The deal, worth $2.2 billion, had been announced in November 2020 and would have brought together two of the five largest American publishers.

US District Court Judge Florence Pan, in her ruling, said the government had convincingly shown that the merger would substantially lessen competition “in the market for the US publishing rights to anticipated top-selling books.”

Pan said her full reasoning for the decision would be issued under seal, as it relied on confidential business information.

The Justice Department hailed the decision, which comes only a week before crucial midterm elections in which Democratic President Joe Biden has tried to paint his party as defending consumers' interests.

The Justice Department under Biden has been more aggressive than his predecessors in attempting to block mergers, with mixed success so far.

“Today's decision protects vital competition for books and is a victory for authors, readers, and the free exchange of ideas,” said Assistant Attorney General Jonathan Kanter in a statement.

With 10,000 employees worldwide and nearly 15,000 books published per year, Penguin Random House — a subsidiary of the German Bertelsmann Group — dominates the industry in the United States.

Simon & Schuster, owned by Paramount, is the fourth largest of America's “Big Five” publishing companies, which also include HarperCollins, Hachette Book Group USA and Macmillan Publishers.

Stephen King ‘delighted'

Big-name writers on the roster at Simon & Schuster include Stephen King and Doris Kearns Goodwin, while Barack and Michelle Obama and John Grisham have books published by Penguin Random House.

It is also preparing to release Prince Harry's memoir, in early 2023.

Penguin Random House said it strongly disagreed with the judge's ruling and announced it will request an expedited appeal.

“We believe this merger will be pro-competitive, and we will continue to work closely with Paramount and Simon & Schuster on next steps,” it said in a statement.

But best-selling author King praised Pan's decision, in a statement going against his own publisher.

“I am delighted that Judge Florence Pan has blocked the merger of Penguin Random House and Simon & Schuster,” the “King of Horror” said in a tweet. 

“The proposed merger was never about readers and writers; it was about preserving (and growing) PRH's market share. In other words: $$$,” he said.

Paramount said it was disappointed by the ruling.

“We are reviewing the decision and discussing next steps with Bertelsmann and Penguin Random House, including seeking an expedited appeal,” it said.

Prior to the US action against the takeover, the UK's competition authority had also taken a close look at the merger, as both groups have British divisions. It issued a favorable opinion in May 2021.