Antitrust Law Daily Wrap Up, ANTITRUST—S.D.N.Y.: Romance author’s claims of monopolization against Amazon Audible proceed, (Jun 12, 2025)

By Martin A. Steinberg, J.D.

Audible allegedly engaged in a multifaceted scheme to maintain its monopoly power in the audiobook retail distribution market by imposing excessive distribution fees, enforcing restrictive exclusivity terms, penalizing authors who distribute their work elsewhere, and foreclosing competition through alliances and content control.

The federal court in New York City denied Audible Inc.’s motion to dismiss a class action brought by bestselling author CD Reiss, who alleges that Audible, a subsidiary of Amazon, engaged in monopolistic practices in the audiobook distribution market. Reiss, representing a class of self-published and independent authors, claims Audible used exclusionary contracts, excessive distribution fees, and restrictive practices, including a mandatory 90-day exclusivity period, competition penalties, and strategic alliances with Apple to suppress competition and maintain its market dominance. The court held that Reiss plausibly alleged anticompetitive conduct and substantial market foreclosure under Section 2 of the Sherman Act and found she had standing as a direct purchaser subject to the alleged overcharges (Reiss v. Audible, Inc., No. 1:24-cv-05923-JLR (S.D.N.Y. Jun. 11, 2025)).

Background. Reiss, a best-selling author residing in California, has been self-publishing for over a decade and began producing audiobooks in 2016. In 2017, she was the recipient of an Audie award. She has distributed audiobooks through Amazon on both an exclusive and competitive basis since 2020.

Audible is the leading audiobook retailer in the U.S. and globally, accounting for over 60% of domestic audiobook sales. Audible’s parent company is Amazon.com, Inc. Amazon also owns Audiobook Creation Exchange (ACX), an online marketplace launched by Audible in 2011 that connects authors, narrators, producers, and other industry professionals to create audiobooks. To sell their audiobooks, self-published and independent authors upload them through ACX, with all titles distributed through ACX made available for sale on Amazon and Audible.

Audible offers two distribution options via ACX: exclusive and competitive. Exclusive distribution limits authors to Audible, Amazon, and iTunes, and comes with a 60% distribution fee, resulting in a 40% royalty. Competitive distribution allows authors to use other platforms but subjects them to a higher 75% distribution fee, along with a 25% royalty, and non-price penalties such as reduced visibility and marketing support. Authors must commit to seven-year license agreements with auto-renewal clauses and are locked into exclusivity for the first 90 days after a title's release.

On June 13, 2024, Reiss commenced this action against Amazon on behalf of herself and the putative class members, asserting claims of monopolization and attempted monopolization under Section 2 of the Sherman Act. Reiss seeks monetary recovery, including treble damages, in addition to nationwide injunctive relief. The putative class includes a subclass of audiobook authors and rightsholders who distribute an audiobook title through channels in addition to Audible and who pay Audible’s distribution fee of 75% or more. On September 16, 2024, Audible filed its motion to dismiss, and the next day, the court entered the parties’ joint stipulation to substitute “Amazon.com, Inc.” with “Audible, Inc.” as the proper defendant in this matter.

Audible moved to dismiss on two independent grounds: (1) Reiss has not adequately pleaded anticompetitive conduct, as required for both her monopolization and attempted monopolization claims under section 2 of the Sherman Act, and (2) Reiss lacks antitrust standing because the only direct victims of the challenged conduct were Audible’s distribution rivals, such as Google and Spotify, not self-published authors like Reiss.

Alleged anticompetitive conduct. Reiss alleges that Audible, leveraging its dominant market position, engaged in a broad pattern of exclusionary conduct designed to suppress competition in the audiobook retail distribution market. Central to these claims is Audible’s use of the ACX, which imposes a mandatory 90-day exclusivity period on self-published authors, locking in their titles during peak sales windows. Authors who opt for non-exclusive distribution are subject to a 75% distribution fee, 15% higher than the exclusivity fee, and are also penalized through reduced visibility, lower search rankings, and diminished promotional opportunities. Reiss characterizes this “competition penalty” and associated non-price penalties as mechanisms that coerce authors into exclusivity, deterring experimentation with alternative platforms and stifling output despite growing consumer demand.

Beyond ACX, Reiss alleges that Audible’s anticompetitive conduct extends across the broader audiobook ecosystem. Audible has entered into exclusive agreements with major publishers and high-profile authors, securing popular titles and entire genres. This has resulted in an estimated two-thirds of all new releases being exclusive to its platform during their critical initial release period. The company also limits consumer mobility by preventing file transfers and restricting competitors from offering “must-have” titles in subscription packages, thereby increasing switching costs. Additionally, Audible’s “coopetition” alliance with Apple Books—its largest potential competitor—allows it to collectively control over 80% of the market, further insulating it from competitive pressures. Reiss contends that this web of conduct effectively forecloses rivals, depresses author earnings, and maintains Audible’s supracompetitive pricing power.

Anticompetitive conduct. The court held that Reiss plausibly alleged that Audible engaged in exclusionary conduct sufficient to support claims of monopolization and attempted monopolization under Section 2 of the Sherman Act. Under Section 2 of the Sherman Act, the plaintiff must plead both monopoly power and exclusionary conduct. While Audible did not dispute its dominance in the relevant market, it contested the sufficiency of Reiss’s allegations of exclusionary conduct. In assessing whether conduct is exclusionary, courts consider its effect on competitors, its “impact on consumers,” and “whether it has impaired competition in an unnecessarily restrictive way.” Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 U.S. 585, 605 (1985).

