Differentiated rights
Or, as also pointed out by Mr. Steuart, he may "impose upon any of these estates any condition or limit," as by limiting the use (28) for special purposes, (29) at a special price, or (30) for a special time, or (31) in a special locality, or (32) to a special person.
Court protection
The rights scheduled, adds Mr. Steuart, the courts will protect (a) "in equity by injunction and the recovery of profits"; or (b) "at law by a civil action for trespass or conversion, with a recovery of special damages for actual injury or punitive damages for injury to reputation, or by replevin for the recovery of possession of the work, as well as by any other form of action known to the common law or statute law and proper to the protection of this class of property."
Division of rights
The owner of the copyright of a book may thus publish a limited edition of his book and sell it to whom he may please, or for a specified market. Such specified or divided rights are recognized in Germany as "getheiltes Verlagsrecht," in France as "édition partagée," and there is specific reference to them in the German copyright law. Some of the specified rights are cognate to the rights of a proprietor of land to sell a piece of land subject to certain restrictions, agreed upon with the purchaser or imposed upon the title in the deed of transfer. As in the frequent practice of restricting use for the purposes of a stable or a shop, or requiring that only one house shall be built on a specified number of lots.
Analysis of property rights
In an elaborate discussion of fundamental principles in his opinion in Harper v. Donohue, in 1905, affirmed by the Circuit Court of Appeals in 1906, Judge Sanborn analyzed the property rights of an author before publication, after unrestricted publication and after publication under the copyright acts. Among the rights before publication he mentions "the right to sell and assign the author's interest, either absolutely or conditionally, with or without qualification, limitation or restriction, territorial or otherwise, by oral or written transfer. Such literary property is not subject either to execution or taxation, because this might include a forced sale, the very thing the owner has the right to prevent." "Unrestricted publication," he says, "without copyright, is a transfer to the public to do most of the things the author might do, in common with the author, except all right of transfer and sale, which remains to the author; but without advantage, since the work has become, by the publication, common property." "The copyright acts," he concludes, "substantially give the following additional rights: To copyright, and thus secure the sole privilege of unlimited multiplication and sale of copies; to sell or transfer the unlimited right of reproduction, sale and publication, the limited right of serial publication, the right of publication in book form, the right of translation, the right of dramatization or one or more of these rights in specific territory, and the right to secure a copyright either generally, or in one or more countries whose laws permit it, either in the name of the author or assignee. Also the right to the author to license the sale or other restricted enjoyment of some lesser right, without the power to copyright."
The courts have indeed held to very broad principles as to such rights. In the case of Press Pub. Co. v. Monroe, the court said:
Broad interpretation
"The right of property includes the right to transfer the subject of it or any interest in it by gift, grant, or device. And if the fruits of mental effort are regarded as property, like all other possessions, they descend to the legatees, the executors, and administrators of their creditors; they pass by sale or gift to their transferees; the use of them, limited or unlimited, goes to their licensees, and, logically, the power of the State is bound to protect forever the successive owners in the exclusive use and enjoyment thereof."
Limits of protection
Where these latter rights are not specifically granted by statute, the rule has been established by the courts that they will be upheld so far as necessarily inferable from the rights granted and not further. It is under this rule that the greater number of the mooted questions in the application of copyright law have arisen in respect to the scope of copyright. Most of these specific rights are in fact necessary inferences from the statute, in the protection of the property rights therein conferred, but the courts will not go beyond fair construction of the letter of the statute.
Differentiated contracts
In respect to the rights to give, lend, grant, manufacture, lease or license, mortgage or devise copyright property, it may be said that these are subsidiary rights conditioned on and essential to the general right of property in copyrightable or copyrighted material. An author may exercise any of these rights in respect to his unpublished work so far as they are applicable to it, or to his copyrighted work after publication; and either the copyrightable manuscript or the copyrighted work may pass by inheritance. Thus an author may manufacture, or cause to be manufactured, his unpublished work, and he may retain exclusive control over the manufactured copies so long as he pleases before publishing the work; and after publication (which involves placing on public sale, or publicly distributing) he may exercise these rights negatively by withdrawing his work from further sale. The English law, however, contains a provision that in certain cases the Crown may require continuance of publication.
