The HarperCollins Lawsuit: Keeping Authors Aboard As Traditional Publishing Sinks

HarperCollins v. Open Road

In March, the U.S. District Court for the Southern District of New York, sitting in Manhattan, handed a victory to HarperCollins in its lawsuit against Open Road Integrated Media over the e-book publishing rights of Jean Craighead George’s award-winning children’s novel, Julie of the Wolves (1972). This “victory” for HarperCollins, however, highlights for authors one of the perils of pursuing the traditionally published route: desperate publishing corporations will stop at nothing to make sure “its” authors go down with the ship.

Let’s start with the facts of the case:

  • In 1971, author Jean Craighead George signed a contract with HarperCollins (then Harper & Row) to publish Julie of the Wolves “in book form” for a $2,000 advance (just over $11,000 in today’s dollars) and royalty payments between 10-15%.
  • Although the grant of publishing rights was in Paragraph 1, the contract also contained a provision (Paragraph 20) that said: “the Publisher shall grant no license without the prior written consent of the Author with respect to the following rights in the work: use thereof in storage and retrieval and information systems, and/or whether through computer, computer-stored, mechanical or other electronic means now known or hereafter invented and net proceeds thereof shall be divided 50% to the Author and 50% to the Publisher …” (Emphases mine.)
  • The contract between George and HarperCollins also had a “reserved rights” clause that reserved to George “[a]ll rights in the Work now existing, or which may hereafter come into existence, not specifically herein granted.”
  • In 2010, Open Road, an e-book publisher founded in 2009, offered to publish the e-book of Julie of the Wolves for a 50-50 royalty split with George. George approached HarperCollins to see if they would match the royalty. HarperCollins wanted to publish the e-book, but insisted on giving George a meager 25% royalty for the Newbery-award winning novel.
  • In 2011, George contracted with Open Road to publish Julie of the Wolves in e-book form, which sold around 1,600 copies.

Spurned, HarperCollins filed a lawsuit against Open Road for copyright infringement on December 23, 2011.* George, who passed away in 2012 at nearly age 93, was never a party to this lawsuit, even though interpretation of the contract between George and Harper Row—whether it assigned e-book publication rights (in 1971!) and whether it was breached—was key to this dispute.

Clearly, through the 1971 contract, George had granted HarperCollins the right to exploit the copyright through printed publication. But now a federal court in Manhattan, in granting the Plaintiff-HarperCollins’ motion for summary judgment, has determined that the 1971 contract also covered later-developed ways of exploiting the copyright (“new uses”).

The Southern District of New York opinion, available here (PDF), is disappointing.

In law school, property rights are often referred to as “a bundle of sticks.” When you own something, you can grant another person some rights to that property while keeping others, or you can give them the whole bundle. There’s a big difference between granting all of the rights in the Work — which would be the whole bundle — and granting the right to publish a Work in book form. So, when a 1971 publishing contract gives rights to the Work “in book form,” that does not necessarily include the right to publish an e-book decades later.

Back in 2001, another judge in the same New York federal court found that a very similar contract (the publishing contract for a variety of works, including Kurt Vonnegut’s Slaughterhouse-Five) that granted a publisher the right to “print, publish and sell the work in book form” did not grant e-book rights.Random House, Inc. v. Rosetta Books LLC, 150 F. Supp. 2d 613 (S.D.N.Y. 2001), aff’d, 283 F.3d 490 (2d. Cir. 2002). Also, importantly, in George’s case, while the full contract has been kept confidential, we do know that the royalty schedule in paragraph 17 of the contract only discusses print forms, like “bound copies of the original edition” and “unbound sheets” and the “cheap edition” (an industry term to describe paperback editions), and a “plate royalty” for books sold by a book club.

To me, those two points largely answer the question in this case: the “book form” referred to in George’s contract meant printed versions of the Work, and nothing more. Rights to everything else were “reserved.”

But the Court held exactly the opposite, concluding “the e-book format constitutes a permissible extension of ‘book form’ via ‘storage and retrieval and information systems, and/or whether through computer, computer-stored, mechanical or other electronic means.’” That language comes much later in the agreement, in Paragraph 20 of the contract (see “facts section” above).

The phrase “and/or whether” in Paragraph 20  isn’t just bad English, it’s bad legal writing as well, and the parties and the Court spent a long time debating what that language could possibly mean, with the Court concluding that “and/or” somehow trumped “whether” and the rest of the contract.

