Ebook Borrowing/Lending

Another “buy” button lawsuit over digital licenses continues

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From Rebecca Tushnet’s 43(B)log:

This putative class action alleged that Amazon overcharged and “[d]eceived consumers by misrepresenting that it was selling them Digital Content when, in fact, it was really only licensing it to them[.]” Plaintiffs brought claims under California, New York, and Washington consumer protection law, and common law claims for unjust enrichment.

Plaintiffs alleged that Amazon offers cheaper “rent” options for some of its content, but more expensive “buy” options as well. When consumers “buy” digital content, it’s stored in a folder called “Video Purchases & Rentals.”

But, in fact, Amazon does not cannot pass title of any of this content to consumers. “If the licensing agreement for any of the Digital Content is terminated, Amazon has to pull the Digital Content from not only its site but from all consumers’ purchased folders, ‘which it does without prior warning, and without providing any type of refund or remuneration to consumers.’”

Amazon argued that Article III standing was absent because plaintiffs haven’t lost access to their digital content, and that their claims of overpayment also rested on the mere threat of future unavailability. The court disagreed: there’s a plausible difference in value between owning outright versus purchasing a revocable license.

“Buy” was also plausibly deceptive. Amazon argued that “buy” didn’t mean perpetual ownership, and that it sufficiently disclosed the risk of losing access. Plaintiffs pointed out that Amazon also allows real, non-repossessable purchases with the “Buy” button for tangible goods.  Again, the court agreed with plaintiffs: it was plausible that “buy” could be materially misleading. The court hypothesized a consumer who paid nearly $40 for Barbie and Oppenheimer, but whose Barbenheimer (first judicial appearance?) weekend was ruined because Amazon suddenly lost one license. “Understandably, this consumer ‘might feel a little miffed [or go nuclear] if she were told that she received exactly what she paid for.’”

Link to the rest at Rebecca Tushnet’s 43(B)log and thanks to C. for the tip.

In former days, PG had the occasion to deal with Amazon’s in-house attorneys regarding various matters relating to his clients. He found these lawyers to be intelligent, competent and reasonable (a trifecta that not all lawyers/legal departments can pull off).

PG speculates that the mess described in the OP originated with the marketing department’s decision to proceed on a path contrary to the legal department’s strong recommendations.

In most businesses with which PG has dealt, in such battles, the marketing department often wins. After all, marketing and sales are how a company makes money, and legal is always a cost item that invariably slows down the release of new products and services (often deeply resented within corporate middle management).

Intellectual property in digital form is always licensed, not sold. One of the primary reasons for this legal/practical decision is that digital property is almost always easily duplicated—bits can multiply extremely rapidly in a digital device and thereafter be sent digitally anywhere in the world at the speed of light.

Yes, physical books can be duplicated and shipped anywhere in the world, but a printing press and lots of paper is required to do so. Therefore, you own the single printed copy of a book you purchased at Barnes & Noble (or Amazon), but you license the ebook you receive from Amazon or Barnes & Noble because they are operating under the terms of a license they have received from the indie author or a publisher which has the author’s consent to print, publish, license or sell the book.

But Marketing said, “Customers will be confused if we have, ‘License now with 1-Click®‘”

End of license v. sale discourse.

‘Copyright, Not Infringement, Serves the Public Interest’

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From Publishing Perspectives:

On Friday . . . four major publishers—Hachette Book Group, HarperCollins Publishers, Penguin Random House, and Wiley—filed a brief that opposes the Internet Archive‘s appeal of its loss on March 24, 2023, in the copyright case Hachette Book Group, et al, v. Internet Archive.

The original lawsuit was filed by the publishers in June 2020 and argued that the Internet Archive had digitized “millions of print books and [distributed] the resulting bootleg ebooks free of charge from its site, without the consent of the publishers and their authors or the payment of any license fee.”

In his grand of summary judgment of almost a year ago, the judge, John G. Koeltl of the United States district court in the Southern District of New York, wrote, “The publishers have established a prima facie case of copyright infringement,” and his opinion included a firm rebuke to the controversial concept of “controlled digital lending.”

Nevertheless, the Internet Archive made good on its promise to appeal, arguing that Judge Koeltl didn’t understand the facts of the case and was wrong in his decision.

. . . .

The United States’ publishers’ association has announced the filing of the new brief, highlighting these points from the new brief:

  • “Controlled digital lending is a frontal assault on the foundational copyright principle that rights holders exclusively control the terms of sale for every different format of their work—a principle that has spawned the broad diversity in formats of books, movies, television, and music that consumers enjoy today. “…
  • There is no resemblance between the Internet Archive’s conversion of millions of print books into ebooks and the historical practice of lending print books.  Nor does the Internet Archive’s distribution of ebooks without paying authors and their publishers a dime conform with the modern practices of libraries, which acquire licenses to lend ebooks to their local communities and enjoy the benefits of digital distribution lawfully.
  • The Internet Archive operates a mass-digitization enterprise in which it copies millions of complete, in-copyright print books and distributes the resulting bootleg ebooks from its site to anyone in the world free. Granting summary judgment, the district court properly held that the Internet Archive’s infringement is not saved by fair use as each of the four factors weighs against the Internet Archive under longstanding case law.
  • “In sum, the Internet Archive distributes the publishers’ copyrighted material in a market that the publishers, as the copyright owners, are exclusively entitled to exploit, and the Internet Archive looks to replace the publishers as the supplier of ebooks to its customers.  ‘This is precisely the kind of harm the fourth factor aims to prevent.’
  • “’There is nothing transformative about the Internet Archive’s controlled digital lending practices because it does nothing ‘more than repackage or republish’ the works. ‘The Internet Archive does not reproduce the works in suit to provide criticism, commentary, or information about them.’  Rather, the Internet Archive admits that controlled digital lending serves a ‘similar’ purpose to licensed library ebooks—i.e., to make books available to be read—which precludes transformativeness ‘even if the two were not perfect substitutes.’
  • “The Internet Archive’s flawed policy argument is that the law must change to ‘ensure that technological innovation allows libraries to improve access to books…’ But public libraries practicing ‘traditional library lending’ across the country have already implemented this ‘technological innovation’ via the publishers’ authorized library ebooks—which serve ‘people of diverse geographical, cultural, and socioeconomic backgrounds,’ ‘individuals with disabilities,’ and ‘residents of rural and urban areas,’ as well as facilitating research.  In other words, the publishers have realized the innovation [that] the Internet Archive belatedly champions; the Internet Archive is merely usurping it.
  • “The authorized library ebook market is thriving—readers have never had more access to free, licensed ebooks than they do today…  The number of ebooks and audiobooks checked out via OverDrive in 2020 was 430 million, a more than 500-percent increase from 2012.

Link to the rest at Publishing Perspectives

Record Number of Libraries Hit One Million Digital Lends in 2023

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From Publishers Weekly:

OverDrive reps reported this week that a record 152 library systems and consortia across seven countries—including 41 states and seven Canadian provinces—surpassed the one million digital lends benchmark in 2023, which includes e-books, digital audiobooks, and digital magazines. The numbers represent a significant jump from the 129 library systems that hit the milestone in 2022.

The 152 public libraries hitting the milestone are based in the U.S., Canada, Australia, Canada, Germany, New Zealand, Singapore, the United Kingdom, and the United States.

For the second year in a row, the Los Angeles Public Library topped the global list, with more than 12 million digital titles circulated; MELSA: Twin Cities Metro eLibrary in Minnesota remains the highest circulating consortium. Houston Public Library in Texas experienced the highest year-over-year circulation growth, up 57%,, while Öffntlicher Bibliotheken in Berlin, Germany, held the strongest growth for a library outside North America—up 46%—for the third consecutive year. In addition, OverDrive said that 23 library systems hit the million lend mark for the first time in 2023.

The news comes a week after OverDrive reported that 2023 was another record-breaking year for digital library circulation, with a 19% increase in library checkouts of digital media over 2022. In all, library users worldwide borrowed some 662 million e-books, digital audiobooks, and digital magazines.

Link to the rest at Publishers Weekly

US Senate Finance Committee Presses Publishers on Library Ebook Contracts

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From Book Riot:

Earlier this year, Fight for the Future — a group of technology experts, policymakers, and creatives — launched a tool called Who Can Get Your Book, meant to highlight the challenges of accessibility and availability of ebooks in public schools and libraries, rural areas, and other communities where these disparities create burdens to information. It is but one organization seeking transparency around ebooks from publishers, and now, the US Senate Finance Committee is pushing for more.

Finance Committee Chair Ron Wyden (D., Oregon) and U.S. Representative Anna G. Eshoo (D., California) lead the latest charge, drafting a series of letters to the Big Five publishers to clarify their ebook contracts with public schools.

Ebook contracts are notoriously tricky. For libraries, who can purchase print books and own them through their natural lifespan, ebooks come with restrictions on a number of fronts. They aren’t owned by the library and instead are licensed: at any time, the books may disappear or come with circulation limits, and those licenses come at astronomical prices. In cases where licenses can be negotiated with better terms for the library, costs only grow.

These contracts and the ways they restrict access for users have become magnified over the course of the pandemic, when the digital divide became even more profound.

As reported in December, one school district in southern California found itself budgeting $27 per student every 12 months to access the classic and widely-taught The Diary of Anne Frank. The same title can be purchased in print by a library for a one-time price and used without limit; outside of the library, the average person can purchase The Diary of Anne Frank on Kindle one time from anywhere from $.20 to $14 and read it as much as desired for that single cost.

That doesn’t mean non-library purchases of ebooks are perpetual, nor are they owned by the individual who made the purchase.

“Even readers with vast personal collections of e- and audio-books should be alarmed, as most ebooks and audiobooks are also merely licensed to those who believe they are “buying” them, leaving the door open for publishers and big tech companies like Amazon to later erase books, as well as alter what they say, down the line,” said Lia Holland campaigns and Communications Director at Fight for the Future.

Beyond the costs, not all digital material is made available for licensing by schools or libraries. Amazon exclusives, for example, keep many works completely inaccessible. Who Can Get Your Book gives points for every accessible format to a title, and uses those to grade how easy it is to borrow it. Born a Crime, the popular memoir by Trevor Noah, for example, earns a D grade because the digital audiobook isn’t available outside its exclusive deal with Audible and because of restrictive licensing agreements for the ebook.

All of these challenges have led to demand for change.

“E-books play a critical role in ensuring that libraries can fulfill their mission of providing broad and equitable access to information for all Americans, and it is imperative that libraries can continue their traditional lending functions as technology advances,” reads the letter Senate Finance Committee members sent to Penguin Random House, Hachette, HarperCollins, Simon & Schuster, and Macmillan.

. . . .

“We are thrilled to see legislators taking action for the public’s right to own and preserve all books, no matter what form they are published in. With so much of our lives happening online, the opportunity to own digital books is almost nonexistent—a stark and concerning departure from how our society interacts with paper books,” said Holland.

“Through restrictive and expensive licensing schemes on ebooks and audiobooks, publishers are acting against the best interest of authors by reducing the number of titles that libraries and schools are allowed to offer and preserve. This often means that the most successful and mainstream books are the only ones purchased, locking many authors out of income from library purchases as well as away from the vast audiences of readers that public institutions serve. We hope that legislators will take swift action to ensure perpetual access to knowledge and diverse voices for everyone.”

Earlier this summer, Maryland became the first state to pass legislation on ebook licensing. The bill, which goes into effect January 1, 2022, requires any publisher offering ebooks for sale to consumers in the state also make those materials available for purchase by libraries in the state.

In other words, exclusives would no longer be allowed to be exclusive or put undue access barriers to library materials in the state. Publishers Weekly breaks down this legislation, making it sound like Amazon remains a question mark.

Link to the rest at Book Riot

Yes, of course traditional publishers would screw up library licensing of ebooks just like they screwed up everything else with their ebook businesses.