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Originally published as a Guest Blog on Writer Beware® September 7, 2012
Authors create the content blog aggregators need for their web collections. Each gains in different ways. For the aggregator, the greater the variety of material and the steadier the receipt of content the more valuable the aggregated website. Because aggregating content is a business not a charitable operation, it is natural that aggregator agreements to publish content will primarily reflect the aggregator’s interests. Benefits to authors come in the form of readership and (possibly) recognition which may be a fair exchange even the author is un- or minimally compensated for her work. However, particularly productive authors will wish to retain control over their contributions and may find aggregators’ “Terms of Use” unaccommodating. It is a fair question, What does an author give up in exchange for granting a license for the privilege of having her content aggregated with others and accessible to the searching public?
The consideration in exchange for a license should begin with an appreciation for copyright. This is so because all agreements between publishers and authors start with a grant of rights. The Copyright Act states that “Copyright protection subsists … in original works of authorship fixed in any tangible medium of expression” (§ 102). Content submitted for aggregation is a tangible medium of expression, but remedies for infringement of content come through registration. There is no immediate remedy for unregistered content however egregious the taking. Neither the granting of rights nor the publication of content protects an author against infringement. Copyright registration is not expensive but it may be (or may be thought to be) uneconomical.
The questions concerning aggregator “Terms of Use” are not simply academic. They can affect an author’s future. Active content creators produce volumes of original material which can be collected and reworked into other formats. It is one thing to confer limited rights of publication and distribution of content on a nonexclusive basis and another to lose control of other statutory rights. One of the exclusive rights an author has under the Copyright Act is the right “to prepare derivative works based upon the copyrighted work” (§ 106(2)). Exclusive licenses are not typical in aggregator agreements, but there is a form of nonexclusive license that has some worrying features.
It is prudent before granting rights for the author to carefully examine the terms under which the aggregator accept content in exchange for publication. Not all terms are equally beneficial to the author. There are different monetizing models, all of which have the ultimate purpose of creating revenue for the aggregator. Some aggregators create libraries of material which are accessed for payment. Other aggregators generate revenue from the advertising on their websites. Some models may share the revenue with authors.
The potential problems are illustrated by several examples. In drawing attention to terms in the following agreements we are not suggesting any deliberate attempt to benefit at the author’s expense, but we are pointing out that the agreements are essentially on a “take it or leave it” basis, which is always a sign for caution.
1. The ODP (Open Directory Project) is a comprehensive directory of Web resources.
In exchange for ODP’s agreement to include an author’s work the author agrees:
To grant AOL LLC. Corporation a non-exclusive, royalty-free license to use, publish, copy, edit, modify, or create derivative works from my submission.
The catch is “edit, modify or create derivative works from my submission.” Although the ODP license is nonexclusive the author grants AOL extensive rights to the blog content. The author can terminate the license but AOL owns any derivative work it creates, but the derivative works created from the author’s submission are owned by the aggregator “royalty free.”
2. BLOGLINES is an aggregator of syndicated news feeds operated by WYBS.
The Bloglines Terms of Service assert that “WYBS does not claim ownership of the Content you place on your Private Page or Public Page,” but “[b]y uploading, submitting or otherwise disclosing or distributing content of any kind on the WYBS website or otherwise through the Bloglines Service, you” – here comes the kicker –
[You] Grant to WYBS, its affiliates and their assignees the perpetual, irrevocable, non-exclusive, royalty-free right to use, reproduce, display, perform, adapt, modify, distribute, make derivative works of and otherwise exploit such content in any form for the purpose of providing the Bloglines Service, including without limitation, any concepts, ideas or know-how embodied therein….
Even though Bloglines disclaims ownership of blog content, the author has lost control of her work. She has granted WYBS the right to “exploit such content in any for” and in any way it chooses to on a “perpetual [and] irrevocable” basis that includes the right “without limitation … to exploit such content … an any concepts, ideas or know-how embodied therein.” The “non-exclusive” is meaningful only to the extent that the author has the means to exploit the work in the same fashion as the aggregator.
3. Curata is a content curator for businesses which describes itself as “how smart marketers produce a consistent stream of high-quality content.”
Curata’s Terms of Use state that:
“By submitting, posting or displaying Content you give us an irrevocable, worldwide, royalty-free, and non-exclusive license to reproduce, adapt, modify, translate, publish, publicly perform, publicly display and distribute any Content which you submit, post or display on or through, the Website. You represent and warrant to us that you have all the rights, power and authority necessary to grant the above license. You agree that you are solely responsible for (and that we have no responsibility to you or to any third party for) any Content that you create, transmit or display or permit to be created, transmitted or displayed while using the System and for the consequences of such actions (including any loss or damage which we may suffer) by doing so.”
