Orphan Works

[PDF version available after the endnotes.  Copyright 2021 Tony Lima.  All rights reserved.]

Dr. Seuss was canceled on March 2.^[1] It started with numerous schools removing six titles from their reading lists. Eventually, the Dr. Seuss Foundation, holder of the copyrights, withdrew the titles from publication. Prices of those titles on Alibris.com soared to as high as $4,500.^[2] (More details about Alibris later in this article.)

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The issue I want to explore is whether copyright law should be changed to accommodate works withdrawn from publication. Stanford law professor Mark A. Lemley calls these “orphan works” in his very informative paper on this topic.^[3] I’ll summarize his thoughts later, as well as pointing out some problems.

The Banned Books

There’s a lot to unpack here, so be patient. Meanwhile, here are the canceled books. ^[4]

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These books are now deleted not only from school reading lists but from the Amazon bookstore. I don’t know whether Amazon will delete them from your Kindle (or the app). If that happens to anyone who reads this, please let me know. Also, you paid for that book. If Amazon deletes your copy, that is called theft. Amazon better credit you the purchase price.

To its great credit, Alibris will still sell you the Seuss books. Indeed, given the structure of the Alibris marketplace, it would be difficult to ban the sale of any book. If the company tried, they would probably face a rebellion from their sellers. Many of them are independent sellers, whether casual or professional.

Ben Shapiro (@BenShapiro) weighed in on this on Twitter,^[5] in his podcast of March 3, and probably in writing. Here’s the essence of Ben’s argument.

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Shapiro is suggesting changing copyright law to a “use it or lose it” rule, similar to trademark law.^[6] Aspirin was once a trademark of the Bayer Corporation. They allowed anyone producing acetylsalicylic acid in pill form to call their product aspirin. Failure to defend a trademark can result in losing legal protection for its ownership.^[7] Presumably, if the owner of the copyright to a work withdraws that work from publication, the work in question would lose copyright protection and become part of the public domain.

The Current Market for Orphan Works

But there are costs created by this proposal. Allowing unlimited publication of orphan works will have negative impacts on two market segments: those who own inventories and sellers who create markets for previously owned copies.

In the short run, there are existing inventories of the orphan work held by retailers (likely including Amazon). Owners of these inventories will probably see the market value of their copies fall. This would be a cost directly related to the proposed change. Perhaps the proposed change to copyright law should include an “if there are no objections” clause. This would give sellers with proven inventories of the orphan work the opportunity to delay entrance by a competitor. There should be some limits on these claims. My first reaction was to limit the number of copies held in inventory. For example, you must have more than 25 copies in stock to file a valid objection. But as a good economist, I realize that restricting quantity is likely inefficient. Perhaps the current market value of the inventory must be more than, say, $500.

In the longer run, competition is from the “previously owned” market. Prof. Lemley assumes this group is mainly used bookstores. While a few of those have survived, most of the market has moved to the internet. Amazon offers both new and used books, DVD’s, and CD’s. They own ABE Books, a large used book seller. But there is another company with a different approach that got its start on the web in 1999, about the same time as Amazon.^[8]

Alibris.com is a mixed marketplace.^[9] It includes independent sellers (casual and professional). But Alibris also is a retailer, selling books from its inventory. They offer books, music, and videos, many used. The independent sellers’ market is like eBay but with considerably more advice and assistance for sellers. Alibris collects a variety of fees from sellers. Buyers rate sellers and the average rating is posted on the website.^[10] Sellers can be kicked off the platform if their fulfillment rate falls below 85%. (The fulfillment rate is the ratio of orders filled successfully to orders placed by buyers.) But that percentage is a necessary, not a sufficient condition. A seller may go on vacation, mark his account as on vacation, then extend his stay while forgetting to update his Alibris calendar. In the case of Dr. Seuss books, some sellers were caught in a whipsaw. They listed their books on ABE and other sites. When the Seuss books were pulled from publication, a seller might get orders from one buyer through multiple outlets. Assume there were three orders. The seller has only one copy. Let’s just say right after the Seuss books were taken out of print, quite a few sellers took a hit on their fulfillment ratio. Luckily, Alibris seller services helped them through this situation.

One key difference between Amazon and Alibris is the dual role Amazon plays as both a publisher and seller of books. With their growing presence in producing video content, they are both publisher and seller in that market, too. In both markets they sell both real and virtual content. Books are sold as hardcopies and in digital format. Video content is streamed and sold on DVD. Alibris sells hard-copy content and has a provider that offers e-books.

