v.
`
`BRIAN E. FROSH, in his official capacity as
`Attorney General of the State of Maryland,
`
`
`Plaintiff,
`
`200 St. Paul Place
`Baltimore, MD 21202,
`
`
`
`
`
`
`
`
`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 1 of 31
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF MARYLAND
`
`
`ASSOCIATION OF AMERICAN
`PUBLISHERS, INC.,
`
`
`455 Massachusetts Avenue, NW
`Washington, DC 20001,
`
`
`
`
`
`
`
`
`
`Civil Action No. ___________
`
`
`
`Defendant.
`
`
`COMPLAINT FOR DECLARATORY AND INJUNCTIVE RELIEF
`
`The Association of American Publishers, Inc. (“AAP”), by and through its undersigned
`
`counsel, hereby brings this action to enjoin enforcement of extraordinary new legislation from
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`the State of Maryland that distorts the free marketplace and contravenes federal law. In support
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`of its Complaint, AAP alleges as set forth below.
`
`NATURE OF THE CASE
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`1.
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`AAP is the national trade association for the U.S. publishing industry, which
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`publishes some of the most acclaimed fiction, nonfiction, children’s books, education materials,
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`and scholarly works in the world. The industry’s varied publishing houses—both commercial
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`and nonprofit entities across the country—contribute mightily to the modern creative economy.
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`To do so, they invest considerable resources and make incalculable marketplace-based decisions,
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`relying on the uniform and unambiguous authority of the U.S. Copyright Act.
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 2 of 31
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`2.
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`American publishers serve hundreds of millions of readers each year in both local
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`and global communities, and, for more than two centuries, have been an essential catalyst for
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`democracy and the distribution of knowledge. Yet the vitality of the publishing industry cannot
`
`be taken for granted. It requires, and has always required, publishers to make decisions about the
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`timing, pricing, and formats of their books, and to balance the various, competing, and ever-
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`evolving business models for distribution, access, and enjoyment. This is the way all content
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`businesses endure and serve the public interest, whether they invest in books, music, movies, or
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`newspapers.
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`3.
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`AAP brings this action to prevent an unauthorized, unprecedented, and unjustified
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`encroachment by a state into federally protected intellectual property rights and the creative and
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`financial investments that such rights represent. The State of Maryland has enacted legislation,
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`Md. Code, Educ. §§ 23-701, 23-702 (hereinafter, the “Maryland Act”), that requires publishers
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`to distribute ebooks, audiobooks, and other digital literary works to public libraries in Maryland,
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`as well as controls the timing and terms for doing so. The Maryland Act thus commandeers the
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`rights of publishers and authors, in direct contravention of federal copyright law.
`
`4.
`
`The authority of the U.S. Congress—not state legislatures—to prescribe the scope
`
`of rights for copyrighted works is enshrined in Article I of the United States Constitution. The
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`Constitution explicitly empowers Congress to enact a system of exclusive rights by which
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`authors will be incentivized to create, disseminate, and be compensated for their writings. Today,
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`Title 17 of the United States Code codifies a lengthy and complex statute of exclusive rights,
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`remedies, exceptions, and limitations that govern the reproduction, distribution, public display,
`
`public performance, and transmission of creative works, including over the Internet (the
`
`“Copyright Act” or “copyright law”). Congress has enacted and amended these provisions over
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`
`
`2
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 3 of 31
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`the years as necessary in its expert judgement, following extensive and transparent deliberations
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`with affected stakeholders—including libraries—and in keeping with the many trade and treaty
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`obligations of the United States that pertain to the treatment and protection of creative works
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`across borders.
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`5.
`
`Set to go into effect on January 1, 2022, the Maryland Act is a frontal attack on
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`these federal rights and those who depend upon them to make a living. The state law seeks to
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`establish a right by public libraries to demand limitless digital copies of literary works, on terms
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`the State of Maryland deems “reasonable,” and other artificial advantages that contravene federal
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`law and the free marketplace.
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`6.
