In a ruling that could set a dangerous precedent for future publishing cases and "devstate" bookstores, a federal judge on Thursday approved a settlement in a civil antitrust case that had accused three publishers of conspiring together to raise e-book prices, The Wall Street Journal reported.

Three publishers agreed to the settlement with the Justice Department, which accused them and two other publishers of using the release of Apple's iPad to raise e-book prices, according to CNN Money.

Under the settlement, HarperCollins, Simon & Schuster, and Hachette will be required to allow big retailers to reduce prices for two years - an arrangement opponents fear could kill bookstores and be a boon to Amazon.

"It's devastating to bookstores," Paul Aiken, executive director of the Authors Guild, told The Wall Street Journal.

But Judge Denise Kote essentially said "too bad" when approving the deal, while noting the "birth of a new industry is always unsettling" ... as she cackled snidely before her bubbling cauldron, tossed in three frog's heads, and cracked a whip for added emphasis.

"I think that everybody competing with Amazon in the e-book market had better fasten their seat belts," Mike Shatzkin, the founder and chief executive of the Idea Logical Company, a consultant to publishers, said in an interview. "I would expect Amazon to be leading the charge to cut prices on the most high-profile e-books as soon as the decision allows them to do so. As soon as that starts to happen, all the books that are competing with them will have to reconsider their prices."

The Hachette Book Group, Simon & Schuster and HarperCollins all denied wrongdoing, but agreed in April to settle with the government, while the Penguin Group USA, Macmillan, and Apple declined to settle. They face a trial next summer.

Before Apple's iPad was released Amazon's Kindle was the main way consumers could get e-books.

Amazon forced publishers to sell the e-books for around $9.99, but after the iPad was released they allegedly began conspiring to raise prices to two three dollars per book.

"It is not the place of the court to protect these bookstores," Judge Kote said. After a ruling like this, that much seems abundantly clear.

Citing a lack of price competition when it filed the suit in April, The Justice Department accused them of conspiring to raise the cost of e-books and causing consumers to pay tens of millions more than they otherwise would have.

The judgment has the potential to spark an e-book price war in the publishing industry. According to the New York Times, Paul Aiken, the executive director of the Authors Guild, which vigorously opposed the settlement, said in an interview that the biggest losers would be traditional independent bookstores. If the cost of a newly released e-book drops further, the bookstores will have more trouble selling hardcover books at their current prices, he said.

Gina Talamona, a spokeswoman for the Justice Department, praised the ruling on Thursday, saying that "consumers will start to benefit from the restored competition in this important industry."

For the next two years, the settling publishers may not agree to contracts with e-book retailers that restrict the retailer's "discretion over e-book pricing," the court said. For five years, the publishers are not allowed to make contracts with retailers that include a most-favored nation clause. "The time limits on these provisions suggest that they will not unduly dictate the ultimate contours of competition within the e-books industry as it develops over time," Judge Cote wrote.

The settlement calls for the three publishers to end their contracts with Apple within one week. The publishers must also terminate contracts with e-book retailers that contain restrictions on the retailer's ability to set the price of an e-book or contain a so-called "most-favored nation" clause, which says that no other retailer is allowed to sell e-books for a lower price.

Penguin and Macmillan are not subject to the settlement and can continue to set the prices for their e-books while the legal case against them proceeds. The sixth major publishing company, Random House, was not named in the Justice Department's lawsuit.

Amazon declined to comment on Thursday. But when the settlement was announced in April, Amazon called it "a big win for Kindle owners," and said it looked forward to eventually lowering its prices on e-books.

According to The New York Times, Simon & Schuster, the Hachette Book Group, HarperCollins and Barnes & Noble declined to comment.