With used textbooks available on the Internet and rental textbooks available for 40 percent to 70 percent off sale price, the college textbook business has entered "permanent decline," says lead plaintiff the Louisiana Municipal Police Employees Retirement System.

Barnes & Noble's offer to buy the College Booksellers division from company founder, chairman of the board and controlling shareholder Leonard Riggio offers far more than what a third party would pay to buy the floundering branch, the shareholders say.

The deal lacks transparency, since Barnes & Noble did not submit history or projections for the division's performance, according to the complaint, which alleges that company directors approved the acquisition because they are indebted to Riggio.