Both companies, their competitors, as well as the remaining used book and record stores, are the ongoing competitors for publishers of orphan works. These companies have expert sellers and lots of experience. They have proven abilities to adapt as shown by their continued existence after about a quarter century in business. (Remember, these are internet years.) New entrants to a market like this should be well-capitalized and prepared to compete with experts.

Copyrights Owned by Dead Creators

Yes, you read that correctly. A copyright does not necessarily expire with its creator. The owner of a copyright can extend its duration after death by willing the intellectual property to an individual, corporation, or (in the case of Dr. Seuss) a foundation. Much of this stems from the Sonny Bono Copyright Term Extension act in 1998. Chris Sprigman discussed this in his delightful article “The Mouse That Ate the Public Domain: Disney, the Copyright Term Extension Act, and Eldred v. Ashcroft.”^[11] Here’s Mr. Sprigman’s colorful description:

Back in 1998, representatives of the Walt Disney Company came to Washington looking for help. Disney’s copyright on Mickey Mouse, who made his screen debut in the 1928 cartoon short “Steamboat Willie,” was due to expire in 2003, and Disney’s rights to Pluto, Goofy and Donald Duck were to expire a few years later.

Rather than allow Mickey and friends to enter the public domain, Disney and its friends – a group of Hollywood studios, music labels, and PACs representing content owners – told Congress that they wanted an extension bill passed.

Prompted perhaps by the Disney group’s lavish donations of campaign cash – more than $6.3 million in 1997-98, according to the nonprofit Center for Responsive Politics – Congress passed and President Clinton signed the Sonny Bono Copyright Term Extension Act.

The CTEA extended the term of protection by 20 years for works copyrighted after January 1, 1923. Works copyrighted by individuals since 1978 got “life plus 70” rather than the existing “life plus 50”. Works made by or for corporations (referred to as “works made for hire”) got 95 years. Works copyrighted before 1978 were shielded for 95 years, regardless of how they were produced.

Dr. Seuss’s first copyrighted work was^[12]

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Before the extension, the copyright on this work would have expired in 2027. The act extends protection to 2047. I’m no lawyer so I won’t offer a suggestion about whether ownership of the copyright by a foundation moves the work into the “work for hire” category. I doubt this very much.

A Legal Opinion

Enter Stanford law professor Mark A. Lemley.^[13] He explored the issues involved in copyrighted material withdrawn from publication. His recommendation is straightforward. The work withdrawn should have copyright protection removed. Anyone may publish the work without fearing legal consequences. If the copyright owner decides at a later date to reissue the material, copyright protection is reinstated. But there should be no penalty for those who published the material during the unprotected period.

I like this proposal. Despite several technical flaws,^[14] his paper is worth reading in its entirety. Let me summarize it.

Once upon a time, it was impossible to record television shows, movies, or live performances at any reasonable cost. The VCR and its VHS standard changed that for television and movies. Today anyone with a smartphone can shoot very high-quality video. In 2018 filmmaker Steven Soderbergh shot Unsane using an iPhone 7+. The following year he used an iPhone 8 for High Flying Birds, something of a popular success.^[15]

The point is straightforward. There are numerous legal opinions supporting the idea that once a book has been purchased, the owner is free to resell it. The same is true of recordings published with the approval of the copyright owner. When you owned a legal copy of a work in whatever format you could do just about anything with it except copy it. And there is a “right to record” described by Prof. Lemley on p. 3.^[16] Interestingly, later in his paper he seems to forget these decisions, writing^[17]

Perhaps we could avoid having content disappear by having consumers make permanent copies of their streams. But that’s not a satisfactory solution either. While consumers today can often make their own copies… it is less clear that they can do so without permission, and even less clear they will be able to do so legally in the future. While consumers own physical books, CDs, and DVDs and have the right to resell them,…. they probably don’t own digital downloads… and they certainly don’t “own” things they stream, like the songs in a Spotify playlist.

There is some confusion here. Ownership does not require the right to resell. Granted in most cases those two are inextricably linked. But that is not necessary. Since we’re changing copyright law anyway, why not include a “right to record with no accompanying right to resell?” (Perhaps “possession” would be more descriptive than “ownership.)

Prof. Lemley’s Errors

I’ll first summarize the technical problems, then use the summary to dive into the details.

