Tasini v. New York Times, Inc.

06 July 2002

This is my collected commentary on the Tasini matter. Although this is presented as a single essay, the material has been drawn directly from contemporaneous Surreality Check entries.

I. The Second Circuit Opinion

On Friday, September 24, 1999, the United States Court of Appeals for the Second Circuit (Winter, C.J.) overturned Tasini. The Court ruled that electronic databases are not "revisions" of print publications, and that publishers therefore must explicitly request and receive rights for such use from authors.

I anticipate a petition for certiorari (appeal) to the Supreme Court and an immediate stay, since this decision completely destroys NEXIS (the largest private supplier of electronic archives). I also expect massive lobbying and legislative action. So, authors, don't get your hopes up yet; it ain't over 'til it's over.

Neither the New York Times (lead defendant) nor the National Writers' Union, whose de facto president-for-life Jonathan Tasini is the lead plaintiff, have included even a hint of the decision, over 30 hours after announcement. The Times, Chicago Tribune, and Washington Post somehow managed to refrain from any mention of the case in their respective Saturday (25 September) editions.

With due respect to Judge Winter, the opinion appears somewhat overwritten. After I can distill it, I'll step through the significant aspects in this journal. And I'll admit it—I expected the Second Circuit to reverse the one pro-author aspect of the District Court opinion, but it did not.

But, nonetheless, I'm shedding crocodile tears for NEXIS and its competitors. I find it awfully hard to sympathize with the publishers on this one. First of all, it only affects material provided by freelancers; material produced by their employees remains work-for-hire and thus the property of the publisher in the first instance. We'll ignore the practice of purchasing all rights pursued so diligently by some publishers—including the New York Times. (If the publisher already purchases all rights, it doesn't need to pay for database rights, does it?)

More to the point, though, I can't believe that profit margins will be measureably reduced. NEXIS and its competitor WestLaw charge well over $4 per minute just for browsing and searching their databases. Downloading and printing material costs more—over $0.30 per line based on the most recent pricing schedules to which I have access.

Let's do a little simple math here. We'll assume that the database rights will result in additional payments of 50% to every freelancer—an extraordinarily high estimate. However, the vast majority of the material online and on CD-ROM will not generate higher payments to authors. As noted above, Tasini has no impact at all on material generated in-house. Let's assume that as many as 20% of the articles in any given database originate with freelancers. This means that payments to freelance authors in toto would increase by:

50% * 20% = 10%

But even this grossly overestimates the increased cost of author compensation to the database as a whole. Ignoring compilation and indexing costs—which are nontrivial, but considered proprietary information—net compensation to authors typically amounts to less than 15% of fully diluted per-issue costs of for-profit periodicals in the United States. Thus, actual content costs to the database would increase by just under 3%.

Anyone care to place a bet on double-digit increases in the access and use fees for online and CD-ROM-based databases of general periodicals?

I've been busy because two of my clients (academic organizations) asked me how Tasini would impact them. My smug answer was: "It won't. I anticipated it in the revisions to the publication agreements that we did some time ago. The publication agreement already transfers electronic database rights to [client], with appropriate compensation to the authors."

Nyaah, nyaah, nyaah. Because I convinced my clients not to act like greedy media conglomerates, they can keep up their established practices without missing a beat. This is called "win-win negotiating"—a concept that I'm afraid has completely escaped the media conglomerates (and most of the legal profession).

Now that I'm done being smug, what does Tasini mean? We'll start off with a brief summary. Recall the three major issues? Here's how the Second Circuit answered them:

1. The defendants did not preserve the "back of the check contract" issue for appeal. This appears to be based upon a settlement between the parties. In any event, the defendants' position was food for worms.
2. The second major issue—whether publishers are merely "reissuing" or "revising" their collective works by placing articles in electronic databases (17 U.S.C. § 201(c)), and thus "privileged" to do so without explicit approval from or payment to authors—came out very pro-author. The court decided that none of the electronic databases at issue qualify as "reissues" or "revisions," and that using the articles in the databases was therefore a copyright infringement—unless the authors explicitly agree to allow use of the articles in the specific database.
3. The court punted the third major issue—whether electronic database rights are transferrable at all (17 U.S.C. § 201(d)). Based on the record below and its decision on the second issue, it did not need to decide the issue. However, the opinion emphasizes that authors and publishers can "contract around" provisions in the Copyright Act, which implies that the authors' position has little chance of success.

Procedurally, this is why Tasini won't really be final for several years.