To me, regardless of how the “and/or whether” question is resolved, the overall point of Paragraph 20 remains clear, particularly when viewed in the context of the technology available in 1971. HarperCollins’ memorandum of law gives some examples of what those “storage and retrieval and information systems” could be: in 1969, MIT created “an experimental computer system for accessing the full text of 10,000 journals,” and in 1971, Project Gutenberg was set up to “create electronic books of public domain works that would be stored, retrieved and read on computers.”

That seems to be what the contract was getting at: if the publisher wanted to put the text of the book in some sort of electronic database (either then known or later invented)— which under copyright law would require its own separate license — then George had the option of saying “no” or of receiving 50/50 royalty.

I disagree with the Court that a reference much later in the contract to antiquated database systems is the same thing as an e-book license — indeed, from the 1990s onward, HarperCollins’ own contracts drew a clear distinction between rights relating to e-book versions and rights relating to information storage systems — but even if we assume that Paragraph 20 granted HarperCollins publishing rights in the e-book form, it requires a 50/50 split. That would just mean HarperCollins breached their agreement with George by refusing to publish the e-book form unless she accepted a 25% royalty instead of the 50% royalty required by the very same sentence they claim covers ebooks.

Apparently, it seems to be the norm for publishing corporations to present their authors with the choice to either accept a 25% royalty for e-book publication (regardless of the royalty on the page) or not have their novel published as an e-book at all (even though this would mean that the publisher has failed to “exploit the copyright,” probably breaching its obligations to the author).**

In You Can’t Buy That! The Great E-Book Royalty War, Salon writer Laura Miller explains that publishing corporations insist on the 25% royalty even though e-book production costs are limited. As she points out about George’s book in particular:

[I]t’s unlikely that HarperCollins is still paying off the cost of editing and promoting “Julie of the Wolves,” a title that has sold 4 million copies in print since it was first published 41 years ago. It’s also unlikely that they’d be doing much to promote the e-book if they did publish it, since publishers tend to concentrate those resources on new titles.

At the end of the day, this case suggests that one of the ways big publishers are trying to stay afloat in the current market is by holding e-books of popular authors for ransom, a strategy that has now been blessed by the Southern District of New York.

The shaky legal reasoning in the HarperCollins v. Open Road Media court opinion will likely do nothing but encourage publishing corporations to threaten authors with years of litigation if they dare to try to bargain for even equal treatment (such as a 50-50 split) for “new uses.”

So, what are the lessons from the HarperCollins lawsuit?

Well, if authors have any bargaining power at all, it may be worth it to consider the possibility of limiting copyright grants to ways of distribution known at the time of the contract. However, a better course of action may be to avoid traditional publishing entirely.

*By the way, Jane Friedman, cofounder and CEO of Open Road, had actually been the President and Chief Executive Officer of HarperCollins Publishers Worldwide. I remember having seen Friedman quoted in George Packer’s Cheap Words piece in The New Yorker, which I criticized in my post, What’s Troubling About Amazon?.

**The entire contract isn’t available for public view. So, apart from the paragraphs discussed in the court opinion, I don’t know what the terms are.



  1. The incredible part to me is how, given the extraordinary length of copyright protections, this is a problem that will likely outlive us. Consider just this book: it will remain copyright protected until 2067! Or consider works first published literally today; they will have contracts that discuss e-books specifically, but which make no reference to any of the technologies that will be developed over the next few decades.

    To me, it really boils down to: did you sell all of your rights or only some of your rights? If you sold all of them, then the publisher gets control of all these new uses. If you only sold some of them, and otherwise preserve the rights to yourself, then you get them.

    Simple, and I don’t see why courts are bending over backwards to invent reasons why publishers should own things they didn’t bother to pay for. If they wanted Ms. George to sell all of her rights to all forms in the future, I’m sure they could have done so by bumping the advance up to, I don’t know, maybe the exorbitant, incredible, luxurious sum of $4,000.

    1. “I’m sure they could have done so by bumping the advance up to, I don’t know, maybe the exorbitant, incredible, luxurious sum of $4,000.”

      Ha! The whole saga makes the publisher look cheap and exploitative. If this is how they treat an established, popular author, there really isn’t any hope for anyone else. Thanks for the comment!

