Judge Tosses Anderson's Antitrust Suit Against Magazine Publishers

A judge has dismissed the multimillion-dollar lawsuit brought by Anderson News LLC, a bankrupt magazine and book wholesaler, against major magazine publishers including Time Inc. and Hearst Communications.

In its lawsuit filed in 2009, Anderson News alleged that Time, Hearst, and a number of other magazine publishers had conspired to put Anderson out of business after it attempted to raise prices.

The publishers responded to these price hikes by refusing to supply Anderson with magazines, forcing its retail customers to switch to rival wholesalers to supply their newsstands.

Anderson’s lawsuit was initially dismissed by a lower court in 2010, but Anderson appealed to the Second Circuit court in 2012. The lawsuit cited evidence of alleged collusion including emails, phone conversations and personal meetings between executives from the magazine publishers.

The magazine publishers fired back with lawsuits alleging that Anderson conspired with another wholesaler, Source Interlink, to force them to accept increased fees.

On Thursday, U.S. District Judge Paul A. Crotty granted a request from the defendants for summary judgment and dismissed Anderson’s lawsuit following an earlier round of court arguments in July. Crotty also dismissed the publishers’ counter-suits against Anderson, stating that they couldn’t prove their claims, either.

In addition to dismissing the lawsuit, Crotty noted that some of Anderson’s own moves may have violated anti-trust statutes -- particularly its attempt to persuade retail giants Wal-Mart and Kroger not to take their business to other wholesalers, which would have effectively blocked magazines from their newsstands.

In his sharply worded judgment, Crotty wrote: “If there were ever an antitrust case of the pot calling the kettle black, this is it. It is clear [Anderson’s] own ill-conceived and badly executed plan led to its downfall.”

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