• The defendants will almost certainly continue the appeals process. This means either a rehearing en banc by the entire Second Circuit (the September opinion is, as normal, by a three-judge panel), or perhaps an immediate attempt at appeal to the Supreme Court. The defendants have until December 23d, 1999 to file a request for a writ of certiorari with the Supreme Court. The plaintiffs then have sixty days to file an opposition to the writ. The Supreme Court will then take some time to decide whether to grant the writ (hear the appeal).
• If the Court denies certiorari—and the "normal" odds are about 1% and falling rapidly—the Second Circuit will issue its mandate thirty days after the denial and send it back to the District Court.
• If the Supreme Court determines that it will hear the appeal, both sides (again) get the opportunity to file briefs. There will certainly be briefs from amici curiae (self-styled "friends of the court" who are usually there to cheer on one side or the other). Given the briefing schedule established by the Court's rules, oral argument could not occur before October, 2000. The decision would then come down some time before June of 2001.
• Most critically, the case came up on summary judgment. That means that the District Court judge determined that no rational jury could decide the facts of the case any way other than the way she stated them in her opinion. As I understand the record below, this is somewhat tenuous, although it appears that the parties have not preserved the issue. The Supreme Court may well decide that, because its view of the law is slightly different, the Second Circuit needs to reconsider the case.
• In any event, the summary judgment was on liability only. Further proceedings will be required in the District Court to establish a remedy—damages, injunctions, whatever. And, of course, that part of the case will be subject to an independent appeal, starting the process over again.

I've been involved in one of these ping-pong cases. The dispute arose in 1988; the case was filed in 1989; the District Court judge dismissed the matter in 1992; the Court of Appeals reversed in 1994; and the Supreme Court affirmed the reversal in 1995. That sent the case back down to the District Court. Discovery took another couple of years, then there was a summary judgment decision in 1997, followed by—you guessed it—another appeal. The appeal was decided in early 1998, and the Supreme Court denied certiorari in late 1998. I came in in the middle, and left in the middle. Fortunately.

One should also remember that publishers as a whole are notoriously slow payers. Even if the judge comes up with a "formula" (say, 15% additional for UMI's use, 25% additional for NEXIS's use, etc.) that is acceptable to the parties—fat chance, given the lead defense counsel—it's going to take a while to track down the authors of articles originally published in the 1980s and early 1990s and pay them their money. And does it bear interest? Prejudgment or postjudgment? Both? What about individual authors who object to having their material continue in the databases?

This is not a simple case, folks. The initial proposition is fairly simple: "If the contract doesn't explicitly transfer electronic database rights, the author retains those rights." But it's not so easy to fix once someone has screwed it up; especially when one side's historical position is largely in bad faith.

This brings us to the concept that really separates lawyers from political scientists and historians. Lawyers focus on the remedy that is (or is not) available for conduct at least as much as they care about the conduct itself. Political scientists and historians, on the other hand, virtually always ignore the remedy. Leonard Levy's American Constitutional History—a text used for many, many years in many, many undergraduate courses on constitutional law— has damaged a generation of law students, who discover that Levy's failure to consider remedies so skewed his presentation as to make it worse than useless.

So, what remedies are at issue in Tasini? We'll start with the statutory remedies under the Copyright Act (17 U.S.C. §§ 101 et seq.):

• An injunction against future infringement, which may include seizure and destruction of infringing materials
• Monetary damages, which may be either a statutory amount per incident of infringement or actual damages; the plaintiff must elect one of these remedies before trial
• For willful infringement, trebling of any monetary damages
• Reasonable attorney's fees and costs, paid by the loser

A winning plaintiff can obtain remedies of each type in the same case. A winning defendant can get only attorney's fees and costs paid by the unsuccessful plaintiff (see Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994)), although truly egregious and knowingly false claims of copyright infringement can result in criminal sanctions against the plaintiff.

"Injunction" is the legalism for "don't do it any more." It is theoretically possible to obtain an injunction to force someone to take an action, not refrain from one, but that is disfavored in civil suits that do not involve government officials, and then should be called mandamus ("do your duty").

In copyright law, the injunction ordinarily prohibits the defendant from any further action that would continue the infringement, and may require the defendant to destroy unsold infringing materials and attempt to pull materials back from distribution. This is quite a powerful remedy, and scares the living daylights out of publishers and multimedia providers.

Sometimes, though, an injunction is merely shutting the barn door after the horses have bolted. That is largely the case in Tasini. Contemporary contracts for periodicals include (often overreaching) electronic database clauses. Tasini was filed in 1994, and contract practices changed significantly in the following year. (Hold your questions about Wizards of the Coast's Dragon CD-ROM for another time.) Thus, most of the infringements—particularly those by the bigger databases, such as NEXIS—are long-past, fleeting, and extraordinarily difficult to track. As we'll see, this also implicates the damages factor.

If applied strictly to Tasini, NEXIS would have to shut down while the database owners screened each and every article in the database to ensure that appropriate electronic database rights existed, either through the work-for-hire doctrine or via contract. What Tasini really says is that electronic database rights are separate from print publication rights—they are a derivative work like the novelization of a screenplay (or screenplay written from a novel).

