Textbook Licensing: Where the Clean-Up Meets the Cover-Up

Posted on 10/26/2010 by Dan Nelson and Kevin P. McCulloch | Printable Version | Comments (0)

Many stock photography professionals remain largely unaware of the widespread and institutionalized practice of copyright infringement that plagues the textbook licensing industry.  The dual purpose of this article is to provide a brief introduction to this phenomenon and, in doing so, to help alert photographers, vendors, and other stock photography professionals to the fact that major U.S. textbook publishers have been—and, indeed, still continue to—systematically infringe third-party copyrights in photographs that they use in textbooks and various other materials.  We also will explore some of the various factors that allowed this situation to occur and go unnoticed, despite being an industry-wide practice that has given rise to some of the most egregious cases of copyright infringement in recent memory.
 
Enticed by the ease of technology, several major textbook publishers have made it their policy—often without the knowledge or consent of the licensor or copyright owner of third-party content—to retain the high-resolution digital files of photographs licensed for their programs.  Despite this burgeoning trend, most publishers have been slow to adapt or develop technology to guarantee proper rights management of the photographs now being maintained in these databases.  As a result, publishers remain in possession of an enormous volume of third-party photographic content, but do not have any systems or policies in place to guarantee that the required rights are secured before this content is included in future textbooks or other materials.  Perhaps even more troubling is that this problem persists despite the fact that the original licenses governing much of this content were limited to particular publications or editions and, in many cases, made clear that additional permission (and payment) was required before any additional or subsequent uses could be made of these images.
 
Simply put, textbook publishers have acquired vast amounts of third-party content, but have been woefully deficient (and, in some cases, intentionally so) in creating the systems and developing the policies that are required to manage the rights for these images.  As these archives of third-party content grew, publishers often succumbed to the temptation to use them as a source of material for new projects without securing the necessary rights to do so.  Photo editors routinely searched these databases and selected third-party photographs for new programs.  As a result, many major textbook publishers routinely failed to make the considerable effort needed to secure additional permission to use these images before including them in new textbooks.


 
Because publishers failed to develop the necessary rights-management infrastructure to expeditiously seek licenses for such uses, several unacceptable problems emerged.  Many photographs were published with no permission, and none ever granted subsequently.  Many thousands of photographs were published prior to any permission being granted.  And many thousands were exploited in excess of the print run limitations spelled out in license agreements.  Publishers routinely sent third-party copyrighted material to the printer without permission to use it, and then never received permission for that use or surreptitiously sought retroactive permission under the guise of forward rights.
 
In many cases, the surreptitious requests for retroactive rights included misleading (and oftentimes outright fraudulent) language that gave vendors and photographers the impression that only prospective rights were being requested.  These stealth retroactive license requests, as they have come to be known in the cases against these publishing companies, often use language that suggests that the publisher is “working on” a program, or they identify the copyright date as a  year or more out but fail to mention that the book already is in print and already is being sold to customers.  In many cases, these retroactive requests also are presented as seeking permission for an “extension” of the original print run, despite the fact that the copies already have been ordered, printed, shipped, and sold.   Such tactics obviously are intended to create the illusion that the publisher has not already infringed the content owner’s copyrights.  When confronted with such requests, many vendors and photographers (understandably) are duped into signing agreements that the publishers now claim release them from liability for these egregious and fraudulent practices.
    


Despite repeatedly being confronted in litigation about these questionable practices, major textbook publishers continue to toe the line between the clean-up and the cover-up, surreptitiously seeking retroactive permissions and trying to run out the clock on old infringements.  By organizing these questionable practices into some basic categories, we can better understand the immense scope of the problem and, hopefully, begin to develop some practicable and just solutions.
 
Archiving

With the advent of technology allowing publishers to retain and easily search high-resolution digital files of third-party content, major publishers began to stockpile literally tens of thousands of photographs that they did not own, regardless of whether they had obtained the rights to do so.   These archival databases were designed to allow photo researchers to easily review and select images for upcoming publications, but they did not always include the sophisticated detail that is necessary to ensure effective rights management.  As a result, photo researchers could easily access third-party content from other programs and incorporate such photographs in new books, but did so without the knowledge or consent of the copyright owner.


