In In re: Electronic Books Antitrust Litigation, multi-district litigation, Southern District of New York Judge Denise Cote rejected publisher Penguin Group’s motion to compel arbitration for plaintiffs who purchased e-books from Amazon or Barnes & Noble, both of which contain arbitration clauses in their purchase agreements. The complaint accuses Penguin and other publishers of fixing prices for electronic books.
The court held that even if the arbitration agreements were generally enforceable, requiring arbitration of Sherman Act claims would prevent the proposed class from asserting its federal rights. The court found that it would be economically irrational for any plaintiff to bring an individual arbitration claim. “Plaintiffs can expect at most a median recovery of $540 in treble damages,” the court explained, “and [each would] face several hundred thousand dollars to millions of dollars in expert expenses alone.”