Keeping Up With Media Law

The law moves slowly - as it should. Whether common law or statute, you want relatively stable rules of the road so you can live your life and do business with some degree of predictability. And when you're in the media - and pretty much everyone reading this blog is likely in the media - law becomes particularly important. You have a host of things that can come up:

• libel and defamation
rights of privacy and publicity of people you cover
• people suing because they took whatever advice you offered and didn't like the results
• infringement of intellectual property
• actual or simply alleged copyright infringement
• new potential uses of material, which means new rights to consider

That's just a start off the top of my head. However, the world does not move at the same speed of the law. Just a few years ago, you wouldn't have been able to talk about Twitter. Cell phone information delivery? Pretty new. Technology is stretching the bounds of where material can appear and in what context legal issues can arise. That's why I'd suggest reading Can the law keep up with technology? on CNN.com. There aren't many answers, but a lot of questions you need to be considering.

HP Competes with Google on Books - Only Smarter

Hewlett-Packard, which, aside from PCs, is a giant in imaging, is taking on Google on the book front and has thrown the gauntlet down via a partnership with the University of Michigan, one of Google's most important partners in its online book offering, because it has one of the great academic research libraries. First, check the story I wrote at BNET for the details. I really do think that HP has outsmarted Google on its own territory.

That's the view from the business and tech front, but let's consider what this means for writers. Remember that there's still wrangling over negotiations on the class action suit by writers and publishers. (I opted out, considering it a bad deal, so don't have a direct personal stake in it.) The HP announcement would seem likely to have a big impact on how the discussions are going:

• Google is going to point to this as proof that there is competition and that it's not closing things off.


• The writers and publishers should argue that the HP deal shows that there's no need to grab rights going forward.


• The judge might well see the HP deal as proof that handing over rights to so-called orphaned works (still in copyright but the rights holder difficult to ascertain or find) is bad from a market view because it would provide a sanctioned advantage to one company over another.

My short take, for whatever it's worth, is that the HP entry is going to do more to kill the rights grab than almost anything else that could have happened. On the balance, the argument becomes that there's no need for a special deal and that Google or any other company can clearly go into business looking at public domain works and that they don't need to have an extraordinary access to the intellectual property rights of individuals or organizations.

Furthermore, this gives Google a competitive kick in the rear. Since HP is doing it, why not Xerox, which is also big in imaging? Why not Amazon? IBM? It's a case where more is merrier, at least for those of us who own book rights. In fact, I'm wondering why some of the organized writers groups don't do something equal to HP's tactics. Instead of protesting, often long after the horse is out of the barn, some activity, create something practical instead. How about partnering with an Amazon or Barnes & Noble or Xerox or someone who might have the wherewithal to create a competing service. Think of it as an iUniverse that is actually effective - able to store scanned or reproduced books, create paper copies on demand, take and fulfill orders, split revenues. Negotiate with a few and use that as leverage to get a better deal out of one, rather than getting tied into an Amazon "you can have 35 percent" deal. That would be real activism, because it could be effective and makes the market system work for writers, rather than the other way around.

Image courtesy of stock.xchng user designkryt.

Harlan Ellison on Being Asked to Work for Free

If you're a writer, you need to listen to Harlan Ellison. This brilliant author and speaker (I had the pleasure to hear him lecture, if you can call what he does "lecturing," in college) has one of the best understandings of value paid for value received in the business. Much of his

"They always want the writer to work for nothing. And the problem is, there are so many writers with no goddamn idea that they're supposed to be paid every time they do something. ... I sell my soul, but at the highest rates, the highest rates. I don't take a piss without getting paid for it." Much of his industry reputation for being difficult is a direct reaction to his refusing to smile while being screwed. (Many who have worked with him have said that he's far more mensch than maniac.)

The next time you feel yourself weakening when asked to give more rights, take on spec, and otherwise bend over for the convenience of some corporation with an immense income and highly paid executives, listen to this.

Boondoggle in Google Rights Win? (Warning, Rant)

Google has finally settled a two-year-old law suit filed by the Authors Guild and five publishers. The topic? Infringed rights, of course, coming out of the company's scanning millions of library books and making them available for search. The plaintiff argument was that this was a new use of entire copyrighted works without permission.

