Section 8.2

• Jurisdiction: New York

A. History and Background

The introduction of e-books to the marketplace in 1998 is recounted briefly in the previous chapter.⁸⁰³ Since that time, e-books have become widely accepted and sometimes a preferred alternative to print books. According to a report by Author Earnings, over 485 million e-book units were sold in 2016, representing over 20% of the total number of books sold.⁸⁰⁴ Although it is currently in dispute whether e-book sales are growing or in decline, at least in certain genres, there is no doubt that they are and will continue to be a permanent and prominent part of the publishing ecosystem.⁸⁰⁵

Not surprisingly, the advent of e-book publishing was accompanied by various legal challenges related to the introduction of new use technology as courts were asked to interpret contracts intended only for print book sales and distribution. One of the first such court decisions to address e-book rights involved a traditional book publisher, Random House, seeking a preliminary injunction against an e-book publisher, RosettaBooks, that sought to sell in digital format eight specific works that Random House had the exclusive license to "print, publish and sell . . . in book form."⁸⁰⁶ The court denied the injunction on the basis that Random House was not likely to prevail on its claim that the right to publish in "book form" included the right to publish the works as e-books.⁸⁰⁷ This decision was subsequently affirmed by the Second Circuit Court of Appeals.⁸⁰⁸

In a later decision, however, the same federal district court reached a somewhat different conclusion when asked to review a publishing agreement that granted the publisher not only the "exclusive right to publish . . . in book form" but also provided for exclusive "subsidiary rights" and a grant of certain publication rights "by electronic means 'now known or hereafter invented'" subject to consent of the author.⁸⁰⁹ In reaching her decision, Judge Buchwald found that the contractual language was "sufficiently broad to draw within its ambit e-book publication" and that e-books constituted a "permissible new use," despite the fact that when the 1971 contract was entered into, "no commercial market for e-books existed."⁸¹⁰ A permanent injunction was subsequently entered against the e-book publisher with respect to publication of an e-book version of the book.⁸¹¹

In the decision, Judge Buchwald expressly recognized that her holding, "dependent as it is on antiquated language, may be of limited...