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Exclusive Rights for Exploiting Literary Works

Co-author, Gerald M. Levine

Publishers expect and demand exclusive rights for exploiting literary works. When lawyers talk about “standard” clauses and courts refer to publishing contracts as “standard agreements” it is not to suggest that there is a standard form such as we expect for certain real estate transactions. What we mean by “standard” is that the contract clauses address similar concepts of rights and duties expressed in language differently crafted by each publisher.  We will comment on the standard clauses from the Author’s perspective. The reason to emphasize the Author’s perspective is that publishing contracts are not negotiated from the ground up.  They are prepared by the Publisher and delivered to the Author as though ready for signature.  And, many Authors (some to their regret) sign without understanding what the contracts contain or what rights they are giving up.

The first of the so-called “standard” clauses in traditional publishing contracts is the Grant of Rights.  Depending on the business model the author will grant many of her rights for the term of copyright to a traditional publisher, fewer rights for a limited term to an ebook publisher, or retain all rights granted under the Copyright Act if she self publishes.

We start from the proposition that if a Publisher offers a contract to an author the rights it is bargaining for have significant economic value.  Contracts signed without negotiation are drafted primarily with the publisher’s benefits in mind and only incidentally with the author’s.  Publishers understand this and are generally amenable to making some contractual changes as long as the changes don’t undermine their economic interests.  

U.S. copyright law and the Copyright Act are never far from publishing contracts.  A logical beginning is to consider the following questions:

1.  What rights does an Author have that a Publisher would want to license?  And,
2.  Where do the rights come from?

The answers are in the U.S. Copyright Act.  Section 102 provides that “Copyright protection subsists … in original works of authorship fixed in any tangible medium of expression.  “Literary works” is the first of 8 categories of “works of authorship.” Other “authors” include composers, dramatists, choreographers, artists, sculptors, and architects.

Section 106 of the Copyright Act lists the exclusive rights granted to Authors.  The list is commonly referred to as a “basket of rights.”  The Author has the exclusive rights to do and to authorize others to

reproduce the copyrighted work
prepare derivative works
distribute copies to the public
perform the work and
display the work publicly  

This basket of rights is divisible, meaning that individual rights can be licensed separately.  Authors should resist giving Publishers every right they have.  There is no point, for example, in giving most Publishers “performance” rights, which they will not be able to exploit.  Most authors do not want to give up their right to prepare derivative works, yet some publishing contracts contain language that does just that.

At a minimum Publishers ask for the rights to reproduce, publish, distribute and sell a book to the public.  A “standard” Grant of Rights clause reads:
The Author grants to the Publisher the sole and exclusive right during the full term of copyright and any renewals or extensions thereof to exercise and license (i) the right to reproduce, publish, distribute and sell the full length Work in the English language in a product reproduced in print-on-paper or other physical media (“book form”); (ii) the right to use the full length content of the Work in the English language in electronic media; and (iii) the subsidiary rights to the Work specified below, in the following territories.

You will notice that the Grant of Rights clause contains six elements:
1.  The “sole and exclusive right” to exploit the Work;
2.  For the full term of copyright and any renewals or extensions;
3.  To reproduce, publish, distribute and sell the Work;
4.  HOW?  In “book form” AND in “electronic media”;
5.  The right to sublicense subsidiary rights; and
6.  All rights are to be exercised in stipulated territories.  

Under the 1976 Copyright Act the full term of copyright (if the contract is not terminated earlier) is the life of the author plus 70 years.  Publishing contracts also enumerate the Subsidiary Rights granted in a separate clause.  We will discuss subsidiary rights in another essay.

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