Google is paying $125 million (making the settlement over unregistered magazine works seem like petty cash). Someone or other is supposed to establish a books rights registry, allowing people to view books in whole or in part and then enabling payment, whether from Google or the readers is unclear to me at the moment, to the rights holders. However, I'm a bit suspicious because $30 million of this settlement is going to setting up this registry.

I thought that there were at least two existing registries, one set up by the NWU and another by some combination of the Authors Guild, ASJA, and possibly others. And even if there weren't, $30 million to set this up? You could fairly comfortably fund a start-up high tech company for that period of time and get it running. This is very serious money. What the hell is it being spent on? This isn't someone else's money, folks. It's probably partly your money, if you write books. What transparency will there be in this new registry? Where is all the money going? Is Google doing all the tech work? (In which case, the $30 million becomes normal cost of doing business and hardly a win for anyone other than Google.)

By the way, this was also clearly a strategic win ... for Google. Going forward, people will buy books they want online and libraries will pay for access. Who gets 37 percent of the revenue? Google. Plus, there's advertising revenue and Google gets the same percentage of that. So for $125 million, it's probably nailed down many, many times more future revenue. This will turn out to be a pretty cheap business acquisition for them. That means the publishers and the AG have, through this negotiation, validated in a practical sense the business model of taking intellectual property of writers, making money off it, and then, if enough writers and publishers scream loudly enough, giving in just enough to keep what you established. Why should a company go this route? Because the publishers and writers are so determined to keep anyone from prying rights out of their hands that they aren't actively considering and pushing for new business models. In that view, this "victory" is completely Pyrrhic.

Reusing Material from WMFH Assignments

Some discussion on a writers' board centered on what degree of change was enough so that you could sell a piece originally sold under a WMFH contract, and then if the publication went out of business, did the rights return to the author, even if written under WMFH.

On the first question, I'd personally be wary of including ANY of the material written as-is under a WMFH contract in any other piece. Under such an agreement, the publisher owns copyright and could sue you for using "its" material. You would need to toss the entire piece and start from scratch, although the information in your notes would be available (assuming you didn't sign those away, as some contracts require), and the quotes actually belong to the people you interviewed (it's best to ask if they mind being included in another piece, so you extend the implicit permission you had in the first place). But to take even some of the sentences? Not only would you be looking to lose in court, but you'd involve the second publisher and instead of burning a bridge, you'd reduce it to its constituent atomic parts.

On the second question, unless there is a clause specifically stating that you would get rights back in case the company went out of business - and I've yet to see a clause like that in all the contracts I've reviewed - then, no, you don't get anything back. If you sold your car to someone who then died without any living heirs, would you automatically get the car back? No, because you sold the property and no longer have a claim on it. It's the same with WMFH - you sell the intellectual property and no longer have any claim on it or any right to it.

It's the Archives, Folks

A story in Folio tells how National Geographic continues the argument that it can publish a software-enhanced CD version of the magazine without paying photographers additionally. The legal battle is going on 11 years, now. I won't recap the history; that's available at the link. However, I will note a specific paragraph:

“It’s the archive that’s at stake,” Angelo Grima, senior vice president and deputy general counsel for the National Geographic Society, said during a panel on digital rights at the Magazine Publishers of America’s Magazines 24/7 conference at the Hearst Tower Thursday. “We’ll go to the Supreme Court if we have to, because our archive is that important to us.”

Of course, this isn't just about photography. It's about "content." The real economic value of images or stories or graphics or video or audio is not the immediate market value of any single piece. No, it's having the collection - the entire collection - that is at issue. It is the collection that allows companies to sell rights to databases, to get advertising, to charge institutions for subscriptions. And every bit helps add to that value. That means the story you consider unimportant in the long run because it is timely, or short, or so specialized, has lasting value. Just because you don't grasp the value of a piece of antique furniture doesn't mean that you should toss the Louis XIV chair. No, you find out the value, and then figure out what you want to do with that value.

I know this probably seems like an old and tired argument to most of you, but it's vital and we have to remember it again and again. What we create has value. People want it because it does have value, both on its own and in a given context. When businesses want you to give up lots of rights, even non-exclusively, it is because they want to make money off what you have done. Don't you think it's only reasonable that you also make money from it?

