Legal Challenges for Online Digital Libraries
| Autor | Argyri Panezi |
| Cargo | Ph.D. Candidate European University Institute, Department of Law (Florence) |
| Páginas | 18-34 |
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Abstract
Libraries have traditionally played a central role in collecting and organizing material and giving wide
access to culture and knowledge. Does the existing copyright framework provide enough space for online
digital libraries to claim an equivalent central role in the online space? This article explores the legal
challenges for online digital libraries’ collection building. The materials that comprise the content of
a library fall broadly under three categories with respect to their copyright status: copyrighted works,
works with ambivalent copyright status (such as orphan and out-of-print works) and public domain works.
In the paper, I try to answer a number of legal questions related to these three categories of works,
inter alia licensing and e-lending as well as digital exhaustion, and also defend the value of creating and
sustaining robust digital libraries online. The paper will conclude on how the theory of the commons can
improve the existing legal framework and strengthen the libraries’ position in order to sustain valuable
knowledge commons supporting the ever-growing network ecosystem. Thus, I emphasize the value of
maintaining a growing public domain that can be organized and digitally accessible online.
Keywords
digitization, EU digital policy, digital libraries, licensing and e-lending, digital exhaustion, orphan works,
public domain, knowledge commons
Topic
copyright
ARTICLE
Legal Challenges for Online
Digital Libraries*
Argyri Panezi
Ph.D. Candidate
European University Institute, Department of Law (Florence)
Argyri Panezi
18
* This article constitutes the communication presented by the author at the International Conference on Internet Law
and Politics 2014, and as such was included in the Proceedings of the Conference, which are available at
handle.net/10609/36801>.
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Retos legales para las bibliotecas digitales en línea
Resumen
Tradicionalmente, las bibliotecas han tenido un papel central a la hora de coleccionar y organizar material,
y de ofrecer un acceso amplio a la cultura y el conocimiento. ¿Ofrece el marco actual de derechos de
autor espacio suficiente para que las bibliotecas digitales puedan reclamar un papel equivalente en el
espacio en línea? Este artículo explora los retos legales a los que se enfrentan las bibliotecas digitales
a la hora de crear colecciones. En cuanto a los derechos de autor, los materiales de una biblioteca se
clasifican, en sentido amplio, en tres categorías: obras protegidas por derechos de autor, obras con un
estatus ambivalente (como por ejemplo obras huérfanas o agotadas) y obras de dominio público. Este
artículo intenta responder a una serie de cuestiones jurídicas relacionadas con estas tres categorías
(como por ejemplo, entre otras, la concesión de licencias, el préstamo electrónico y el agotamiento de
obras digitales); además, quiere defender la importancia de establecer y mantener bibliotecas digitales
en línea. El documento concluye explicando de qué modo la teoría de los bienes comunes puede mejorar
el marco legal existente y fortalecer la posición de las bibliotecas a fin de mantener el valioso patrimonio
de conocimientos comunes que alimenta el ecosistema creciente de la red. En consecuencia, se pone de
relieve la importancia de mantener un dominio público cada vez más amplio que se pueda organizar y
al que se pueda acceder digitalmente en línea.
Palabras clave
digitalización, política digital de la UE, bibliotecas digitales, concesión de licencias y préstamo electrónico,
obras huérfanas, dominio público, patrimonio de conocimientos comunes
Tema
Copyright
1. Introduction: why is the discussion
about digitization policy and
the creation of digital libraries
important?
Why do policymakers care about digital libraries, whose
purpose is mainly public, at a time when the e-book market
is evolving exactly as a market, without public purpose
considerations?
1
There are important reasons why we still
need to care about libraries also in the digital age. Libraries
have traditionally played a central role in collecting and
organizing material and giving wide access to culture and
knowledge. While a market is consumer-preference driven,
culture and knowledge (scientific or academic etc.) need to
be organized and preserved at times beyond markets. This
is obviously the case, for example, with niche scholarship
on topics as specific as medieval medical history. Thus,
a task of assembling human knowledge online extends
beyond the digitization of popular literature titles. All
the more, the intellectual works, after being assembled,
need to be curated, organized and presented in a useful
way to the public. These are all tasks that libraries are
traditionally committed to. Therefore, the question that
this article wishes to explore further is on this very issue
of the role of the digital libraries. Do existing regulatory
frameworks, mainly copyright limitations and exceptions,
1. E-book readers, the need for interoperability, price-fixing, competition and dominance (see Amazon) are among the biggest issues debated
today as regards the new and quickly developing e-book market See A. Daly (2013, 350 et. seq.)
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2. The legal bases thus far are mostly soft law provisions: Commission and Council recommendations and conclusions (article 292 TFEU), press
releases and reports (such as the Comité des Sages report) and some specific legislation initiated (notably the Orphan Works Directive).
Most importantly, though, the ongoing copyright reform consultation (public consultation on the review of the EU copyright rules) can
potentially play a big role further producing hard law changes with direct effects on digitization and the creation of libraries online.
For the EU’s digital libraries initiative see: ec.europa.eu/information_society/activities/digital_libraries/index_en.htm>.
3. See primarily the Digital Public Library of America (DPLA). For the ongoing efforts of the US Copyright Office – and also the legislation it
seeks to implement, for example on the issue of orphan works see opyright.gov/orphan/> (ongoing inquiry).
4. P. Goldstein and B. Hugenholtz (2013, pp. 307- 321).
provide enough space for online digital libraries to claim
an equivalent central role in the online space?
In broad terms, the two jurisdictions that I take into account are
the American and the European. Digitization has been a clear
priority in the EU digital agenda for some time now.
2
At the same
time the issue has been and continues to be heavily debated
in the US in the context of the Google Books litigation and
with more digital library initiatives having started in parallel.3
This article begins by mapping the relevant legal issues
involved. I first explore the legal challenges for online digital
libraries’ collection building with regard to copyrighted
works, works with ambivalent copyright status (such as
orphan and out-of-print works) and public domain works.
Second, I look at what is the additional value of a digital
library, which should make policymakers differentiate them
and perhaps entrust them with the special role of offering
wide access to intellectual works and preferential treatment
in the form of copyright limitations and exceptions.
2. Legal challenges for online digital
libraries’ collection building
The materials that comprise the content of a library fall
under three categories with respect to their copyright
status: copyrighted works, orphan works and out-of-print
works. These three I categorize together as works with
ambivalent or, rather, problematic copyright status (such
as orphan and out-of-print works) and public domain works.