`
`The Maryland Act supplants the fundamental authority of publishers and authors
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`to determine whether, on what terms, and in which markets and channels they will distribute
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`their literary works. It interferes with marketplace-based decisions that, pursuant to federal
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`copyright law, are the responsibility and prerogative of copyright owners to determine, and
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`which directly affect both the short-term success and long-term promise of books and the
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`additional creative properties they may spark. The Maryland Act will take these decisions out of
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`the hands of copyright owners, and instead impose an unprecedented state-level compulsory
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`licensing scheme.
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`7.
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`The Maryland Act would put one set of beneficiaries of the copyright system—
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`libraries—in positions of unprecedented control, empowering them to direct and diminish the
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`copyright owners who create and own the intellectual property in demand. The Maryland Act
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`ignores that libraries have always had to make careful choices in serving patrons and using
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`taxpayer money. Libraries have never had unfettered rights to every literary work upon demand,
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`nor have they had the authority to set terms that subvert publishers’ commercial recoupments and
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`
`
`3
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 4 of 31
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`profits, as would be the case under the Maryland Act. Libraries play a critical but carefully
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`prescribed role within a broader copyright value chain—a chain that necessarily begins with
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`authors and is fueled by the publishing houses to whom the authors entrust their copyrights.
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`8.
`
`The Maryland Act is preempted as a matter of law. The Maryland Act conflicts
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`with a long-established, carefully balanced, and complex federal legal framework enacted by
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`Congress to govern the protection and disposition of copyrighted works in the United States and,
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`through international treaties, beyond U.S. borders. The Maryland Act overrides publishers’
`
`exclusive rights under federal copyright law, in violation of both express and conflict preemption
`
`principles, as well as the Commerce and Due Process Clauses of the United States Constitution.
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`9.
`
`This lawsuit is necessary to address the Maryland Act’s threat to the copyright
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`marketplace and everyone who makes that marketplace possible. It does not, however, reflect
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`lack of interest on the part of publishers in supporting their library partners. Indeed, the United
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`States has an extensive and hugely successful public lending library enterprise, by which patrons
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`have access to millions of ebook and audiobook titles, at the same time those titles are available
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`through booksellers and digital platforms. Most publishers already make their full digital
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`catalogs available to public libraries in Maryland and elsewhere. As a result, in addition to print
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`checkouts, libraries in Maryland already boast many millions of digital checkouts per year, far
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`exceeding their reach during the nineteenth and twentieth centuries. As publishing has grown, so
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`too have libraries.
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`10.
`
` The legislative history of the Maryland Act makes clear that the state law was not
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`adopted to address a failure by the publishing industry to provide literary works in digital format
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`to libraries for lending to patrons. There already is a robust market for ebook and audiobook
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`distribution between publishers and libraries. The Maryland Act’s legislative history and public
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`
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`4
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 5 of 31
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`statements by state legislators and public officials reveal that the Maryland Act arises primarily
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`from concerns regarding Amazon, which is not an AAP member. Yet state-level policy concerns
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`about Amazon’s distribution practices relating to books it publishes independently do not justify
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`intrusive legislation that harms publishing houses of all sizes and specialties. Moreover, the
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`Maryland Act is not limited to the publishing houses of the United States; any foreign publisher
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`transacting in the state will be subject to its reach, creating serious questions of treaty compliance
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`and international reciprocity.
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`11.
`
`For all these reasons, and as described further below, AAP seeks (1) an order
`
`declaring the Maryland Act void and unenforceable because it is preempted by federal law and
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`unconstitutional, and (2) a preliminary and permanent injunction enjoining enforcement of the
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`Maryland Act.
`
`PARTIES
`
`12.
`
`AAP is the national trade association for book, research journal, and education
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`publishers in the United States. AAP is a 501(c)(6) not-for-profit corporation organized and
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`existing under the laws of the State of New York, with its principal office at 455 Massachusetts
`
`Avenue, NW, Washington, DC 20001.
`
`13.
