In at least some countries, there is a specific copyright in the typographical arrangement of so-called "published editions". This is certainly the case in Australia, and also in the United Kingdom. In the UK, section 1 of the Copyright, Designs and Patents act says, so far as relevant here:
"Copyright is a property right which subsists in accordance with this Part in the following descriptions of work—
(c) the typographical arrangement of published editions."
Like much current legislation, it does not sit easily with modern technology. In particular, some legal research may reveal if the Courts have decided where an EBook is in fact published in particular circumstances. For instance, using Harry's Sherlock Holmes as an example, likely Harry did all of the work preparing it in the United Kingdom. But it was uploaded to Mobileread (presumably a United States entity) to servers, presumably in the US. Once uploaded, it is available all over the World. This is the type of problem which arises and is dealt with badly in many areas,most notably Taxation. So where was it published? Or was it published in all jurisdictions simultaneously?
Without this legislation what seems to be required to attract protection for a particular edition is some further "creative" step. Just what is sufficient is of course a matter of what has been done in relation to the particular book in question.
Our choice as a community is whether we are prepared to accept this type of thing happening or not. If we choose not, then we need to arrange the library so that it attracts copyright protection, and actually licence the EBooks so that commercial exploitation can only take place with consent.
So far as the current situation is concerned, I think someone representing Mobileread needs to write to Kobo, Amazon informing them:
1. What has happened;
2. That the EBooks concerned may be subject to copyright protection in some countries;
3. That charging for them may breach consumer law in some countries.
The request should probably not be that they be taken down, but simply that their origin be prominently stated on the relevant web pages, and that they be offered free of charge.
I would not recommend legal action, which is likely to be very costly and unlikely to achieve a satisfactory outcome.