A complete digital library should be able to offer access to
all of these types of works.
I explore the collection that a digital library builds following
this categorization since the legal status then dictates
accessibility. A copyrighted book cannot be offered online
without the right-holders’ permission, and is accessible
under their terms.
I will examine these three categories consecutively. I begin
with copyrighted works. Besides being a very big corpus
of works, it is also a hugely important one given that most
recent books and intellectual works in general are usually
under copyright. Even if some copyrighted works are freely
accessible, for example under a certain type of Creative
Commons license, they are still as such under the copyright
framework – essentially meaning that they are not part of
the public domain, unless the right-holders have explicitly
given up their rights.
Starting with the copyrighted works, the questions that
emerge broadly occur in two phases, one during the input
phase (how does the library get access to the copyrighted
material?), and the second during the output phase (in what
manner is the library allowed to offer access to the public,
its users?). I will look at the distribution right that copyright
affords to right-holders and also exhaustion and the big
debate of digital exhaustion.
Then I explore the orphan works puzzle and the issue of
out-of-print works, and propose a policy solution or change
that strengthens the case for digital libraries: entrusting the
orphans and the out-of-print works to the public domain.
Last, I examine the public domain works and whether the
legislator (the copyright policymaker) indeed promotes
access and reuse of this category of materials. I conclude
by arguing how digital libraries could be the institutional
gatekeepers of these bodies of works managed primarily
(where possible) as commons.
3. Copyrighted works
3.1. Distribution right and exhaustion
Two central economic rights that copyright affords to right-
holders are, first and foremost, the reproduction right (right
to make copies) and, second, the right to distribution (right to
distribute copies).
4
The right to distribute copies is relevant
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to the discussion of library lending and, by consequence, to
e-lending as well (following subchapter).
Article 6 of the WIPO Copyright Treaty is devoted to the
Right of Distribution and states that:
1) Authors of literary and artistic works shall enjoy the exclusive
right of authorizing the making available to the public of the
original and copies of their works through sale or other transfer
of ownership.
(2) Nothing in this Treaty shall affect the freedom of Contracting
Parties to determine the conditions, if any, under which the
exhaustion of the right in paragraph (1) applies after the first
sale or other transfer of ownership of the original or a copy
of the work with the authorization of the author.
(emphasis added)
As demonstrated in the wording of the above Article 6 in
paragraph 2, the distribution right is limited by exhaustion
(principle of exhaustion or first sale doctrine). Once copies
of works have been placed in the market with the right
holder’s consent, further re-distribution (for example,
resale) does not need to be authorized. This is a long-
standing rule in the EU jurisdictions where the principle of
exhaustion has been established by the European Court of
Justice and codified in the Information Society Directive
of 2001 article 4(2). In addition, there is a territorial effect
within the entire EU jurisdiction, as first sale of a work in
one EU member state will also exhaust the distribution
right of the author in all other member states. In US law
the US Copyright Act recognizes the same rule in section
109(a).
Traditionally, once a library purchases a book from a
publisher, the exhaustion or first-sale doctrine releases
the copy from further copyright control.
5
Library lending
of printed books finds its legal basis exactly on this doctrine.
This is not the case today for e-books and e-lending.
According to the Agreed Statements concerning the WIPO
Copyright Treaty (statements concerning Articles 6 and 7),
the expressions copies and original and copies, subject to
the right of distribution and the right of rental under the
said Articles, refer exclusively to fixed copies that can be
put into circulation as tangible objects.
6
Thus, currently copyright law worldwide explicitly only
grants exhaustion to tangible objects, such as printed
books.
7
The situation for digital works, including e-books,
is unclear. According to Harald Müller, from a legal point
of view libraries cannot lend e-books out because there
is no statutory legal instrument available for e-book loan
services by libraries.
8
I am not entirely certain that this
conclusion holds unconditionally. This author, however,
suggests that since the current regulatory framework
does not protect libraries, as exhaustion does for printed
books, they must lobby to create new legal instruments
enabling e-lending.
3.2. Licensing and e-lending
Given the lack of clear regulatory framework covering
e-lending, libraries that wish to make e-books available for
lending to their users are currently facing several licensing
practices and models offered by publishers or right
holders. This is the case both for purely digital libraries
and for traditional libraries wishing to offer digital services
on top of their traditional services. The framework is still
quite unclear for a number of reasons, both practical and
legal. E-lending is a rather new service, which they can now
offer only once they negotiate with publishers and clear
licensing terms. This is quite different than what libraries
are used to in terms of lending services for print books.
To lend print books all libraries do, traditionally, is acquire
copies, which are then part of their own collection. In the
legal sense the exhaustion or first sale doctrine, as we will
analyze further, has been covering the lending of print
books. The situation with e-books, however, is different.
Access to e-books takes place on the basis of licenses
rather than purchase.
From the publishers’ side, the business models for licensing
are still new as they experiment with different levels of
access as well as with pricing. The e-book market is rapidly
5. Ibid, p. 316. There is however a “Public Lending Right” in the European Union jurisdictions, as per the EC Rental Right Directive.
6. See <http://www.wipo.int/meetings/en/html.jsp?file=/redocs/mdocs/diplconf/en/crnr_dc/crnr_dc_96.html>.
7. H. Müller (2012, p. 152).
8. Ibid.
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expanding
9
and, as the market is expanding, publishers
experiment with several digital publishing business models.
David O’Brien, Urs Gasser and John Palfrey classify the
models used by e-book distributors to libraries in three
general categories (a distributor is usually the intermediate
that sells access to e-books to the libraries, often from
multiple publishers
10 11
): 1. the perpetual access model, 2.
the subscription model and 3. the pay-per-view model.
12
The perpetual access model allows libraries to integrate
e-books into their collection through an e-book collection
management software platform, usually hosted not by the
library itself but by an e-book vendor.
13
Access is determined
by the terms of each license. The DRM technology used by
the vendor platform limits how the file can be accessed and
shared.
14
This model usually tries to replicate print book
lending in that it limits access to the e-book in time (loan
periods are usually between 14 and 21 days), and allows
one (or some) patron at a time. The costs for this model
include platform maintenance fees; in addition, e-book titles
are generally more expensive compared to purchase of the
print book.
15
The subscription model gives the libraries the option of
subscribing to a database of e-book titles for a predetermined
period of time.
