an 11-day trial in August in federal court in Washington to examine a request by prosecutors to ban the merger, giving a boost to the Biden administration’s attempts to crack down on monopolies.
In the original lawsuit, filed in November 2021, the Justice Department alleged that Penguin Random House and Simon & Schuster, the fourth largest US publisher, compete to buy manuscripts from authors offering large advances and other benefits, as well as favorable contracts for writers.
The merger, the US government indicated when filing the lawsuit, would eliminate that competition, so authors would receive a lower stipend and there would be fewer books on the market and less variety for readers.
The case against publishers joins a series of antitrust investigations initiated by the Biden government, also by the United States Federal Market Commission, against large technology companies such as Meta –Facebook parent company- and Google.