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Government and not from any original or creative work of the people who sell these outline maps. However, in this particular instance the publisher of these maps, having his attention called to the fact that the present act provides for substantial statutory damages even though no actual damage to the map publisher can be shown from the use made of his outline maps, examines the back files of the magazines of the country for a considerable period of years and asserts claims against all magazines in which such outline maps have been used, with a view to obtaining settlements based upon the threat which lies in the statutory damages provided by the present act.
The CHAIRMAN. Would you consider that power simply as a racket of men who are acting as parasites upon the organization that you represent, the Saturday Evening Post, and the other newspapers and magazines?
Mr. WARNER. I think the fact very clearly demonstrates that it could be so defined.
The CHAIRMAN. What would you recommend to this committee to put a stop to that racket?
Mr. WARNER. That is, something as to the technical method of stopping it?
The CHAIRMAN. Will Mr. Newcastle speak on that?
The CHAIRMAN. The committee will be glad to put a stop to that kind of racketeering in the publication business.
Mr. WARNER. I think you have every desire to do so.
The National Publishers Association gladly joins with the authors in approval of a revision and modernization of the copyright law which will put legal title of the copyright in the author. In doing so we urge that in any such revision and modernization of the law the utmost care should be used to protect the business man who is ready and willing to pay to the full for the literary material that he uses. Any revised copyright act ought not to invite harassing litigation by drastic remedy provisions which are not necessary for the protection of the legitimate author, and merely serve as an invitation to the racketeer.
The CHAIRMAN. In other words, your organization now goes on record that it is in favor of granting to the author the right to his copyright provided you secure the protection for your newspapers and magazines that you have just enumerated.
Mr. WARNER. That is so.
I have already stated that the payments which the magazines make for their right of first publication are the largest single source of income to the authors of the country. These payments would be impossible if the only income of the magazines came from their circulation, and no revenue was derived by the magazines from the advertising copy which they carry. When I say that large prices are paid by the magazines to the authors for the right of first publication, I mean just that. It is not uncommon, under modern conditions, for a magazine to pay a writer for the rights of first publication in a serial story from $50,000 to $75,000 without asking or obtaining any right in the use of the literary work for any other purpose. The fact that the advertising income helps make it possible to pay the author large prices for his material makes it important
for this committee to understand the relation between the magazine and the advertiser.
The CHAIRMAN. What is the average time that a magazine carries a book before it publishes it in serial form?
Mr. WARNER. That will vary according to circumstances and conditions.
The CHAIRMAN. Is that contractual as a rule?
Mr. WARNER. It is the important part of the contract which is made in the trade with the author, not always, but it can be made so and it is quite customary.
The CHAIRMAN. Complaints have been made by some authors that many magazines carry these books before they put them into form maybe two or three years, and they are denied the privilege of their property rights. Would you be in favor of putting into a law the time limit in which you must publish their book in book form, two or three years, and the rest shall be left to contract?
Mr. WARNER. Provided that the magazine at the time of purchase is aware and on notice of the time limit for publication.
A practical problem would present itself as to the inventories now on hand. Publishers may have on hand inventories that may run up to a million dollars; it is a practical matter. It would not be possible for them to use up all of that material within, say, a 2-year period.
The CHAIRMAN. What is the average run of a serial in a magazine?
Mr. WARNER. From 3 to 5, sometimes 6 installments. But you see where you have a practical problem presented to you in that regard, it sometimes happens that authors are contracted for over two or three or four year periods, one novel a year and a group of short stories; and it is very important, in creating a magazine or periodical for publication, that a proper balance of interest be included in each issue; and it will sometimes happen that through working out in advance the type of story, love story, mystery story, and so forth, there will be an overinventory of certain types of story and in keeping the proper balance in the magazine there will be a deferring of the publishing of a given story because it hasn't its proper place within the magazine for presentation.
