Readers in the United States who have who have bought electronic books can look forward to compensation, as three publishers agreed to a $69m (£44m) settlement of claims that they had colluded to fix ebook prices.

Announcing the agreement alongside attorneys general from 54 other jurisdictions, the Tennessee attorney general Robert E Cooper said the collective action would "send a strong message that competitors cannot get away with price-fixing".

"We will do everything within our power to stop competitors from colluding to artificially raise the costs the prices by millions of dollars more for some of the most popular ebook titles," he said.

The suit alleges that Hachette, HarperCollins and Simon & Schuster conspired to to increase ebook prices and eliminate retail price competition by imposing a distribution model in which publishers set the prices – the so-called agency model. The three publishers settled with the US department of justice in April, a move which HarperCollins CEO Victoria Barnsley called "the wrong decision" only last week.

Now the three publishers have agreed a $69m fund to compensate customers who have bought ebooks between 1 April 2010 and 21 May 2012 from any of five publishers accused of price-fixing earlier this year. They have also agreed to cease existing agreements under the agency model, allowing retailers such as Amazon and Barnes & Noble to reduce ebook prices, and will be barred from making any such agreements for the next two years.

They have also agreed to cover the states' expenses of approximately $7.5m in fees and costs. Payments will begin 30 days after the agreement is approved by the court. Macmillan and Penguin have rejected the claim.

Each state is set to receive a proportion of the settlement, with Tennessee expected to receive $1.2m, Connecticut due to receive $1.3m and Colorado approximately $1.5m

The Colorado attorney general, John Suthers, said that he would not tolerate "publishers colluding to overcharge consumers millions of dollars for some of the most popular e-books"."Today's settlement paves the way for consumers to receive restitution and promotes retail competition in the ebook market," he said.

The three publishers rejected the claim that they had been involved in illegal price fixing, describing the agreement as a chance to avoid the expense and distraction of a prolonged legal dispute.

Simon & Schuster's Adam Rothberg called it a "fair settlement".

"We're pleased to now have put this matter behind us," he said, "and moving forward, to continuing our work with authors and accounts to grow the market for books of all formats – and to take advantage of the many opportunities afforded us by publishing in the digital era."

A statement from Hachette insisted that the company "was not involved in a conspiracy to illegally fix the price of eBooks, and … made no admission of liability".

"However, faced with the prospect of lengthy and costly litigation with government plaintiffs with virtually unlimited resources, we decided that the costs, uncertainties, and distractions of this litigation would be too disruptive to our business," it continued. "Our choice to join the settlement was critical to putting these disputes behind us and focusing our attention on the business of inspiring, developing, and distributing great books."

Penguin and Macmillan are due to appear with Apple in court to defend the accusation in June 2013.