I admit that for a few moments last night I thought about not doing a news post but I eventually got over it. We still need news on Independence Day, right?
First up, two wildly competing views of copyright.
I admit that for a few moments last night I thought about not doing a news post but I eventually got over it. We still need news on Independence Day, right?
First up, two wildly competing views of copyright.
The Oatmeal is a satiric cartoon site run by Matthew Inman. About a year ago, he noticed that his content was being uploaded without attribution to a site called “The FunnJunk.” The FunnyJunk is a site that contains user generated content. This means that account holders post things that they like from all over the internet. Maybe a pre-Pinterest sort of site. The Oatmeal writes to the FunnyJunk requesting that the information be removed.
FunnyJunk took down the comics but proceeded to create a mirror image of The Oatmeal’s website. The Oatmeal responded by asking his readers what to do.
The FunnyJunk responded with a call to action to its own users asking them to inundate The Oatmeal’s inbox and facebook page. The FJ’s users responded in droves using their arsenal of retorts such as gay slurs and incoherently misspelled sentences to insult The Oatmeal and his biological predecessors for having the gall to procreate and, I guess, learn how to spell and draw.
According to Ars Technica, after the furor died down, the FJ admin acted somewhat responsibly, possibly realizing that its site could be in jeopardy due to all the copyrighted material illegally reposted there.
When the flame war finally died down, the FunnyJunk admin issued an unsigned note saying, “We’ve been trying for the longest time to prevent users from posting copyrighted content” and “I’m having all content, comics, comments, etc. with the names of your comics in them deleted/banned by tonight… The site barely affords to stay alive as it is and has enough problems.”
The Oatmeal v. FunnyJunk could have died there in November of 2011, only to be a footnote in internet flamewar history. But no.
The FunnyJunk for some reason came into contact with Charles Carreon, Esq., an attorney who came into national prominence during the sex.com domain name lawsuit. Carreon penned a letter on behalf of FJ, threatening The Oatmeal with a lawsuit for the post where The Oatmeal points out that the FJ has copied his website. Carreon, on behalf of FJ, wants the post to be taken down and $20,000 in damages.
The Oatmeal gets a lawyer and responds back with well worded, backed by research, rebuttal. The Oatmeal also goes on to decide to raise money off this ridiculous situation because so many of his readers want to help but the money isn’t going to Inman, instead he raised money for charity. Initially, he only thought to raise $20,000 for charity but the donations came in thick and fast and in the end, Inman raises over $200,000 which is donated to The American Cancer Society and the National Wildlife Federation.
The Oatmeal v. FunnyJunk could have died there on June 12, 2012, only to be a footnote in internet flamewar history and with its own Wikipedia entry. But no.
The situation gains the attention of the mainstream media and Carreon begins to make personal threats. He expresses wonderment and dismay at the internet’s reaction (he calls it bullying) toward his legal demands of Inman and The Oatmeal. He suggests that there might be other legal problems for the Oatmeal such as the fundraiser being violative of IndieGoGo’s term of service.
The internet continues to make fun of FJ and Carreon. Other attorneys make public statements about Carreon’s actions which include statements like “Holy fucking shitballs inside a burning biplane careening toward the Statue of Liberty, Captain! I hope that the reporter merely got the story wrong, because if not, that’s more fucked up than a rhino raping a chinchilla while dressed up in unicorns’ undergarments. ”
The Oatmeal v. FunnyJunk could have died there later on June 12, 2012, only to be a footnote in internet flamewar history, with its own Wikipedia entry, and a few mainstream media mentions. But no.
Charles Carreon’s pride has been wounded. In his delusionary state, he must see that the only way out is to double down on the Jack and the Six (i.e., worse blackjack hand in the deck). He takes the situation to DefCon 5. Last night, Popehat was alerted by another legal watcher that Charles Carreon has filed a lawsuit against The Oatmeal, IndieGoGo, American Cancer Society, and National Wildlife Federation.
He transcended typical internet infamy when he filed a federal lawsuit last Friday in the United Sates District Court for the Northern District of California in Oakland. He belonged to the ages the moment he filed that lawsuit not only against Matthew Inman, proprietor of The Oatmeal, but also against IndieGoGo Inc., the company that hosted Inman’s ridiculously effective fundraiser for the National Wildlife Federation and the American Cancer Society.
But that level of censorious litigiousness was not enough for Charles Carreon. He sought something more. And so, on that same Friday, Charles Carreon also sued the National Wildlife Federation and the American Cancer Society, the beneficiaries of Matthew Inman’s fundraiser.