While Curata does not use the term “derivative” the author has all but granted it in the terms “adapt, modify … publicly perform [and] publicly display” the substance of the work.
In each of these examples, the author has licensed aggegator the right to exploit her work. It is not as though she does not have the same rights or is inhibited in licensing to others but the exploiting by aggregators is without approval, and without approval she has no control. Authors should assess the benefits, consider what they are prepared to give up in exchange for publication of their works to audiences larger than they themselves can attract and make their decisions with knowledge that they lose control of many of their copyright rights. Productive authors should be particularly careful because for them original content can be collected or packaged in different formats or reworked into books for traditional or e-publishers.
Copyright law protects authors who have registered their works. They are generally well attuned to copyright for their separately standing works, but less so when it comes to shorter works accepted for publication in compilations such as collections and anthologies. Section 103 (a) of the Copyright Act states that “[t]he subject matter of copyright … includes compilations.” A “compilation” is a collection of items in which a number of separate and independent contributions are collected into an organic whole. However, § 103(b) provides that the
copyright in a compilation … extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work, and does not imply any exclusive right in the preexisting material.
The statutory language makes clear that there are distinctions between the compilation “author” and “authors” of works collected in the compilation. Section 103 tells us that a compilation can be copyrighted, but it “does not imply any exclusive right in the preexisting material.” In fact, “[t]he copyright in such work is independent of” the copyrights in the included works. The provision continues:
The copyright in such work is independent of, and does not affect or enlarge the scope, duration, ownership, or subsistence of, any copyright protection in the preexisting material.
What rights a compiler may have depends on the nature of the relationship with the author and of the material collected in the compilation. The copyright in the compilation or collection is one form of protection; a separate copyright in the component works is another. Depending upon whether the grant of rights to poetry or short story is exclusive or nonexclusive to the compiler, to be fully copyright protected requires the compiler to register his copyright and the author to register hers. Poetry and short stories included in the compilation that are copyrightable are separately entitled to copyright protection.
The published compiled volume should include two different notices to effectively comply with the Copyright Act. There should be a compilation notice (which protects the author/compiler) and separate authorial notices for the included works (which protect the contributors). (As a separate note, materials included in a compilation that have fallen into the public domain, poetry and short stories for example, do not spring back to copyright life or in any way benefit a deceased author’s estate. The works remain available for use by the public, except to the extent that the compiler has added copyrightable additions:
The copyright in a compilation … extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work.
Infringement that violates the rights of the compiler may also violate the rights of a contributing author, but without a registered copyright of her own the author has no recourse. Why attention to statutory requirements is important is illustrated in cases adjudicating copyright claims of infringement of photographs. What is true of photographs also applies to poetry and short stories. In Bean v. John Wiley & Sons, Inc., CV 11-08028 (D. AZ August 3, 2011) the defendant claimed the photographs had no copyright protection because the registration did not comply with the registration requirements of the Copyright Act. The Court in a separate prior action in which Bean had sued Houghton Mifflin Harcourt Publishing Co., (unpublished decision) concluded that “Corbis’s registration of six compilations containing thousands of photographs by different authors was not effective in registering the individual works in the compilations to the individual authors.”
The Copyright Office does not specifically address registrations works included in a compilation and it is unclear precisely what the law requires the compiler to do. The most recent announcement on this issue is Pacific Stock v. Pearson Education, Inc., 11000423 (D. Hawaii January 11, 2012). The defendant argued that plaintiff did not have valid copyrights for individual works registered only as parts of compilations of various artists. The message from Pacific Stock and other cases, including a 2010 case from the Southern District of New York, Muench Photography, Inc. v. Houghton Mifflin Harcourt Publishing Company and R.R. Donnelley & Sons Company, 712 F.Supp.2d 84, 95 (S.D.N.Y. 2010) is that while group registrations are valid as to the compilations they do not protect the individual works. Therefore, the prudent course is for the compiler to include copyright notices for all contributions including the compiler’s and an author to separately register her own copyright.
In agreeing to publish a work publishers typically demand author “grant and assign” it an exclusive license to “print, publish and sell” the work for the “term of copyright and all continuations, extensions, and renewals thereof” in stipulated languages and territories. In modern publishing agreements the language is clear that the grant extends to digital rights. However, the grant of right in 1970′s contracts typically used the phrase “in book form.” Ebooks were not imagined at that time (or, if they were) their form was not realized until the late 1990′s. There are two questions. First, did the author intend (could it have intended) to grant publisher more than print rights? If she did not then she can separately grant ebook rights to an ebook publisher. Second – an interrogative conundrum – is an ebook a book “in book form”?