`
`AAP litigates this action on behalf of its members. AAP represents the leading
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`consumer, educational, professional, and scholarly publishers in the United States and counts
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`more than 120 publishers across the country as its members. AAP’s members include large and
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`small trade and consumer publishers, university presses, independent publishers, education
`
`publishers, and publishers of research journals. Together, these publishers invest in and produce
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`a valuable array of literature, children’s books, history, political books, and countless other
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`genres that are indispensable to public discourse and personal enrichment; critically acclaimed
`
`
`
`5
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 6 of 31
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`course materials that prepare students to lead and contribute to an increasingly complex world;
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`and academic books and research journals that advance thousands of disciplines across medicine,
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`science, and the humanities. AAP’s members publish books in every format—from traditional
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`hardcover and paperback books to ebooks, audiobooks, and other digital literary works—across a
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`wide range of subjects.
`
`14.
`
`AAP represents its members on matters of law and policy, advocating for
`
`outcomes that incentivize the publication of creative expression, professional content, and
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`learning solutions and that enable publishers to effectively enforce their intellectual property
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`rights. Among AAP’s most critical priorities is ensuring the viability of the United States’ more
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`than 200-year-old copyright framework that encourages publishers to invest in and distribute a
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`great variety of books to the public.
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`15.
`
`AAP has associational standing to bring this suit on behalf of its member-
`
`publishers. AAP’s members would have standing to individually challenge the Maryland Act.
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`The statute would require publishers under threat of state sanction to make certain distributions
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`of their digital literary works. This directly interferes with publishers’ reliance on uniform
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`federal copyright principles and statutory provisions, from which they make a variety of
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`complex, marketplace-based decisions on whether and in what manner to invest in authors,
`
`publish books in a variety of formats, and exercise their exclusive rights under copyright law.
`
`16.
`
`Challenging the Maryland Act is germane to AAP’s mission, which includes,
`
`among other things, representing and advocating for its members with respect to matters of law
`
`and policy that affect the health and vitality of the publishing industry and its ability to serve the
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`public interest.
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`
`
`6
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 7 of 31
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`17.
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`AAP is not seeking monetary relief in this action, but rather only declaratory and
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`injunctive relief for the benefit of all publishers equally. Accordingly, the claims and relief
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`sought do not require proof specific to particular AAP members, and AAP members’ individual
`
`participation is not required.
`
`18.
`
`Defendant Brian E. Frosh is Attorney General of the State of Maryland, with his
`
`principal office at 200 St. Paul Place, Baltimore, MD 21202. Defendant is sued in his official
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`capacity. As Attorney General of the State of Maryland, Defendant is charged with enforcing the
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`Maryland Act. The Maryland Act, in § 23-702(d), provides that Defendant may exercise his
`
`enforcement powers pursuant to Md. Code, Com. Law § 13-401 et seq. The Maryland Act
`
`empowers Defendant to seek, inter alia, injunctive relief and criminal penalties to enforce the
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`statute. See Md. Code, Com. Law §§ 13-406, 13-411.
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`JURISDICTION
`
`19.
`
`This case arises under the United States Constitution and presents a federal
`
`question within this Court’s jurisdiction under Article III of the Constitution, 28 U.S.C. §§ 1331
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`and 1343, and 42 U.S.C. §§ 1983 and 1988. AAP’s claims seek to invalidate the Maryland Act as
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`preempted by federal law and as unconstitutional.
`
`20.
`
`The Court has the authority to grant declaratory relief pursuant to the Declaratory
`
`Judgment Act, 28 U.S.C. §§ 2201 and 2202. The Court has the authority to award costs and
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`attorneys’ fees to AAP under 42 U.S.C. § 1988 and 17 U.S.C. § 505.
`
`21.
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`This Court’s jurisdiction is properly exercised over Defendant in his official
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`capacity, Ex parte Young, 209 U.S. 123 (1908), as AAP is seeking declaratory and injunctive
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`relief.
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`
`
`7
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 8 of 31
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`22.