Popehat is a site run by a bunch of lawyers and they are offering Inman pro bono legal work and they are asking the internet the following:
1. Kevin and I have offered pro bono help, and will be recruiting other First Amendment lawyers to offer pro bono help. It’s not just Mr. Inman who needs help. IndyGoGo does to. So do the charities. No doubt the charities already have excellent lawyers, but money that they spend fighting Carreon (whatever the causes of action he brought) is money that they don’t have to fight cancer and help wildlife. That’s an infuriating, evil turn of events.
2. You could still donate through the IndieGoGo program The Oatmeal set up. Or you could donate directly to the American Cancer Society or the National Wildlife Federation. I like animals, and I loved my mother who died at 55 of cancer, but I have no qualms whatsoever about encouraging people to donate to those causes as part of a gesture of defiance and contempt against Charles Carreon and the petulant, amoral, censorious douchebaggery he represents.
3. Spread the word. Tell this story on blogs, forums, and social media. Encourage people to donate as part of a gesture of defiance of Charles Carreon and entitled butthurt censors everywhere. Help the Streisand Effect work.
4. Do not, under any circumstances, direct abusive emails or calls or other communications to Mr. Carreon. That helps him and hurts the good guys. I don’t take his claims of victimhood at face value — not in the least — but such conduct is wrong, and empowers censors.
Feel free to copy this entire post and repost it (even without attribution) anywhere you can.
Personal Note: Self publishing mentality creeps into other creative venues. Louis CK did it with stand up comedy. Now musicians via kickstarter. It’s all about the platform now.
Personal Note: Because it is all about platform and platforms are built on constant (but good) content.
Personal Note: A must read data compilation by Thea from the BookSmugglers (a graduate student who wrote her thesis on ebook prices). She compiled responses from over 919 respondents.
Fictionwise Coupon for 55% off. Valid until the end of the day: 051112
Kobo Coupon Code for 50% off: Regg50us361
This is a long article. Grab a cup of coffee and settle in. I wrote this article and sent it to the RWR but it wasn’t suited for publication so I thought I would share it with you. The right to sever a copyright grant after 35 years came to my attention when Evan Schnittman mentioned it briefly at the end of one of his articles. I went off to research the issue because I found it fascinating. This is what I learned.
A new author enters a publishing contract with very little negotiating power. She is presented with a contract with stock terms and an offer of an advance in exchange for an assignment of her intellectual property rights to the publisher. Often she is in the position of either taking the contract with little changes or not publishing. The Supreme Court noted that “authors are congenitally irresponsible, [and] that frequently they are so sorely pressed for funds that they are willing to sell their work for a mere pittance.” Fisher Music Co. v. Witmark, 318 U.S. 643, 656 (1943).
Congress, who is responsible for setting the parameters of the copyright law in the United States, recognizes the economic imbalance between authors and publishers and has tried to include provisions to correct the imbalance. One of those provisions under the current copyright law is the right of termination of a previously granted copyright.
Initially, the 1909 Copyright Law allowed for renewal terms. The 1909 Copyright Law was based, in part, on the Statute of Anne, the very first law that provided protection for the creative works of authors. The Statute of Anne granted authors 14 years of protection and the 1909 Copyright Law doubled it. The creator of a work registered for a copyright and was granted protection for 28 years. At the end of 28 years, the creator could renew the copyright for another 28 years. The need for renewal allowed the creator to renegotiate the original grant of copyright, usually for better terms. As the end of the two year renewal terms loomed near, Congress began debating extension of the copyright.
Congress passed the Copyright Act of 1976 and added 19 years to the copyrights which were created under the 1909 Act giving those works 75 years of protection. New works were granted protection for the life of the author plus fifty years (which was the international standard at the time). In the Copyright Renewal Act of 1992, Congress did away with renewals added an additional 47 years of protection. This essentially made copyright protection for all works published under the 1909 Act to have a copyright term of 75 years.
Sonny Bono Copyright Term Extension Act (known as CTEA) added an additional 20 years of protection to all copyrighted works. Works produced on and after January 1, 1978 were granted life of the author plus seventy years. Works created prior to January 1, 1978, and either in the first or second term of renewal, were granted an additional 20 years of protection.
The longer term both helps and hurts authors. It helps authors in that they and their heirs are entitled to more revenue from their creative works, but it hurts because there is no time in which an author can renegotiate her rights if that is not a provision in the original grant language.