Enforcement in limited grants
In respect to the right to limit the use of his work under his sale, gift, loan, grant, lease, etc., for a special purpose or at a special price, or for a special time, or in a special locality or to a special person, these powers of limitation, though implied in the grant of copyright, are dependent for their enforcement rather upon the law of contracts than upon copyright law.
There can be no such thing as a copyright for a special purpose or for a special locality, or under other special conditions, for there can be only one copyright, and that a general copyright, in any one work. But specific contracts can be made, enforceable under the law of contracts, as for the sale of a copyrighted book within a certain territory, provided such contracts or limitations are not contrary to other laws. Although record of assignment in the Copyright Office is provided for by the law only for the copyright in general, the separate estates as a right to publish in a periodical and the right to publish as a book may be sold and assigned separately, and the special assignment recorded in the Copyright Office, though this does not convey a right to substitute in the copyright notice a name other than that of the recorded proprietor of the general copyright, which can only be changed as specifically provided in the law under recorded assignment of the entire copyright.
Copyright as monopoly
Copyright is a monopoly to which the government assures protection in granting the copyright. It is a monopoly not in the offensive sense, but in the sense of private and personal ownership; the public is not the loser but is the gainer by the protection and encouragement given to the author. The whole aim of copyright protection is to permit the author to sell as he pleases and to transfer his rights collectively or severally to such assigns as he may choose. Copyright is a monopoly only in the sense that any ownership is a monopoly. Says Herbert Spencer: "If I am a monopolist, so also are you; so also is every man. If I have no right to those products of my brain, neither have you to those of your hands. No one can become the sole owner of any article whatever; and all property is 'robbery.'" In the copyright debates of 1891, Senator O. H. Platt rightly said: "The very essence of copyright is the privilege of controlling the market. That is the only way in which a man's property in the work of his brain can be assured." And as Senator Evarts pointed out in the same debate: "The sole question is what we shall do concerning something which is the essential nature of copyright and patent protection, namely, monopoly." In discussing patent monopoly and the law of contracts in Victor Talking Machine Co. v. The Fair, the U. S. Circuit Court of Appeals, through Judge Baker, said, in 1903, that "within his domain the patentee is czar. The people must take the invention on the terms he dictates or let it alone for seventeen years." Thus as the government grants and guarantees the monopoly, it is not to be taken as in restraint of trade or otherwise contrary to law. Said Judge Cullen in the case of Murphy v. Christian Press Association, in the Appellate Division of the N. Y. Supreme Court, in 1899, decisions as to agreements in restraint of trade "have no application to agreements concerning copyrights and patents, the very object of which is to give monopolies."
Limit only in term
Copyright being in essence a monopoly giving to the copyright proprietor "exclusive rights," as the Constitution provides, the only limitation upon it should be that indicated in the Constitution which confines protection to "limited times." The opponents of copyright have frequently taken the course of falling back upon the plea that in the interests of the public the author should not have exclusive right to his writings and to manage his own affairs, but that Congress should prescribe how he should market his property. This commonly takes shape in the licensing scheme known in England as the Farrer plan and in America as the Pearsall-Smith plan, with respect to books; and in the passage of the "international copyright amendment" of 1891 this plan was made the basis of attack upon the measure. An analysis of the scheme as presented by R. Pearsall-Smith of Philadelphia is given by G. H. Putnam, from the book publisher's point of view, in the "Question of copyright." In the work on "The law and history of copyright," by Augustine Birrell, a member of the present British cabinet, this plan is characterized as a "preposterous scheme." In the case of a book, for instance, a publisher often suggests to the author the general idea of the book, so that it would be doubly unjust to permit any other publisher to issue that book on the compulsory license scheme; and this might hold true, although to less extent, in other fields of copyright. In any event, the original publisher makes large investment not only in type-setting, printing, and binding a book, or in the publishing of any other work, but in advertising and making a market, and that a rival publisher should have the benefit of this market without paying the cost is a violation of the very essence of property. This scheme, however, is applied, in a limited way and as a compromise, respecting mechanical music, in the American code of 1909, and constitutes its most serious defect. There is question, indeed, whether the compulsory license and fixed price may not be an unconstitutional provision. This matter is more fully discussed in later chapters.
Altered theory of copyright
It should be noted that whereas the previous American law required certain statutory formalities before publication, the new American code somewhat alters the theory of copyright, and more nearly conforms statutory with common law, by making publication with notice the initial copyright act and registration and deposit secondary acts necessary for the completion of the copyright and its protection under the statute.
Publishing
The definition of the date of publication (sec. 62) as "the earliest date when copies of the first authorized edition were placed on sale, sold, or publicly distributed by the proprietor of the copyright or under his authority" remedies the vagueness of the previous law and adopts into the statute court decisions to the effect that acts not by the authority of the author or proprietor do not constitute publication in the sense of dedication to the public. In other words, it is made clear that the right to publish inheres in the author and that he cannot be divested of it without his consent. This is the fundamental principle of the new law in the vital matter of protecting the author at the critical point at which an unpublished work, absolutely his own, becomes a published work, subject to statute. In this respect the American code of 1909 comes very close to the acceptance of the right in intellectual property as a natural and inherent right.
What constitutes publishing
As to what constitutes publishing, interpretation by the courts based on previous law will in many respects be applicable to the new code. A book which has been sold or leased to subscribers on a contract of restricted use is none the less published, as was set forth in the opinion by Chief Judge Parker of the N. Y. Court of Appeals in Jewellers' Mercantile Agency v. Jewellers' Weekly Pub. Co. in 1898, and in the opinion by Judge Putnam of the U. S. Circuit Court in Massachusetts in Ladd v. Oxnard in 1896, both having reference to credit-rating books leased to subscribers for their individual use.
"Privately printed" works
Publication depends upon sale or offer to the public, and it is a question whether the sale or offer of a copyrightable work, as the proceedings or publications of a society, to the members of that society only, constitutes publication, to be passed upon by the courts in view of the specific facts. A work "privately printed" or with the imprint "printed but not published," given or even sold by the author to his friends, and not sold generally by his authority, would probably not be held to be published; but the courts would probably hold that the sale of a work, though "privately printed," to merely nominal members of a nominal society, made up of the purchasers of the work, would constitute publication and, if without copyright notice, dedication.
Copying
As to the right to copy, this word in the broad sense as interpreted by the courts, covers the duplicating or multiplying of copies within the stated scope of the statute. It was argued in the mechanical music cases that the word copy extends to any form or method of duplication by which the thought of the author can be recorded or conveyed, but, as more fully stated in the chapter on mechanical music, the U. S. Supreme Court in White-Smith v. Apollo Co. in 1908 upheld the decision below that a perforated roll is not a copy in fact of staff notation, and thus limited the statutory use of the word to duplication by similar or corresponding process. It was for this reason that such specific phrases as "to make any other version," "to convert," "to arrange or adapt," "to make transcription or record" were included in the new code, although these would be included in the broader sense of the right "to copy."
Vending
The right to vend covers by a comprehensive word those general rights of sale through which only can the author obtain remuneration for his work. The most important question which has arisen in respect to the application of this word, which is used both in the previous laws and in the present code, has been as to the use of this exclusive right to limit the conditions of sale after the original sale from the author or proprietor as vendor to the immediate vendee. The courts have in general held that the copyright and patent laws, while creating a legal monopoly for the author or original proprietor, do not authorize any continuing control, and have indeed gone so far as to indicate that a sale is absolute and complete unless limited by special contract within the principles of common or statutory law of contracts. In the leading case of Keeler v. Standard Folding Bed Co., the U. S. Supreme Court in 1895, through Justice Shiras, said:
Control of sale
"Upon the doctrine of these cases we think it follows that one who buys patented articles of manufacture from one authorized to sell them becomes possessed of an absolute property in such articles, unrestricted in time or place. Whether a patentee may protect himself and his assignees by special contracts brought home to the purchaser is not a question before us and upon which we express no opinion. It is, however, obvious that such a question would arise as a question of contract, and not as one under the inherent meaning and effect of the patent laws."