16
Upon termination of the subscription the
library no longer has access to the database unless it renews
its subscription. The advantage of this model is that an
unlimited number of patrons can access the same e-book
simultaneously. However, the cost per user for the library
is quite high. Another disadvantage is that vendors avoid
offering front list titles (publisher’s list of new titles) with
this model.
17
In the pay-per-view model, used less frequently than the
other two, libraries pay a certain fee in order to display a
list of available titles to their users.18 With every use of each
title, however, the library needs to pay an additional fee per
copy. The flat fee for accessing the e-book list is much lower
compared to the subscription model but then the renting
fee per copy rises.
There is also a patron-driven acquisition model, which
resembles the pay-per-view model. If a predetermined
number of patrons request a certain book title, the library
will acquire a copy from the distributor.
19
The difference
here is that libraries actually acquire ownership of the titles
unlike with the pay-per-view model.
Upon first examination, these models have a number of
advantages and disadvantages. Access to front list titles
is one common problem. Balancing the costs of the model
9. Notably in 2011 Amazon.com officially announced that it sells more kindle books than print books. Amazon press release:
corporate-ir.net/phoenix.zhtml?c=176060&p=irol-newsArticle&ID=1565581&highlight>.
See also:
In 2012 Amazon.co.uk made the same announcement. See .theguardian.com/books/2012/aug/06/amazon-kindle-ebook-sales-
overtake-print>.
At the same time, not all publishers permit e-book lending in libraries. Some see libraries as competitors in the digital distribution of books
and do not offer library e-lending programs. Among big publishers that allow e-book lending are Random House, Penguin, Hachette and
HarperCollins, (David O’Brien et al., p. 9). Notably Simon & Schuster did not license any e-books and only in April announced a one year
pilot program with New York libraries, see .forbes.com/sites/davidvinjamuri/2013/04/15/simon-schuster-tests-ebook-lending-
with-new-york-libraries/>.
10. David O’Brien, et al. Urs Gasser, John Palfrey, E-Books in Libraries: A Briefing Document Developed in Preparation for a Workshop on E-Lending
in Libraries, Berkman Center Research Publication No. 2012-15, available at s.ssrn.com/sol3/papers.cfm?abstract_id=2111396##>,
page 8.
11. The most commonly used distributors from the US libraries are OverDrive, NetLibrary, Gale/Cengage and EBSCOhost. Ibid (O’Brien, Gasser
&Palfrey), also citing Library Journal E-book Survey in “Ebooks the New Normal: Ebook Penetration & Use in US Public Libraries”, Library
Journal, 2011, p.24, available at thedigitalshift.com/research/>.
12. O’Brien, Gasser & Palfrey (2012, p. 10).
13. Ibid, p. 14.
14. Ibid.
15. Ibid, p. 15.
16. Ibid, p. 17.
17. Ibid.
18. Ibid, p. 19.
19. Ibid, p. 11. As the authors explain, this model is very useful for libraries offering bestselling e-books that are in high demand.
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with the patrons’ usage (demand) is probably the most
difficult issue. The most problematic aspect is that as long
as these models offer licensing rights and not ownership to
the libraries, access is always subject to the libraries’ ability
to pay fees (which are a form of subscription fees). Without
clear ownership, the libraries’ abilities to build, maintain and
curate a collection is substantially discounted. The advantage
of these models is their flexibility. Publishers, intermediaries
and libraries can collaborate to adjust packages to needs and
to user’s demands. This is at least true in theory, bearing
also in mind, however, the negotiating power of each party.
Copyright holders might be nervous that the ease of use of
a digital library will mean that consumers will stop buying
books (cannibalization of sales). While physical books
degrade, thus the second-hand markets are less of a threat
to the first-hand markets; it is true that digital books don’t
degrade. Thus, the negotiation and contracting process
for copyrighted works between libraries and active right
holders is not simple, as the latter will be looking for revenue
streams and perhaps the maximum possible profit.20 All the
more is the case with their collective societies.
3.3. Legal constructions proposed to address
the problem
In view of the above described situation, scholarship looks
at copyright theory (and beyond it) to discover the solutions
to legal obstacles that libraries are currently facing with
e-lending and formulate arguments on how to also apply
the exhaustion or first-sale doctrine to digital works.
a.) Legislative amendment of copyright law/ special library
exemption
Legislative history of the US first-sale doctrine legislation
shows that library lending is one of the underlying reasons
for the existence of the doctrine.
21
A similar rationale can
be traced in the various EU jurisdictions and the copyright
exceptions they provide for libraries.
22
Yet, given the lack of
legislative provisions that address the same issue for digital
works and the lack of any explicit legislative exemption for
libraries as regards e-lending, some scholars argue that
there is a need for new legislative action. The United States
Copyright Office had reached an analogous conclusion in a
policy document in 2011.23 According to the Copyright Office,
section 108 of 17 U.S.C. enacted in 1987 “was shaped by
the technology and concerns of the pre-digital age.”
24
The
appropriate scope of library exceptions might, thus, need to
be revisited in a coherent and systematic manner.
During the summer of 2013 the Dutch association of public
libraries (Vereniging van Openbare Bibliotheken (VOB))
initiated a test case in their national court of first instance
about the right to lend e-books in public libraries.
25
The
libraries assert that e-lending is (or should be) included in
the copyright exception for libraries and ask for a preliminary
reference to be sent to the European Court of Justice. The
Minister of Education, Culture and Science, on the basis of
a special report prepared by the IVIR Institute (Institute for
Information Law at the University of Amsterdam), already
denied such right.
26
The report observed that e-lending
already occurs in public libraries in several jurisdictions
and is not based on copyright limitations or exceptions, but
proceeds on the basis of contractual agreements. The central
question that the report posed was “whether e-lending by
public libraries is covered by the existing public lending
right regime of the Dutch Copyright Act (Auteurswet), and
whether the European copyright framework leaves enough
space for a copyright limitation or exception at the national
level.”
27
Both questions were answered negatively.
The recent Dutch report on online e-book lending through
libraries28 adds that the Copyright Directive of 2001 provides
for an exhaustive list of permitted limitations and exceptions
to copyright, including several exceptions that concern public
libraries. It stresses that the existing European copyright
framework, in its current state, does not leave room for
20. R. C. Picker (2011, p. 9).
21. M. Chiarizio (2013, p. 620).
22. P. Goldstein and B. Hugenholtz (supra note 4, p. 316).
23. US Copyright Office (2011, pp. 19-22).
24. Ibid, p. 20.
25. See: eofcopyright.com/home/blog-post/2013/06/18/dutch-public-libraries-are-commencing-a-test-case-on-e-lending.html>.