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`There is an actual controversy of sufficient immediacy and concreteness relating
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`to the legal rights and duties of AAP’s members to warrant relief under 42 U.S.C. § 1983 and 28
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`U.S.C. §§ 2201 and 2202. The harm to AAP’s members as a direct result of the Maryland Act
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`and threatened actions of Defendant is sufficiently real and imminent to warrant the issuance of a
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`conclusive declaratory judgment and prospective injunctive relief. This action presents an actual
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`justifiable controversy that is ripe and concrete because on January 1, 2022, the Maryland Act
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`will take effect, and AAP’s members will then become subject to the risk of liability, as
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`described more fully below.
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`23.
`
`This Court’s immediate review of the Maryland Act’s preemption by federal law
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`and unconstitutionality is necessary to prevent an imminent violation of AAP’s members’
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`fundamental rights.
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`24.
`
`Under these circumstances, judicial intervention is warranted to resolve a genuine
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`case or controversy within the meaning of Article III of the United States Constitution regarding
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`the constitutionality and legality of the Maryland Act.
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`25.
`
`A declaration that the Maryland Act is preempted by federal law and
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`unconstitutional, and an injunction preventing its enforcement, would definitively resolve that
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`controversy for the parties.
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`VENUE
`
`26.
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`Venue is proper in this District under 28 U.S.C. § 1391(b)(1)-(2). Defendant is
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`sued in his official capacity, and his official place of business is located within this District. The
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`events giving rise to AAP’s claims, including the enactment of the Maryland Act, occurred in
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`this District.
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`
`
`8
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 9 of 31
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`GENERAL ALLEGATIONS
`
`The Importance of Copyright
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`27.
`
`Copyright empowers creativity and innovation to the ultimate benefit of the
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`public. Today, copyright is as critical in the modern marketplace as it was when the Framers first
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`adopted the Copyright Clause in Article 1, Section 8, Clause 8 of the United States Constitution
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`in 1787 with an eye to the future potential of the United States. Copyright fosters the creation
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`and dissemination of a wide variety of literary works, by providing the economic incentive for
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`authors and publishers to invest creatively, intellectually, and financially.
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`28.
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`Federal copyright law forms the cornerstone of the United States’ vital publishing
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`industry. A healthy and independent publishing industry, in turn, supports the nation’s political,
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`intellectual, and cultural systems. It is no overstatement to say that the free operation of the
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`publishing industry in a nation cannot be separated from the free exercise of democracy, a tenet
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`that is as true for the United States as it is for other countries.
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`29.
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`Federal copyright enables authors, scientists, educators, and others to produce the
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`books, articles, educational materials, and other literary works that define our culture, support
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`our democracy, educate our youth, and enhance our daily lives. It allows publishers to create,
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`market, and distribute a wide array of high-quality books, journals, and educational materials that
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`support a well-informed public and enrich American culture.
`
`30.
`
`Federal copyright promotes the creation and dissemination of these works by
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`granting copyright owners, including authors and publishers, certain exclusive rights in their
`
`works. These rights stem directly from the United States Constitution. That the U.S. Congress
`
`alone has the authority to prescribe the scope of exclusive rights under copyright, including the
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`reproduction and distribution of copyrighted works, is well-established.
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`
`
`9
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 10 of 31
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`31.
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`One of the fundamental changes made by the 1976 Copyright Act was the
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`adoption of a single federal system of copyright to definitively supersede a dual system that
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`involved a dated panoply of state laws and created confusion for the courts and marketplace
`
`alike. In this signature Act, the U.S. Congress determined that a national, uniform copyright law
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`“would greatly improve the operation of the copyright law and would be much more effective in
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`carrying out the basic constitutional aims of uniformity and the promotion of writing and
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`scholarship.” H.R. Rep. 94-1476 at 129 (1976). In doing so, Congress recognized the
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`immeasurable value of authorship and copyright commerce to United States ingenuity,
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`international trade, and the public interest.
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`The Maryland Act and its Threat to Copyright
`
`32.