Given the political muscle of the database providers and the daily reliance upon those databases by libraries, lawyers, legislators, and journalists, I don't believe that any injunction fashioned by the court would be immediate. Instead, the judgment would be stayed for long enough to allow the database providers to screen their databases.

II. The Second Circuit's Revised Opinion

In mid-March of 2000, the Second Circuit issued a revised opinion in Tasini. (This is the opinion that should be cited in the future when referring to the Second Circuit's views. It is reported at 206 F.3d 161.) This is a "good news—bad news" sort of revision.

The good news:

• The panel that originally heard the case has made it even more "pro-author" by clarifying some unfortunate language in the initial opinion that implied that the publishers might have an absolute privilege to reissue. This clarification is probably not pointed at Tasini itself, but at the pending National Geographic litigation Although NG's counsel claims that the cases are not comparable, this issue is critical to NG's position.
• The clarification makes en banc review by all of the active Second Circuit judges (except Judge Sotomayer, who [wrongly] decided the case below and thus may not hear it) considerably less likely, but for a reason that nonlawyers won't see. Let's assume for a moment that Tasini is heard by the Supreme Court. The Court may decide that whether reissue is a right or a qualified privilege is critical, and send it right back to the Second Circuit with "guidance" to reconsider its opinion. This is called a remand. Judges hate avoidable remands, because a judge with too many remands starts getting a reputation as sloppy or incomplete in his or her work. There's an old lawyer joke that explains this:

  A virtuous man in Heaven found St. Peter one afternoon and asked about a threatening figure in black that he had seen. St. Peter looked in the direction indicated and smiled. "Oh, don't worry. That's just God. Sometimes he likes to pretend that he's a federal judge."

  This revision closes a possible loophole, making remand that much less likely. The revised opinion makes reissues more a matter of contract than of copyright. That's attractive because it gets the cases out of federal court, into the state courts.
  <CYNICISM> There's nothing federal judges like more than reducing their own caseload, which admittedly is far from light. But shoving the problem into somebody else's lap is not a very honorable way of doing so. </CYNICISM>

• The clarification may deter a Certain West-Coast Publisher from certain disreputable "reissues." Note that I said "may."

The bad news:

• Unfortunately, making Tasini more pro-author and anti-big-publisher is going to:
  • Somewhat increase the probability that the Supreme Court will grant certiorari and hear the case. Of late, obvious long-term commercial implications of a circuit opinion have increased the probability of cert from slightly less than 1% to about 1.5%.
  • Substantially increase the probability that the publishing industry will lobby, and lobby hard, for legislative changes to the Copyright Act (specifically 17 U.S.C. § 201-203) that will specifically overturn Tasini. Since the Berne Convention's treatment is even more muddled than the American, and the WIPO treaty essentially omitted consideration as "not ripe," Congress may well cave in. Possible slimy, underhanded counterattack: some cynical cretin may point out how much of the US publishing industry is owned by them damned furriners.
• The revision itself will further delay final resolution. The new panel opinion restarts all of the "clocks" in the case, including both the request for en banc review within the Second Circuit (which does have internal guidelines for granting or denying these requests) and the forthcoming petition for certiorari. In other words, my previous estimate is now off by six months to a year—the wrong way. We're looking at 2004 or 2005 before this finally gets resolved, guys.

III. Certiorari

The Supreme Court granted certiorari in Tasini v. New York Times on Monday. Time for a short lesson in civil procedure. Just what the hell does that mean, and how did the case get there?

The Supreme Court, unlike other federal courts, can refuse to hear a case without giving a reason. With negligible exceptions, the Court takes only appellate cases. Around 6,000 requests to hear cases arrive at the Court each year. The Court typically must hear three to six of them as appeals "with jurisdiction noted." It accepts an increasingly smaller number of other cases, even though filings continue to increase. Last Term (October 1999–September 2000), the Court only granted certiorari in around 70 cases.

But how does the Court decide to accept cases? What sets the lucky 1% apart?

Mechanically, a case is accepted for hearing after the Court considers a petition for certiorari and a response (plus briefs from amici curiae, who are supposed to bring other matters to the attention of the Court when the litigants will not "adequately represent all interested parties," but normally just attempt to reinforce one side or the other). The Court's internal procedures require four votes to hear a matter (although it has complete discretion to change the rules; some matters appear to require five votes). That is not to say that the four votes are preliminary votes to reverse; often, they are votes to resolve a circuit split or other matter that is so important it must have a single, national precedent.

This term offers an excellent example of a circuit split: the Casey Martin matter. The 9th Circuit decided that a physically disabled golfer was entitled to use a golf cart during competition; three days later, the 7th Circuit decided the opposite—thus, a circuit split. The Court granted certiorari to resolve the split.

But Tasini does not represent a split. The only potential split currently at the appellate level is in the 11th Circuit, and creating a split would require the circuit to overturn some of its own precedent, which is unlikely—particularly since the Circuit will now sit on its case until the Supreme Court rules in Tasini.