26. The report entitled “Online uitlenen van e-books door bibliotheken” (Online lending of e-books through libraries) is available in Dutch at:
27. Ibid.
28. The Dutch report, supra note 26.
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the introduction at the national level of a (compensated or
non-compensated) copyright exception permitting online
lending of e-books by public libraries.
29
As we noted above, one can conclude that libraries need to
lobby for a statutory solution for their e-book activities.
30
For that reason they need to lobby in order to secure that
the privileges they enjoy as institutions in the analogue
world are also enjoyed in the digital world. Indeed, libraries
already do that. The International Federation of Library
Associations (IFLA) for example has taken the lead with a
concrete treaty proposal on limitations and exceptions for
libraries and archives.
31
b.) Courts’ intervention to uphold digital exhaustion
Other scholars are more skeptical about the possibility
and practicability of a legislative solution.
32
Nevertheless,
as copyright law has strong roots in judicial construction,
with most doctrines originating in common law case law,
these scholars trust that the courts can effectively manage
the new challenges that the digital era poses to libraries.
These would include e-lending.
Aaron Perzanowski and Jason Schultz observe that with
the shift towards digital markets the first sale doctrine is
increasingly marginalized.
33
They suggest that courts should
remedy that, since a legislative change towards this end is
difficult or unlikely to occur today. In their article on digital
exhaustion the authors argue that the common law judge
(they are writing in the setting of the US jurisdiction) can apply
a broader principle of copyright exhaustion to which first
sale is part. This broader principle, as emerges from several
cases, guarantees a set of privileges for the user, namely
alienation, renewal, repair, adaptation and preservation.
34
Judges are called to apply the exhaustion principle to
digital copies as they already do to computer programs
(17 USC section 117). According to Perzanowski and Schultz
courts are already empowered to do so.
35
It is important
that the benefits of the first sale doctrine are also enjoyed
for digital works (as functionally equivalent privileges
36
).
The reasons for this are traced in the benefits of the first
sale doctrine or exhaustion in general. These benefits are:
i. increased access: availability as well as affordability of
copyrighted works is increased. After the first sale, the
right holder lawfully loses control over the copies. Second-
hand bookstores, libraries, video rental shops and auctions
sites are then able to operate as a secondary market which
accelerates access and pushes prices down so that they
are affordable to audiences that would otherwise not be
consumers in the primary market.
37
ii. preservation: specifically for works that are no longer
commercially interesting, as for example out-of-print
books or orphan works; the first sale doctrine assists in
maintaining circulation and thus preserving and keeping
cultural products alive.
38
iii. privacy: consumer privacy and anonymity are threatened
when right holders preserve control over the circulation
of their work after the first sale has occurred.
39
Reader
privacy is an important issue when it comes to e-lending
and the question is who controls the data that reveals
reading habits of users; libraries or private distributors
that operate DRM platforms?
iv. transactional clarity: transaction costs are rendered
disproportionately high and cost inefficient, when
relatively low-cost copyrighted works require complex
29. Ibid, English summary.
30. Müller (supra note 7, p. 154).
31. See
32. A. Perzanowski and J. Schultz (2011).
33. Ibid, pp. 892 et seq.
34. Ibid, p. 912 and pp. 913-922 citing ample case law where the rights to repair and renewal, rights to adaptation and modification, and display
and performance rights are established.
35. Ibid, p. 936.
36. Ibid, p. 937.
37. Ibid, p. 894-5. The authors cite evidence that secondary markets are better at price discrimination and at maximizing social welfare than
copyright owners.
See also A. Reese (2003, pp. 644- 652).
38. Ibid, p. 895.
39. Ibid, p. 896. See also J. E. Cohen (1996).
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limitations and control over redistribution after the first
sale.
40
v. user innovation: there is effective incentive for right
holders to innovate in order to compete with secondary
markets. This way, new or better creations such as updated
works or additional content are promoted.
1
vi. platform competition: consumer lock-in is reduced with
regards to platforms, when consumers are allowed to
alienate their digital purchases from the platforms and
transfer them when switching platforms without the need
to repurchase.
42
The argument promotes interoperability;
that is, for example, the ability to read the same e-book
on a kindle or an iPad.
3.4. Allowing a young market to mature through
competition or intervening when contracts
appear to override copyright law?
Matthew Chiarizio notably suggests that the best course
of action for the government is to not intervene but allow
the stakeholders “a chance to find a solution within the
existing legal framework”.
43
This suggestion emphasizes the
still undeveloped nature of the relevant market, with a lot of
potential to experiment and innovate in viable e-lending models.
The idea that any intervention would be either premature or
disrupt the growth of the market does not fully address an
important factor: the asymmetries in the involved parties’
bargaining powers. Libraries have traditionally enjoyed
privileges for a number of (valid) reasons. The challenges
they face in the digital era are numerous. In a digital world
where electronic retailers have started offering services
such as ‘Amazon’s Kindle Owners’ Lending Library’,
44
trusting the negotiating power of libraries and letting them
survive the e-book market as created without any equivalent
to the digital exhaustion doctrine might be too optimistic.
On the other hand, investigating the current business models
for licensing that enable library e-lending, one cannot help
but conclude that this is another case where contracts are
claiming to supersede copyright law. The relation between
the legislative exceptions and limitations to copyright
and freedom of contract to restrict such exceptions and
limitations in a private contract has been a difficult issue
that courts as well as scholars already faced before the
e-lending discussion.
45
More specifically, courts have faced
the issue of boundaries between ownership and licensing
in several contexts. There is, for example, ample case law
around computer software attempting to determine whether
a transaction was a license or a sale.
46
The problem with e-lending is that the major publishers,
contractually superior to small libraries or, generally,
libraries with serious budget limitations, are now establishing
contractual conditions that exceed the monopoly afforded
by copyright.
47
Without the limitations that the exhaustion
or first sale doctrine place on the copyright monopoly of
the right holders, distribution of digital works circumvents
the rationale behind copyright (to guarantee enough, but
not more than that, incentives for creation) and promotes
rent-seeking practices.