Specific relation to copyrights: the Macy cases
This question in specific relation to copyrights again came before the U. S. Supreme Court in a series of cases, known as the Macy cases, between Isidor and Nathan Straus doing business as R. H. Macy & Co., on the one side, and the Bobbs-Merrill Co. and Charles Scribner's Sons as the respective defendants.
In both cases, the publishers had sought to maintain the retail price of a book, as a right under the copyright law. The Bobbs-Merrill Co. copyrighted the "Castaway" May 18, 1904, and immediately below the copyright notice printed the following in each copy: "The price of this book at retail is one dollar net. No dealer is licensed to sell it at a less price, and a sale at a less price will be treated as an infringement of the copyright."
The Scribners sought to accomplish the same purpose as to their copyright books by printing in their catalogues, invoices and bills of goods the following notice: "Copyrighted net books published after May 1, 1901, and copyrighted fiction published after February 1, 1902, are sold on condition that prices be maintained as provided by the regulations of the American Publishers' Association."
New dealers were required by the American Publishers' Association, in consideration of a discount allowed by the publisher in question, to enter into an agreement as indicated, but this agreement Macy & Co. refused to accept and they bought books as best they could and sold them at "cut rates," thus inducing dealers from whom the purchases were made to violate the agreement with the publishers.
The Bobbs-Merrill case
In the leading case of Bobbs-Merrill Co., appellant, v. Straus, the opinion of the U. S. Supreme Court was delivered June 1, 1908, by Justice Day, who said: "The precise question in this case is, does the sole right to vend (named in section 4952) secure to the owner of the copyright the right, after a sale of the book to a purchaser, to restrict future sales of the book at retail to the right to sell it at a certain price per copy, because of a notice in the book that a sale at a different price will be treated as an infringement, which notice has been brought home to one undertaking to sell for less than the named sum? We do not think the statute can be given such a construction, and it is to be remembered that this is purely a question of statutory construction. There is no claim in this case of contract limitation, nor license agreement controlling the subsequent sales of the book. In our view the copyright statutes, while protecting the owner of the copyright in his right to multiply and sell his production, do not create the right to impose by notice, such as is disclosed in this case, a limitation at which the book shall be sold at retail by future purchasers, with whom there is no privity of contract."
The Scribner case
In the Scribner case the decision delivered on the same day by the same justice, upheld the lower courts in their view, "that there was nothing in any of the notices of a claim of right or reservation under the copyright law," and "that independent of statutory law" the question of relief in equity was not open to the federal courts because there was no diversity of citizenship nor claim above $2000 "requisite to confer jurisdiction of questions of rights independent of the copyright statutes." On the allegations of the bill as to alleged contributory infringement by inducing dealers to sell in violation of agreement, on which the lower courts held that complainants had not proved an agreement based upon their printed notice, the Supreme Court declined to review the question of fact.
English underselling case
In the English case of Larby v. Love, in 1910, however, Justice Bucknill in the King's Bench held the defendant liable for damages for the sale of certain maps to undersellers in disregard of prohibitions specified in the bill of sale.
Suits under state law
The Macy cases included suits in the New York State courts by Straus v. American Publishers' Association et al., claiming that the action of the publishers in endeavoring to maintain rates constituted a conspiracy in restraint of trade contrary to the statutes. The N. Y. Court of Appeals held, through Chief Judge Parker, that the agreements would have been free from legal objections if confined solely to copyright publications, but were contrary to the statute in affecting the right of a dealer to sell books not copyrighted at the price he chooses. The copyright side of the question was again pressed in the lower courts and reached the Court of Appeals a second time in 1908, when it was passed upon by a divided court, four to three, Judge Gray for the court declining to review its previous action. The dissenting judges, through Judge Bartlett, held that the decision of the U. S. Supreme Court in the Bobbs-Merrill case did apply in the current case and that the State Court of Appeals should therefore conform its decision to the finding of the federal Supreme Court. The question has been brought into the federal courts in a new series of suits, and it has yet to be finally settled by the U. S. Supreme Court, whether the legal monopoly conferred by the copyright statute safeguards the copyright proprietor against certain provisions of the anti-trust laws, state or national.
Translating