On Fri, 26 Apr 1996 rtannehil[_at_]cas.org wrote:
>
> Does anyone know of additional information about the National
> Writers Union (NWU) and UnCover creation of a transaction-based
> writers' royalty system for electronic media?
>
> NWU is establishing the Publication Rights Clearinghouse (PRC) to
> handle the royalty system. (See Library Hotline, 22 April 1996).
Attached is the text of a recent article about Publication
Rights Clearinghouse, the new collective-licensing agency
of the National Writers Union, followed by PRC "Frequently
Asked Questions."
Irvin Muchnick
Assistant Director
National Writers Union
<irvmuch[_at_]netcom.com>
PUBLISHED IN THE SAN FRANCISCO DAILY JOURNAL
March 1, 1996
WRITERS HAVE COPYRIGHT SHIELD IN CYBERSPACE
By James Evans
Daily Journal Staff Writer
Free-lance writers, represented by the National Writers
Union, have created a legally significant and potentially
lucrative weapon in their battle with publishers over
copyright and revenue in cyberspace.
The union has established the Publication Rights
Clearinghouse, a central licensing agency for digital
distribution and photocopying of articles when the
copyright is owned by the authors instead of the
publishers.
The PRC is similar to the Copyright Clearance Center, which
primarily serves as a licensing organization for
publishers, and was central to one of the key court
decisions allowing for copyright payments for photocopied
materials, *American Geophysical Union v. Texaco Inc.*,
60 F.3d. 913 (1994).
In that case, the 2nd Circuit Court of Appeals ruled that
companies could not avoid paying for photocopying
privileges based on the impracticality of finding
individual publishers and authors when a structure existed
to make paying licensing fees convenient.
"No matter how much it's used at first, the mere existence
of the PRC is terribly important legally and politically
because it establishes that there is a market for digital
materials, and that we are, as a creative community, being
conscientious about these knotty problems in digital
media," said Irvin Muchnick, the union's Oakland-based
assistant director.
The PRC has signed a nonexclusive agreement with only one
company so far, but it is a big one -- UnCover, operators
of the largest article and journal database in the country.
UnCover recently was purchased by the Knight-Ridder Corp.,
which also owns the San Jose Mercury News.
On a quarterly schedule, writers will receive 30 percent of
the $8.50 that UnCover charges its customers for each
article. From that payment PRC subtracts administrative
costs of 20 percent for union members or 25 percent for nonunion
members.
Muchnick said he expected other companies to see how the
PRC conducted business before following UnCover. "Our real
target is the Information Access Co., owned by Thomson
Publishing in Canada," he said.
"We would like to get them signed on, but they haven't
responded yet," Muchnick said. "They keep pointing to their
license agreements with publishers, and we keep pointing
out that those agreements aren't valid because they include
licenses to material owned by writers, not publishers."
He added that he expected the PRC to have a favorable
impact on *Tasini v. New York Times*, 93-CIV8678 (SS), a
case in the U.S. District Court for the Southern District
of New York, involving the digital reproduction of work
owned by writers.
Local copyright counsel agreed that the PRC could change
the tide in the writers' struggle with publishers over
copyright in cyberspace.
"It's a good accommodation of the increasing tendency for
publishers to go on-line and take advantage of the
stratospheric demand for on-line publications, and at the
same time to protect rights of writers to be compensated
for their work," said Karl Olson, a partner at San
Francisco's Cooper, White & Cooper.
"If it's technologically feasible [to pay individual
authors], then it undercuts the argument that it's
impractical to do it," he said. "The PRC seems like a
marketplace solution that avoids legal problems that are
being fought in the Tasini case.
"I would think that both publishers and writers would
accept [the PRC] if they could avoid duking it out in
court," Olson said. "But the legal rules are being made up
as we go along in cyberspace, and to a large extent, they
will be shaped by what can be done technologically."
Roy S. Gordet, a San Francisco copyright specialist who has
represented the National Writers Union, said publishers
might not like the PRC because it removes an excuse for not
paying authors.
"In the Texaco case, companies couldn't say that it was too
hard to track down publishers, because there was a
structure set up," he said. "Similarly, in the PRC, there's
a structure in place, and it's intended to facilitate
licensing.
"The PRC is a starting point, and it will be improved,"
Gordet said. "The [Copyright Clearance Center] has signed
on big corporations that are concerned about getting nailed
for illegal copying."
David Hayes, head of the intellectual property practice at
Fenwick & West, said the PRC was an "important development"
that was necessary to realize the marketing potential of online
and multimedia products.