And so seven men and two women will decide whether splitting freelancers' work from its original context and placing it in a database is a new publication or merely a reissue. On that issue rides the life or death of Northern Lights, Nexis, and a number of other electronic database providers. Allegedly (as the economics are not nearly so dire as the services claim). Although I'm a big fan of searchable databases, I also believe that the Constitution's Copyright Clause means what it says:

Article I, § 8
The Congress shall have the power… to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries…

<SARCASM> Of course, this is not an issue that authors need to worry much about any more. Contemporary publishing contracts are explicit about database rights; in fact, publishers usually take a "we get the database rights, and that's nonnegotiable" stance. So don't worry about it. </SARCASM>

Why should writers care about the result in Tasini? It's as much a matter of contract law as of copyright. Technology and usage will march on, and this situation will happen again. When most of the materials at issue in Tasini were published, virtually nobody had the thought of widespread electronic access, or exploitation of electronic rights. Thus, they were not discussed in publishing contracts.

So, the real meaning of Tasini does not really concern electronic rights, or at least not electronic rights per se. It's about allocation of rights in the face of silence in the contract. Yes, this battle has been fought before, over cinema adaptations, radio adaptations, and TV adaptations. That those rights are subject to negotiation at all is largely due to the estate of Edgar Rice Burroughs: Tarzan and John Carter of Mars are perhaps the most-litigated properties in copyright.

The two sides' positions are as follows:

• The publishers want the default rule to be a very generous transfer of rights. The defense that the electronic database publications are merely reissues of the original publication depends upon assuming that form doesn't matter; if it does, we never reach the reissue defense at all. On the facts in the record, it seems clear that these publishers were not merely reissuing; they were repackaging. And that, my friends, is an infringement unless that right was somehow transferred to the publisher.
• The authors want the default rule to be very strict—if it isn't explicitly mentioned in the publishing contract, it's not transferred. This, however, is a double-edged sword; excessive rigidity will lead to industry-wide insistence on all rights contracts (or even a demand to transfer copyright). It's already happening, folks. A short-term win here will no doubt lead to regressive publishing contracts.

On balance, what's the answer? In my not so humble opinion, it should come pretty close to the authors' position. Yes, there needs to be some flexibility in interpretation; for example, if a contract anticipates a particular use by saying "digital database rights," but the term of art later adopted is "electronic database rights," it seems clear that the parties meant to transfer (or, if in a disclaimer clause, not transfer) the right to full-text use of the material in machine-readable form. On the facts of Tasini, it's pretty clear that a right other than reissue was in question, because the material was not in fact reissued, but consolidated, indexed, and made available in a manner to allow retrieval of specific articles. I don't turn to the New York Times's op-ed page for a given date; I look for the author's name, or the title, or whatever else the search engine can use as a reference.

But this does require vigilence by authors. Read your contracts. Assume that the nice editor with whom you've developed a working relationship will be fired tomorrow when one of the media conglomerates takes over, or when there's a shakeup at the top if it's already part of a media conglomerate. If you don't understand a clause, go ahead and ask the editor… but remember that, even if the editor truly does want to be author-friendly, the editor is in all probability not a lawyer. If you still don't understand or you're not satisfied, get an attorney to look it over.

One last thought on this whole mess: by not creating a class action, the plaintiffs screwed a lot of other authors. The other authors whose works were initially placed in electronic databases between about 1987 and 1995 (filing of the suit) no longer have a legal remedy, as the three-year statute of limitations has run. One can argue that it's a continuing violation, or try to use the discovery rule, but the cause of action clearly accrued during the 1987–95 period. If, however, the case had been structured as a class action, the statute of limitations would have been suspended for all members of the potential class prior to judgment on the merits (or exclusion from the class by change in the class definition). Further, it's a lot easier to get attorney's fees in a class action than in a pure copyright matter. Most important, though, a class action creates some additional pressure to settle, even if only partially. The CARL UnCover suit is an excellent example. Yes, there are additional procedural hurdles, and sometimes class actions just make the defendants more obstinate; but, particularly in a case like this one with an easily defineable injury, uniform practice, and a large number of plaintiffs who have each suffered a relatively small legal injury, there's really no excuse. There are reasons, but they do not create an excuse. The plaintiffs and their attorneys are equally responsible. <Disclosure> I have a litigation history "across the v." with one of the plaintiffs' attorneys and her firm, and it's an extremely unpleasant history indeed. </Disclosure>

IV. The Supreme Court Affirms

The Supremes—two old ladies and seven guys in drag—decided Tasini on 25 June 2001, by a 7-2 vote. Justice Ginsburg wrote the majority opinion; Justice Stevens wrote a dissent, joined by Justice Breyer. The opinion is not what I'd hoped for.

It's much better.

