[LIBRARYDIR] FW: [SPARC] Class action lawsuit filed against "inclusive access"

[Boyoung Chae]

FYI

[sbctc logo]Boyoung Chae, Ph.D.
Policy Associate, Educational Technology & Open Education
Washington State Board for Community and Technical Colleges
Openwa.org<openwa.org> | OER & Low-Cost Label<https://www.sbctc.edu/colleges-staff/programs-services/educational-technology-open-education/oer-low-cost-label-implementation.aspx>
bchae at sbctc.edu<mailto:bchae at sbctc.edu> |360-628-3549
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From: Nicole Allen <nicole at sparcopen.org>
Sent: Wednesday, January 29, 2020 5:14 PM
To: SPARC Members <sparc-members at sparcopen.org>
Subject: [SPARC] Class action lawsuit filed against "inclusive access"

Dear SPARC members,

I’m writing to share with you some analysis of the class action lawsuit<https://www.insidehighered.com/news/2020/01/27/independent-bookstores-mount-inclusive-access-lawsuit> against "inclusive access" filed late last week in federal court, which alleges antitrust violations by college bookstore chains and major textbook publishers.

The lawsuit was filed by a group of independent college bookstore chains, who allege that "inclusive access"—a model to automatically bill students for temporary access to digital course materials—is eliminating competition and student choice in the market. The plaintiffs claim that this in turn harms their business, since students do not have the option to purchase their course materials from other sources. The complaint covers a range of antitrust violations, including allegations that defendant publishers colluded to force the market to inclusive access, that they conspired to prevent independent retailers from being able to sell inclusive access materials, and that the continued expansion of inclusive access will foreclose the market to competition. It also makes several preemptive arguments against industry claims that inclusive access is innovative or that it saves students money.

While the complaint discusses the Cengage/McGraw-Hill merger<https://sparcopen.org/our-work/oppose-cengage-mcgraw-hill-merger/> and both companies are defendants, the lawsuit does not allege any violations specifically related to the merger. However, the complaint draws multiple arguments directly from our DOJ filing on the merger, since the lawsuit concerns many of the same antitrust issues we raised for DOJ (which will only get worse if the market further consolidates).

This is the second major lawsuit filed concerning inclusive access, the first<https://www.postandcourier.com/news/textbook-scam-alleged-in-federal-lawsuit-against-sc-s-biggest/article_d266c94a-262e-11e9-a6dd-ab6ac37fa3d1.html> being from a South Carolina independent bookstore against Trident Technical College, which is still pending. While both deal with the similar practices, there are several differences. The TTC lawsuit focuses on a specific institution and seeks injunctive relief from unfair trade practices, whereas this is a class action suit that focuses on antitrust violations by major publishers and retailers that affect the whole market. As such, the new lawsuit is more nationally significant, and it highlights many of the concerns that SPARC has about the harms of inclusive access, which are discussed in our Landscape Analysis<https://sparcopen.org/our-work/landscape-analysis/> and Roadmap for Action<https://sparcopen.org/our-work/roadmap-for-action/>.

I have attached the complaint here, and there are articles in Inside Higher Ed<https://www.insidehighered.com/news/2020/01/27/independent-bookstores-mount-inclusive-access-lawsuit>, EdSurge<https://www.edsurge.com/news/2020-01-28-targeting-inclusive-access-deals-college-bookstores-sue-textbook-publishers-and-retailers>  and Bloomberg<https://news.bloomberglaw.com/mergers-and-antitrust/mcgraw-hill-b-n-accused-of-online-course-materials-monopoly?context=search&index=0>. With inclusive access continuing to spread rapidly, it is important to educate campus decision-makers about the significant consequences. Expect more to come from SPARC in the coming weeks.

Cheers,
Nicole



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Nicole Starr Allen
SPARC<http://www.sparcopen.org> | Director of Open Education
21 Dupont Circle NW, Suite 800
Washington, DC 20036 USA
+1 (202) 750-1637
nicole at sparcopen.org<mailto:nicole at sparcopen.org>
@txtbks<http://www.twitter.com/txtbks>

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