The US Justice Department will ask a federal judge on Monday to block a $2.2 billion merger between the world’s five largest book publishers, Penguin Random House and Simon & Schuster, which is expected to include testimony from author Stephen King.
In the ruling, the government will focus on the advance paid to the most successful authors, especially those earning at least $250,000, rather than what consumers pay for the books.
“Evidence shows that the proposed merger will lead to authors of best-selling books receiving smaller advances, meaning authors who have been working on their works for years will receive less for their efforts,” the government said at a pre-trial conference.
The government also intends to show that there was concern among the parties to the merger that the agreement was not legal. Earlier, the government released an email from Simon & Schuster CEO Jonathan Karp, who wrote: “I hope the Justice Department won’t allow Penguin Random House to buy us out, but we’re assuming we still have the Justice Department”.
King, author of “The Shining,” “Carrie” and other hits, will testify on behalf of the government along with publishing executives and authors’ agents.
On Monday, in the same courtroom in Washington, the Justice Department will argue before a different judge whether to block UnitedHealth Group’s $8 billion acquisition of the healthcare company.
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