You can download the entire report [173k] (or, if you prefer, just the syllabus [30k], a summary prepared for the public by the Reporter of Decisions—this is not an official part of the report, but it's always a good introduction). If you're a serious writer, I recommend that you download the full opinion, as it will bear considerable study.

Tasini is a resounding victory for writers. The Court held that a searchable electronic databse is not merely a "revision" or "reissue" of a prior collective work. This is consistent with the Second Circuit's opinion in the case, which was affirmed, and with decisions of other federal courts—except, virtually standing alone, the initial decision by the District Court in Tasini itself. More crucially, though, this is consistent with the evolving international practice. Footnote 13 requires some scrutiny (citations omitted for clarity):

Courts in other nations, applying their domestic copyright laws, have also concluded that Internet or CD–ROM reproduction and distribution of freelancers’ works violate the copyrights of freelancers. After the French Plurimédia decision, the journalists’ union and the newspaper-defendant entered into an agreement compensating authors for the continued electronic reproduction of their works. In Norway, it has been reported, a similar agreement was reached.

In other words, this isn't something unique to the US, which would create tremendous problems given the international reach of most electronic databases, specifically including several of the defendants. Instead, as Justice Ginsburg implies, we're behind the international community—and Tasini is a big step toward catching up.

More generally, Tasini stands for two principles of great importance to writers:

1. A publishing contract means what it says, regardless of later attempts to redefine terms. Most of the opinion turns on the definition of the word "revision":

The crucial fact is that the Databases, like the hypothetical library, store and retrieve articles separately within a vast domain of diverse texts. Such a storage and retrieval system effectively overrides the Authors' exclusive right to control the individual reproduction and distribution of each Article.

Slip op. at 18, citations omitted. Thus, if a term is not defined to include a specific concept when the contract is signed, later changes in technology do not automatically enlarge the publisher's rights at the expense of the author. Justice Ginsberg repeatedly noted that the purpose of the 1976 revisions to the Copyright Act was to enlarge author rights, not shrink them.

2. This decision is final. Most cases are merely remanded to the court from which they last came—the US Court of Appeals for the Second Circuit, in Tasini—for further proceedings "consistent with this opinion" (or, if it's from a state court, "not inconsistent with this opinion"—means the same thing, but it's a little bit more polite out of concern for federalism and states' rights). Here, though, the Court said the liability question is closed; all that remains is for the District Court to fashion a remedy.

Perhaps the most important part of Tasini concerns what it says is not required under copyright law: a specific remedy. A concern for remedies is what really separates a lawyer from a publishing executive, or a writer, or a political scientist, or a computer scientist. Most people—quite rightly—are concerned primarily with the question of "What is the correct behavior?" Even when correct behavior is clear, though, there's insufficient concern with "What can I do when I've been wronged?" It's all well and good to prove infringement, but that's not why most people file copyright suits.

The Copyright Act provides for several varieties of remedies, and it is in the court's discretion to choose one or more of them:

•  Damages, either statutory or actual

•  Disgorgement of proceeds

•  An injunction prohibiting further infringement

•  In certain egregious cases, punitive damages

•  In criminal cases—and yes, there is a criminal component to the Copyright Act—criminal penalties including fines and imprisonment

•  Costs and reasonable attorney's fees

But it is the judge's choice to fashion a remedy. As Justice Ginsburg emphasized,

[I]t hardly follows from today’s decision that an injunction against the inclusion of these Articles in the Databases (much less all freelance articles in any databases) must issue. The parties (Authors and Publishers) may enter into an agreement allowing continued electronic reproduction of the Authors’ works; they, and if necessary the courts and Congress, may draw on numerous models for distributing copyrighted works and remunerating authors for their distribution.

Slip op. at 20 (citations omitted).

In other words, the Court explicitly states that the publishers' principle policy argument against finding infringement is incorrect. The materials need not be withdrawn from databases unless and until the trial court imposes such an injunction as a remedy. There will be no gaps in the historical record, unless the publishers refuse to pay for use of the articles. It's their choice. They've been offered an out, in the form of a strong suggestion from the Court that the parties look to compulsory licensing for music.

The phrase "bad faith" comes to mind in this context. But then, given the law firms involved, one shouldn't be too surprised. On one side, we find a labor lawyer trying an IP case of more than ordinary complexity—and screwing it up at the start.¹ On the other side, we find a law firm widely known for its "millions for defense, not a dime for tribute" approach to litigation. The new trial judge, whoever he or she may be (the initial trial judge was elevated to the Court of Appeals), may wish to consider this in fashioning a remedy. Flouting the legal process needs to be discouraged, even if only by refusing to credit any of the inevitible challenges to the plaintiff's attorney's fees, and perhaps even applying a success-and-complexity multiplier.

Of course, the court can get around that complex calculation by making a finding of willful misconduct by the publishers and database providers. Such a finding may be justified by the fact that the publishers changed their contracts to explicitly include database rights shortly after the suit was filed in the first place—an admission against interest by conduct.

