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Publishers Win Preliminary Injunction in Library E-Book Fight

Feb. 17, 2022, 3:59 PM

The Association of American Publishers Inc. convinced a federal court that it has a strong case for showing a Maryland law requiring the distribution of electronic works to libraries is preempted by the Copyright Act, winning an order temporarily blocking the law.

Any works that publishers license to the public must be also be licensed to libraries on “reasonable terms” according to the Maryland law. The measure conflicts with the federal Copyright Act by interfering with the publishers’ right to distribute works, Judge Deborah L. Boardman wrote in an opinion for the U.S. District Court for the District of Maryland.

The only way publishers can avoid the law’s reach is by not selling licenses to the public, according to the opinion. Publishers who don’t offer libraries the licenses face steep civil and some criminal penalties, forcing the publishers to offer licenses to libraries, the court said.

“It is clear the Maryland Act likely stands as an obstacle to the accomplishment of the purposes and objectives of the Copyright Act,” Boardman wrote. “This forced transaction between publishers and libraries effectively strips publishers of their exclusive right to distribute their copyrighted work—a right that necessarily includes the right to decide whether, when, and to whom to distribute.”

Boardman in a separate order found that the publishers met the four factors needed for the court to grant a preliminary injunction, stopping Maryland from implementing the law for now.

The AAP, whose members include HarperCollins Publishers Worldwide and Cambridge University Press, showed that it will likely succeed in its claim that the Maryland act is preempted by the Copyright Act, AAP members will suffer irreparable harm if there’s no injunction, an injunction is in the public interest, and the balance of equities tips in favor of the AAP.

The suit is being closely watched by other states who are considering proposing similar legislation. New York Gov. Kathy Hochul vetoed one bill, and others are pending in Rhode Island and Massachusetts.

Library associations have supported the Maryland law and similar legislation saying it gives libraries a fairer deal on licenses for digital works. The public interest is better served by publishers having the exclusive rights guaranteed to them under the Copyright Act, Boardman wrote.

While libraries offer a vital public service, federal legislation is necessary to carve exceptions for libraries in the Copyright Act, the court ruled.

“Libraries face unique challenges as they sit at the intersection of public service and the private marketplace in an evolving society that is increasingly reliant on digital media,” Boardman wrote. “Striking the balance between the critical functions of libraries and the importance of preserving the exclusive rights of copyright holders, however, is squarely in the province of Congress and not this Court or a state legislature.”

Oppenheim + Zebrak LLP represents the AAP.

The case is Association of American Publishers Inc. v. Frosh, D. Md., No. 1:21-cv-03133, 2/16/22.

To contact the reporter on this story: Samantha Handler in Washington at shandler@bloombergindustry.com

To contact the editor responsible for this story: Renee Schoof at rschoof@bloombergindustry.com