`
`The Maryland statute follows the lobbying efforts of a few library groups to
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`fundamentally rewrite U.S. copyright law and profoundly disrupt the vital and delicate
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`publishing ecosystem. The Maryland Act will be the first such state law to go into effect, but
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`some other states—including New York, Rhode Island, and Massachusetts—are likewise in the
`
`process of either adopting or considering copycat legislation. These state intrusions into
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`copyright are rushed and ill-conceived. They disregard that copyright law is exclusively the
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`domain of the U.S. Congress. Further, at the expense of authors, publishers, booksellers, and
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`readers, they ignore that the public interest comprises much more than just libraries.
`
`33.
`
`The Maryland Act is an impermissible and unconstitutional overreach into federal
`
`copyright law. The legislation is part of an unjustified effort to divert copyright policy away from
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`the U.S. Congress to state assemblies, at the expense of longstanding incentives and protections
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`that are the foundation of our creative economy.
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`
`
`10
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 11 of 31
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`34.
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`In May 2021, the Maryland state legislature passed the Maryland Act for the
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`stated “purpose of requiring a publisher who offers to license an electronic literary product to the
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`public to also offer to license the electronic literary product to public libraries in the State on
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`reasonable terms that would enable public libraries to provide library users with access to the
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`electronic literary product.” 2021 Md. Laws Ch. 411 (H.B. 518).
`
`35.
`
`The Maryland Act added two sections, §§ 23-701 and 23-702, to the Education
`
`article of the Code of Maryland, under the subtitle “Electronic Literary Product Licenses.” A true
`
`and correct copy of the Maryland Act is attached hereto as Exhibit A.
`
`36.
`
` The Maryland Act provides, in relevant part, as follows:
`
`(a) Subject to subsections (b) and (c) of this section, a publisher who offers to
`license an electronic literary product to the public also shall offer to license the
`electronic literary product to public libraries in the State on reasonable terms
`that would enable public libraries to provide library users with access to the
`electronic literary product.
`
`(b) The terms of a license under subsection (a) of this section may include:
`
`(1) A limitation on the number of users a public library may
`simultaneously allow to access an electronic literary product;
`
`(2) A limitation on the number of days a public library may allow a user to
`access an electronic literary product; and
`
`(3) The use of technological protection measures that would prevent a user
`from:
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`(i) Maintaining access to an electronic literary product beyond the
`access period specified in the license; and
`
`(ii) Allowing other users to access an electronic literary product.
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`(c) The terms of a license under subsection (a) of this section may not include a
`limitation on the number of electronic literary product licenses a public library
`may purchase on the same date the electronic literary product license is made
`available to the public.
`
`(d) A violation of this subtitle shall constitute an unfair, abusive, or deceptive
`trade practice and is subject to enforcement in accordance with Title 13, Subtitle 4
`of the Commercial Law Article.
`
`
`
`11
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 12 of 31
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`Md. Code, Educ. § 23-702 (effective Jan. 1, 2022) (emphasis added).
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`37.
`
`The Maryland legislature enacted the pending law with little regard for the
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`authors and publishers that will be impacted by the law or the numerous, serious issues these
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`groups raised upon learning of the radical new legislation. Authors and publishers alike informed
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`the Maryland legislature of considerable preemption and constitutional concerns, including
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`through detailed testimony submitted by AAP and the Authors Guild in opposition to the
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`Maryland Act, but those concerns were cast aside.
`
`38.
`
`If allowed to go into effect, and enforced, the Maryland Act will violate
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`publishers’ rights and undermine federal copyright law in numerous ways.
`
`39.
`
`The Maryland Act will force publishers to disseminate ebooks, audiobooks, and
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`other digital literary works to public libraries in Maryland, whenever publishers distribute those
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`works to anyone else—regardless of the fact that federal law protects publishers’ exclusive right
`
`to decide whether and to whom they will distribute their works.
`
`40.
`
`In further disregard to publishers’ rights under federal copyright law, the
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`Maryland Act mandates that publishers disseminate their digital literary works to Maryland
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`public libraries immediately and in an unlimited quantity and that any related terms be
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`“reasonable.” The Maryland Act leaves what is “reasonable” largely undefined but that will
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`inevitably be decided by the State of Maryland in enforcing the law. Likewise, the Maryland Act
`
`does not lay out what libraries qualify as “public libraries in the State.”