It appeared that the questions were answered in Random House, Inc. V. Rosetta Books, 150 F. Supp.2d 613 (S.D.N.Y. 2001), aff’d 283 F.3d 490 (2nd Cir. 2002). In that case, the district court denied a preliminary injunction against Rosetta Books which the Second Circuit Court of Appeals affirmed. Because the parties thereafter settled the dispute the ultimate questions were never answered. But, the district court held (citing New York contract cases) that the phrase “in book form” did not “include the right to publish the works in the format that has come to be known as the ‘ebook’.” The court held that it did not because “in the publishing industry” the phrase “is understood … to be a ‘limited’ grant.” The phrase “limited grant” is anathema to publishers who believe they acquired an exclusive license to “print, publish and sell” the work in every conceivable format “now known or hereafter invented” for the term of copyright.
The unresolved issue of “in book form” has now returned to court in HarperCollins Publishers LLC. v. Open Road Integrant Media, LLP., 11 Civ 9499 (S.D.N.Y complaint filed December 23 2011). The complaint alleges that “[n]otwithstanding the … grant of rights … Open Road, a digital publisher … seeks illicitly to capitalize on HarperCollins’ four decades of publication and promotion of Julie of the Wolves [by] … publishing an electronic version of that book.” The complaint continues:
The rights that HarperCollins acquired from George plainly encompass such electronic means of distribution, which is but a technology-enabled variant for how consumers can read the Work. Open Road’s unlawful exploitation of those rights is directly competitive with sales of the Work in paper format and HarperCollins’ own plans to publish Julie of the Wolves as an e-book.
The Random House case was decided under New York contract law. In affirming the district court, the Second Circuit Court of Appeals added that “New York … has arguably adopted a restrictive view of the kinds of ‘new uses’ to which an exclusive license may apply when the contracting parties do not expressly provide for coverage of such future forms.” New York being the capital of book publishing in the United States it is not surprising that the issue are not been litigated in any of the other Circuits.
Given how the Random House case ended HarperCollins is in a position to test “whether the license extends to ebooks” by exploring the “‘evolving’ technical processes and uses of an ebook … and the reasonable expectations of the contracting parties,” Random House, 150 F.Supp.2d at 615 n. 5. Random House had argued that “the phrase ‘in book form’ means to faithfully reproduce the author’s text in its complete form as a reading experience and that, since ebooks concededly contain the complete text of the work, Rosetta cannot also possess those rights.” The court did not see it that way:
While Random House’s definition distinguishes “book form” from other formats that require separate contractual language — such as audio books and serialization rights — it does not distinguish other formats specifically mentioned in paragraph # 1 of the contracts, such as book club editions and reprint editions….
The Court continued:
Not only does the language of the contract itself lead almost ineluctably to the conclusion that Random House does not own the right to publish the works as ebooks, but also a reasonable person “cognizant of the customs, practices, usages and terminology as generally understood in the particular trade or business” … would conclude that the grant language does not include ebooks.
The Court concluded:
Employing the most important tool in the armamentarium of contract interpretation — the language of the contract itself — this Court has concluded that Random House is not the beneficial owner of the right to publish the eight works at issue as ebooks.
HarperCollins’ arguments are not different. It alleges that Open Road is seeking “to reap where … it has now sown by seeking to divert sales of the Work from HarperCollins in the rapidly expanding e-books market.” It complains that “[t]his fundamental impairment of rights ensured to HarperCollins by contract and copyright law should be enjoined and Open Road’s unlawfully gotten gains therefrom disgorged.”
The next substantive step in the HarperCollins litigation will be an application for a preliminary injunction. The same route as in Random House and the same legal questions. If the contract term “in book form” does not extend to ebooks, then Open Road’s publication is not copyright infringement. If the author only agreed to a “limited grant” (harking back to Random House) she may legally assign her right to a digital publisher to publish her work in ebook format.
One can hardly wait — breathlessly is more apt! — for the next installment on this issue. Until the grant formula “in book form” was abandoned for a more inclusive grant of rights (which is now “standard”) digital rights for works contracted for in the 1970s and on may very well be under authors’ control. Although George has not been named in the lawsuit she undoubtedly executed a publishing agreement with Open Road. That too could be an issue because the ebook will be in competition with the print book, which may violate the non-compete term in the publishing agreement.
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