More on Movies, Net Profits, and Authors

Well, I've just been pointed to another LA Times piece that goes over the numbers a bit more:

• Olivia Goldsmith, author of The First Wives Club, was paid $250,000 for the movie rights, although worldwide gross for the film was reputedly $181.4 millon.


• Winston Groom was promised $350,000 and 3% of the net profit for the movie rights to Forrest Gump. He got ... $350,000.


• Alice Walker, who was supposed to get 3% of the gross for the movie version of The Color Purple, eventually got something, but only "a fraction" of what she thought she was owed.


• Art Buchwald sued Paramount Pictures for what he said was theft of the concept from his treatment for the idea of Coming to America. He won in court, after being told by the studio that although the movie grossed $350 million, there wasn't any money to pay net profits. Must have been a catered lunch or two that put them in the hole that completely.

The story has a great quote:

Ernest Hemingway once noted that authors should drive up to the California border and throw their books over a fence while studio officials throw bags of money back over the fence. That, he said, should be the end of the transaction.

Net Profits Screw Book Author

A studio taking advantage of an author - I know, it's hard to believe, eh? Thanks to a reader pointing to Sarah Weinman's blog, which pointed to this LA Times piece, we have a story of an author, Deborah Gregory, who wrote a popular line of books for girls: The Cheetah Girls. But when she signed on for a cut of net profits of the movies, CDs, DVDs, and even concerts that Disney has sold, she didn't realize she was also signing on for Hollywood accounting:

Her breezy, street-smart tales of five girls chasing pop music careers were turned into two hit television movies, and a third is now being filmed in India. Cheetah Girls CDs and DVDs have sold in the millions, and concert tours have hit more than 80 cities. Meanwhile, Disney's fabled merchandising machine flooded the market with Cheetah Girls shoes, dolls, toothbrushes, video games, backpacks, note pads, pillows, posters, T-shirts and the like.

Gregory expected to get a piece of the action when she signed a 2001 contract promising her 4% of the net from all of this activity. But like many other authors who have signed away dramatic rights, she says she never got a penny of the profits. Unlike screenwriters, who were backed by a strong union in their recently ended strike, most literary writers are at a disadvantage when negotiating with Hollywood. And it is difficult, if not impossible, for them to crack the safe.

According to the story, Gregory has seen $125,000 total in the last nine years. She's never gotten a "net profit participation statement" from Disney, although she's been asking. She lives in a studio apartment in Manhattan.

"This is an old, old story in Hollywood," said literary agent Nicholas Ellison, who has represented numerous clients in book-to-film negotiations. When studios are asked why an author has not received any net profits, he said, they often point to expenses that have grown larger than expected and contend that a hit picture has not, in fact, made money.

It's called "Hollywood accounting," and in some cases studios may be on solid ground, citing legitimate costs such as promotion and development. But in other cases, contracts contain definitions of "net profits" that make it all but impossible for an author to collect money that once seemed tantalizingly at hand.

No kidding. According to the WGA, 43 percent of Hollywood movies over the last five years were adapted from books, articles, and other writing. As Paul Aiken of the Authors Guild said, "The best advice we give is that you should try to get as much of your money upfront. You can't count on net profit deals for anything." And apparently the studios are ready to walk away from writers, including ones that aren't big names, because there are always other books available.

But don't think this is restricted to Hollywood. I've often found these "net profit" clauses in both book and magazine publishing contracts. Writers assume they're getting something real, rather than asking just what the hell gets taken out before you get to "net." It makes me angry - really angry - because this isn't some accident, or just a poor choice in wording, or even contract terms taken from some other kind of contract and assumed to be applicable, as happens often in publishing agreements. This to me reads as the deliberate intent to trick a writer into the assumption of getting one thing, while offering an opportunity to play with definitions to deliver a great big fat zero.

Let me ask you: Have you ever signed a contract that provided for participation in net sales through syndication, or licensing to overseas magazine titles? Now, I've known a couple of writers who have gotten extra money from Hearst, but other than those couple of cases, I've never heard of anyone getting money down the line.