It sometimes happens that things are bought more freely than they should have been, where there isn't the closest control, and it is not advisable to make those publications even in a 2-year period. It seems a long time to a layman, but it is not a long time in waiting to publish it, keeping in mind a balanced magazine that will appeal to a circle of population. It is a practical problem that can be handled in future contracts for an author's work, provided we have proper notice ahead of time so that we have time to arrange for publication possibilities. I think in any act it is necessary to keep in mind the inventories that the publishers have already on hand at the time the act goes into effect if they are obliged to relinquish their right within an unduly short period after the act comes into being. The future does not bother me, we can bargain for that.
It is the essence of the magazine's contract with the advertiser that a given issue of the magazine publication containing certain advertising copy furnished by the advertiser shall be put in circulation on a fixed date and remain on the newsstand available to the public for a certain definite period. Time is an essential element in the contact between the magazine and the advertiser. If any. thing prevents a magazine from putting a particular issue in circulation on the date on which it has contracted so to do, the advertiser has quite properly under his contract a claim against the magazine for the refund of a large part or all of the amount which he pays for the space in the magazine. If an issue of a magazine is held up for five days or ten days beyond its issue date, the amount of possible loss to the magazine publisher is enormous.
The CHAIRMAN. Then you are afraid of an injunction being granted against some journal on the basis of infringement or other considerations that may prevent getting the magazine out on time?
Mr. WARNER. Yes, sir.
The CHAIRMAN. And you think some legislation should be enacted that would prevent enormous losses from the abuse of these temporary injunctions?
Mr. WARNER. Yes, sir. The larger of the magazines will cover from $500 to $1,000,000 in advertising contract material in a single issue.
The CHAIRMAN. The Saturday Evening Post contains about $5,000,000?
Mr. WARNER. Not in an issue, no; they would run about $1,000,000.
The CHAIRMAN. There is a million dollars worth of advertising in one issue of the Saturday Evening Post?
Mr. WARNER. From $500 to $1,000,000. The issues are not running up to their usual volume but under normal conditions they would run about that limit. An injunction might hold up an issue of the Post, for instance, using that as an illustration, and some judge might, without any particular knowledge of facts, very casually grant an injunction that might defer an issue for two or three days that would contain matter than constituted an innocent infringement. The Curtis Publishing Co. would be properly subjected to damages by its advertisers. We believe that there should be no power of injunction issued against a publication.
Mr. CHAIRMAN. You think they ought not to go into the equity part of the court but should sue for damages?
Mr. WARNER. We are entirely willing to pay the actual damages that can be proven, no desire to avoid paying for the particular harm that is done to anybody. But an injunction is entirely destructive and is not of any benefit whatever to the owner of any infringed material. We will pay actual damages, yes; whatever they may be. We have no desire to avoid any such responsibility.
The CHAIRMAN. I have been told that there is another racket going around, pictures of moving-picture stars advertisements say, and then through injunction, until they can get a settlement these racketeers hold up the printing.
Mr. WARNER. I have heard rumors of such cases but I have no personal knowledge, and I think such cases that have come to notice have been with regard to advertising, but there have been cases where photographs have been inserted and advantage taken of that fact.
The CHAIRMAN. Is the magazine liable on the basis of damages under the present act?
Mr. WARNER. The publisher, as a practical matter, has almost no control and attempts very little control over advertising, but they
are extremely careful to avoid publishing any advertising statements which are not based
upon facts. The CHAIRMAN. Don't you think the advertiser alone should be held responsible for any infringement or any act of injustice, based upon the act itself, rather than the publisher?
Mr. WARNER. Decidedly so, and we so recommend, because we are publishing something over which we have no actual control. We are simply performing a service for the advertiser and the advertising agent is responsible.
The CHAIRMAN. Would you favor such legislation in the new copyright bill?
