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Copyright Clearance Center And Intellectual Property

Last week I received a check for a few hundred dollars from the Copyright Clearance Center. The check amount reflected 28% withholding of around a hundred bucks since I didn’t provide them with my social security number. If you aren’t familiar with the Copyright Clearance Center, or CCC, they are the clearing house for receiving and distributing overseas royalties from countries that regulate photocopying from books and mandate payment to the publishers. They also handle U.S. rights licensing for academic packages and some other uses, but I’m not concerned with that part of their business which is consensual, ie, both the publishers and the end users have agreed to the arrangement, with the CCC taking 15%.

The reason I didn’t respond to annual requests from the CCC to provide my taxpayer information is that I didn’t want to do business with another government granted monopoly. It’s bad enough that U.S. publishers are stuck with Bowker and their overpriced ISBN services, but working with the CCC is neither a right nor a privilege, it’s compulsory, forced on publishers by international agreements. I know publishers who look at any payment of this kind as some kind of bonus, but I’m not capable of seeing it that way, no doubt due to my extended struggles with piracy.

The next stop down this slippery slope is where Google Adsense gets legal permission to stop responding to DMCA takedown requests and starts issuing publishers royalty payments for stolen works, 15% of the amount that Google and the pirate split for the advertising sold. After all, from their standpoint, it’s Google and the pirates who are doing all the work, so what right would the publisher have to complain? Again from their standpoint, the free market of competitive bids for ad placement is setting the prices, so the publisher’s feelings about value are irrelevant. And of course, there’s the triumphant argument that you can’t stop it, so you have to accept it.

Returning to the Copyright Clearance Center, I finally phoned them last year to find out why they were sending me these requests for tax information when I had no intention to allow them to represent me, and after several calls, got through to an account rep who was able to offer a partial explanation. Pages (I don’t know how many or which) from one of my computer books had been used (it was unclear over what period of time) as a course package in one or more schools in one or more countries that pay royalties to the CCC for distribution. That wasn’t enough of an explanation for me so I asked to speak to somebody in their legal department.

A few weeks later an attorney from their legal department replied, and I’ll include the most relevant paragraphs below:

Unlike the US, where CCC can only offer permission to photocopy or digitally disseminate your works if we have your express, contracted agreement, most other countries allow the photocopying and other copying of works without the permission of the rightsholder.  Through statutory or legal licenses, levies on copying equipment, or agreements with local rightsholders that get extended to non-national rightsholders by law, Reproduction Rights Organizations (RROs) in those countries are able to collect royalties for the use of works.  Through a network of agreements, RROs exchange those royalties.  CCC, as the RRO for the United States, has agreements with other RROs to repatriate royalties for US rightsholders, which we pass on to publishers and authors.

In other words, publishers have no say in the matter as to whether or not the CCC collects money (and takes their commission) from other countries. And the “other copying of works” I highlighted may already mean that the Google and pirates are teaming up for legal piracy somewhere in the world. As to simply rejecting the royalties:

Of course, it is entirely your decision as to whether to accept this payment or not.  If you do accept this payment, that would not imply that you have granted any permission to CCC or any other entity to copy your works or to represent you in any way.  Accepting or rejecting this payment will have no impact on the copying of your work in those countries where it is permitted without your authorization.  If you reject this payment, CCC will place those royalties in a fund that is used for activities such as anti-piracy work, litigation against infringement, and copyright education, which we conduct on behalf of all US rightsholders as part of our Mission.

In other words, publishers can either take the money, or the CCC will hand it over to to another group of people who will spend it going to overseas conferences, flying business class, and paying themselves nice salaries. Or in the words of a useless employee I recall who helped drive a business into bankruptcy, “Working damn hard.”

So come tax time, I’ll be waiting for a 1099 misc made out to Foner Books that I can attach to my 1040 so I don’t have to pay taxes on this amount twice. Amusingly, the IRS representative I spoke to in order to clarify the procedure was no stranger to the CCC. Apparently, I’m not the only publisher or rights owning author who doesn’t rush to fill out tax paperwork sent out of the blue in a package that screamed “scam.” The CCC attorney acknowledged that their mailing pieces are poor, but didn’t think it would be cost effective to improve it given that most publishers are already on board.

I don’t really have a bone to pick with CCC, other than the fact I tend to suspect that everybody who isn’t self employed or working for peanuts is overpaid, especially when a government granted monopoly is involved. But my preference would be for the U.S. to drop out of any Reproduction Rights Organizations that don’t require publisher consent. If publisher consent is required for U.S. copying, why shouldn’t it be required in every country that’s sophisticated enough to have a royalty reporting system in place?

As far as losing out on revenue goes, I’d rather preserve my rights than be in the business of selling fig leafs to photocopier loving academics. And as much as I hate to give the Google guys any encouragement in their quest to take a cut of every information transaction in the world, I don’t see much difference between metering photocopying and paying an arbitrary royalty to the publisher without the publisher’s consent, and doing the same thing on the Internet. It’s all stealing, but that never stopped a special interest group from buying politicians and getting their thefts legalized.

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