This suggests that writers should absolutely push back on these net deals. Either the publisher isn't using the rights you grant and there is no money of which to get a cut, in which case this is opportunity wasted, or they do make sales and come up with ways of not paying. Do you ever get notification of other sales? Is there a clause, as in the book publishing business, where you could audit them? Nope, and I'm betting that's for a reason, though I cannot bring myself to calling it good. According to the story, Gregory wrote 16 novels in the Cheetah Girl series, sold 2 million copies, and got $180,000 in advances. Think that's good? Do the math: it's $11,250 per book. You could write how-to series titles and probably do better. As for the pittance she saw from what Disney got, I guess their expenses were inordinately high:

The first movie was broadcast in 2003, drawing an estimated 6.5 million viewers on its first night; the second aired in 2006, attracting 8 million. Two CD soundtracks sold a combined 3 million copies. National concert tours in each of the last three years have played to sold-out crowds. Merchandise made by a flurry of companies who leased the rights from Disney began flooding into malls across the nation.

Hollywood is again courting Gregory over a new series she's written. And this time she's not depending on just her agent, which is William Morris these days, but is independently hiring an experienced entertainment lawyer to represent her interests. You and I can't do that with magazine contracts, so maybe a "get this out of the contract" approach is what is necessary. And if the publisher insists that it needs the rights, then tell them you want something in there about being able to audit the results and to get notification of when these deals happen. Oh, and a definition of exactly what comes out between gross and net.

More Deals With Writers & Why You Should Care

First David Letterman made a deal with the Writers Guild so he could use professional writing talent (and get stars to start showing up on his show again). Then came United Artists, which Tom Cruise is trying to revive. Now the Weinstein Company, a huge name in independent film, has signed an interim deal with the WGA. This has lessons for those writers who think that they always have to give in and have no power.

“We need to get people back to work,” Mr. Weinstein said of the agreement. He said executives of the major film and television companies — which broke off talks with the writers last month — had reacted “negatively” to his decision to reach independent terms. But Mr. Weinstein said he felt an obligation to help break the logjam that has shut down much of the entertainment industry.

Other production companies are seeking independent deals. The major studios haven't given in, but there is only so long they can hold out when companies that can and will produce film and television - and online entertainment - swoop in to pick up consumer dollars. The reason writers have felt that they have little power is that they have given it away by giving up.

As for another example of why to push for rights, there is this "tidbit" passed on from writer activist Debra Cash:

Presented by The JetBlue Card from American Express, Times On Air(TM) is the latest addition to our many in-flight entertainment options. Tune to channel 41 of our seatback TVs to watch lifestyle programming exclusive to JetBlue from the New York Times' library, including interviews with celebrities and influencers, home and garden segments, and travel tips.

As she notes, "...and they wonder why writers are striking over residuals for the as yet undetermined media of the future..." Actually, they don't wonder; the major corporations just want it all for themselves. Now is the time to keep pushing back.

The Future of Print Is ... Video

According to DMNews (the DM stands for direct marketing), Meredith is working with Comcast to launch Parents TV late this year. They want to hit all media and find new revenue resources, and understandably. Also understandable, though perhaps less desirable from the point of writers, is that the publisher wants to make use of the material is has:

“What we’re doing is either creating content based on our [magazine] editorial or creating content relevant to editorial,” he continued. “We’re not trying to do something outside the realm of the content we create on the editorial side – we just want to bring it to life. The programming won’t be about saying ‘Family Circle’ or ‘Parents,’ but it will be integrated into the content so people know the credibility is there.”

In copyright terms, this would be derivative content, as one is based on the other. It's a right that comes as part of copyright, and one that, sadly, may writers give away. There is a problematic mindset that many writers have: "If I don't already do something with it, or if I don't know what it means, then it must be OK to let someone else have it, because I wouldn't be selling it anyway."

Pull your head out of the sand and look around. Content has value, not just in its first form, but in the way people reuse it. Why? Because it saves them time from having to do all the work you might have undertaken to write it in the first place, and you have already come up with a unique expression of the ideas in your work. That has value, because otherwise a company has to pay to get all that done again. If you're giving away the right to create derivative works, consider that you're effectively handing people checks for sums to be deducted from your potential earnings. Also, this isn't stopping with Parents TV:

The launch of Parents TV is part of a larger Meredith strategy to extend branded content into new platforms. The company launched Better.tv in March. Comcast was chosen as a distribution partner for Parents TV because, McCabe says, it is the 2-to-1 leader in Video on Demand distribution.

Parents TV has already gathered a slew of advertisers, including Discover Card and Kimberly-Clark, makers of Huggies diapers. All programming will be ad-supported.

Meredith is offering custom-created content and product integration for Parents TV advertisers. However, McCabe insists that no infomercials will be made. Only if a product can be organically integrated, he says, without a negative reaction from consumers, will content be produced around it.

In other words, start adding zeros to those checks.

Simon & Schuster Blinks

From what the Association of Authors' Representatives (literary agent organization) and the Authors Guild are saying, Simon & Schuster is backing down on effectively elminating out-of-print rights reversion. The company had tried questioning the Authors Guild in a statement on Publishers Weekly, but apparently that was short-lived. Here's what the AAR had to say after having a few of its crew meet with S&S:

They informed us that S&S is investing a lot of resources in its digital publishing initiative, and their expanded efforts in conventional and newtechnologies will enable them to supply books to consumers in a variety of formats, including Print on Demand, electronic books, digital downloadable audio, online page views, et. al. Their goal is to keep books in print more effectively and to market frontlist and backlist titles more vibrantly.They have confirmed for us that they are agreeable to negotiating with agents a revenue-based threshold to determine the in-print status of a book.

That is certainly good news - and proof that if writers don't roll over, publishers are quite capable of backing down.

Electronic Rights Article

I recnetly saw a Mediabistro.com discussion about electronic rights where a number of people said they found the concept confusing. There's a good reason - they are confusing. So while I'm not a lawyer, I have put together my understanding of and research into the subject. You can check the Electronic Rights link under Writers Resources in the left hand part of the web page or just click here.

Authors Guild Warns of "Simon & Schuster Rights Grab"

I've had a number of writers pass on news of an Authors Guild warning about book publisher Simon & Schuster. You can see the original message, but here's the heart of it:

Until now, Simon & Schuster, like all other major trade publishers, has followed the traditional practice in which rights to a work revert to the author if the book falls out of print or if its sales are low.

The publisher is signaling that it will no longer include minimum sales requirements for a work to be considered in print. Simon & Schuster is apparently seeking nothing less than an exclusive grant of rights in perpetuity. Effectively, the publisher would co-own your copyright.

The new contract would allow Simon & Schuster to consider a book in print, and under its exclusive control, so long as it’s available in any form, including through its own in-house database -- even if no copies are available to be ordered by traditional bookstores.

This may be new for S&S, but this is hardly news. Book publishers have for some years have been redefining "out of print." If you have a recent book contract, look and see if there is wording to the effect that a book is in print so long as at least one version is available. Now see if you granted rights to create e-books or print-on-demand delivery or even more general "electronic" rights that a publisher can use to make a title capable of being searched through an online book seller (think Amazon) or search engine (like Google). If so, and if they've produced such a version, then you, my friend, are stuck - at least until 35 years go by and, under US copyright law, you rescind any previous license.

Reading and understanding contracts is a vital part of having a viable writing business. You can't just look for a checklist that someone provides you. No guidelines that have ever been produced yet can envision every single possible twist and turn that business models and, as a result, contracts will take. Don't rely on what other writers tell you or what agents suggest. Learn enough about publishing contracts to smell when something is fishy, and whenever possible, get a good publishing lawyer to review the document. If you won't go to any trouble to take care of your own affairs, you'll find that no one else will, either.

How Bad Publishers Are at Managing Royalties and Rights

I'm a fairly cynical guy when it comes to trusting what publishers do, but Art Hutchinson, a strategic planning consultant and owner of the Mapping Strategy business blog, managed to surprise me. He had posted an interesting take on a New York Times article about publishers not having a clue as to why some books sell better than others. I responded in a comment and his answer is a must read for book authors, or those who wish to be. Go to this link, scroll down, and see his post about how one major publisher only paid attention to royalties and rights for big-wig authors, and otherwise didn't worry about things.