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Decision of Note: Second Circuit Rules on e-Book Sample in Digital Locker

The U.S. Court of Appeals for the Second Circuit decided that an agreement between a book author and a publisher allowed a customer of distributor Barnes & Noble to retain a sample of the book in the “digital locker” the distributor provided to the customer.

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The U.S. Court of Appeals for the Second Circuit decided that an agreement between a book author and a publisher allowed a customer of distributor Barnes & Noble to retain a sample of the book in the “digital locker” the distributor provided to the customer. Smith v. BarnesandNoble.com LLC, 15-3508.

Louis K. Smith, author of a book titled The Hardscrabble Zone, entered into an agreement for Smashwords to publish an e-version of the book. Smith sued BarnesandNoble.com after he terminated his agreement with Smashwords. The copyright infringement suit complained about a licensed sample from Smith’s book on one BarnesandNoble.com customer’s digital locker. The U.S. District Court for the Southern District of New York decided that BarnesandNoble.com wasn’t liable for either direct or contributory copyright infringement.

Declining to address the infringement issue “given the sparse facts of the case,” the Second Circuit instead noted: “The plaintiff had a distribution agreement that explicitly permitted the distribution of samples as promotional material.” The appeals court added: “[T]he agreement provides for the distribution of samples with a license ‘for free, noncommercial use, duplication and sharing,’ without provision to terminate the license for samples already distributed in the event the distribution agreement itself is terminated. Significantly, the distribution agreement authorizes paper samples as well as digital samples, and treats them alike. Since a customer who has a paper sample may obviously keep it, reread it, and make additional paper copies of it for noncommercial use at will, it follows that the agreement does not provide or imply that a person who obtained a digital sample would lose the license for free access upon termination of the distribution agreement.”

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Stan Soocher 
is Editor-in-Chief of Entertainment Law & Finance and a tenured Associate Professor of Music & Entertainment Studies at the University of Colorado’s Denver Campus. He is the author of Baby You’re a Rich Man: Suing the Beatles for Fun & Profit (ForeEdge/University Press of New England) (http://amzn.to/1EWt79L). For more, visit www.stansoocher.com.

The views expressed in the article are those of the authors and not necessarily the views of their clients or other attorneys in their firm.

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