Copyright law claims the ability to maintain the delicate
balance between different interests. The various exceptions
40. Ibid, p. 896.
41. Ibid, p. 897.
42. Ibid, pp. 900-901.
43. Chiarizio, supra note 21, p. 641.
44. See
See also B. Rosenblatt (2012).
In view of Amazon’s launching of a lending library, Lloyd Jassin interestingly finds that the next great e-book debate will be on how to
define subscription revenue. See Lloyd Jassin, Amazon’s Lending Library Liability, available at www.copylaw.org/2011/11/amazons-
lending-library-liability.html>.
45. See O. Fischman Afori (2013, p. 401).
46. From US case law see:
Vernor v. Autodesk Inc.,621 F.3d 1102, 1110-11 (9th Cir. 2010)
MDY Industries. v. Blizzard Entertainment, Inc., 629 F. 3d 928, 938 (9th Cir. 2010)
Apple, Inc. v. Psystar Corp., 658 F.3d 1150, 1155-56 (9th Cir. 2011)
UMG Recordings, Inc. v. Augusto, 628 F.3d 1175, 1180 (9th Cir. 2011).
47. O. Fischman Afori, supra note 45, p. 393.
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and limitations are also attempting to maintain the same
balance. When contracts afford benefits to right holders that
far exceed the rights afforded by copyright law this already
delicate balance is distorted. This seems to be the case with
licensing models that publishers currently offer to libraries.
Academic libraries in particular are suffering from this
development. Restrictive licenses then threaten to become
a real obstacle to research and teaching.48 This also explains
the spread of the open access movement and the role that
major libraries seek to play leading the policy debate and
demanding that electronic subscriptions must be rethought.
49
In all, the sticking contradiction to the right holders’ legal
rights regarding a print book renders the need for clarity
in the regulatory framework for e-lending pressing. The
increased cost for online versions of works is a burden that
we cannot just assume that libraries will simply adapt to. As
Reese explains, a decline in affordability and of access via
libraries is a crucial problem.
50
Under the current framework
he identifies a possibility that either digital works will be made
available by libraries at greater cost or, even worse, many
works will not be available in libraries at all.
51
If we value the
role of the library and wish to preserve it in the digital era as
well, the situation is alerting and calls for regulatory action.
4. Orphan and Out-Of-Print Works
4.1. The Orphans Puzzle
Fay Kanin, Chair of the Library of CongressNational Film
Preservation Board (NFPB), coined the term orphan works to
inclusively describe works protected under copyright whose
copyright holder cannot be identified or located.
According to one account, there are two approaches in
definitions to the orphan works problem.52 The first focuses
on the inability of a potential user to identify and locate the
right holder from whom permission is to be sought. The other
approach places the inability of the user to easily obtain
permission to use a particular work central to the problem
(broader approach, also argued by Google during the Google
Books controversy). Out-of-print books, for example, are a
category, which includes orphan works, without the two
categories overlapping. This broader issue of the inability or
difficulty to connect to the copyright owners has led to the
perception of orphan works as a greater problem of market
failure.53 A potential user faces disproportionate transaction
costs to obtain authorization from a right holder, as well as
the risk of infringement liability. Thus, he will usually forgo
the use “even though had the user been able to locate the
copyright owner, a deal would have been struck for that
use.”
54
Although it is to be expected that rights clearance
involves certain transaction costs, with orphan works these
costs become disproportionally high and results are still
not guaranteed.
According to librarians, there are a great number of orphan
works for which it is estimated that even after extensive
research, no further information can be found. However,
knowing the exact size of the problem is important in order
to be able to calculate the social and economic costs and
benefits of possible solutions to the problem.
55
The very
nature of orphan works renders the finding of both firm
quantitative and qualitative data a difficult task. This also
explains why the size of the problem has not been calculated
in a consistent manner.
56
48. Ibid, p. 404.
49. See open letter from Harvard University Library: “Faculty Advisory Council Memorandum on Journal Pricing”, April 17, 2012, available at
50. Reese (supra note 37, p.646).
51. Ibid.
52. D. Hansen (2011).
53. Ibid, p. 1.
54. L. Pallas Loren (2012, p. 3).
55. See also the JISC 2009 report, analyzing data from an online survey of over 500 organizations suggesting that many public sector
organizations in the UK are themselves unsure of the extent of the problem. The report is available at tp://www.jisc.ac.uk/media/
documents/publications/infromthecoldv1.pdf>.
56. For example, the British Library has estimated that 40% of its copyrighted collections are orphan: Report of the ‘Comité des Sages’
reflection group pm bringing Europe’s cultural heritage online, The New Renaissance, available at tp://ec.europa.eu/culture/pdf/
report_Comite_des_Sages.pdf>, p. 16.
David Drummond, Google’s general counsel estimated that relatively few, under 20%, of the books in the Google Books corpus will ultimately
turn out to be orphan (also relying on his positive predictions for Google’s project incentivizing copyright owners to come forward). See
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The root of the orphan works problem, which renders the
quest for a solution from the EU and the US so difficult, is
found primarily in the expansions to copyright law over
the past few decades; extensions of copyright duration
along with elimination of registration, renewal and notice
requirement for copyright protection (these results are also
due to the Berne Convention rules). As simply explained by
Olive Huang, longer copyright terms create longer periods
over which copyright ownership can change hands and
become even more difficult to trace.
57
In any event, orphan works constitute an appreciable corpus
of works that need to be taken into account in any discussion
about a digital library. As the Google Books and HathiTrust
litigations showed, orphans are also a far from negligible
stake for stakeholders.
4.2. Legislative attempts and responses thus far
Starting with the premise that the owner (author or
subsequent right holder) is absent, there is indeed an
interesting question that lingers with respect to orphan
works: Why has it thus far proven so difficult to introduce
reform in a property law area where owners of works are
absent (thus by definition are unable themselves to lobby),
while users of works lobby for reform?
58
Indeed, in the US there have been two unsuccessful attempts
to legislate the orphan works problem: first, with the Orphan
Works Act of 2006.
59
Later two other bills were introduced,
the Orphan Works Act of 2008
60
, and the Shawn Bentley
Orphan Works Act of 2008.
61
There is already one report
on orphan works prepared by the United States Copyright
Office and published in January 2006. Indicating that there
will indeed be another attempt to legislate, the United States
Copyright Office recently issued a broad notice of inquiry
in the Federal Register, seeking comments from the public
regarding the current state of play for orphan works.
