The book publishing industry, already facing disruption from Amazon(s amzn) and e-books, will confront a new form of turbulence in 2013. Starting in January, publishers face the loss of their back lists as authors begin using the Copyright Act to reclaim works they assigned years ago.
These so-called “termination rights,” which let authors break contracts after 35 years, have already made the media thanks to a court squabble between the Village People and music studios. On the book front, publishers and agents are staying mostly mum even though the bestseller lists from 1978 reveal some very big names eligible to reclaim their work — Stephen King, Judy Blume, John LeCarre and so on. Here’s a plain English overview of how the law works and why (for now at least) we’re likely to see literary types negotiate rather than litigate.
The law in question is Section 203 of the 1978 Copyright Act which allows authors to cut away any contract after 35 years. Congress put it in place to protect young artists who signed away future best sellers for a pittance.
“People have had 2013 circled on their calendar for a while,” said Andrew Bart, a copyright lawyer at Jenner & Block, in a phone interview.
Termination rights are not a new idea and have been the subject of famous court cases involving John Steinbeck, Lassie and Superman. The difference is that these older cases are based on a pre-1978 law that often required an author to exercise renewal rights which, in many cases, the author had signed away.
The new law has fewer such loopholes and will also mean that what has been a drip-drip of old copyright cases could turn into a flood as nearly every book published after 1978 becomes eligible for termination.
The 1978 law also means a threat to the back list of titles that are a cash cow for many publishers. The threat is amplified as a result of new digital distribution options for authors that were never conceived when the law was passed — these new options mean authors have more leverage to walk away from their publishers altogether.
Publishers contacted for this story were reluctant to discuss termination rights and several sources said they want to deflect attention from it. That may not be possible for much longer.
“Grist for the Litigation Mill”
Even by the standards of copyright law, the author reclamation rules are a messy cat’s cradle of ambiguous rules and technicalities. The math makes your head spin.
For instance, authors have a five-year window to exercise the right but must also provide advance notice at least two years but no more than 10 years beforehand. For 1978 authors — who are eligible to reclaim in 2013 — the window is already closing.
It’s unclear how many understand the rules. Several literary agents contacted for this story appeared to be unaware of how they worked or even of their existence. This is not true of copyright lawyers, some of whom are rubbing their hands at the prospect of a legal trainwreck.
“This will provide grist for the litigation mill,” said Bart, comparing the law to the 1999 safe harbor rules that tied courts in knots for a decade.
For musicians, the reversion rights issue has spilled into court already. Since last year, studios have been claiming that the lead singer of the Village People is ineligible to reclaim copyright. The studios argued the music is an ineligible “work for hire” and that the whole band — as joint authors — must together trigger the termination. The arguments have failed so far as the first judge to hear them sided with the singer in May.
While the “right to hire” issue may not affect most book authors (who are typically not employees), it may affect some of the country’s most famous writers.
Copyright lawyer Lloyd Jassin says that some publishers may try to pull a legal ace from their sleeve by pointing to the personal corporations that prominent authors use to license their work. These corporations mean that — technically at least — the author may be ineligible since they are employees of the corporation not authors.
Another potential flashpoint for famous authors is what happens to film and merchandise rights if they reclaim copyright. While the law lets studios keep rights to films that are already made, it’s less clear who controls sequels and individual characters.
A Bomb or a Bargaining Chip?
The long awaited (and dreaded) new termination regime kicks in for real in just over a month. For now, though, it’s still too soon to say if the rules will denude backlists in a big way. A cursory search of the copyright registry suggests that termination notices have yet to flood in (copyrights are public records and a termination and transfer would have to be recorded).
This quiet may mean that many authors are simply unaware of their option to have a second bite at the apple. Or it may mean that quiet negotiations are taking place behind the scenes. While authors have the option to bolt their publisher, many may prefer to simply seek a sweeter deal rather than fly solo or risk triggering a lawsuit. And, as Law360 notes (sub req’d), there may be only a relative handful of works that are valuable enough to justify expending millions in legal fees.
Finally, via Hawes.com, here is a list of the New York Times bestsellers from November 1978:
1 WAR AND REMEMBRANCE, by Herman Wouk
2 CHESAPEAKE, by James A. Michener
3 FOOLS DIE, by Mario Puzo.
4 THE FAR PAVILIONS
5 SECOND GENERATION, by Howard Fast.
6 PRELUDE TO TERROR, by Helen MacInnes
7 THE EMPTY COPPER SEA
8 EVERGREEN, by Belva Plain.
9 ILLUSIONS, by Richard Bach.
10 EYE OF THE NEEDLE, by Ken Follett.
11 BRIGHT FLOWS THE RIVER, by Taylor Caldwell.
12 THURSDAY THE RABBI WALKED OUT, by Harry Kemelman.
13 THE SILMARILLION, by J.R.R. Tolkien.
14 WIFEY, by Judy Blume. (Putnam’s, $8.95.)
15 SCRUPLES, by Judith Krantz.
1 IF LIFE IS A BOWL OF CHERRIES — WHAT AM I DOING IN THE PITS?
by Erma Bombeck.
2 A DISTANT MIRROR, by Barbara W. Tuchman.
3 IN SEARCH OF HISTORY, by Theodore H. White.
4 THE COMPLETE BOOK OF RUNNING, by James F. Fixx.
5 AMERICAN CAESAR, by William Manchester.
6 THE SNOW LEOPARD, by Peter Matiniessen.
7 THE WOMAN DOCTOR’S DIET FOR WOMEN, by Barbara Edelstein, M.D.
8 GNOMES, text by Wil Huygen, illustrated by Rien Poortvliet.
9 A TIME FOR TRUTH, by William E. Simon.
10 ROBERT KENNEDY AND HIS TIMES, by Arthur M. Schlesinger, Jr.
11 PULLING YOUR OWN STRINGS, by Wayne W. Dyer.
12 THE COUNTRY DIARY OF AN EDWARDIAN LADY, by Edith Holden.
13 THE ONLY INVESTMENT GUIDE YOU’LL EVER NEED, by Andrew Tobias.
14 JACKIE OH! by Kitty Kelley.
15 PURE AND SIMPLE, by Marian Burros.