Who Got These Amazing Book Deals?
The DOJ's lawsuit against Penguin Random House mentions a Grammy-winning singer who scored $8 million for her memoir
The Department of Justice filed a lawsuit against Penguin Random House on Tuesday — the first major antitrust lawsuit under the Biden Administration and an apparent attempt to stop the publisher from acquiring its rival, Simon & Schuster. The 26-page civil complaint, filed in Washington D.C. District Court, lays out the Department’s case for why the merger “should be blocked.”
The main reason is that PRH is the largest publisher in the country, operating in a market with only four other true competitors — HarperCollins Publishers, Hachette Book Group, Macmillan Publishing Group, and Simon & Schuster — which even its own parent company described as an “oligopoly.”
The case against PRH includes several incredible details, one of which is that the Simon & Schuster CEO more or less confessed in an email that he believed the deal to be illegal. “I’m pretty sure that the Department of Justice wouldn’t allow Penguin Random House to buy us,” he wrote to one of the firm’s “best-selling authors” in May of 2020, “but that’s assuming we still have a Department of Justice.” Likewise, though PRH has publicly suggested the merger was necessary to compete with Amazon, another executive privately admitted that he “never, never bought into that argument.” Also, there’s this paragraph from the introduction:
Authors are the lifeblood of book publishing. Without authors, there would be no stories; no poetry; no biographies; no written discourse on history, arts, culture, society, or politics. In the words of Penguin Random House’s U.S. CEO, “[B]ooks have the power to sustain us, particularly in challenging times…” Penguin Random House’s Global CEO put it more simply, “Books matter…”
Books do matter. But which ones? The most interesting segments of the complaint are the descriptions of PRH’s most competitive acquisitions of “anticipated, top-selling books,” accompanied by some eye-raising hard numbers. Which begs the question: who are these anonymized descriptions about? If you know, tell us at firstname.lastname@example.org. In the meantime, here are our best guesses.
The Grammy-winning singer’s memoir
Deal: $8 million with Simon & Schuster
Description: “The head-to-head competition between Defendants has allowed authors of anticipated top-selling books to secure higher advances and other favorable terms. For example, in January 2019, Simon & Schuster tried to acquire the memoir of a Grammy-Award winning singer and avoid competing in an auction by making a pre-emptive offer for $5 million. After this initial offer was rejected, Simon & Schuster increased its bid to $6 million, and Penguin Random House countered with $7 million plus $2.5 million in potential bonuses. Upon hearing of Penguin Random House’s bid, Simon & Schuster’s then-President emailed his boss: “I’m concerned that if we offer less than $8 million, [the author’s agent] will go back to PRH. She said they were willing to offer more.” Simon & Schuster eventually won with a bid of $8 million.”
Gawker’s Guess: Olivia Newton-John’s memoir Don’t Stop Believin’. Simon & Schuster has a bunch of Grammy winners in its stable. Taking out the men and the ones published before 2019 whittles the options down to Halsey’s I Would Leave Me If I Could, Lana Del Rey’s Violet Bent Backwards Over the Grass, Chiquis Rivera’s Invencible, and ONJ. But Halsey and Lana wrote poetry collections, not memoirs; and Rivera’s memoir doesn’t come out until next year. ONJ had already written her memoir and released it in Australia in 2018. The news of this book deal came out a little early for the DOJ timeline — Simon & Schuster announced it in mid-December of 2018 — but the ready-made memoir hit the market in mid-March 2019, which seems timely. They didn’t announce any other Grammy-adjacent memoirs in 2019.
The Broadway play adaptation
Deal: $1.4 million with Penguin Random House
Description: “In mid-2019, Penguin Random House, Simon & Schuster, and Hachette were invited to bid on a book proposal based on a Broadway play. Penguin Random House and Simon & Schuster submitted equivalent bids; Hachette’s was lower. The author’s agent then asked for “best bids” from Penguin Random House and Simon & Schuster, both of which knew they were competing against the other. Simon & Schuster submitted a bid of $1.4 million, whereas Penguin Random House’s bid was closer to $1.25 million. Upon learning this, Penguin Random House’s U.S. CEO agreed to match Simon & Schuster at $1.4 million. At that point the auction was a dead-heat, with each publisher trying to win the “beauty contest” between them by pointing to the superior services each could provide to the author, including marketing, publicity, and editorial support. As Simon & Schuster’s current CEO summed it up: “The choice is between Simon & Schuster and RH and we’ll find out today.” The author eventually chose Penguin Random House.”