1. He uses computer memory, disk storage, and bandwidth interchangeably. Memory is high-speed random-access computer memory. Disk storage gives slower access but with much greater capacity.^[18] Bandwidth measures the speed at which data can be moved from one user to another. Bandwidth is often the bottleneck when trying to connect computers separated by thousands of miles.
2. Digital storage media can include hard drives, optical media (DVD’s and CD-ROM’s), digital magnetic tape, and undoubtedly some media I have overlooked.^[19] One specific type of media I’ll reference is network-attached storage (NAS). These units are boxes with sophisticated hardware and software to manage the hard disks or solid-state drives mounted in the bays.
3. The copyright owner may not be the same as the publisher. This is common in the fiction segment of the book publishing industry. This may create a principal-agent problem. The publisher (the agent) may want to withdraw the work from its catalog while the author (the principal) may not like that idea. Standard author-publisher contracts may deal with this issue. I’ll leave it to others to sort this out.
4. Lemley appears to contradict himself. On page 3 he mentions legal precedents supporting the “right to record.” Later (page 10 and others), he seems to argue against the existence of such a right. I am not now, nor have I ever been an attorney so I may have missed some subtle distinctions.
5. While he deals with inventories held by publishers who entered the market during the period in which the work was withdrawn from publication, he fails to recognize the inventory problem immediately after the work is withdrawn. I discussed this earlier. And the solution to both problems is straightforward and identical.
6. On page 24 he asserts that “the world has moved to streaming services, so no one has DVDs to watch or rent.” This is hyperbole. I can give one counterexample. My household owns quite a few DVDs. Of course, we also have a good collection of vinyl records because we’re old. But the lesson is clear. If you like a work enough to read, watch, and/or listen to it repeatedly, buy it in a form that can’t be easily revoked by others.
7. Finally, there is a minor error on page 28 where he implies that updated software has no bugs. As my former colleague Alan Kuchek put it, “Mature software has no bugs. OK, we know that doesn’t exist. I define consenting software as software where the current version has fewer bugs than the previous version.

I’ll focus on items 1, 2, 5, and 6.

Streaming Media: A Brief History

Amazon Prime, Netflix, Disney+, Hulu, and many others supply streams of video content. But what if you want to watch Walter Hill’s 1987 classic Extreme Prejudice?^[20] After years of no streaming availability, Amazon will now charge you $5.99 to stream this title. But they’ll sell you a DVD for $7.99! Even Prof. Lemley’s example of a TV series you can’t watch, El Ministerio del Tiempo, is now streaming on Amazon.^[21] My long-time availability test is the 1960’s detective series 77 Sunset Strip. For better or worse, I still can’t find that title in any format.

Prof. Lemley is very concerned about the amount of storage video occupies. And with good reason. But I can put together a 40 terabyte network-attached storage device (full mirroring RAID, 20 tb available storage) for a little over $2,000.^[22] That’s a lot of storage.^[23]l A standard DVD (single side, single layer, called DVD-5) holds 4.7 gb and 133 video minutes. A DVD-9 (single side, dual layer) holds 8.5 gb and 240 minutes.^[24] That means 20 tb of storage will hold between 2,331 and 4,255 movies. That’s quite a lot. And the storage cost is between $0.49 and $0.89 per movie. (Calculations are in this Excel workbook.)

Additionally, Prof. Lemley is a little confused at how Netflix and Amazon work. Consider this:^[25]

Netflix may maximize its revenues by devoting a lot of server space to streaming Tiger King to many people rather than offering a wider array of content relatively few people are interested in and for which it has to pay minimum fees.

The professor has confused disk space with bandwidth. A good analogy is water distribution. There is a reservoir that holds the water. This is equivalent to disk storage space. There are also pipes that contain the water flowing to various customers. That’s the bandwidth. The storage is the stock of content, while the bandwidth is the flow to customers.

If many people stream Tiger King, that will take a lot of bandwidth. The amount of server space that takes depends on server speed – how fast the server can deliver data to the stream. Netflix used to compensate for this by distributing boxes to various locations around the country (perhaps the world). Each box contained “a Netflix.” The combination of server speed, the distribution of content locations, and the number of locations determine the number of copies of Tiger King Netflix must keep on the servers.

Today, Netflix relies on Amazon Web Services for distributing content. This offloads the storage-bandwidth tradeoff to Amazon, but it also means Netflix has ceded some control of its distribution to a competitor.