Essentially the renewal period in the 1909 Act allowed for a natural reversion of rights. Renewal was complicated for an author. Many missed the renewal deadline, failed to follow the procedure accurately, and signed away their expectancy in the first time instead of waiting. Congress, when it eliminated renewals and extended the period of protection, included a reversion of rights through a termination procedure.
17 U.S.C.A. § 203 (a) (2009).
The purpose of Section 203 is to provide authors a natural reversion of rights so that they get a second bite at the bargaining apple. It allows any author, or a person assigned by the author, to terminate the original grant during a five year period beginning 35 years after the publication was made or 40 years after the grant of rights, whichever comes first.
The key difference between Section 203 and section 304 is who has the right to terminate the grant of copyright. Section 203 applies only to contracts signed by authors and only the author and the author’s assignee via a will or other document would have the right to exercise the termination provision.
Ostensibly, Section 203 limits the duration of a grant or a maximum period of time in which a grant can be effective. After that maximum period of time has expired, the author recaptures her rights and has the ability to put them on the marketplace once again. Contractually, an author and her publisher can grant a shorter period of time. For example, a standard author contract has an “out of print” provision which requires a publisher to keep the work in print for a period of time. If the publisher allows the work to go out of print for a period of six months or more, the author may request by written notice that the work be placed back into print. If the publisher fails to do so within a proscribed period of time, then the grant is terminated and the rights revert back to the author.
Each contract must be examined for reversion of rights language and how reversion of rights is to be effectuated. “In print” is defined by the contract and standard terms may include language such as “in print if it is in stock or available for sale in any edition of the Publisher or any of its licensees”. The timing or occurrence of reversion of rights can differ for print v. digital rights, or territorial rights. Digital rights will often revert if, during a period of time, royalties do not exceed a specified floor.
If the publisher is keeping the work in print, however, rights would never revert back and, therefore, an author is entitled to reclaim those rights through the exercise of Section 203 termination.
In the case of any work other than a work made for hire, the exclusive or nonexclusive grant of a transfer or license of copyright or of any right under a copyright, executed by the author on or after January 1, 1978, otherwise than by will, is subject to termination
An author can terminate almost any transfer of her copyright if the grant was executed on or after January 1, 1978. The grant must fulfill the following qualifications:
a) Not be a work for hire
b) Executed by the author and no one else
c) Not a grant made via a will
Problems arise if the original grant was open ended. The Rano v. Sipa, 987 F.2d 580 (9th Cir. 1992) case suggests that an open ended contractual grant cannot be terminated except for that 5 year period defined in Section 203. Walthal v. Rusk, 172 F.3d 481 (7th Cir. 1999), determined that a contract for an indefinite period of time can be terminated by the request of either party to the contract. Thus in some states, unless the original grant is for longer than 35 years, the contract will not be terminable until the conditions of Section 203 are satisfied.
Further, derivative works that were made pursuant to the grant cannot be terminated.
Basically, the author and the author’s heirs are the only ones entitled to terminate a grant made after January 1, 1978. In the case of an anthology, or joint work, a majority of the authors must execute the notice for termination.
This becomes more complicated if the author has died, in the case of either a solo or joint work. For example, for the heirs to terminate a grant, they must hold more than 50 percent interest in the work. If the author has a spouse, the spouse is entitled to the entire interest, but if the author has children, the spouse is entitled to only 50 percent and the remaining 50 percent is split between children and grandchildren (obviously this is an issue ripe for a book!). In Larry Spier, Inc. v. Bourne Co., 953 F.2d 774, 777 (2d. Cir. 1992), the author included his mistress as a beneficiary in his will, but the court found that the mistress was not entitled to a termination right because the statute applied only to spouses and children.
17 U.S.C.A. § 203(a)(3) (2009).
An author is entitled to terminate the grant 35 years after the execution or 40 years after the first date of publication, whichever comes first. In order for termination to occur and rights to revert, notice must be timely given. According to Section 203, notice must be within 10 years, but no less than two years before the effective date of termination provided in the notice.
Date of Execution of Grant + 40 = X
Date of Publication + 35 = Y
Compare X and Y. Which is the earliest date?
