Appeals Court decision in writers' class-action lawsuit against periodical publishers

On August 15, the Second Circuit Court vacated the $18 million settlement of the "Literary Works in Electronic Databases Copyright Litigation" (formerly known as "Reed Elsevier v. Muchnick", and the class-action follow-up to "Tasini v. New York Times"). The Appeals Court decision sends the writers' class-action lawsuit against periodical publishers back to the lower Federal District Court for renegotiation or more litigation.

The appeals court ruling in this electronic-rights class-action lawsuit is based on the conflict between writers who did register their copyrights (the minority of writers) and those who did not (the majority). This decision is yet another chapter in freelance writers' 10-year struggle for payment for use of their work in periodicals' digital archives. Stay tuned.

An important Federal appellate decision was announced on August 15, 2011, in a copyright infringement lawsuit against newspaper and magazine publishers brought by the NWU and other writers and writers'organizations.  

This decision by the 2nd Circuit Court of Appeals is the latest episode in a decade of litigation that has followed the Supreme Court's decision in Tasini v. New York Times. In that case, print publishers were found to have violated the copyrights of freelance writers when the publishers purported to sell or license rights to distribute and access articles from their archives in electronic form, without paying or getting permission from the authors and without ever having acquired rights to use the articles other than in print form.

Following the Supreme Court's decision upholding writers' rights to control the electronic use of their work, the NWU and other organizations filed class-action lawsuits on behalf of all freelance writers who had contributed to the print editions of numerous newspapers and periodicals.

A settlement in the class action was agreed to and approved by the District Court in 2005. Under that proposed settlement, the publisher defendants would have paid writers a total of approximately $11 million plus legal fees.

Since then, there have been a series of appeals, with the case going first to the 2nd Circuit Court of Appeals, to the Supreme Court in 2010, and then back to the 2nd Circuit to consider a different set of issues. (The case was called "Reed Elsevier v. Muchnick" in the Supreme Court, and "In re Literary Works in Electronic Databases Copyright Litigation" in the District and Circuit Court decisions.)

In the latest ruling, a 2-1 decision upheld the objections of a group of writers led by former NWU staff member Irv Muchnick and overturned the District Court's approval of the settlement. The majority found that the "Class C" authors who had not registered their copyrights, the vast majority, had not been adequately represented. In particular, the court focused on the potential conflict (made real by a volume of claims that might exceed the total settlement fund) over how to divide the available money between the minority of writers who had registered copyright in their articles and the majority who had not registered their copyrights.

The judges noted that the "associational plaintiffs [which include NWU] advanced the interests of all authors, the largest contingent of which we can reasonably assume" are among the 99% of writers who had not registered their copyrights. Mindful of our continued responsibility to all of our members and to all of the writers affected by this class-action lawsuit, we are currently reviewing our options with our lawyers and with the other plaintiffs. We will be issuing further advisories to NWU members and other writers as the case moves forward.

Much has changed in electronic publishing over the decade while this case has been pending. Rights to electronic distribution of written works, including both newly published work and archives of work originally published in print form, have proven to be much more valuable than was generally recognized at the time the original settlement in this case was negotiated. And micro-payment systems such as those used for pay-per-view and pay-per-click online advertising have demonstrated the feasibility of tracking and paying compensation for individual page views of copyrighted content such as articles from the archives of print periodicals.

This decision underscores how important it is for writers to register copyright in all of their works, including even short articles. We believe that the requirement for writers to register copyright before they can sue for damages or collect statutory damages is unfair, and the sort of unnecessary "formality" expressly forbidden by international copyright treaties. That's why we have advocated for a change in copyright law, so that when periodical publishers register their copyright for an entire issue, all authors' (and other contributors) works would automatically be registered as well. And the copyright registration procedures, especially for frequently changed content such as blogs and other dynamic Web content, are unnecessarily confusing and burdensome.  We believe that any reform of U.S. copyright law should include abolition of the registration requirement or, failing that, substantial simplification and updating of the procedures for copyright registration, especially those applicable to works published online.

As long as the registration requirement remains in U.S. copyright law, however, we continue to advise all writers to protect their rights by registering all of their written work.

Links for more information

Decision by the 2nd Circuity Court of Appeals, Aug. 18, 2011

Initial report in Publishers Weekly

Additional analysis from Publishers Weekly

Analysis by law professor James Grimmelmann

PaidContent.org on the implications of the decision

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