 
Consolidation of Permission Departments

Most major textbook publishers, in addition to acquiring their smaller competitors, also have begun to consolidate their permissions departments.  While such a move allows for coordinated and centralized permissioning, it has highlighted the central problem that permeates the industry:  the tug of war between the clean-up and the cover-up.  While different publishing companies have taken different approaches to the problem, the one thing that appears to be consistent across the industry is a lack of fair dealing vis-à-vis photographers and vendors in whatever efforts are made to “extend” or “true up” licenses.  Publishers almost never volunteer that they already have exceeded the scope of their license, or that the unauthorized use already has taken place.  Instead, most publishers either do nothing, hoping the passage of time will absolve their liability for infringement, or they engage in some form of stealth retroactive licensing.

Print Overruns

The problem of print overruns in textbook licensing has become the most widely understood copyright problem affecting the stock photography industry.  In order to obtain rights as cheaply as possible, publishers traditionally have sought permission to print relatively few books, but then printed as many as they required.  The scope of this practice is astonishing.  In many cases, the major publishers have printed millions of copies of books containing third-party content, despite the fact that the governing licenses permitted only tens of thousands of copies.  Because this egregious practice is so widespread, there are literally tens of millions of books in print for which these publishers never sought or received permission to use all of the third-party content.  In many cases, publishers never seek to “true up” these licenses unless there is a future business reason for the extension.  As a result, most copyright owners whose images appear in these books remain unaware that the publisher exceeded the permission granted, let alone that courts considering the issue repeatedly have held that exceeding the authorized print run constitutes copyright infringement.  In the few cases where publishers have sought to “true up” their print overruns, they nearly always do so without disclosing that the print run already has been exceeded and the license already has been breached.

Non-Permissioning

A lesser known issue in the industry involves straightforward unauthorized use of third-party content.  It is extremely difficult to determine how prevalent this practice is in the industry, but it is certain that major publishers have printed books containing third-party content for which they never subsequently sought or obtained permission to print.  This is one of the most insidious of the bad business practices in the textbook publishing industry.  The Copyright Act creates a monopoly in favor of the copyright owner to control the manner in which their copyrighted material is (or is not) published.  Retaining third-party content, usually without the knowledge of the content owner, then publishing that content in books without the knowledge or consent of the copyright owner flies directly in the face of the founding principles of the Copyright Act.

Late Permissioning

Nearly as troubling as non-permissioning is the problem of late permissioning.  We use the term “permissioning” loosely here, since an unwitting victim of a stealth retroactive license request is not truly granting permission.  Nevertheless, prior to the consolidation of permissioning departments at major textbook publishers, most permissioning was done by design and production departments.  As a result, permissioning largely took a back seat to production, resulting in countless programs for which files were sent to the printer before permissioning was complete.  This obviously resulted in non-permissioning, but it also resulted in widespread late permissioning, where permission was sought only after publication.  This too constitutes flagrant infringement of an author’s exclusive copyrights.

Conclusion

Despite this being one of the biggest rights grabs of third-party content in recent memory, publishing executives and photographers remain largely oblivious to these insidious business practices.  It is understandable, albeit unacceptable, that the publishing industry would attempt to conceal from the stock photo industry its enormous liability for infringing third-party copyrights.   As the struggle continues between the cover-up and the clean-up, largely in secret and under bogus claims of confidentiality, a shadow has been cast on the entire textbook publishing industry, and that industry’s respect for the copyrights of creative professionals remains in serious doubt.


Copyright © 2010 Dan Nelson and Kevin P. McCulloch. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-461-7627, e-mail: wvz@fpcubgbf.pbz

Dan Nelson is the founding partner of Nelson & McCulloch LLP and represents professional photographers in copyright litigation.  He can be reached at dnelson@nelsonmcculloch.com or at (212) 907-6677. Kevin McCulloch is the managing partner of Nelson & McCulloch LLP’s Washington, D.C. office.  He can be reached at kmcculloch@nelsonmcculloch.com or at (703) 351-5281.

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