After the time I spent in the Executive Branch, I definitely would know a subtle plan if it was painted purple, dancing naked on a harpsichord, singing "Subtle Plans Are Here Again." I can't say the same for the media: Even the law-oriented media (such as Law.com, FindLaw {although, given that it's now owned by the West Group, one of the major database operators that will be affected, that's not a complete surprise}, and GigaLaw.com) have missed the subtleties of the Tasini decision. Completely. Quite possibly because none of them really cares a whole helluva lot (or knows a whole helluva lot) about the publishing industry and its quaint practices, let alone the author's perspective thereon.

The least subtle of these subtleties is the implication for the concept of "derivative works." Time for some statutory construction, folks. Don't say I didn't warn you…

A "derivative work" is a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted. A work consisting of editorial revisions, annotations, elaborations, or other modifications, which, as a whole, represent an original work of authorship, is a "derivative work."

17 U.S.C. § 101. The examples are nice, but far from all-inclusive. Consider, for example, that a popular videogame might be based on a work of fiction. The key is the end of the first sentence: any "form in which a work may be recast, transformed, or adapted." That's very broad indeed. Compare this to the publishers' defence:

Copyright in each separate contribution to a collective work is distinct from copyright in the collective work as a whole, and vests initially in the author of the contribution. In the absence of an express transfer of the copyright or of any rights under it, the owner of copyright in the collective work is presumed to have acquired only the privilege of reproducing and distributing the contribution as part of that particular collective work, any revision of that collective work, and any later collective work in the same series.

17 U.S.C. § 201(c). Quite a contrast.

Although the Court didn't say so explicitly, its reasoning is based upon a fairly simple premise:

The content creator owns every single right
not explicitly transferred in writing to a third party.

Tasini also implies a corollary:

All rights of such a third party are to be construed as narrowly as possible so as to maintain consistency with Article I, § 8, cl. 8 and its purposes.

Thus, the Court decided that a putative revision that takes a work from its explicitly authorized context and transforms the way one views (or hears) the work to a different medium actually "recast[s or] transform[s]" the work. The new version is thus a derivative work, not a revision, and therefore falls within the content creator's control unless rights to that derivative have been transferred in writing.

As a practical matter, this is far easier to administer than the opposite conclusion. By drawing a fairly easy to see line in the sand, the Court reduces the burdens on future judges and not incidentally enables content creators and their distributors (publishers, in this instance) to understand their rights and responsibilities without having an expensive lawyer review every single angle… and then be wrong, because said lawyer is being paid by one side or the other, and will slant his or her opinion in his or her client's favor. But I've seen virtually no commentary that notes that just maybe administrative simplicity—an explicit goal of Justices Scalia, Thomas, Rehnquist, and Kennedy, as shown throughout their respective jurisprudence—is another argument in favor of the result in Tasini.

Here is what I believe is the proper test for determining whether a "revision" is a revision:

A reuse of a work forming part of a collective work is not a revision with privileges under § 201(c) unless:

•  The reuse maintains the work's context, including pagination, placement, typography, graphics, and surrounding material; and

•  The reuse does not allow or include indexing and/or direct retrieval methods substantially different from those included in the collective work as first issued that will retrieve the substance of the work, except as minimally required by otherwise qualifying media changes in the reissue; and

•  The reuse is issued in the normal course of business, and not pursuant to any agreement with a third party; and

•  The reuse is not editorially or otherwise revised except to eliminate objectively clear typographical or other reproductional errors;

or the specific reuse is specifically authorized in writing by the content creator.

This is truly media-neutral—in contrast to the publishers' position, which is merely revenue-neutral as to the author (although revenue-enhancing as to them). Thus, it also meets Justice Stevens's main objection, as expressed in his dissenting opinion.

One subtle aspect of the opinion—critical for anyone interested in creators' rights, whether as a creator or a later user of rights—is the tea leaves left in the bottom of the cup for future disputes. We'll look at some specific examples over the next few entries, but a general understanding will be helpful.

So, what does the Court think about creators' rights?

In the 1976 revision, Congress acted to “clarify and improve [this] confused and frequently unfair legal situation with respect to rights in contributions.” The 1976 Act rejected the doctrine of indivisibility, recasting the copyright as a bundle of discrete “exclusive rights,” each of which “may be transferred… and owned separately.” Congress also provided, in § 404(a), that “a single notice applicable to the collective work as a whole is sufficient” to protect the rights of freelance contributors. And in § 201(c), Congress codified the discrete domains of “[c]opyright in each separate contribution to a collective work” and “copyright in the collective work as a whole.” Together, § 404(a) and § 201(c) “preserve the author’s copyright in a contribution even if the contribution does not bear a separate notice in the author’ s name, and without requiring any unqualified transfer of rights to the owner of the collective work.”