62
In the EU there have been concrete policy developments
with the Orphan Works Directive, 2012/28/EU, adopted the
previous October.63 This directive on certain permitted uses of
orphan works sets out common rules for the digitization and
online display of orphan works.
64
The directive applies only
63. Ibid. 74–76.
64. Ibid. 74.
65. Ibid. 75–76; for some scholars ‘[t]here is no presumption that civilians are not directly participating’, see e.g. Boothby (2009, n. 24, p. 766);
for some other scholars, in case of doubt, civilian should be presumed to be directly participating in hostilities, see e.g. M. N. Schmitt (2004,
p. 509); see also M. N. Schmitt (2010a, n. 3, pp. 737–738); see also the reply from N. Melzer to those criticisms (2009b, n 14, p. 857).
66. The Tallinn Manual (n. 9, rule 35, § 12).
67. Interpretive Guidance (n. 13, pp. 77–82).
68. See e.g. W. H. Parks (2009, n. 14) passim; M. N. Schmitt (2010b, n. 8, pp. 39–43); contra see N. Melzer (2009b, n. 14, pp. 895–896 (‘While
Parks rightly points out that, during the expert discussions, several participating experts were extremely critical of Section IX, he fails to
note that just as many experts strongly supported its inclusion in the Interpretive Guidance, and several others even argued that Section
IX was not sufficiently restrictive, but should be complemented by human rights standards on the use of force.’).
69. Interpretive Guidance (n. 13. p. 82, footnote 221).
70. Ibid. 77.
Pamela Samuelson, Google Book Search and the Future of Books in Cyberspace, 94 Minn. L. Rev. 1308 (2009-2010), p. 1323 citing to the
Competition and Commerce in Digital Books hearing before the House of Representatives, available at .house.gov/hearings/
hear_090910.html>. At the same time for the same project Jonathan Band estimated that around 75% of out-of-print books will remain
unclaimed: See J. Band (2009, p. 294).
57. O. Huang (2006, p. 268). See also D. Hansen (2012). According to Hansen the orphan works problem may have existed in theory since
copyright laws first came into effect, if one defines the problem broadly as the situation where the owner of a copyrighted work cannot
be located and asked for authorization by someone who wants to use it.
In her recent article Lydia Pallas Loren argues that the problem can also be traced back to terminology. Indeed, the orphan metaphor
is misleading. Loren claims that the use of the metaphor is now also causing difficulties to address the problem. She proposes the term
hostage works instead. Lydia Pallas Loren, supra note 54. For the notion of the “romantic author” see Mark A. Lemley (1997).
58. See A. Katz (2012, p. 1337), where he remarkably notes: “A discussion of solutions to the orphan works problem will not be complete before
addressing why has it been so challenging to find an acceptable and workable solution to this problem in the first place. The difficulty is
puzzling because owners of orphan works are, by definition, absent from the debate about orphan works, and normally, when discussions
about contemplated reforms do not involve those who might be directly affected by them, one could expect that reform would be easy.
Specifically, one could expect that in a setting where users lobby for reform that would allow them to use orphan works, and owners of
those works are absent, passing a pro-user reform (even overly pro-user) would be a breeze. Therefore, the fact that it has been difficult
to find an acceptable solution, and that many of the proposed solutions involve serious impediments on using orphan works, suggests
that the political economy of the orphan works problem is complicated, and that there is much at stake—not necessarily for the interests
of orphan owners, but for the interests of those who speak on their behalf”.
59. H.R. 5439, 109th Congress, 2nd session, 22 May 2006.
60. H.R. 5889, 110th Congress, 2nd session, 24 April 2008.
61. S. 2913, 110th Congress, 2nd session, 24 April 2008.
62. See at
academic world together with libraries (comments from librarians, associations of libraries and university libraries) are recognizing a real
problem that needs comprehensive solution.
63. Available at: eu/internal_market/copyright/orphan_works/index_en.htm>.
64. Directive preamble, point 3. The Directive is complementing and without prejudice to the existing 20 September 2011 Memorandum of
Understanding on key principles on the digitization and making available of out-of-commerce works: Memo available at: opa.
eu/rapid/press-release_MEMO-11-619_en.htm>. In order to establish whether a work is orphan the above mentioned institutions shall carry
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to works that are first published (broadcast or made publicly
available by the beneficiaries) in the territory of an EU Member
State. In all, the solutions that the Directive provides are quite
narrow in scope since they apply to a particular class of users
and uses and only to particular types of works. One could
question whether there is any plausible reason to discriminate
between public interest institutions and others (private/for-
profit bodies). Some questions also arise with regard to the
(considerable) discretion of member States with respect to the
implementation of the directive. Given that the EU directive is
narrow and leaves ample room for different interpretations,
and that the member States have now initiated debate at a
national level, it is reasonable to conclude that even after
the passing of the directive the debate around orphan works
is far from being closed, also in the jurisdiction of the EU.
All the more, what is important for us here is that the
directive is not adequately addressing the larger issue of
mass digitization. The diligent search requirement it sets
(Orphan Works Directive, article 3) is neither very clear nor
efficient to enable mass rights clearance for orphans. This
is, however, the most important issue for the creation of
digital libraries, at least as regards this body of works. Thus,
the directive cannot be easily seen as solving how digital
libraries can deal with orphan works, which they have to
do on a mass rather than an in concreto or sporadic scale.
4.3. Scholarly proposed solutions
There is ample legal scholarship examining the orphan
works problem. Some of this scholarship includes systematic
mapping and evaluation of possible solutions to the issue.65
66
Thus, many solutions have been proposed including
centrally administered licenses (this is the Canadian
system), extended collective licensing (applied in various
Scandinavian jurisdictions, a system where management of
rights is assigned to a collective society, which negotiates
freely on behalf of owners), limited liability, meaning limiting
remedies after a diligent search for right holders (this is
the solution favored by the US Copyright Office in both the
2006 and 2008 attempts to legislate), statutory limitation
or exception, access and reuse systems tailored to fair
use, suggesting that fair use exceptions suffice to solve
the problem of orphan works when applied correctly. In
addition to the above categories of approaches, there is one
more general category; broader policy reforms that seek
to address copyright formalities and duration, and library,
archive and museum privileges, while having the ability to
mitigate or partially address the orphan works problem. The
objectives here are: 1.) reinvigoration of copyright formalities
and reduction of the effect of increased copyright duration
and, 2.) reforms to library, archive, and museum privileges
that would allow those institutions to provide new forms of
access to the works in their collection.