Gawker’s Guess: I was hoping this was Hamilton, but Lin-Manuel Miranda probably gets more than $1.4 million for his books. Also, the Hamilton book came out in 2016, his book of “inspirational tweets” came out in 2018, and his latest adaptation of In The Heights was only announced this past April. Random House did nab the Dear Evan Hansen adaptation, but that was also in 2018. Gawker’s best guess is The Prom, the Broadway musical about an Indiana high school that cancels prom over a lesbian couple. The DOJ says this bidding war started in “mid-2019;” news that The Prom was getting turned into a Y/A novel broke in late April of that year. The buyer was an imprint of Penguin Young Readers.
The Mueller Investigation tell-all
Deal: $1.5 million plus up to $500,000 in sales bonuses with Penguin Random House
Description: “That same month, an agent sent a proposal to four of the Big Five publishers for a book on the Mueller investigation. Only Simon & Schuster and Penguin Random House submitted offers. After hearing that its bid of $625,000 was lower, Simon & Schuster increased its bid to $1.5 million. A senior Simon & Schuster executive told the agent that Simon & Schuster had not offered her agency “an advance of this magnitude to a new author in the nine years I’ve been here.” Penguin Random House increased its offer to $1.5 million plus up to $500,000 in sales bonuses. After hearing that the author chose Penguin Random House, the Simon & Schuster executive wrote the CEO: ‘I did everything I could and we lost to Random House ... Frustrating.’”
Gawker’s Guess: My first guess was the actual Mueller Report, which PRH published in full in 2019. But that book was put out by three different publishers, so it seems unlikely that anyone fought over it, and it came out in April of 2019. The DOJ says the deal was proposed the “same month” as the Broadway play deal in “mid-2019,” so the timing isn’t right. Gonna guess Where the Law Ends: Inside the Mueller Investigation, by Andrew Weissman, which came out two weeks ago. Congrats to Andrew.
The gender inequality book
Deal: $775,000 with Penguin Random House
Description: “In 2020 Penguin Random House and Simon & Schuster competed in an auction for a book on gender inequality. After the first round, three bidders remained, including Penguin Random House and Simon & Schuster, with Simon & Schuster submitting the highest bid at $475,000. After the third bidder dropped out, Simon & Schuster and Penguin Random House drove the bidding up to $625,000 and $650,000 respectively. Subsequently, the agent asked for best and final bids, and Simon & Schuster bid $750,000. Suspecting that it was bidding against Simon & Schuster, Penguin Random House stretched its bid to $775,000. After winning the contract, the acquiring editor emailed her colleague: ‘we prevailed over . . . S&S.’ Her colleague replied: ‘[W]e got this one, and over stiff competition.’”
Gawker’s Guess: An upcoming book on “gender inequality” that inspired a bidding war during the first year of the pandemic? This must be Don’t Pull on My Scarf, by Deborah Birx. Just kidding. I don’t know.
The debut novel
Deal: $700,000 with Simon & Schuster
Description: “Penguin Random House and Simon & Schuster again went down to the wire in another fierce contest for an author’s debut novel. After multiple rounds of bidding, the author’s agent announced that only the two top bidders would be allowed to continue. Penguin Random House and Simon & Schuster were the two highest at $510,000 and $525,000, respectively. They continued bidding against one another for several additional rounds. Upon hearing that the other bidder had put in a final offer just shy of $700,000, Simon & Schuster increased its offer from $525,000 to $700,000 and won the auction.”
Gawker’s Guess: It’s despicable for the DOJ to include this without giving a year. There are so many debut novels.
The book about the opioid epidemic
Deal: $825,000 with Penguin Random House
Description: Penguin Random House and Simon & Schuster also competed for a book on the opioid epidemic in an auction in early 2020. When the bidding reached $645,000 after several rounds, the other bidders dropped out leaving Penguin Random House and Simon & Schuster as the only remaining bidders. Penguin Random House and Simon & Schuster then went back and forth with competing bids for multiple rounds, with Penguin Random House eventually prevailing with a winning bid of $825,000.
Gawker’s Guess: This could likely be Patrick Radden Keefe’s Empire of Pain, which came out in April from Doubleday, a Penguin Random House subsidiary, and was great. Send those guys to jail.
Update: A tipster sent Gawker some interesting intel after this post went up. “The Patrick Radden Keefe book was in the works well before 2020, maybe even before his New Yorker piece on the Sacklers ran in 2017. My best guess for the $825k advance is this deal, inked in May 2020 with Convergent (a PRH imprint). From the official Publishers Lunch memo: