Hochul Vetoes New York’s Library E-book Bill

From Publishers Weekly:

Just hours before it was set to become law, New York Governor Kathy Hochul on December 29 vetoed New York’s library e-book bill. The bill is now back with the legislature, where it is tabled.

The veto comes despite strong grassroots support: in June, the bill unanimously passed the New York Assembly 148-0, and passed the New York State Senate 62-1. But the Association of American Publishers’ December 9 federal lawsuit seeking to block implementation of a similar law in Maryland sparked concern in the governor’s office. And in her brief explanation of the veto, Hochul cited the AAP’s concerns.

“While the goal of this bill is laudable, unfortunately, copyright protection provides the author of the work with the exclusive right to their works,” Hochul wrote. “As such the law would allow the author, and only the author, to determine to whom they wish to share their work and on what terms. Because the provisions of this bill are preempted by federal copyright law, I cannot support this bill. These bills are disapproved.”

The New York bill was also opposed by a cohort of powerful New York-based industry groups, including the AAP and the Authors Guild, which urged Hochul to veto the measure in a recent letter, calling the bill “an unjustified attack” that would have “a significant negative impact on the economy and jobs” in New York.

. . . .

The library e-book bills come after a decade of tension in the library e-book market, with librarians long complaining of unsustainable, non-negotiable prices and restrictions on digital licenses. Specifically, the bills emerged as a response to Macmillan’s controversial (and since abandoned) 2019 embargo on frontlist e-books in libraries, which led library advocates to take their concerns to state and federal legislators.

“This is a powerful moment for libraries,” concluded a December, 2020 report on digital lending from the ALA’s Joint Digital Content Working Group. “If we cannot find ways to make our digital collections robust and lasting, including a return to perpetual access as an option, libraries will never be able to meet an ever-increasing demand and provide equity to the communities we serve.”

Link to the rest at Publishers Weekly

6 thoughts on “Hochul Vetoes New York’s Library E-book Bill”

  1. This is a fascinating elision of rights. The publishers are not the authors; they are, in the language of the Second Circuit (which includes New York) under the 1909 Act, “mere licensees.” Which means that the terms of the publishing contracts must be parsed to determine who has standing to assert the “exclusive rights” in a copyright-related action or preemption.

    And that is not easy and not trivial. It certainly can’t be done in a press release, or public speech by a politician who is not acting as an attorney, or based upon incomplete litigation in another jurisdiction that very well may apply its own contract law to the dispute notwithstanding any choice of law provision in other contracts.

    This also presents a fascinating opportunity to explore the question of “transfer of future unknown rights, and the parties’ contemplation thereof.” But that is never going to get into court; it’s for law-journal articles, and arguments at conferences and in bars, and political grandstanding. (IMNSHO, the correct resolution of the question is “it depends, and there cannot — or at least should not — be a ‘default position’ for the same reasons that the general ‘you signed the land-sale agreement, you’re stuck with it despite the racially restrictive covenants’ theory fails.”) And more relevant, the distinction among “what are current market conditions, as they would affect an arms’-length agreement between authors and publishers of equal bargaining power”; “how have current market conditions changed since the signature to the respective contracts”; and “did one side in the negotiation over the relevant contract clause(s) abuse a superior position regarding one or more of economic relationship, actual knowledge, or constructive knowledge”.

    If and only if this was a tabula rasa, the answers may/might be different. But we’re dealing with a transition state — and as any chemist can and will tell you (at length, with lots and lots and lots of math and hedging and scientific wild-ass guesses), making predictions for the future and/or extracting products directly from transition states is rather dangerous. In the “tends to make things go ‘boom'” tradition of chemistry.

    Snarkily, I’d also add that this situation implicates antitrust law and misuse of intellectual property protections beyond the scope of those protections — which are exceptions to the general disfavor of monopolies apparent in the Founders’ writings — but that’s even more theoretical and confined to the law journals! It also evades the question of what measures a monopolist that is not an unlawful monopolist is entitled to take in pursuit of Ricardian rents, non-Ricardian rents, or both, whether inside or outside the purview of antitrust law.

    tl;dr Although publicly everyone is treating the publishers as the sole decisionmakers on the “sale side” here, that’s at minimum unwarranted conclusion-jumping; it may well be correct in many instances, but not in all. It is not justified without contract-by-contract interpretation concerning non-work-made-for-hire publishing contracts entered into between 01 Jan 1978 and 08 Dec 1994… and there are just a few books libraries would like to acquire that were so contracted.

    Reply
    • “and as any chemist can and will tell you (at length, with lots and lots and lots of math and hedging and scientific wild-ass guesses), making predictions for the future and/or extracting products directly from transition states is rather dangerous. In the “tends to make things go ‘boom’” tradition of chemistry.”

      (Been there, done that. More or less.) 😉

      Chemists aren’t the only ones who push systems until tbey go BOOM!!
      There is an entire engineering discipline that thrives off tbat methodology. Testing to destruction.
      As in, “if it didn’t go boom, you didn’t push it enough.” : D

      I agree you don’t want to do that to legal or economic systems but sometimes it’s the best and fastest way to learn the limits of a system. The textbook example for the next few decades is the SPACEX development of their STARSHIP orbital spaceship family.

      https://www.space.com/every-spacex-starship-explosion-lessons-learned

      They went from proof of concept to safe landing in two years (with lots of gorgeous fireballs!) and if the feds don’t block them any more, tbey’ll go to actual orbit and recovery in another year. For contrast, tbeir competitors at SPACEX have been spending billions of Bezos’ money for 20+ yrars and have yet to deliver even one working BE-4 engine, much less an orbital launcher. Testing to destruction can be expensive but it provides full clarity, really fast.

      Personally, I would favor somebody trying it with political parties. 😀
      Full clarity, really fast.

      Reply
  2. One question that I’ve never seen answered in the whole “publishers charge libraries a high(er) fee for ebooks” issue is – who winds up with that money? Publisher? Author? Someones Cat?

    Reply
      • It’s even worse than that, Tom. Commercial publishing contracts are still catching up with electronic books, but almost all commercial publishing contracts establish the list price based not on what is offered to restrictive markets, but on the price offered to the trade, and then calculate the author’s royalty off of that. For example, if a book’s ordinary list price is $27.95, that’s the basis for royalty calculations… even if several thousand library copies get sold at $77.45. (No, I did not pick those numbers out of a hat — I filed the serial numbers off real ones. Well, mostly, because someone who really knows commercial publishing can infer which conglomerate that relates to.) And it’s actually worse for “percentage of net” agreements, because libraries are treated as “special sales” at a considerably lower percentage of net.

        And it’s even more interesting given that publishers frequently try to limit the number of times, or the duration, of the “license” they offer to libraries for e-books. But that’s off-topic here.

        Reply
  3. “If we cannot find ways to make our digital collections robust and lasting, including a return to perpetual access as an option, libraries will never be able to meet an ever-increasing demand and provide equity to the communities we serve.”

    OK. The demand for free stuff isn’t met. It’s tough. My demand for free Jaguar XKE has never been met. It’s been many years, and each year, there are fewer and fewer.

    Reply

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