Earliest date – 10 = first date you can send in your termination notice
Earliest date – 2 = last date you can send in your termination notice
Book rights are sold to a publisher in 1980 and the book is published in 1982
1980 = date of execution of the grant
1982 = date of publication
1980 + 40 = 2020
1982+35 = 2017
2017 v. 2020 = 2017 being the earlier date
2017 -10 = 2007 is the first date upon which to terminate a grant
2017-2 = 2015 is the last date upon which to terminate a grant.
17 U.S.C.A. § 203(a)(3) (2009).
The Code of Federal Regulation §210.10(b)(2) lays out in detail the contents of the termination notice. It does not provide a form. A termination notice should include the following for each work (other provisions apply if it is the heirs who are terminating the grant):
Each termination notice must be recorded with the Copyright Office with the correct information and during the correct time frame. Failure to properly record a termination may result in the termination being invalid. In other words, this is not something you should try at home, but rather contact an entertainment lawyer or your agent to effectuate the termination. Once those rights are reverted back, the content creator has another opportunity to sell their valuable works.
While Congress wanted to protect authors, it is determined that the authors are only entitled to one chance at renegotiating their contracts. In Penguin Group (USA) v. Steinbeck, 537 F.3d 193, 204 (2nd Cir. 2008), the court noted that the termination provision could only be used once by authors and their heirs:
It should be noted that under our view, authors or their statutory heirs holding termination rights are still left with an opportunity to threaten (or to make good on a threat) to exercise termination rights and extract more favorable terms from early grants of an author’s copyright. But nothing in the statute suggests that an author or an author’s statutory heirs are entitled to more than one opportunity, between them, to use termination rights to enhance their bargaining power or to exercise them. See 17 U.S.C. § 304(d) (permitting exercise of termination right only “where the author or owner of the termination right has not previously exercised such termination right”).
It is increasingly important to obtain one’s rights in this changing publishing period. The second chance to negotiate one’s work can result in a higher royalty rate, new advances, and other economic opportunities.
Disclaimer: A short article can never address all the legalities of termination and the following is only intended to provide an overview. Those that have questions about a specific grant should seek legal counsel as soon as possible. The works that are subject to a pre January 1, 1978, grant must follow the termination clause provision in Section 304. Those works that were subject to a grant post January 1, 1978, must follow the termination clause in Section 203. This article addresses only Section 203 provisions.
Copyrights, particularly lengthy ones, benefit the corporations that license and/or those copyrights. The Copyright Extension Act of 1998 isn’t called the Mickey Mouse protection act because it is designed to protect individual creators. It is designated as such because it benefits one of the largest owners of intellectual property, Disney. As of 1998, the term of copyright extends from 50 years for an individual and 75 years for a corporation to life of an author plus 70 years and 120 years for a corporation or 95 years after publication, whichever occurs earlier.
The reason that this is problematic is that when authors sell or license their works to a publisher, it is ordinarily for the term of copyright. When a new author or an author with little following enters into negotiation with a publisher, she rarely holds a position of power. This has changed given the new options available to authors such as digital first or self publishing but the fact remains that an individual’s ability to negotiate differing terms from the boilerplate is challenging.
Even the Supreme Court acknowledged this in Fisher Music Co. v. Witmark, 318 U.S. 643, 656 (1943). The Court said “authors are congenitally irresponsible, [and] that frequently they are so sorely pressed for funds that they are willing to sell their work for a mere pittance.” Id.
As a result, authors are allowed to reclaim their copyright after 35 years. I wrote an extensive article about this in 2009 (which I am reposting today). A longer term of copyright protection helps because value from the author’s creative works can pass to his or her heirs. The longer copyright hurts authors because it does not allow for a period of renegotiation. We have seen the backlist of authors become valuable but not exploitable by authors.
Marsha Canham noted on her blog that the backlist titles are bound by old contracts wherein the royalty rates were 6-8% of “net”.
What does the author get out of that, you ask? Well…remember that these are backlist books, so the author probably has an old contract that, in some cases, gives the same royalty rate for ebooks (which were just a glimmer on the horizon ten years ago, and twenty years ago not even a glimmer) as for print books, which would be between 6-8% of the *net* price.
But I digress again. NOT counting any net mumbo jumbo, we now have $52,300 for those books. Out of that, the author *should* get 25% which would work out to $13,075. But using Publisher Math, they only get $6537. And if the contract is older, and we’re working off the 8% royalties…that number zooms down to $4184, which, using Publisher Math, can become finostigated down to around $2K. Even if it’s left at the 8%, the publisher still gets the lion’s share of $48,116. And if it’s left at 25%, they keep $39,225.