4.4. Out-of-print works
Out-of-print or out-of-commerce works have known or
traceable authors, unlike orphans. However, for systematic
purposes, I include them in the same problematic as orphan
works. While digitization can bring new life to these works,
the efficiency argument that I will make in the following
chapter works well for both, when seen as abandoned
property works. Unlike the orphan works issue, which
became hugely debated, especially after the Google Books
litigation is the US, the literature on out-of-print works
is less. There has been interesting economic analysis for
potential markets for out-of-print works.
67
For the purposes
of this paper, however, I will deal with this issue far less
extensively, and grouped with orphan works where the
emphasis, also from scholarship, is based.
4.5. A solution that strengthens the case
for digital libraries: entrusting orphan
and out-of-print works to the public domain
Given both the complexity of the orphan works problem
and the lack of a clear and strong policy argument to
63. Ibid. 74–76.
64. Ibid. 74.
65. Ibid. 75–76; for some scholars ‘[t]here is no presumption that civilians are not directly participating’, see e.g. Boothby (2009, n. 24, p. 766);
for some other scholars, in case of doubt, civilian should be presumed to be directly participating in hostilities, see e.g. M. N. Schmitt (2004,
p. 509); see also M. N. Schmitt (2010a, n. 3, pp. 737–738); see also the reply from N. Melzer to those criticisms (2009b, n 14, p. 857).
66. The Tallinn Manual (n. 9, rule 35, § 12).
67. Interpretive Guidance (n. 13, pp. 77–82).
out a diligent search according to the requirements of article 3 of the directive, keeping records of their searches on a publicly accessible
online database. What constitutes a diligent search is outlined in more detail in a Memorandum of Understanding on Diligent Search
Guidelines for Orphan Works. Once designated as orphan, it may be used (digitized and made available) by the institutions only in order to
achieve aims related to their public-interest missions, in particular the preservation of, the restoration of, and the provision of cultural and
educational access to works and phonograms contained in their collection (art. 6(2) of the Directive). The directive provides for a system
of compensation if the right holder(s) is found at a later stage (article 5 of the Directive).
65. S. van Gompel and B. Hugenholtz (2010).
66. D. Hansen (2012a).
67. See for example M. D. Smith, R. Telang and Y. Zhang (2012).
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maintain their copyright status, as well as the existence
of out-of-print works, which have the potential of regaining
a digital life, it is arguably much more efficient and a
better policy option to entrust both to the public domain.
From the perspective of the creator, entitlement is lost
by virtue of the creator’s absence or the lack of further
incentives to commercialize, and because the transaction
with a user, if at all possible, has become inefficient. From
the perspective of the public, I argue that there should
be a mere freedom in accessing and using the orphans
and out-of-print works and they should be added to the
corpus of the public domain. Freeing both sooner rather
than later is a solution that both avoids the utility loss
of abandoned works and simultaneously generates great
societal benefits by enlarging the public domain. Becoming
part of the public domain’s commons, orphan and out-of-
print works are not losing the connection to a supposedly
father/romantic author
68
but are gaining a family at large,
the community enjoying them and benefiting from them,
utilizing them and making them relevant.
While intellectual property law generally implies an overall
analogy to property law, ironically this has not been the case
with orphan or out-of-print works. In property law there are
a number of rules and doctrines in both civil and common
law jurisdictions that favor the loss of property once
abandoned for enough time (rules on adverse possession,
rules determining the faith of abandoned property etc.).
The rationale behind such doctrines is to penalize neglectful
owners by granting, under certain requirements, property
either to other (adverse) possessors, or to the public. At the
same time they seek to give property owners the incentive
to be attentive to their assets.
69
The irony is that in this
case borrowing doctrines from property law would rather go
against sustaining intellectual property rights on orphans.
My main argument, however, is that the body institutionally
most capable of protecting works with unclear or dubious
copyright status is neither a private company like Google,
nor a collective society like Authors Guild, arguably not
even the state, which can design compulsory licensing
schemes. It is rather the public as a whole, the same
body that has an interest collectively in using and reusing
information as input to new production. As Elinor Ostrom
has demonstrated, studies “challenge the presumption that
governments always do a better job than users in organizing
and protecting important resources”.
70
Practically, what I propose is that this body of works shall
be managed as commons along with the ones already in the
public domain (following chapter). Successful management
of commons is not a simple task. I propose that the central
role of trust between key players (contributors, users and
gatekeepers) shall be played by libraries, institutions that
already enjoy a stern status and can be trusted to play
the crucial role of gatekeepers for common intellectual
recourses. The proposal needs further elaboration, which
is beyond the scope of this article. Here I merely formulate
the argument that current orphan and out-of-print works
offer a great opportunity for institutional innovation with
respect to commons.
5. Public Domain Works
The third category, public domain works, is rather the easier
case when it comes to collection building for digital libraries.
They are freed from copyright and available for scanning
by any stakeholder, private or public, for the purposes of
digitization. Quoting Paul Heald, the legal consequence
of public domain status is that all users may appropriate
freely without interference from competing claimants.
71
Although there are many different definitions of the public
domain (mainly depending on jurisdiction), most more or
less accept at least this consequence as fact and as the
common denominator.
72
Commission Recommendation of 27 October 2011 on the
digitization and online accessibility of cultural material and
digitization preservation understands online accessibility of
public domain works as follows (article 5):
73
1.) It must be
ensured that the material remains in the public domain after
digitization; 2.) The widest possible access and reuse of the
material for non-commercial and commercial purposes
68. A. Chander and M. Sunder (2004, p. 1338).
69. Ibid, p. 12.
70. E. Ostrom (2009, p. 409).
71. P. Heald (2014, p. 1).
72. For a consistent effort to map the public domain see P. Samuelson (2009).
73. See also Recital 13.
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must be promoted and; 3.) Measures to limit the use of
intrusive watermarks or other visual protection measures
that reduce usability of the digitized public domain material
must be taken.
