OLD WINE IN NEW BOTTLES—DOES A PUBLISHING AGREEMENT
BETWEEN AN AUTHOR AND A BOOK PUBLISHER GRANTING THE
RIGHT TO PUBLISH A WORK “IN BOOK FORM” INCLUDE THE RIGHT
TO PUBLISH THE WORK AS AN E-BOOK?
Throughout most of the Twentieth Century, standard form publishing agreements between authors and
book publishers granted the publisher the exclusive right to publish the work “in book form” without
elaborating on the meaning or scope of a “book” or “book form.” With the digital revolution, starting in
earnest after the turn of the Twenty-first Century, electronic publishing and distribution of works previously
published only as traditionally printed books became a commercial reality. This development raised
questions for many authors and publishers concerning whether their contracts gave the printed book
publisher the exclusive right to publish the work in e-book form, or whether the author, who typically
retains ownership of the copyright in the work subject to the rights of the publisher, had the right to license
another firm to distribute an e-book version of the work.
The question can have significant economic
implications. A publisher, which has invested
money in distributing and popularizing a work in
book form, would not like to have another firm
usurp the benefit of its investment by capitalizing
on the demand for the work as an e-book, an
increasingly important part of the market for
reading material. Conversely, an author, if free
to license e-book rights to another publisher, is
likely to be able to receive a higher royalty rate
for a work from an e-book publisher than that
provided for in an older standard form publishing
contract signed before e-books became a
reality. In part because the marginal cost of
publishing e-books is negligible, the e-book
royalty rate in a new agreement is typically 25%.
The royalty rate under an older publishing
agreement that does not set a separate royalty
for e-books is more likely in the range of 10%
(although, of course, e-books are typically less
expensive than printed books).
known authors such as William Styron and Kurt
Vonnegut. Their original publishing contracts
from the 1960s through the early 1980s in
general granted the exclusive right to publish the
works in “book form.” Random House sought to
stop the venture cold in its tracks with a
preliminary injunction. However, Judge Sidney
Stein denied the injunction, Random House, Inc.
v. Rosetta Books LLC, 150 F. Supp. 2d 613
(S.D.N.Y. 2001), and the appellate court
affirmed, 283 F.2d 490 (2d Cir. 2002). Random
House argued, not implausibly, that “book form”
meant something with printed words that was
read like a traditional book and included an ebook. However, the court disagreed. Relying
on New York state court cases taking a
restrictive view of the extent to which new uses
were included in old licenses that did not
expressly contemplate the new uses, the court
held that “book form” did not include the right to
publish an e-book version.
The issue of whether “book form” in a publishing
agreement included e-books was raised early
on, in 2001, in a case that Random House
brought in New York federal court for copyright
infringement against the nascent e-book venture
known as Rosetta Books LLC. Rosetta Books
sought to publish e-versions of works by well
The Rosetta Books decision has been the
leading case on the issue for almost ten years.
However, in December 2011, another publisher,
HarperCollins, decided to take another run at the
issue based on slightly better contract language
for the publisher in a 1971 contract. The new
case, HarperCollins Publishers LLC v. Open
© 2012 TANNENBAUM HELPERN | 900 THIRD AVENUE, NEW YORK, NY 10022 | 212.508.6700 | WWW.THSH.COM
This article is not legal advice and may constitute attorney advertising in some jurisdictions.
Road Integrated Media, LLP, 11 Civ 9499 (NRB)
(S.D.N.Y.), concerns the book Julie of the
Wolves by Jean Craighead George, a children’s
novel originally published in 1972. According to
the Complaint, the 1971 agreement grants the
exclusive right to publish the work “in book form”
in the first paragraph, but elsewhere in the
agreement (paragraph 20) makes clear that the
scope of the right extends to exploitation of the
Work “through computer, computer-stored,
mechanical or other electronic means now
known or hereafter invented.” The strength of
the new case is difficult to evaluate because
HarperCollins curiously chose not to attach the
publishing agreement to the complaint. This
could mean that HarperCollins’ interpretation of
the agreement is a stretch.
However, the
additional language could also be all it takes to
expand “book form” to include e-books.
If you have questions about e-book rights, or
author’s rights generally, please contact Donald
Prutzman
at
(212)
508-6739,
email:
Prutzman@thsh.com, or the Tannenbaum
Helpern partner with whom you usually deal.
The HarperCollins case bears watching, as the
result could significantly affect the relative rights
of authors and publishers under pre-2001
publishing agreements. After the Rosetta Books
decision in 2001, publishers generally changed
their standard form agreements to include ebooks and other new forms expressly.
However, authors and their heirs should take a
look at their pre-2001 agreements to see what
light they shed on who, as between author and
publisher, has the right to publish the work in ebook form. Even if the language is ambiguous,
the result in the HarperCollins case may give the
author or their heirs leverage to negotiate a
better royalty rate for e-books, more in line with
the going rate under today’s agreements that
expressly contemplate e-book versions of
published works.
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© 2012 TANNENBAUM HELPERN | 900 THIRD AVENUE, NEW YORK, NY 10022 | 212.508.6700 | WWW.THSH.COM
This article is not legal advice and may constitute attorney advertising in some jurisdictions.