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Entertainment news source Variety reported on Monday that Penguin Random House and ViacomCBS’s attorneys argued in court that Penguin Random House‘s proposed acquisition of Simon & Schuster will benefit authors and be “pro competitive,” adding that it should not be blocked under federal antitrust law.
Their attorneys claimed that the merger will allow Penguin Random House to bring “enhanced distribution capacity to a greater number of authors, including Simon & Schuster‘s authors.” They also stated that the U.S. Justice Department cannot prove that the merger will reduce competition or diminish pay for book rights. Lead attorney for Penguin Random House Dan Petrocelli said that the merger “will only enhance competition.”
The Wall Street Journal reported in November that the U.S. Justice Department filed a lawsuit on the same day that seeks to block Penguin Random House‘s upcoming purchase of publishing business Simon & Schuster due to antitrust concerns. The Justice Department said that if the deal went through, Penguin Random House would “hold unprecedented control and outsize influence over which books are published in the U.S. and how much authors are paid.”
The publishers argue that the deal would improve efficiency and make titles more available to both retailers and consumers.
The American Booksellers Association (ABA) asked the Department of Justice in December 2020 to challenge the purchase due to antitrust implications, expressing concerns the purchase would lead to a large consolidation of power in the U.S. book publishing industry, which could make it more difficult for authors and editors to attract support they need to write books.
ViacomCBS announced in November 2020 that it had agreed to sell the publishing business Simon & Schuster to Penguin Random House LLC, a wholly owned subsidiary of Bertelsmann SE & Co. KGaA, for US$2.175 billion. The cash transaction was expected to close in 2021. After the purchase, Simon & Schuster would continue as a separate publishing unit under the Penguin Random House umbrella. Simon & Schuster‘s President and CEO Jonathan Karp and COO and CFO Dennis Eulau would continue to head the company.
Simon & Schuster distributes Viz Media manga and novel publications in North America.
Penguin Random House Publisher Services’ clients include Seven Seas Entertainment, Kodansha USA Publishing (which handles the Kodansha Comics and Vertical imprints), Square Enix Holdings Co., Ltd. for its Square Enix Manga & Books publishing label, and Dark Horse Comics.
Source: Variety (Gene Maddaus)
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