Barnes and Noble has until the day after Thanksgiving to respond to Spring Design’s lawsuit pertaining to the nook.  If Spring Design is successful in getting an injunction Barnes and Noble may not be able to sell any more of their nook ereaders this holiday season.

There is a copy of the court documents  that Spring Design has filed if you are interested in reading it.  It looks pretty bad, but of course we will have to wait for Barnes and Noble’s response to get their version.

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The most recent leg of the downtrend appears to have started around October 8, when B & N adjusted their fiscal year outlook .  The next day, October 9,  the Wall Street Journal broke the story about Barnes and Noble’s ereader plans, but this did nothing to put the brakes on the stock’s slide.  Even when the nook was officially announced on October 21 the stock didn’t stop its downward plunge.  Obviously Wall Street isn’t impressed with the nook.

Of course, if you are into TA, then the stock has now reached a region of congestive support and may now  a: move sideways for some time; b: rest for a bit before resuming its rush towards zero; or c: rest for a bit before attempting a bounce, quite possibly of the dead cat variety, back upwards.

There is also the possible interpretation that enough people knew about or expected the lawsuit that it has been priced into the stock  by the recent action.

As to why Wall Street does not think much of the nook ereader, I’m not sure.  I should imagine that if Barnes and Noble is not forced to delay the sale of the nook by Spring Design’s lawsuit it will prove to be pretty popular, especially with consumers who know that ereaders are the gadgets de jour but don’t do their homework to find out which one is best, then walk into a B & N store, see the nook and are seduced by its good looks; especially if it demos as well as it looks.  This is an ereader with suburban mom appeal as Engadget terms it.  We already know that when people buy ereaders they usually start reading more, which means more ebook sales, which should mean a better bottom line for Barnes and Noble.

One wonders if,  though,  after the eggnog wears off, some nook ereader owners will not suffer some degree of buyer’s remorse which could result in some backlash against Barnes and Noble if the company does not do something to improve their ebook store.  Barnes and Noble obviously is the primary ebook supplier for the nook ereader, but their ebook selection is not the best nor are their prices.  I did a price comparison recently between the Kindle Store, Sony eBook Store and Barnes and Noble.  Barnes and Noble had the highest prices of all three.   Their ebook store also had 20% less titles than the Kindle store, though this is a bit deceptive.  Most of the authors in my book list were popular authors; the more esoteric and off of the beaten path your reading is the more titles you are likely to only find at the Kindle store.  Sony is primarily a hardware company; yet in my ebook price and availability comparison they beat B&N, which is a content company.   My comparison study was after all a test of content .

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