Mr. WARNER. We think it should be there for the protection of the public. It is not to the interest of the honest author that there should be any provision in a revision of the copyright law which will permit anyone, on a claim of copyright infringement, to interfere with the distribution of a magazine in course of preparation by drastic injunctive or impounding remedies. It is true that the honest and wellmeaning author, realizing his ultimate stake in the performance by the magazine in its contract with its advertisers, does not assert these drastic remedies. While they stand in the copyright act, however, they constitute an invitation to the racketeer. We believe that they should be eliminated from any copyright law.
Another practical feature of the magazine industry that should be taken into account in a revision of the copyright law is that the magazine is buying from the writer, in practically all cases, a right of first publication. The magazine pays the large prices which it pays because it needs to get and does get this right of first publication, to be exercised before the literary work is presented in any other form. A large part of the value of the magazine publisher's right in the literary work would immediately disappear, and in most cases the material is rendered useless to the magazine publisher, if the work were to be presented to the public in some other form, prior to or during the distribution of the magazine under its right of first publication. Use prior to first publication destroys the value of what the magazine has purchased. A revision of the law which puts title to the copyright in the author ought to protect the magazine publisher so that when he buys and pays for the right of first publication, he gets what he pays for, and is protected prior to and during his exercise of this right aaginst the presentation of the material in any other form. In this connection I wish to refer briefly to another phase of this matter. Owing to the practical conditions under which a magazine publisher operates, and especially to his relations with his advertisers, it is necessary for the magazine publisher to plan out the literary content of his publication for a considerable period in advance. The result is that the magazine publisher is buying much of the literary material which he purchases, for publication in issues which will not actually be presented to the public until between a year or two years after purchase. In some cases purchases are made for publication at a time in the future even more remote than the 2year period.
The CHAIRMAN. Are there any other magazines that are not interested in the by-products of the serial ?
Mr. WARNER. You speak of the by-products of the serial. If we are interested in the rights beyond the first serial rights, we should
contract with the author and state it in the contract. In most cases we are interested in the first serial rights. That is where our interests begin and end. There are cases, but we believe those cases should be covered in the contract itself.
The CHAIRMAX. The authors who appeared before the committee said the publishers took advantage of them while they, the publishers, had the copyright in their own name, refusing to give it back to the authors unless they could share with them on the by-products of that serial.
Mr. WARNER. If the committee has the feeling that any such practice exists, I would be glad to have it.
The CHAIRMAX. They have been here and made such statements. Mr. WARNER. I would like very much to have it specific in that
The CHAIRMAN. Some of the authors contended they could not get back their rights unless they shared their profits with the magazines.
Mr. Rich. They were not specific. They made the general statement. They did not give us specific instances.
The CHAIRMAN. They gave me the names of the magazines, too, and I want you to know, Mr. Warner, that they have some just criticism.
Mr. WARNER. I don't believe, Doctor, that they can state a single instance, at least in recent years, where there has been any practice on the part of the National Publishers Association that they can properly object to. I state that unqualifiedly.
The CHAIRMAN. For your information, therefore, I am going to get in touch with the officers of the authors' group and ask them to give me confidentially, in a written letter, some of the names and I will submit them to you.
Mr. WARNER. I would be very much interested in following them up and I would like for you to ask the president of the Authors' League to make a statement to that effect. I think we are entitled to that.
I think that the practice of the members of the National Publishers Association is that it will stand the closest scrutiny and the fullest exposition before sunlight, daylight, and everything you want to put before it.
The CHAIRMAN. You understand I am only quoting what has been said here.
Mr. WARNER. I understand that. We want nothing but facts. We have nothing to gain and have a great deal to lose in taking that attitude toward the authors from whom we secure material.
The CHAIRMAN. These allegations are not made against the big representatives of your organization but against some of the smaller magazines.
Mr. WARNER. I will be very interested to get any information you may have, Doctor.
There is another practical condition in the magazine industry to be considered by this committee in its task of framing any revision of the copyright law: A large part of the printed material included in a modern magazine in advertising copy. This copy is seldom prepared in the office of the magazine, but is generally prepared and controlled by the advertiser or the advertising agents and is often sent to the magazine at as late a date as is possible, consistent