*  *  *

Essentially, § 201(c) adjusts a publisher’s copyright in its collective work to accommodate a freelancer’s copyright in her contribution. If there is demand for a freelance article standing alone or in a new collection, the Copyright Act allows the freelancer to benefit from that demand; after authorizing initial publication, the freelancer may also sell the article to others. It would scarcely “preserve the author’s copyright in a contribution” as contemplated by Congress if a newspaper or magazine publisher were permitted to reproduce or distribute copies of the author’ s contribution in isolation or within new collective works.

Slip op. at 9–12 (citations and footnotes omitted).

That's very nice. But what does it mean? What Justice Ginsburg and her six colleagues are saying is that the 1976 revision of the Copyright Act shifted the preexisting balance, that had been strongly in the publisher's favor, to the actual creator (or at least the party assigned as the creator by the Act). This is consistent with the core holding. It would make little sense to assert that the creator transfers only what he or she explicitly transfers in writing, and then reduce with the creator owned to transfer in the first place. Although there's no guarantee that any law will make sense—particularly in intellectual property—the devil is usually in the details. This is not a detail; it's a core principle. A little farther on, we'll see how this shift both predicts the results in other existing cases and points toward resolution of future inevitible controversies.

V. Related Cases

The most obvious pending case to which Tasini provides much of the resolution is Greenberg v. National Geographic Society. The multi-CD-ROM set of National Geographics is an invaluable research tool, both for individuals and libraries. That it's useful, though, is not an excuse for theft—even when justified by what is at best a delusional rationalization.

Greenberg concerns the rights of freelance photographers, not authors. Similar to the publisher-defendants in Tasini, the National Geographic Society—a Congressionally chartered corporation—claims that the CD-ROM set is merely a revision of the existing magazines. To a point, the CD-ROMs are much more like a true revision than the databases in Tasini. The Society authorized only a true facsimile edition that includes all of the advertisements, typographical errors, and context of each article and illustration. In that sense, it's a much closer call than Tasini (although the indexing software, it seems to me, makes this at least an arguable claim). What the Society and its lawyers conveniently forget, though—despite the fact that both the trial court and the Eleventh Circuit discussed the issue extensively and granted judgment on that factor alone—is the use of copyrighted photographs in "value-added" enhancements to the CD-ROM set, including animated montages in the startup sequence. By no stretch of the English language short of calling "glory" a "nice knock-down argument" is that a "revision," "reissue," or continuation of the same series.

The saddest aspect of Greenberg is that the scope of the matter is such that it should have been settled at an early stage. There is clear actual misuse, under long-established case law, which should have convinced the Society and its counsel to settle at least the montage aspects of the matter. For somewhat less than its lawyers would have charged to evaluate the settlement (based on typical stock-photo fees), the Society could have purchased that specific additional right from those photographers whose work was in the montages, and perhaps even favored those photographers by explicitly purchasing reprint rights to their other work in the set, too.

The National Geographic case is not the only pending matter influenced by Tasini. For example, consider Random House, Inc. v. Rosetta Books LLC (S.D.N.Y. No. 01civ1728shs). This is the "is an e-book a book" case. Judge Stein emphasized that his decision was based upon "neutral principles of contract interpretation," not copyright law. The critical passage is as follows:

Manifestly, paragraph #1 of each contract—entitled either "grant of rights" or "exclusive publication right"—conveys certain rights from the author to the publisher. In that paragraph, separate grant language is used to convey the rights to publish book club editions, reprint editions, abridged forms, and editions in Braille. This language would not be necessary if the phrase "in book form" encompassed all types of books. That paragraph specifies exactly which rights were being granted by the author to the publisher. Indeed, many of the rights set forth in the publisher’s form contracts were in fact not granted to the publisher, but rather were reserved by the authors to themselves.

Slip op. (11 Jul. 2001) at 12 (record citations omitted)

On this basis, Judge Stein properly found that an e-book is not, as Random House claimed, a nondistinct subset of a book. It is, instead, a "new use" that is distinct. Random House's contract did not include such new uses, and therefore its motion to prevent Rosetta Books from publishing e-book versions of eight novels whose contracts dated from the 1960s through 1980s was denied.

So why does Tasini matter to this question? If it's just contract law, then a decision on copyright shouldn't matter, should it? It's not quite so simple. In the Second Circuit—which, because it includes the US publishing center of New York City, creates the most copyright law (followed by the Ninth Circuit, including Hollywood, and the Sixth Circuit, including Nashville)—there are several precedents for allowing nondistinguishable "new uses" of material under a previously granted license. See Boosey & Hawkes Music Publishers, Ltd v. Walt Disney Co., 145 F.3d 481 (2d Cir. 1998) (music license for use in a film includes use in a videotape); Bartsch v. Metro-Goldwyn-Mayer, Inc., 391 F.2d 150 (2d Cir. 1968) (derivative license for a film includes use in a television broadcast of the film). What Tasini does is make clear that an electronic text is a distinguishable "new use" as to a printed original. Judge Stein never cites any of the Tasini decisions, but it clearly casts a shadow. Once it is clear that an e-book is not the same as a book, the only question remaining is whether the grant of rights in the publishing contract for the book is so broad that an e-book would be included anyway. It is clear that the grant is not so broad, particularly as the authors reserved many of the other traditional derivative rights such as dramatic adaptations. Tasini further reinforces the concept that a publisher isn't allowed to retroactively redefine rights.

