The budding e-book controversy

At that time, Random House comprised nearly half the American book trade through imprints such as Random House, Knopf and Crown. Today, after the absorption of Bantam, Doubleday and Dell, its market share is even greater.

Unlike Simon & Schuster and other competitors, Random House had not updated its contracts to reflect contemporary issues and had failed to secure any author's grant of electronic or interactive rights for any book published.

Worse still, for a trivial monetary advance, it had transferred electronic rights in perpetuity to one of the few properties it owned outright--its prestigious dictionaries, future editions and successor and derivative works--to Dick Brass, currently Microsoft's vice president for new technology.

Today, Random House's lawyers are trying to stretch the definition of the word "book" in order to justify a grab of author's rights.

A decade ago, Random House's in-house lawyers were working the same scam with another catch phrase, "mechanical reproduction rights," which to them meant everything, including everything digital, electronic or interactive.

Random House's owners and management did not share the lawyers' aggressive interpretation, and I was very careful to secure additional signed, specific grants of rights from authors for any of the electronic publishing projects I undertook at Random House which included, among others, the re-launch of the Modern Library, new editions of the Audubon Guides, interactive versions of the LA Times crossword puzzles, interactive Fodor's travel guides, electronic Random House dictionaries and encyclopedias, and best-selling titles in a variety of electronic formats, including "Jurassic Park" on the PowerBook and "The Civil War" on the Sony Bookman.

You may recall that at that time Random House was the property of the Newhouse family's Advance Publications and closely overseen by S.I. Newhouse. On many occasions, S.I. and I discussed specific questions of electronics rights arising both from use of text and from artwork and photographs.

He never gave me the impression of caring very deeply about the issue, even though the paranoia of professional photographers threatened the profitability of certain Random House imprints as well as most of the Conde Nast magazines. (No doubt, this attitude partially explains why photographers are still complaining about Conde Nast.)

Technology and the law
In any event, despite the efforts of task forces and committees, the revised standard Random House and Conde Nast contracts used in the mid-90s were still lagging behind contemporary technology and law.

Now Random House has a new owner: The closely-held-but-going-public-through-a-Belgian-backdoor Bertelsmann. The lawyers and owners have changed, but the Luddite arrogance remains the same. They assert ownership of "book" rights never foreseen, valued, or understood, let alone exploited, by any editor or publisher at Random House. Moreover, you can be certain that Random House only claims these extraordinary "book" rights for the works of authors whose agents are too weak or naive to have already negotiated their own revised standard contracts with Random House.

Like any other successful bully, Random House must choose its victims carefully. It harasses a relatively powerless start-up because it doesn't dare go up against the powerful agents who dominate trade publishing.

In fact, Random House's entire involvement in electronic publishing belies their current legal position. Its own contracts document that Random House always previously secured specific grants of electronic rights from authors for works they wished to exploit in electronic formats. They have very clearly not understood the term "book" to include these rights.

Authors who signed amended or additional contracts to cover electronic forms to my certain knowledge include Ken Burns, Michael Crichton, William Safire and the New York Times, the Audubon Society and the LA Times as well as the puzzle-writing team of Burstyn and Tunick.

With beautiful symmetry, where Random House has itself been the author of works licensed to others for electronic publication, it has defined such rights very narrowly in terms of form, platform, term and territory, as for example Fodor's guides or the Random House Dictionaries or Encyclopedia. Moreover, they have aggressively and successfully opposed any unilateral attempts of a licensee to extend the grant of rights in any way.

Why now do they assert that "book" includes existential modes of being very exoteric to Guttenberg and Caxton? Somebody smells some easy money somewhere, almost certainly mistakenly.

I hope that Random House gets the trouncing in court that their hypocrisy and bullying so richly merit, but they probably won't. It's all a calculated risk, after all, and when you're nearly the only game in town what does it matter if you offend some mid-list authors and their agents?