Google Wades into E-Mud with E-Books; Settlement with Publishers May Not Be Valid

Last Updated Nov 10, 2008 3:28 AM EST

google-books-logo.jpgIt was news at the end of October that Google came to terms with publishers and authors regarding its scanning of copyrighted books and making them available for electronic search. However, a new twist has emerged: Google will be able to sell electronic versions of books that have gone out of print. Depending on the very specifics of that agreement between publishers, Google, and the Authors Guild, all three have walked into a veritable quicksand of upcoming woe, argument, and potential law suits, all because they're forgetting a basic legal issue in most publishing.
"Almost overnight, not only has the largest publishing deal been struck, but the largest bookshop in the world has been built, even if it is not quite open for business yet," wrote Neill Denny, editor of The Bookseller, a trade publication based in London, on his blog.The settlement remains subject to court approval, and the bookshop would operate only in the United States for now. But the agreement is only one of many initiatives under which books are making what may be the biggest technological leap since Gutenberg invented moveable type.
Yes, it's a big deal. One of the problems that have always faced publishing is how long a given title can remain economically viable. Publishers and authors want to keep making money, but there is a cost to keeping inventory on-hand, and every year thousands and thousands of books go out of print, which means that the publisher officially stops stocking copies and promoting the book. Once a book is out of print, it is no longer available.

When a book it out of print, it immediately brings into play a specific part of many, if not most, publishing contracts. These complex documents juggle dozens of types of rights that authors license to the publisher. For the use, the publishers pay authors royalties, or payments for every copy sold and every use of the content sublicensed to someone else. Such agreements between an author and a publisher are typically long-term but still temporary things. One of the triggers that end the contractual arrangement between author and publisher is the out-of-print clause.

Under this clause, which appears in a great many contracts, once a book is officially declared out of print by the publisher, all rights return to the author. That has been the ort publishers have tossed to writers. When the book is officially dead to the publisher, the writer can make other arrangements for subsequent publishing because the writer again wholly owns the book and the publisher no longer has any rights to it.

You can now see where this is going. Publishers and an organization of authors, which likely does not have permission to offer rights from all its members and certainly doesn't have the power to offer rights from non-members, have told Google that it can create e-books for out-of-print titles. But if the titles are out-of-print, then the publishers by and large have no rights to the book at all. Only the individual author can make such a deal. Hence the quagmire:

But the Google deal with the Association of American Publishers and the Authors Guild could be a catalyst. Under the proposed settlement, Google would share online sales revenue with publishers and authors.
Google has just made a deal on e-books largely with organizations that don't own the rights in question. That casts a bigger question over the entire settlement. Now, it's a class action suit, so authors presumably would eventually be able to sign up for their share of the pie.

But it would seem that there would have to be two groups of books in question: those that are in print and those that are out of print. For the former, the publisher would likely have the right to negotiate with Google, though even then they might not if they didn't have contracts that gave them appropriate electronic rights.

For the out-of-print books, the publishers wouldn't have a legal stake in the content; only in the design and layout of the book. So can they rightly bargain on behalf of authors when they no longer have a publishing agreement for the material?

There's one other twist, as well, that comes out of experience with the multi-million dollar class action suit that a number of writers organizations had filed against print and electronic publishers for the unauthorized inclusion of magazine articles in electronic databases. Disclosure: I was in the class and had filed my claim. Second disclosure: I never saw a penny, and that was because of something that could easily happen here, as well.

To really legally protect a U.S. copyrighted work, the copyright owner has to register copyright with the Copyright Office of the Library of Congress. But I know from personal experience that not all book publishers actually do register all of their titles. If this agreement starts to show cracks -- or, has happened to the class action over electronic use of magazine articles, if some authors file objections that ultimately overturn the settlement -- you now have two groups: authors whose copyright was registered, and those whose copyright was not. The latter would have no legal ground to bring suit.

Chances are the entire deal is going to get extremely messy before it even starts. And if the authors are left on their own, Google may well get to do what it wants, including profiting from using intellectual property it doesn't own simply by that old rejoinder, "So, sue."

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    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.