Recorded Books, NetLibrary in Lawsuits Over Audiobook Service
Jennifer Pinkowski -- Library Journal, 7/17/2007
Recorded Books and NetLibrary are suing each other for breach of contract, violation of copyright, unfair competition, and defamation, among other charges, according to documents filed in U.S. District Court in Baltimore, MD, in May and June. So far, service to the 1700 libraries that subscribe to Recorded Books’ content through NetLibrary seems largely unaffected by the litigation.
The dispute comes three years into a licensing and distribution agreement that made approximately 2000 e-audiobooks from Recorded Books, the world’s largest provider of audiobooks, downloadable through NetLibrary, a division of the Ohio-based nonprofit library giant OCLC Online Computer Library Center.
According to the claim filed May 31 by Recorded Books, based in Frederick, MD, the deal was supposed to be an exclusive one. Yet NetLibrary entered into agreements with the Bibliographical Center for Research and SOLINET to distribute e-audiobooks from publishers such as Random House, Books on Tape, Listen and Live, Listening Library, and Blackstone Audio, according to Recorded Books. On May 4, Recorded Books subsequently notified "numerous" subscriber libraries that the contract had been terminated and that no Recorded Books content would be available through NetLibrary after May 31.
Content still available
NetLibrary quickly fired back with its own letter, assuring librarians that Recorded Books content would indeed be available after May 31--and for the following three years. Revenue benchmarks set in the contract had been met, which had triggered an automatic extension of the agreement to 2010, according to NetLibrary.
Recorded Books' initial suit charged NetLibrary with both breach of contract and copyright infringement, the latter stemming from NetLibrary’s continuing distribution of its content. NetLibrary’s counterclaim, filed on June 19, says content from other e-audiobook providers is allowed as long as Recorded Books consents to it--but that Recorded Books refused to meet with NetLibrary to do so, causing NetLibrary to "suffer economic damages."
Hearing on July 24
On June 22, Recorded Books filed an injunction to force NetLibrary to immediately stop distributing its content; a hearing is scheduled for July 24. Neither Recorded Books nor NetLibrary would comment to Library Journal on the details of the litigation, nor what the impact has been on subscriber libraries.
"Sub-par" customer service is another reason Recorded Books terminated the contract, according to its complaint. Cited in the suit is Iowa City Public Library, IA, which in January lost NetLibrary service for a week while the latter tried to fix a long-standing glitch over user authentication, according to Recorded Books’ complaint.
ICPL librarian Kara Logsden, who oversees the library’s downloadable content, confirmed to LJ the week-long "shutdown" but wouldn’t say whether it was the result of poor service. ICPL has since dropped NetLibrary for its main competitor, OverDrive. NetLibrary protests that of the libraries with e-audio subscriptions, Recorded Books identified only 14 alleged complaints, and that 88 percent of libraries renewed their subscriptions between February 2006 and February 2007.
ICPL was unaware it was mentioned in Recorded Books’ lawsuit. Few libraries seem to know about the pending litigation, says Judy Napier, who sits on the Public Library Association’s audiovisual committee. Napier learned of the lawsuit through LJ. "We just met at the annual ALA [conference] and no one mentioned it," Napier said.