Thus, I can't claim that this is a "prediction" any more, although I did predict several weeks ago that Rosetta Books would turn on the contract language, and not on copyright law—even though the ultimate source of the cause of action is an allegation of copyright infringement. Judge Stein came to the right decision.

As I've mentioned before, I'm not so happy with the plaintiff for other reasons—the principal of Rosetta Books, Arthur Klebanoff, is also the principal of the Scott Meredith Literary Agency, which he purchased some years back. Aside from the obvious and insoluble conflict of interest (and that goes for you, too, Mr. Curtis), the Scott Meredith Literary Agency is notorious as the one fee-charging agency with any historical track record of actually placing works with commercial publishers. Historical only, though, as there's little evidence of new sales in the last few years—since Mr. Klebanoff purchased the agency. It's analogous to—and this is an unfortunate comparison made for clarity, and not as an accusation or implication of such reprehensible views—the ACLU's quite proper and necessary defense of various neoNazi groups' rights to free speech in the 1970s and 1980s. In other words, I can admire the result without admiring the litigant.

Sometimes, though, a court will fail to take a hint. Tasini stands for the proposition that anything that is not excrutiatingly and explicitly otherwise in the Act or publishing contract must be interpreted in the content creator's favor. Morris v. Business Concepts, Inc., however, ignores that principle.

First of all, Judge Conway's rationale for the decision is just plain wrong. He granted summary judgment to the defendant because the infringed works had been registered only as part of the magazine's compilation copyright. That's all well and good, if docket control is the issue (the better method would have been to dismiss without prejudice with leave to amend upon production of the relevant certificate, which could have been obtained through standing procedures for expedited registration). However, since the defect is curable, it is not, by definition, a failure of subject-matter jurisdiction. There is no cure for failure of subject-matter jurisdiction. A complete explanation is far beyond the attention span of any reasonable individual; suffice it to say that failure to provide a certificate doesn't cut it.

More grievously, though, Judge Conway completely misconstrued the entire rationale of the 1976 Copyright Act. His opinion relies upon distinguishing authority that did allow authors to file under protection of another's registration certificate as being relevant only under the 1909 Act. This is the only way to reach the conclusion in the judgment, as it runs against otherwise-binding authority. The unstated assumption, though, is that the 1976 Act somehow made it more difficult for an author to assert his/her rights than did the 1909 Act. Justice Ginsburg's opinion in Tasini clearly states that the opposite is the case:

In the 1976 revision, Congress acted to "clarify and improve [this] confused and frequently unfair legal situation with respect to rights in contributions."³ The 1976 Act rejected the doctrine of indivisibility, recasting the copyright as a bundle of discrete "exclusive rights," each of which "may be transferred . . . and owned separately." Congress also provided, in §404(a), that "a single notice applicable to the collective work as a whole is sufficient" to protect the rights of freelance contributors.

Two Registers of Copyrights have observed that the 1976 revision of the Copyright Act represented "a break with the two-hundred-year-old tradition that has identified copyright more closely with the publisher than with the author." The intent to enhance the author’ s position vis-à-vis the patron is also evident in the 1976 Act’s work-for-hire provisions.

Tasini, slip op. at 9–10 (citations and two notes omitted)

VI. Tentative Conclusion

So, then, where does that leave us? In all probability, not a whole lot better off, primarily because the bargaining positions for publishing contracts simply are not equal. This is the one problem with the "well, one can contract around the law" aside in the Supreme Court's opinion: the market power of the publishers is such that they can, and will, force their wishes down the throats of writers. For example, the New York Times and others in its family have begun forcing freelancers to sign contracts for new work that purport to retroactively transfer electronic database reproduction rights to everything that particular freelancer has ever done for the paper for no additional payment. And nobody will, do a damned thing about it. This is precisely what antitrust law was designed to prevent; thanks, however, to the Reagan administration, that element is no longer part of antitrust law absent proof of actual collusion.

Thus far, however, there has been one pleasant surprise: there has been no rush to amend the Copyright Act to overturn Tasini. I suspect, however, that the major publishers are merely waiting until there is a more-attractive amendment to which they can attach such an amendment.

«««««««« notes »»»»»»»»»

1. The plaintiffs in this matter are not exactly paragons of virtue. Their posturing is almost as misleading as that of the publishers.

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