NACS Sues Three Publishers over 'Dual Pricing'
by John Mutter -- Publishers Weekly, 7/28/1997
Cambridge University Press, Oxford University Press and Addison Wesley Longman named in price discrimination suitAfter campaigning since December against "dual pricing" whereby publishers sell books to stores at different discounts depending on whether the titles are used in classes or not -- the National Association of College Stores is suing three publishers: Cambridge University Press, Oxford University Press and Addison Wesley Longman. The suit was filed last Wednesday in federal court in the southern district of New York; NACS's law firm is Arent Fox Kintner Plotkin &Kahn, of Washington, D.C.
Three bookstores were named as co-plaintiffs: Bookcraft Inc., which d s business as Beaver Bookstore, Bemidji, Minn.; Michigan College Book Co., which operates several college bookstores in Michigan; and Spartan Shops, which d s business as Spartan Bookstore and is affiliated with San Jose State University, San Jose, Calif.
The suit is reminiscent of the ABA's antitrust lawsuits against six publishers, originally filed in 1994 and since settled. NACS president Jeff Mack ech d the ABA's rationale for its lawsuit when he commented, "Our aim in filing suit against these publishers is to level the playing field for all college bookstores."
The complaint alleges that the defendants' pricing policies "either expressly or in practice result in college stores paying more than other competing booksellers for identical titles when those books are intended for classroom use," and thus violate the Robinson-Patman Act's prohibition against price discrimination. In general, NACS said, nonacademic bookstores receive discounts of 30%-50% on most titles while college stores receive 20% discounts on the same titles when the books are used in classrooms.In its particular charges, the suit alleges that Cambridge has an express policy of giving 20% discounts on trade book for classroom use regardless of quantity ordered.
As for Oxford, the suit contends that under the house's agency plan, the discount decreases as the number of copies of a title is ordered, which makes the discount on books that are part of a large order -- typically for classroom adoption -- ever smaller.
Likewise, Addison Wesley Longman's agency plan has the effect of making the plan's higher discounts unavailable to college bookstores by excepting text-adoption orders from its 36% discounts.
The NACS suit has been the result of a slow process that began last December, when the association asked members to send evidence of dual pricing to Arent Fox for evaluation. In March, the association identified 44 publishers and distributors whose policies it said were illegal. In April, NACS's board voted to ask Arent Fox to contact eight of the original 44 publishers to ask them to change their policies; if changes were not made, counsel was authorized to file suit. NACS said that 10 publishers and distributors of the original group of 44 have changed their pricing policies in acceptable ways and that four other publishers are in the process of reviewing their practices.
In a prepared statement, Oxford said it "vigorously denies that it practices price discrimination with respect to college stores." The company said its policies apply equally to all categories of retailers. A spokesperson for AWL said the company needed more time to study the complaint before issuing a comment, and no one was available at Cambridge at press time to respond to the NACS suit.
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