"Over time in both cyberspace and the multimedia industry,
we must have a central place to get clearances; otherwise,
?1;0cit's impractical," he said. "The CCC has worked well, but
it's more oriented toward business-type publications. The
PRC is more oriented toward writers.
"I believe there's room for both of them, and I certainly
think it's a good idea," Hayes added. "I definitely think
it has legal importance in light of *Texaco*."
Copyright 1996 Daily Journal Corporation
# # #
PUBLICATION RIGHTS CLEARINGHOUSE
Frequently Asked Questions
Q. What's the purpose of Publication Rights Clearinghouse?
- The immediate goal of PRC ("perk"), the new collective
licensing project of the National Writers Union, is to put
money into the pockets of freelance writers who have
articles listed and sold via UnCover, the largest magazine
and journal article database in the world.
Potentially, PRC also will strengthen our hand in the
larger political fight for writers' rights in new
technologies. This agency seeks to add options for working
writers in their struggle to get paid fairly for the reuse
of their material. Before long, PRC hopes to be licensing
writers' works to other companies, helping writers get
their due from electronic reuse.
- What's the genesis of PRC?
- PRC is the first victory of the NWU's Operation Magazine
Index (OMI) campaign, which is confronting companies
involved in the for-profit electronic distribution of
freelancers' magazine articles without their permission and
without their being compensated. Unlike other similar
companies, the management of UnCover (which was recently
acquired by media giant Knight-Ridder) responded to OMI by
opening negotiations with the NWU to establish the firstever
transaction-based writers' royalty system in this new
medium.
The same issue of "information superhighway robbery" is
the basis of Tasini v. Times, the landmark lawsuit filed in
1993 by NWU president Jonathan Tasini and ten other members
against six major publishers and database operators, and
now pending in U.S. District Court in New York.
Q. How do I get started?
- Fill out and return the enrollment license, along with
the initial copyright clearance fee. This enables PRC to
clear electronic rights for your back list of articles.
While PRC will endeavor to clear all electronic rights to
your works, it will license to online publishers only the
specific rights they require. (At present, in the case of
our first licensee, UnCover, those are non-exclusive fax
delivery rights. For details on the UnCover arrangement,
see the section at the end of this document.)
- How does PRC work?
- In the vast majority of cases, freelance writers control
rights to all uses -- print and electronic -- of the
articles they write. By custom and law, unless otherwise
specified in a contract, print publishers "buy" only the
right to print it one time, in hard copy. So if you haven't
otherwise signed away rights, you never need the first-use
print publisher's permission to profit from further uses of
your work.
With that principle in mind, PRC is inspired by the
music industry's American Society of Composers, Authors and
Publishers (ASCAP). But unlike ASCAP's, the revenue stream
for PRC is based solely on actual orders of works by online
computer users. As an alternative to having thousands of
writers individually licensing their periodical material,
with bookkeeping and monitoring headaches on both ends, PRC
licenses certain rights from individuals and then
collectively licenses those rights to electronic
publishers. PRC accumulates the copyright fees charged by
these publishers and distributes royalties on a quarterly
basis to our individual enrollees.
- How do I tell if I can legally license electronic reuse
rights to a particular article?
- The PRC staff will make rights clearance decisions,
based on the information you provide us. If you have a
contract for your original assignment from the magazine
publisher, we'll interpret it. If you don't have a
contract, we'll ask you to warrant that you never
transferred electronic rights to another party. If you're
unsure, we'll review the facts with you by phone.
Q1. I'm an NWU member. Am I automatically enrolled in PRC?
Q2. I'm not an NWU member. Can I still enroll in PRC?
- You must enroll separately in PRC even if you're already
an NWU member. And if you don't want to join the NWU, you
can still license your magazine and journal works through
PRC, but some fees may be higher. NWU members enjoy access
to the Union's grievance division, which has recovered $1
million for writers from publishers. The NWU also offers,
among other resources and benefits, training in its
Standard Journalism Contract and Guide to Book Contracts,
and access to an affordable group health plan.
- What does it cost to sign up?
- PRC's one-time initial rights clearance fee is $20 for
NWU members and accredited members of any creators'
organizations that have joined PRC as Associate Sponsors.
(Free Associate Sponsorships are currently available to
qualified organizations upon request.) For all others, the
initial rights clearance fee is $40. This fee supports
PRC's costs in researching and processing electronic
rights licenses to each enrollee's back list of articles.
- Does the enrollment license have an indemnification
clause, and should I be bothered by that?
