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Harper Seeks Injunction in Dispute with Open Road

25 May 2014

From Publishers Weekly:

Calling it a case of “blatant infringement,” attorneys for HarperCollins have asked the court for a permanent injunction blocking Open Road from publishing its unauthorized e-book edition of Jean Craighead George’s Julie of the Wolves, as well as more than $1.1 million in damages and attorney costs.

The request comes after HarperCollins’s recent win in its copyright suit against Open Road, and after the parties were unable to come to a voluntary settlement to resolve the case. Under a court order, Open Road is set to file its opposition brief no later than June 20.

. . . .

HarperCollins attorneys said a meaningful damage award was necessary to “deter Open Road, and others, from arrogating to themselves the new-media publication rights of legitimate licensees like HarperCollins,” and to bolster “an orderly market” for electronic publication rights.

“This case will surely be looked to as an important precedent in this area,” the brief states. “Hence, a sizable statutory damage award, coupled with the other remedies sought in this motion, will send an appropriately strong message to digital publishers.”

. . . .

  HarperCollins also asked the court for attorneys’ fees in the amount of $1,089,371.50 and costs in the amount of $7,040.62. That figure represents 70% of HarperCollins’ total fees of $1,556,245.00.

. . . .

[T]his case is at its heart more of a contract dispute than a copyright case, driven primarily by digital royalty rates. The author opted to go with Open Road for a 50% e-book royalty, while HarperCollins is said to have offered a digital edition, but refused to match the 50% royalty.

It seems unlikely that HarperCollins would have chosen to undergo the expense and uncertainty of litigation with Open Road only to enter into a license agreement with Open Road after winning.

It also seems unlikely that George’s estate would agree to take a lesser royalty with HarperCollins. In an earlier filing in the case, George was said to have deemed HarperCollins’s e-book royalty rate “fundamentally unfair to authors.” Given the increasing industry-wide pressure to raise e-book royalties, and the apparently lackluster sales of Open Road’s digital edition, there is surely no need for George’s estate to rush into a new e-book deal.

Link to the rest at Publishers Weekly

This is a suit between HarperCollins, the original paper publisher of Jean Craighead George’s “Julie of the Wolves,” and Open Road Media, the publisher of the ebook version of the same title. Ms. George voluntarily entered the lawsuit in support of Open Road.

Even if Ms. George hadn’t formally entered into the suit, she would have been involved in interrogatories, depositions, possible testimony at trial, etc., and would have been wise to retain her own attorney to help with those.

From the pieces of the contract that have appeared in the court case, PG hopes Open Road appeals the verdict.

Pulling back, there are some lessons for other authors from this lawsuit:

1. The standard “term of the copyright” clauses in the contracts traditional publishers ask you to sign really do mean you’re stuck with your publisher forever whether you like it or not.

Ms. George signed her HarperCollins contract in 1971. She was in her 90’s when she was draw into this litigation and died before the trial court’s decision. PG didn’t know Ms. George, but he expects she wasn’t happy being in the middle of a lawsuit during the last years of her life.

2. Be very careful what you sign. As reported in various publications, the contract clause at the center of this lawsuit was written by Ms. George’s agent and, apparently, never reviewed by an attorney acting on her behalf. Based on the court records and published accounts, the clause in question was very poorly written.

As you can see by the Publishers Weekly excerpt above, Harper Collins has spent $1.5 million (which is inexpensive for New York City litigation) litigating this poorly-written clause. PG expects Open Road has spent a similar amount.

Bad contract clauses can cost a lot of money.

3. Warranties in publishing contracts can cost real money. According to published reports, Open Road agreed that it would pay for costs arising from any suits against it by HarperCollins, so Ms. George doesn’t appear to be on the hook for Open Road’s attorneys fees.

However, this is most definitely not typical in virtually all contracts from traditional publishers. Normally, under Warranty and Indemnity clauses that nobody but lawyers ever read and understand, the author must pay for everything if the publisher is sued because of the author’s book.

Under a typical publishing contract, Open Road would be asking Ms. George to pay its damages and attorneys fees. If Open Road were required to pay HarperCollins’ attorneys fees, under a typical publishing contract, Open Road would be asking Ms. George to pay those as well.

And, unless Open Road decides to give up and pay up, the case is far from over at this point and there will be a lot more attorneys fees.

Big Publishing, Contracts, Legal Stuff, PG's Thoughts (such as they are)

11 Comments to “Harper Seeks Injunction in Dispute with Open Road”

  1. And of course since it isn’t Amazon this isn’t a large corporation acting like a bully.

  2. A caution tale and something that should surface every time an agent, a fellow author or an editor says to authors that where contracts are considered they don’t need an IP lawyer and that agents know all there is to know about publishing contracts.

    • I find it better just to avoid publishers in general. They can’t screw you over if you cut them out of the story selling process entirely.

      I mean, really, what do they bring to the table at this point? In exchange for putting up with submission/rejection stress, loss of editorial control, limited financial information, and feeling like you’re negotiating a contract with a particularly nasty group of goblins every time you try to earn a living you get what, the possiblity of having your book show up on physical shelves? That hardly seems compelling, or necessary to make a living.

      With dangers like this I’ll stick to ebooks an offering my books through P.O.D. for interested fans. Anything beyond that isn’t worth the headache.

      • I agree, but, unfortunately, not everybody is suited for self-publishing (or wants to be self-published). So it’s good that more and more of this kind of cautious tales are surfacing on the open. This way, at least, those authors who want to be traditionally published, learn that is not all rainbows and flowers, and hopeful enter, if they get offered a contract, the author-publisher relationship with open eyes and with a good IP lawyer by their side.

  3. Yeah that’s one contract term I’d not sign. Always have a knowledgeable attorney go over a contract. Always. And make sure you understand the terms and what you are signing. This goes for freelancers you hire to work for you. Not having a publisher does not mean you won’t deal in contracts.

  4. Hachette. Harper Collins. Sounds more and more like death throes.

    I had an attorney I consulted in an official capacity tell me I am lien-proof. The process servers and I share a chuckle or two when they stop by.

  5. PG, unfortunately, I think the time for appealing the summary judgment has well passed.

    • I hadn’t been keeping track of the time, Pete. You’re probably right.

      I wonder why Open Road didn’t appeal as part of its negotiation strategy if for no other reason.

  6. “Term of the copyright” clauses don’t always mean you’re stuck with your publisher forever.

    http://www.copyright.gov/title17/92chap2.html#203

    http://www.copylaw.org/p/termination-of-book-music-publishing_17.html

    But 35 years is still a good long while.

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