`
`41.
`
`In other words, the Maryland Act implements a compulsory licensing scheme in
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`the State of Maryland for the distribution of digital literary works. The legislation replaces a
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`varied and valuable existing set of marketplace-based decisions as to distribution of copyrighted
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`works with a one-time decision akin to “first publication.” After that initial offering, the
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`
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`12
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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 13 of 31
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`Maryland Act deprives publishers of control over the reproduction, distribution, public display,
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`and public performance of their works, taking away exclusive rights that they hold under
`
`copyright law for the entirety of the copyright term. The Maryland legislature has instead handed
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`those rights over to public libraries in Maryland, empowering the libraries to obtain any digital
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`literary works that they want, for provision to their patrons, so long as they stay within certain
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`terms set by Maryland and pay an undefined “reasonable” price that Maryland will regulate.
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`Under Maryland’s scheme, public libraries—not copyright owners—will control the decision as
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`to whether, when, and how to distribute copyright owners’ digital literary works. The Maryland
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`Act’s compulsory licensing system will diminish the value of the same books and intellectual
`
`property that libraries claim to so prize. The Maryland Act represents an unauthorized taking of
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`copyrights grounded in the United States Constitution and protected by federal copyright law.
`
`42.
`
`The Maryland Act’s potential reach is extraordinarily broad. The types of
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`“electronic literary products” covered by the Act are not limited to just ebooks or audiobooks,
`
`but encompass any conceivable “text document that has been converted into or published in a
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`digital format that is read on a computer, tablet, smart phone, or other electronic device” or
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`“audio recording of a text document, read out loud in a format that is listened to on a computer,
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`tablet, smart phone, or other electronic device.” Md. Code, Educ. § 23-701(b). In other words,
`
`the Maryland Act covers digital versions of not just books, but also magazines, newspapers,
`
`blogs, and a whole host of other texts that may be published, viewed, or listened to on electronic
`
`devices like computers or smart phones.
`
`43.
`
`The definition of “publisher” under the Maryland Act is remarkably broad. That
`
`definition is not limited to publishers of “electronic literary products,” but instead sweeps into its
`
`coverage any “person in the business of manufacturing, promulgating, and selling books, audio
`
`
`
`13
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`

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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 14 of 31
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`books, journals, magazines, newspapers, or other literary productions, including those in digital
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`form, that consist of text, imagery, audio recordings, or any combination of text, image, and
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`audio recording.” Md. Code, Educ. § 23-701(c). The Maryland Act will thus impact not only the
`
`book, journal, newspaper, magazine, and other media publishing industries, but also a whole
`
`range of businesses that manufacture and sell digital literary content to readers, including ebook
`
`and audiobook retailers, aggregators, and digital delivery services. It applies equally to American
`
`and foreign copyright owners doing business in the state, raising additional serious questions
`
`pertaining to the devaluing of intellectual property and due process.
`
`44.
`
`Publishers will face the risk of severe civil and criminal liability under the
`
`Maryland Act. Under § 23-702(d) of the statute, Defendant, in his capacity as Attorney General
`
`of the State of Maryland, may exercise his enforcement powers under Md. Code, Com. Law §
`
`13-401 et seq. The Maryland Act will therefore empower Defendant to seek injunctive relief to
`
`compel publishers to comply with the compulsory licensing requirements of the state law and to
`
`seek criminal penalties against noncompliant publishers—including imprisonment of up to one
`
`year. See Md. Code, Com. Law §§ 13-406, 13-411. The Maryland Act will also allow suits for
`
`damages by any persons allegedly aggrieved by publishers’ failure to grant statutorily mandated
`
`licenses. See Md. Code, Com. Law § 13-408. Remarkably, the Maryland Act subjects publishers
`
`to civil and criminal liability for attempting to exercise their exclusive rights in the very manner
`
`envisioned by the federal statute. See 17 U.S.C. § 106.
`
`45.