What does it mean, however, for the legislator or the
policymaker to promote access and reuse of public domain
works? Before looking at this question, we need to see why
there is a need to promote access and reuse of the public
domain in general; in other words, what is the value or the
social utility of the public domain. According to Samuelson
the public domain serves at least eight distinct values:
it serves as 1.) building blocks for the creation of new
knowledge and, 2.) enables competitive imitation, 3.) follow-
on innovation, 4.) low-cost access to information, 5.) public
access to cultural heritage, 6.) education, 7.) public health
and safety, and last but not least, 8.) enables deliberative
democracy.
74
Paul Heald searching the same question of
the value of maintaining a growing public domain draws an
important conclusion: the value of the public domain will
be its net value, which is the value generated by the work
being in the public domain over and above what it would
generate under copyright.
75
Going back to the issue of the legislator promoting access
and reuse of public domain works, the specific question this
article focuses on is whether the existing legal framework
assists or, at least, encourages libraries to provide this
access and thus promote these values or benefits generated
by the public domain. I believe that the current copyright
framework and general copyright policy does not promote
this access and reuse in a consistent and sufficient manner.
Firstly, the copyright term is excessive, currently lifetime
of the author plus 70 years on both sides of the Atlantic,
blocking new important works from entering the public
domain quicker after they have generated the necessary
profits to the creator. The optimal scope of copyright for
protected works is debated. It has also been famously
modeled by W. M. Landes and R. A. Posner who concluded
that because of discounting to present value, extensions
of the copyright term beyond twenty or twenty-five years
have little incentive effect for creators, which is the main
rationale behind copyright laws in the first place.76 Existing
formal models, however, tend to focus on the optimal term
length for the recovery of sunk costs during a period
of supra-competitive pricing, without considering the
relevance of access and distribution of existing works or
the costs imposed on follow-on creation and the other said
values.
With an excessive copyright term, copyright policy is by
definition not sided on the public domain side. Second,
there is no copyright rule forbidding or disincentivizing
the propertizing of public domain works. Thus, private
companies are able to make profit out of this pool of sources
offering them online as part of a service and locking them
with DRM systems even though they are legally free from
copyright. This is the case, for example, with Google, which
began to scan books taken from libraries and also made
public domain books part of their business plan for the
Google Books service. Google profits from advertising, and
thus offers the scanned public domain books for free to
users; however it is part of a commercial service. There are
additional examples of services that make profit directly
from making available public domain works.
77
6. Conclusion: the need for
a regulatory framework
supporting online digital
libraries and sustaining valuable
knowledge commons
The Internet’s potential to revolutionize the way we access
and then produce culture and knowledge should be supported
by a regulatory framework that promotes wide accessibility,
in order to sustain valuable commons supporting the
ever-growing network ecosystem. Digital libraries are a
central paradigm in this respect. Thinking about libraries,
a helpful conceptualization is that of a zone of accessible
74. Samuelson, supra note 72, p. 22.
75. P. Heald (2014, p. 1), citing Pollock et al. (2010).
76. W. M. Landes and R. A. Posner (2003, p.70 and 210 et. seq).
77. Se e for example
domain works for free, such as the Project Gutenberg (started in 1971 by Michael Hart) which is the first important online digital library
project, exactly offering works that are free from copyright (under US law). The project now has over 45,000 items in its collection. See
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information.78 It is necessary to enlarge the corpus of these
accessible materials, if we believe in the value of creating
and sustaining robust access points to knowledge online.
Furthermore, within libraries, information is organized in a
way meaningful to the users. As Randal Picker has noted
(on the opportunity of the rejection of the Google Books
Settlement in 2011) “we are at a point of rebooting how
we design our digital library future”.79 What already seems
undesirable is a digital library monopoly. What we should
instead want to foster is a rich digital library ecosystem.
80
James Boyle describes the evolution of the Internet from a
government project to the White Paper, to a private industry.
81
The Internet has started from being an agora, then a market
and now it returns to becoming an agora again.
82
This
becomes more clear when we look at Jonathan Zittrain’s
five conceptual layers to the network; physical; protocol;
applications; content; and social layer.
83
The layers represent
the division of labor among people constructing and/or
using the network. The past associates with proprietary
networks and hierarchies, whereas the present facilitates
polyarchies. Nowadays, however, we observe a cultural shift
towards alternatives to either the market’s contracts-based
production (employers in firms) or property-based market-
value systems (individuals in the market following signals).
84
Other production models are mostly commons-based or
peer-production models particularly visible in the digital
world (for example open source software).
In the same vein, we observe a shift from strict and
expanding copyright laws to peer production of knowledge,
information and culture.
85
Simultaneously, we witness the
phenomenon of cultural agoraphobia (openness aversion)
whereby we underestimate the “importance, viability, and
productive power of open systems, open networks, and non-
proprietary production.”
86
This article seeks to be a basis
for the consideration of the role of the digital library in
fighting against this cultural agoraphobia. In the digital
era space is virtually unlimited (information is stored in
the cloud), knowledge is accessible and books are fireproof;
libraries cannot turn to ashes like the library of Alexandria
famously did. But how rich and accessible are they? How
accessible can they be and how accessible should they be to
the public? Indeed, the Internet’s potential to revolutionize
the way we access and then produce culture and knowledge
should be supported by a regulatory framework sustaining
online digital libraries, as public service institutions beyond
markets and beyond the division of private and public.
78. See B. Shermand and L. Wiseman (2006, p. 259 et. seq.).
79. R. C. Picker, supra note 20, p. 1.
80. Ibid, p.2.
81. J. Boyle (2008, p.85 et seq).
82. See
83. J. Zittrain (2008, p.67).
84. Y. Benkler (2002).
85. Y. Benkler (2006, p. 23).
86. J. Boyle (supra note 81, p.231).
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Recommended citation
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y Política. No. 19, pp. 18-34. UOC. [Accessed: dd/mm/yy].
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About the author
Argyri Panezi
Ph.D. Candidate
European University Institute, Department of Law (Florence)
argyri.panezi@eui.eu
Argyri Panezi is a PhD candidate at the European University Institute in Florence. Her topic is the law
and economics of book digitization, and in particular she researches the legal challenges posed by the
creation of digital libraries and the regulation of knowledge commons in networked environments. She
obtained her LL.M. at Harvard Law School where she specialised in Internet law and policy. She obtained
her undergraduate law degree from the University of Athens, Greece, and was called to Bar in Athens
in 2011. Prior to her doctoral studies, she worked as an attorney in Brussels.
European University Institute
Badia Fiesolana
Via dei Roccettini 9,
I-50014 San Domenico di Fiesole (FI)
Italy