90-day exclusivity agreements. The court found that the terminability of the ACX contracts alone was not sufficient reason to warrant dismissal of this action. The court rejected Audible’s argument that Reiss's complaint focused solely on the 90-day exclusivity period in ACX contracts, instead recognizing that the complaint described a broader, multifaceted scheme that included not just exclusivity terms, but also price and non-price penalties, content lockups, distribution restrictions, and a market-sharing alliance with Apple Books. The court emphasized that exclusionary conduct must be evaluated holistically, not in isolated parts, and that the totality of Audible’s actions plausibly demonstrated harm to the competitive process.

Substantial foreclosure is a prerequisite for every exclusive-dealing Section 2 claim. BRFHH Shreveport, LLC v. Willis-Knighton Med. Ctr., 49 F.4th 520, 530 (5th Cir. 2022). The court further explained that while short-term of less than a year exclusivity contracts are presumed to be lawful, Reiss’s allegations went beyond mere duration; she alleged that Audible’s market dominance, the economic penalties for non-exclusivity, and the strategic timing of the 90-day lockup during peak sales periods functionally coerced authors into exclusivity and foreclosed rival platforms. Additional allegations, such as exclusive deals with publishers, search algorithm manipulation, restricted consumer access, and Audible’s alignment with Apple, further supported a plausible theory of substantial market foreclosure. The court concluded that, although Reiss had not yet quantified the precise share of foreclosed commerce, her allegations were sufficient at the pleading stage to suggest that Audible’s conduct could harm competition and warrant discovery.

Other exclusionary conduct. The court found that Reiss has adequately pleaded substantial market foreclosure and therefore denied Audible’s motion to dismiss the Complaint on that ground. The court noted, however, that Reiss may well have difficulty proving substantial market foreclosure down the road. But, to survive Audible’s motion to dismiss, Reiss has met her burden of pleading a plausible theory thereof.

The court considered Reiss’s allegations beyond the ACX exclusivity terms, emphasizing that Audible’s anticompetitive practices extended across multiple layers of the audiobook market. Reiss alleged that Audible secured exclusive deals with influential authors and large publishers, beyond self-published creators, resulting in two-thirds of all new audiobook releases being locked to Audible for at least 90 days. She further claimed that Audible controlled a majority of content in popular genres such as general fiction, science fiction, and erotica, creating significant barriers for competing platforms to offer comparable catalogs.

Reiss plausibly alleged other exclusionary tactics, including restricting how subscribers use rival platforms, denying competitors access to “must-have” titles under subscription plans, and leveraging a partnership with Apple Books to control over 80% of the market jointly. When taken together with the 90-day ACX exclusivity, these practices formed a cohesive strategy to foreclose rivals and reinforce Audible’s market dominance. According to Reiss, nearly two-thirds of all new releases are locked up by Audible for at least 90 days. Beyond Audible’s use of exclusivity agreements, Reiss also alleges that Audible constrains its 50 million-plus subscribers’ ability.

Standing. Audible also argued that Reiss lacked antitrust standing. The court disagreed, holding that Reiss had adequately alleged (1) a direct injury in the form of overcharges paid to Audible and (2) that she was a direct purchaser with no intermediary in the distribution chain. Direct purchasers who pay allegedly inflated prices due to anticompetitive conduct have standing under the Clayton Act. The court rejected the argument that only competitors had standing, emphasizing that author plaintiffs are among the direct economic victims of Audible’s conduct. It also found that damages were not so speculative as to warrant dismissal and that there was no significant risk of duplicative recovery.

Antitrust injury. Reiss has sufficiently identified the practices complained of and the reasons the practices are or might be anticompetitive. Moreover, Reiss alleges that she and the class of authors she represents are Audible’s direct customers, subject to its anticompetitive conduct, including its excessive distribution fees. Reiss’s alleged overcharge injury is of the type the antitrust laws were intended to prevent. In re Keurig Green Mountain Single-Serve Coffee Antitrust Litig., 383 F. Supp. 3d 187 (S.D.N.Y. 2019).

Efficient enforcer. The court concluded that Reiss was an appropriate and efficient enforcer. It analyzed whether Reiss had standing to bring her antitrust claims by applying the Second Circuit’s four-factor test. First, her alleged injury, resulting from overcharges due to Audible’s supracompetitive distribution fees, was directly linked to Audible’s exclusionary conduct, which involved no intermediaries in the distribution chain.

Second, although Audible argued that its competitors like Spotify or Google would be more suitable plaintiffs, the court clarified that antitrust standing does not require a plaintiff to be the “most motivated,” only that the plaintiff is among those naturally incentivized to sue, which Reiss, as a directly harmed author, clearly was.

Third, the court found Reiss’s alleged injury was not speculative, as she claimed a concrete financial harm in the form of inflated fees and reduced earnings. Reiss argues that damages can be calculated “by the difference between the prices paid to Audible by class members and the but for prices that would have existed in a competitive market without Audible’s anticompetitive conduct.”

Fourth, there was no undue risk of duplicative recovery or complex apportionment of damages, since Reiss and the proposed class directly contracted with Audible and paid the challenged fees. Although Audible maintains that any damages calculation for Reiss would be “exceptionally complex,” courts routinely decline to find that the complexity of damages calculations defeats the standing of an otherwise efficient enforcer. Accordingly, the court concluded that Reiss met the requirements for antitrust standing and was a proper plaintiff to enforce the Sherman Act claims at issue.

The Case is No. 1:24-cv-05923-JLR.

Judge: Rochon, J.

Attorneys: Barry Frett (Sperling & Slater PC) for CD Reiss a/k/a Christine Demaio.

Companies: Audible Inc.; Amazon.com, Inc.

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