  2. Thanks for this. I’m one of the lucky underdogs, in that my husband is a contract attorney and can read and understand ambiguous fine print. I’ve had friends who are battling with publishing companies concerning all sorts of issues because of blurred areas of fine print. I saw this originally on Lee Fullbright’s reblog. Appreciate the post! Paulette

    1. Thanks for stopping by! You are very lucky to have a contract attorney on your side. That definitely helps. Let’s hope that future courts won’t follow in the footsteps of the HarperCollins v. Open Media court. I can’t believe that the judge granted summary judgment to HarperCollins based on the terms of that 1971 contract.

  3. Sad, whatever the legal merits of the case. It seems to me HC took this action simply to hammer home their position. With an in-house lawyer it will have costed them nothing and amounts to legal bullying.

    1. I can’t believe that HarperCollins insisted on a 25% royalty when the contract, to the extent it could possibly have included e-book rights, required a 50% royalty! This definitely seems like the behavior of a desperate company.

  4. Nice post!

    I completely agree with your view. I doubt that any publishing contract from 1971 would have been referring to a technology that *may* have only been present in an episode of Star Trek.

    I’ve read a lot of things this year that depict traditional publishing in a negative light and they definitely have me leaning toward skipping the querying process and just self-publishing my future work. Someone with clout can probably get a fairer contract with a traditional publisher, but I think the eligibility pool is pretty small.

    1. Thank you! I don’t see much of a benefit to traditional publishing these days, though I can’t say my observations come from personal experience. I’ve never attempted the querying process, and I don’t plan on doing it.One of the biggest drawbacks of traditional publishing is how much control they exert–either explicitly through the contract or implicitly–on the author. For example, I can’t think of a single traditionally published author who writes a blog or tweets anything worth reading (except for those who are very well established). It’s like they’re too afraid to say what’s on their mind. Most of their social media presence is either promoting their own book or books by the same publisher. It’s kind of creepy.

  5. Very interesting, and underscores how greedy traditional publishing companies can get when it comes to ebooks. These days, I’d recommend authors get trad published a time or two (and not necessarily with the Big Six) to see how the process works, then seriously consider self-publication. The former gives you confidence in your writing, the latter assures you the highest royalty rate possible.

    1. Sounds like good advice to me, though I don’t plan on querying (if I decide to actually publish any of my manuscripts). One of the drawbacks of traditional publishing that concerns me the most is how much control the publishing companies exert through the contract (either explicitly or implicitly). Do any newly published or less well-established traditionally published authors (who plan on continuing to be traditionally published) write blogs worth reading? If so, I haven’t found one. They only talk about their own books and books published by the same company. It’s like these traditional publishing companies found authors who were interesting enough to be published and then made them the most boring people on earth! Yeah, I’m definitely not interested.

  6. Maybe the lesson is self-publishing and the books go the way of the dinosaur. Just kidding, but it seems with all the restrictive and binding contracts – all that authors are left with is to go along or not to get the work out to the masses. It is all so confusing to me. Do you think these lawsuits got more common since the advent of the web? I think publishers are quaking due to the easy access to and reprint of author’s work. I agree with the publisher though on e-books. They are books and I thought the same thing you wrote on “storage and retrieval”. Glad I am not an attorney. Too much head swimming.

    1. Hi Donna! Even if e-books would count as being “in book form”–even though it’s a technology that didn’t exist in 1971 and wasn’t mentioned in the contract–then the publisher breached the contract with George by insisting on the 25% royalty. They were so greedy, and I can only assume it’s because they’re desperately trying to evolve into birds but seem to be going the way of stegosaurus! Thanks for the thoughtful comment!

  7. I had wondered why some of the books I read as a kid haven’t shown up as ebooks. It doesn’t make sense for publishing companies to require a 25% royalty when all the work was done decades ago. How do they justify it?

    1. Well, the e-book of “Julie of the Wolves” isn’t available anymore! Let’s hope its absence from the e-book market doesn’t last too long.

      As for how the publishing company justifies its greedy behavior, the best I can do is point you to Laura Miller’s article on (link is in the post): “Publishers counter that, while much of the cost of producing a book is loaded onto the hardcover edition, they do also need sufficient income from e-book sales to pay for the editors, designers, publicists and other marketing staff members (as well as overhead) required to bring a title to market, no matter the format. If the e-book edition subtracts from the potential sales of the new hardcover, then the e-book must help make up the difference.”

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