- The National Writers Union urges writers to resist
sweeping indemnification clauses in their journalism
contracts, because those clauses often require the writer
to indemnify regardless of whether he or she breached a
warranty. The clause in the PRC enrollment license, by
contrast, requires the writer to indemnify only for actual
breaches (e.g., blatant misrepresentation of the rights he
or she controls). PRC itself is indemnifying UnCover for
claims of copyright infringement in the distribution of
text from PRC's licensed inventory. We'll take on the
necessary fights in interpreting vague or nonexistent
contract language, but we do need protection in the event
we're supplied with blatantly inaccurate information.
- I've written hundreds of articles. How can I possibly
deal with digging up the paperwork or warranting the rights
for all of them?
- We suggest you start with a group of your most recent
articles or with the ones you think might have the greatest
demand in the electronic marketplace. As we've explained,
PRC is designed to make the clearance process as painless
and streamlined as possible, but only you can supply the
threshold of information that will allow us to get started.
And collective licensing seems to be a potentially
significant source of revenue for writers in new
technologies.
- Can I market my unpublished writings through PRC?
- No. PRC licenses only articles previously published in a
magazine or journal.
- What about other electronic publishing ventures?
- PRC is a pilot project. We hope our early success -- in
combination with the pressure of the Tasini suit, our
organizing efforts, and the convenience of the
infrastructure we've created -- will allow us to make deals
with other companies and turn this model into the industry
standard for clearing rights on full-text databases, World
Wide Web sites, and other media of the future.
ABOUT UNCOVER
Q. How does the UnCover arrangement work?
- UnCover provides faxes of articles called up from its
online index. Each time UnCover faxes an article to a
customer, it adds to its own price a "copyright fee," set
aside for the rights-holder. For PRC's licensed inventory,
we have agreed on a copyright fee of 30% of UnCover's
delivery price. The copyright fee is transferred to PRC.
Before crediting the copyright fee to a writer's account,
PRC then deducts an administrative charge: 20% of the
copyright fee for NWU members, 25% for non-members.
Currently, in most cases, UnCover's delivery price for a
faxed copy of an article is $8.50, making the PRC copyright
fee $2.55 and the total price $11.05. If you're a PRC
enrollee and one of your licensed articles is ordered once,
you'll receive either $2.04 (the $2.55 copyright fee less a
20% administrative charge) or $1.91 (the $2.55 copyright
fee less a 25% administrative charge), depending on whether
you're also an NWU member. We see this arrangement with
UnCover as one model for deals between other online
services and PRC.
NWU member Non-member
enrollee enrollee
UnCover's delivery price $ 8.50 $ 8.50
to the customer
PRC copyright fee 2.55 2.55
Total price to the 11.05 11.05
PRC administrative .51 .64
charge (20% of (25% of
2.55) 2.55)
Royalty to writer 2.04 1.91
Q. Eleven bucks for a fax -- isn't that expensive?
- At the moment, UnCover caters to a specialized market of
researchers. The company plans to move soon into various
forms of cheaper online digital text transmission. Through
its carefully engineered rights-clearance mechanisms, as
exemplified by its agreement with PRC, UnCover expects to
strengthen its ability to market its content
electronically. The PRC-UnCover arrangement does
immediately result in lowering the customer's total price
for many articles from the current $11.50 to $11.05.
- My UnCover citation has a typo!
- You'll have the opportunity to correct errors in your
entries. UnCover has also agreed to begin working with us,
in the future, on a system for writers to suggest other
edits of their citations (including a one-sentence
abstract) and cross-references by subject.
- I've written a lot of stuff that isn't listed in the
UnCover index. Can PRC handle them?
- We can indeed. When you enroll, you'll first receive
back from us a list of your "hits" in the UnCover index.
But the purpose of that list is just to "jog your memory."
The UnCover database -- essentially the combined
periodicals collections of dozens of libraries around the
world -- covers some 17,000 publications, but the index
started only seven years ago and it has gaps. So we'll be
asking you to list for us all of your periodical works for
which you believe rights are available. This information
not only will help us get those works listed at UnCover as
quickly as possible, but also will generally expand PRC's
repertoire for deals with other licensees.
- What about my future magazine articles?
- UnCover will "flag" and notify us of all future
citations under your author name or names. In addition,
we're asking enrollees to notify us of their newly
published works and work with us to get their rights
cleared quickly.
We expect that in some cases your PRC leverage will create
opportunities for you to sell electronic rights to future
works to your first print publisher, rather than licensing
them through us. In those cases, of course, we'll notify
UnCover and other PRC licensees accordingly.
Received on Tue Apr 30 1996 - 00:28:33 GMT