Consumers are faced with a choice. If they watch a streaming video and like it, they can record it on their in-house server. It would, of course, be a mistake to try to sell this copy.^[26] Or they can buy a DVD if the video is available in that format. For example, I own the complete X-Files on DVD including both the TV series and the movies. But obscure movies, TV shows, and even audio may not be available on disk. On the other hand, if the movie is just OK, they will probably not bother recording it. There will be less demand for disk storage space than Prof. Lemley imagines.

Back to Prof. Lemley’s Proposal

Lemley argues that copyright law has two goals. The first is to encourage the creation of new material by granting the creator a legal monopoly on the publication and distribution of their content. The second goal, according to him, is to encourage public access to those works. I’m not sure that is an actual, stated goal. But let’s grant him the assumption and proceed.

Lemley argues that the mechanics of streaming actually make orphan works harder to find. As he puts it,

Yet at the very time that it is easier to make out-of-print works available to everyone, those works are in fact becoming harder to find, since removing streaming content doesn’t leave behind old copies of works people can find in libraries or used record stores (or internet archives).

This is a problem created by technology. In the case of Dr. Seuss, the copyright owner has literally prevented publication of those six books. Lemley’s argument is that streaming can also make orphan works unavailable to the public.

Frankly, he’s wrong about this. If you really like a movie, buy the DVD.^[27] And, honestly, if it’s not available on DVD and had a commercial release, you’re not very likely to find it on a streaming service.

But today we live in the age of content produced by Amazon and Netflix. They produce content so they can stream it. Guess what? Many of those are available on DVD. Naturally, this is especially true for Amazon because they also sell the DVD’s. But Netflix’s long-running hit Stranger Things (seasons 1-3) can be had on DVD from Amazon for $34.99.

In other words, if you value a work highly enough, you should own a copy. Both Amazon and Alibris.com offer books, movies, and video series for sale.

A Doomsday Scenario

But what if the owner of the copyright decides to restart publication of the work? Prof. Lemley says, “Fine. Tell the other publishers to stop publishing.” He does make allowances for the inventories of copies created during the period of disappeared content. But there’s a simple solution he overlooks.

Those who published the orphan work also have inventories of content. They, too, should be given the right to object, postponing the resumption of publication until their inventories have been reduced to an appropriate level.

Presumably Amazon and Alibris would have no objections. They would simply start selling the version published by the copyright owner.

Nevertheless, I Agree

Despite all the arguments to the contrary, I come down on the side of allowing orphan works to be published by others. I hope the rights of those who own inventories of such a work will be protected by giving them an opportunity to object. But Amazon, Abe Books, and Alibris have been competing for decades. Indeed, someone has to sell the published orphan books. It might as well be them.

