The company I own, Berkshire Publishing Group, conducts a lot of business in China, so I’m always being asked about intellectual property rights (IPR). I’ve learned that many people equate China with piracy, and stories float around the academic world about bookstore shelves filled with unauthorized copies of monographs and popular nonfiction titles. In fact, it was concern about rights and piracy that prompted us to scrutinize our contracts, talk with the FBI, and do online searches for pirated material. What we discovered, to my amazement, was copies of our books in places they should not have been.
We discovered three cases where Berkshire content was published online by major companies. They hold print rights, but not electronic rights. Each of them, when contacted, responded with alacrity, agreed about the error, and promised to take down the articles and books immediately. But this discovery turned out to be the beginning, not the end. Nearly a year later, we discovered that one of the ‘taken down’ books was being sold on Kobo (kobobooks.com), via a third-party distributor.
With one major academic publisher, Berkshire Publishing found an additional problem: The publisher had failed to register the copyright for a series of books as required by contract.
This leads us to wonder if the situation we’ve discovered might apply to thousands of book contracts, because as a book packager for 8 years, Berkshire’s contractual arrangements are basically the same as those of any academic author. With our titles published under other imprints, those publishers hold print rights and, in most cases, at least some digital rights. We, therefore, receive royalty income from about a dozen publishers, as well as income from digital aggregators to whom we have licensed our more recent, independently published titles.
RESPECTING THE RIGHTS OF OTHERS
What we are learning is that organizations that aggressively defend their own copyright are not respecting the copyright of others. This is systematic theft covered up by sloppy accounting, not just an accident that publishers are happy to rectify when the author or agent notices it.
Adding to the problem is that reading royalty statements becomes harder every year-the layout often changes from quarter to quarter, making it virtually impossible to compare. Plus, we don’t know what isn’t being reported. Very few authors or agents are real “numbers people,” and academic and textbook authors are even less careful because they don’t depend on writing income. I would guess that most authors just deposit the checks, and the only numbers they look at are the sales totals.
The upshot is that, despite worrying and being warned of piracy in China, my big challenge now is dealing with major U.S. and U.K. companies that have not figured out how to manage and account for distribution in the digital age.
Then there’s the downstream issue. After we discovered that our books were being sold as individual ebooks and via the publisher’s topical subscription platform, we found that there had been an epidemic of online infringement. Third party ‘pirate’ infringers somehow obtained copies of the digital files. If the publisher had registered our copyright, as the contract obligated them to, we would have many rights under the law that we do not now have. The books were taken down from the publisher’s platform immediately, but we are still finding pirated copies and also copies distributed through Ingram and Kobo, so the publisher has not managed to track the books within their own systems. And we have received no payment on those distributions, either.
In both cases of infringement, when caught distributing Berkshire content digitally, the publishers’ lawyers fell back on the argument that the use was a license. They said they had been within their rights because the use wasn’t a sale. However, until they realized that we were serious about legal action, they had treated the income as a sale, with a 10% royalty rate, not as a license, which provides us with 50%. Our publishers are trying to wriggle out of their breach of contract by offering the 50% licensing rate that they would never have agreed to otherwise. Their immediate take-down of the books/content was an admission that they didn’t believe they had the right to sell the material as they were doing.
LICENCE OR OWNERSHIP
Sales are generally covered in the royalties clause of contracts. Authors receive a percentage of the money received for each sale. Licensing is detailed in the subsidiary rights (subrights) clauses and is of growing importance because of digital aggregation and distribution. A recent court ruling held that an ebook purchase is a license to use the book, not the ownership of a copy.
The difference between sales and licenses has become a major issue for musicians and music labels. It will soon become similarly important to publishers and authors. The Authors Guild is already preparing to fight this battle, and given that it makes a financial difference of 500% to the author (or, conversely, to the publisher who would have to pay more), it’s bound to be hard fought.
Courts will also have to decide what penalty publishers should pay for publishing work without having the rights to do so. Is it theft, or just an accident? After all, when caught, they generally offer to make some kind of restitution. What if auditing were to show a systematic practice of not ensuring that they have a right to publish?
This development could become very important to a new type of business that I see developing, a representation business. It will be similar to patent enforcement businesses, but will specialize in helping content owners get the full amount due on digital sales of their books. It could also acquire digital rights to books published without clauses covering digital distribution, specializing in extracting the digital value from content, a specific set of skills with a huge range of possibilities.
AFFECT ON LIBRARIES
How do the trials and tribulations of Berkshire Publishing’s copyright and licensing woes affect libraries and information professionals? I see both direct and indirect implications for the library and information community. Anyone who reads widely and uses an ereading device has discovered that many books are not available digitally. Some can be downloaded in one country but not another. What even sophisticated information users may not know is why there is a ‘Tell the publisher you want a Kindle edition’ button. Why does a library database have some full-text books and not others? Why are titles available for a time and then disappear?
Copyright ownership has barely begun to be addressed in the world of library resources. Major lawsuits are underway; the Google Settlement yet to be settled; and a host of legal challenges that are only being talked about now are certain to reach the courts in the years ahead. When making a purchase decision, how many librarians ask to be reassured that the vendor owns the rights to all the materials in the package?
All publishers face the challenge of online piracy-particularly in a world where people expect content, however expensive to create, to be free. But when publishers in turn cheat those whose creative and intellectual effort makes their jobs possible, I find myself on the side of authors and universities-and, somewhat incongruously, also on the side of rock musicians, photographers, and painters.
When I look at the avenues available for intellectual property creators and owners to assert their rights, one is the court system. It’s important for courts to rule on penalties companies should pay for publishing an author’s work in a way that has not been agreed between them.
China isn’t the threat we’re most concerned about. It’s our fellow publishers-our colleagues, our partners-whose accounting for royalties, and especially for digital licensing and sub-rights, is clearly not adequate to the times in which we live.
I see no reason to let a billion-dollar company reap all the profits from my content. But their intransigence about a fair settlement-in spite of having been caught red-handed-means that books are not legitimately available. We want our books in libraries and accessible to readers and researchers, but if they are being sold to libraries by a company that does not own the rights, it puts the customer, inadvertently, in the position of purchasing stolen goods. It is not the librarians’ job to check terms between publishers and distributors, but it’s worth asking about rights before signing.
Next time you find that certain books are not available, when you come up empty on a search, or find material withdrawn from an online database, you might reflect on this as a sign of things to come-an author, agent, or other rights holder who’s holding out for a fair share of the money that libraries are spending on resources.
Originally published in Online Searcher.