February 28, 2001 9:35 AM PST

Random House sues e-book company over copyrights

Publishing giant Random House has filed a copyright infringement lawsuit against RosettaBooks, accusing the e-book company of illegally selling electronic versions of several Random House titles.

The publisher, which filed suit Tuesday in the U.S. District Court for the Southern District of New York, said RosettaBooks violated its rights by selling some of its titles as e-books, including William Styron's "Confessions of Nat Turner" and Kurt Vonnegut's "Slaughterhouse Five." Random House said it intends to publish e-book editions of these works soon.

"We seldom institute legal action," said Random House spokesman Stuart Applebaum. "This is not something we do regularly or lightly, but our publishing rights have been violated. RosettaBooks is offering e-book versions that they have no right to sell. We, not anyone else, hold the e-books right to these titles in question."

Applebaum added that Random House owns the exclusive rights to publish backlist books, or older titles, in print, audio and evolving, technology-centered formats.

The company maintains that an author's grant of rights to publish "in book form" includes e-books, largely because they are the "functional equivalent" of the printed text.

The lawsuit was filed the same day that New York-based RosettaBooks officially opened its site. The company said the disputed books do not belong to publishers, but rather to the authors, from whom it had secured electronic rights.

"The precedent in publishing is that rights--unless it's specifically conveyed in a publishing contract--belong to the rights holder," said Leo Dwyer, chief operating officer for RosettaBooks. "And we are purchasing those rights from the rights holders."

Other works at issue in the Random House lawsuit include Styron's "Sophie's Choice" and Vonnegut's "Breakfast of Champions," "The Sirens of Titan," "Cat's Cradle" and "Player Piano."

Dwyer said RosettaBooks has hired Boies Schiller & Flexner, the law firm of David Boies, who is representing clients such as music-swapping company Napster and former Vice President Al Gore in other high-profile cases.

The preservation of copyrights over the Internet continues to be a complicated topic. Last year's hacking incident involving Stephen King's e-book, "Riding the Bullet," stoked fears in the publishing industry that intellectual property may be unsecure online. Hackers had cracked the software used to encrypt King's e-book and posted illegal copies.

Content owners, including book publishers, have been leaning heavily toward encryption, which is being pushed by a slew of digital rights management companies that promise security to thwart would-be copyright violators.

Earlier this week, RosettaBooks inked a deal with intellectual-property management company Reciprocal to sell secure e-books. Under the deal, some out-of-print books will be available via RosettaBooks' site and possibly other e-tailers.

Meanwhile, Random House stresses that e-books will increasingly become the substitute for the printed book for many customers. The company, which opened an e-book division last July, has said its authors are entitled to substantial e-book royalties--a payment of 50 percent of the net proceeds per copy.

Consumers, however, haven't embraced e-books. Some smaller companies targeting digital or audio book audiences have recently joined the roster of dot-com casualties.

 

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