I am not a lawyer, but it seems to me those of the Big 6 publishers who have been playing the price-fixing Agency Model racket have left themselves wide open for class-action lawsuits if their “agents” go out of business and lose the eBooks of their customers.
Traditionally, this has been the sales chain in print publishing:
It was also that way with eBooks until recently. This traditional model insulated publishers from the customer relationship. Once they sold their product to the middlemen, the customer had this relationship to deal with if any problems developed:
And this was the case with eBooks too. If an eBook retailer went under, the only recourse a customer had was against the retailer itself in whatever manner that was possible (such as bankruptcy court).
Until Apple entered the picture and proposed the Agency Model, which allowed publishers to set their prices. The Agency Model changed the entire chain of liability. Publishers are saying, in effect, “These books belong to us — not to any middleman or retailer — and you sell them at the price we set and simply get a sales commission.”
That new sales chain now looks like this:
Now what happens when the “Agent” disappears? When, basically, the agent of the publisher goes into dissolution — as giant bookseller Borders might? The relationship is revealed to actually be this:
It seems to me that if Borders goes under and people no longer have access to their eBook purchases via their Borders online Library, that the publishers are now legally liable for replacing those eBooks in perpetuity.
Attorneys, starting reviewing your case law and precedents!
And the Big 6 of publishing had better start consulting their own attorneys too.
reposted with permission from Mike Cane’s Xblog