$39,225 for the publisher, $13,075 for the author, and that’s using rose colored glasses for the 25% royalty rate on 10,000 downloads of a $7.99 ebook without any finostigating. Take off the glasses, use the 8% and the numbers change to $48,116 for the publisher and $4184. for the author.
The current standard royalty rate for digital books are 20-25% of net.
A shorter term of copyright, such as 14 years with several renewal periods of 14 years a piece would allow an author to renegotiate a contract every 14 years, taking advantage of the changing landscape in publishing. It may be to the author’s benefit to sell every renewal period up front or she could preserve her renewal periods and take a lower offer initially. However, a shorter copyright period with subsequent renewal periods would endow the author with additional bullets in her negotiating weapon.
The time period for reclaiming one’s copyright has passed for some books published in 1978. 2013, for example, will be the last year for some authors to exercise their termination rights. The termination right is a valuable option for authors, but one that requires affirmative action. A shorter copyright term would automatically limit the length of the grant of copyright and allow for renegotiation which would better reflect the rapidly changing market.
First, Google has totally abandoned indie booksellers. Remember that not two years ago, Google was going to save indie booksellers bacon by allowing them to be affiliates of the Google bookstore. Now Google has decided to eliminate its reseller program and concentrate on building up Google Play. Independent booksellers are now left with no digital bookstore. Copia has reached out to them and offered white label services and I am sure that there are many others who could provide the store front to these indies.
Second, the ABA CEO speaks to the issue of the DOJ lawsuit. Apparently the DOJ has met with the ABA CEO and he has given the government an earful on the evils of Amazon. What is so fascinating in this whole Amazon v. the world mentality that the publishers and booksellers have is that they are using one medium (physical) to argue against the monopoly in another medium (digital). This is actually a pretty important distinction that few are making. Publishers and booksellers are hewing to the line that Amazon is using the undercutting of pricing to grow market share for digital books and that agency pricing helps to stimulate competition in the marketplace. But the competition that the ABA and big publishers talk about is physical bookstore competition. There have been few or no entrants to the digital book selling market since the advent of agency publishing.
Yet Amazon is only one of several players in the physical book market. It does not have a monopoly in the physical book market. At most, they have around 25% and may equal or lag behind Barnes & Noble. The reading market is moving toward digital books, an area which Amazon helped to build, but print still comprises 70% of book sales overall. Thus, Amazon has a monopoly over a fast growing, but small part of the overall book market.
Additionally, Amazon’s competition against the publishers has created a huge money making opportunity for authors, a money making opportunity that didn’t exist prior to the rise of the digital book market. Amazon’s competition against the publishers has also increased the royalty revenue for existing print authors. Thus has agency pricing made authors richer?
Apple, Pearson Plc (PSON)’s Penguin Group, and Macmillan, a unit of Verlagsgruppe Georg von Holtzbrinck GmbH, want to protect the so-called agency model that lets publishers — not vendors –set e-book prices, said the people, who declined to be identified because they weren’t authorized to talk publicly.
This is essentially a reframe of yesterday’s post but contradicts Reuters’ Friday post that Apple might be interested. Clearly something other than some 4 month or 6 month cooling off period is being asked of in the settlement or else Apple et al would likely have no problem settling. Bloomberg News
Libraries Online Incorporated (LION), a consortium of twenty-five Connecticut public, academic, and school libraries, has imposed a moratorium on the purchase of ebooks from Random House. The action, which was unanimously approved by LION members on March 20, is in response to the March 1 price hike put in place by Random House that doubled and sometimes tripled the price of ebooks for libraries.”
The Digital Shift
She recently gave an interview to the American Bar Association’s “Landslide” publication, which is put out by the “Intellectual Property” Section of the ABA. In showing just how out of touch with the times the ABA remains, there is no link I can share for this story, but in the interview, Pallante is asked about the fact that there is widespread criticism of copyright law being “too restrictive.” Her response is downright scary: “It is my strong view that exceptions and limitations are just that — they are important but they must be applied narrowly so as not to harm the proprietary rights of the songwriter, book author, or artist. Copyright is for the author first and the nation second.
“The copyright page includes this note: “The author published an earlier serialized version of this story online with different characters as ‘Master of the Universe’ under the pseudonym Snowqueen Icedragon.”
But, but this was original fiction. Warranted by the author as such. Oh, Vintage. You can see more about the Totally New Piece of Fiction at Vacuous Minx. Galley Cat