In the last 10 years, the independents' share of the consumer book market has fallen to just 15 percent, in 2000, from 33 percent in 1991. Many independents said they were counting on the suit to diminish the competitive edge of the chains, and the association spent heavily on legal fees in the hopes of winning damages for lost business. The legal challenges by the independent bookstores have polarized the book business. The stores began by filing a series of lawsuits against publishers in the early 1980's, accusing them of favoring the chains. The litigation by the independents has created a partisan atmosphere in the industry, making publishers afraid to speak openly about either chains or independents.
Publishers say they have become wary about their conversations with the national chains.
Last month, the judge in the case, William H. Orrick, dismissed the association's claim for damages in a pretrial hearing. Association executives initially talked about appealing, but after two weeks of testimony they elected to settle the case to avoid the possibility of a defeat that could leave it crippled by legal fees. The independents must destroy all documents obtained during the case and agree to forgo any further litigation against the chains for three years. Settling the case also precludes an appeal. Acknowledging that the independents failed to win their stated goals, Mr. Domnitz said the public trial itself was a victory.