Endnotes

1. Scott Morefield (March 2, 2021). “Leo Terrell: ‘Cancel Culture Is Going To Backfire, Because It Denies History.” The Daily Caller. Available at https://dailycaller.com/2021/03/02/leo-terrell-cancel-culture-denies-history-dr-seuss/. Accessed April 23, 2021. ↑
2. Prices obtained from Alibris.com on March 3 and 4, 2021. These are prices asked by sellers. I have no idea whether any books were sold at these prices. ↑
3. Mark A. Lemley (2021). “Disappearing Content.” Available at https://ssrn.com/abstract=3715133. Accessed March 7, 2021. ↑
4. Brandon Gillespie (March 3, 2021). “‘You Don’t Speak For The Black Community!’: Leo Terrell Goes After College Professor Over Canceling Dr. Seuss.” The Daily Caller https://dailycaller.com/2021/03/03/leo-terrell-sean-hannity-dr-seuss-canceling-black-community/. Accessed March 3, 2021. ↑
5. Ben Shapiro (March 3, 2021) https://twitter.com/benshapiro/status/1367128165940932609. Accessed March 3, 2021. ↑
6. : https://twitter.com/benshapiro/status/1367128165940932609. Accessed March 5, 2021. ↑
7. Two notorious examples are Xerox in the 1960s and 19i70s. Even today Coca-Cola actively pursues anyone selling a cola product but calling it Coke. ↑
8. There are other competitors in the online book market. ThriftBooks.com, Bookshop.org, and Blackwells.com are three. ↑
9. Much of the information about Alibris operations is from a conversation with Mike Feldman, Director of Client Services for Alibris. The telephone conversation took place on May 6, 2021 at 2:00 pm. Any errors I made copying the facts from my memory are solely my responsibility. ↑
10. Alibris has an interesting story. The idea for the database that drives Alibris was developed in 1981 by Richard Weatherford. He set up Interloc for professional booksellers in 1993. Alibris started in 1997, about the same time Amazon opened its virtual doors. Für more history, aee https://www.alibris.com/about/story. ↑
11. Chris Sprigman (March 5, 2002). “The Mouse That Ate the Public Domain: Disney, the Copyright Term Extension Act, and Eldred v. Ashcroft.” FindLaw.com. Available at https://supreme.findlaw.com/legal-commentary/the-mouse-that-ate-the-public-domain.html;. First accessed sometime in 2003. ↑
12. U.S. Copyright Office, search for name “Seuss, Doctor.” Available at https://cocatalog.loc.gov/cgi-bin/Pwebrecon.cgi?Search_Arg=Seuss%2C+Doctor&Search_Code=NALL&PID=mYhibjauLaOs1MoVuOlXvX7O66184&SEQ=20210424181931&CNT=25&HIST=1. Accessed April 24, 2021. ↑
13. Lemley, op. cit. ↑
14. Ibid., p.2. The fact that the U.S. has a median age of 38.2 does not imply that “40 years is longer than most Americans have been alive.” Many, but not most. And his reference to “used bookstores” is laughable. Even if Amazon.com’s used book subsidiary Abe Books does not offer a title, alibria.com (far older than even Amazon) will almost certainly have a copy. ↑
15. Ben Lindbergh (February 7, 2019). :” The Rise of the iPhone Auteur.: theringer.com. Available at https://www.theringer.com/movies/2019/2/7/18214924/steven-soderbergh-high-flying-bird-iphone-tangerine-unsane-netflix. Accessed April 25, 2021. ↑
16. Lemley, op. cit., footnote 7, p. 3. “See, e.g., Sony Corp. of Am. v. Universal City Studios, Inc., 464 US 417 (U.S. 1984) (holding the manufacturing of VCRs was not copyright infringement even though consumers could use them to record copyrighted television content); see also Mark A. Lemley, Is the Sky Falling on the Content Industries Media & Content Industries, 9 J. ON TELECOMM. & HIGH TECH. L. 125, 128–30 (2011) (discussing the entertainment industry’s fights against the cassette tapes and the VCR).” ↑
17. Lemley, op. cit., p.10. Ellipses indicate deleted footnote numbers. ↑
18. Yes, I know, mass storage can be either spinning hard disks or solid-state memory. Please allow me this simplification. Do me that favor and I won’t mention digital tape, ZIP disks, and 8-inch floppy disks. ↑
19. See previous note. ↑
20. Walter Hill, director (1987). Extreme Prejudice. Starring Nick Nolte, Powers Boothe, Michael Ironside, Maria Conchita Alonso, and Rip Torn. More information at https://www.imdb.com/title/tt0092997/. I own the video on DVD. ↑
21. The series is available on Amazon. And it is in Spanish. Sadly, the subtitles are also only in Spanish. This is another subtle issue with orphaned works. Should this title be classified as orphaned? ↑
22. (1) QNAP TS-431P3, $419.00. (5) Seagate ST10000NE008 10 tb drives, $1,662.50. Total $2,081.50. QNAP from B&H Photo, New York. Seagate drives from Amazon.com. Fifth Seagate drive is a spare for quick replacement. ↑
23. We have a similar NAS here (different QNAP model, same disks). It is nowhere near full. And we do a lot of video work. ↑
24. Cdbaby.com. https://support.duplication.cdbaby.com/hc/en-us/articles/206172377-DVD-capacity-limits-for-all-types-of-DVDs. Accessed April 25, 2021. ↑
25. Lemley, op. cit., p.7. ↑
26. The act of recording the show may be a violation. As discussed earlier, there is some question about whether the “right to record” exists under current law. As the music industry learned many years ago, it’s futile to pursue many individuals who only record for their personal use and do so infrequently. Don’t scarf up thousands of titles in a few days and you’ll most likely be OK. ↑
27. This is not a perfect solution. I had to search to find my copy of Extreme Prejudice. When I finally tracked down a source for Man’s Favorite Sport? It was available from an obscure outlet. Today, Amazon and Alibris.com both carry both titles, as well as the underground favorite, Liquid Sky. ↑