`
`In short, the Maryland Act will bring to bear the considerable coercive powers of
`
`the State of Maryland to unilaterally force publishers to disseminate their digital literary works to
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`Maryland libraries, on an unlimited basis and on terms dictated by the State of Maryland,
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`whenever publishers disseminate those works to anyone else, anywhere else. The Maryland
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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 15 of 31
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`Act’s requirements are in flagrant violation of the authority granted to publishers by federal law
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`to decide whether and on what terms to make their works available in order to achieve the full
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`benefit and promise of the Copyright Act.
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`The Protection of Copyright Under Federal Law
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`46.
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`The authority of the U.S. Congress to control the scope of exclusive rights under
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`copyright, including reproduction and distribution, is centrally enshrined in the Copyright Clause
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`of the United States Constitution. The Copyright Clause provides that “Congress shall have
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`Power . . . To promote the Progress of Science and useful Arts, by securing for limited Times to
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`Authors and Inventors the exclusive Right to their respective Writings and Discoveries . . . .”
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`U.S. Const. art. I, § 8, cl. 8.
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`47.
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`Pursuant to this constitutional grant of authority, Congress has enacted a series of
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`federal copyright statutes, culminating with the 1976 Copyright Act, 17 U.S.C. §§ 101 et seq.,
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`that, inter alia, define and protect the rights of copyright owners.
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`48.
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`The U.S. Supreme Court has repeatedly affirmed that it is the domain of Congress
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`to determine the overall scope and balance of copyright law, as set forth in the Copyright Act.
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`See, e.g., Eldred v. Ashcroft, 537 U.S. 186, 212 (2003) (“stress[ing]” that “it is generally for
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`Congress, not the courts, to decide how best to pursue the Copyright Clause’s objectives,” and
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`that it is not the role of the courts “to alter the delicate balance Congress has labored to achieve”
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`(citations omitted)); id. at 222 (“[T]he Copyright Clause empowers Congress to determine the
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`intellectual property regimes that, overall, in that body’s judgment, will serve the ends of the
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`Clause. . . . The wisdom of Congress’ action . . . is not within [the courts’] province to second-
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`guess.”).
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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 16 of 31
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`49.
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`The Copyright Act grants copyright owners certain exclusive rights. In particular,
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`the Copyright Act provides that “the owner of copyright . . . has the exclusive rights to do and to
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`authorize” others to reproduce and distribute works, prepare derivative works, and display
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`works, among other rights. 17 U.S.C. § 106. Pursuant to the Copyright Act, copyright owners
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`have the authority to exercise these exclusive rights and to authorize others to do so.
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`50. Moreover, some twenty-five years ago, the United States and hundreds of other
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`countries addressed the specific question of protecting copyright interests arising from digital
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`technologies by adhering to a pair of binding instruments known as the WIPO Internet Treaties.
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`These treaties, which the United States duly affirmed through a combination of existing law and
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`the 1998 Digital Millennium Copyright Act, make clear that the copyright owner has the
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`exclusive right to authorize the digital dissemination or transmission of a creative work,
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`including in new and innovative formats and irrespective of whether the customer is in a
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`bookstore, library, or the comfort of their own home. Intergovernmental leaders paved the way
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`for the very innovations that led to ebooks and audiobooks, and which will, no doubt, lead to
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`future exciting formats made possible by a free market.
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`51.
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`The U.S. Supreme Court has recognized that the public welfare is best served by
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`respecting the scope of copyright owners’ rights under the Copyright Act. See, e.g., Eldred, 537
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`U.S. at 212 n.18 (explaining that “encouragement of individual effort by personal gain is the best
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`way to advance public welfare through the talents of authors and inventors,” that “the incentive
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`to profit from the exploitation of copyrights will redound to the public benefit by resulting in the
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`proliferation of knowledge,” and that “copyright law serves public ends by providing individuals
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`with an incentive to pursue private ones” (citations omitted)).
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`Case 1:21-cv-03133-DLB Document 1 Filed 12/09/21 Page 17 of 31
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`52.
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`Federal copyright law gives copyright owners the discretion and latitude to
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`determine how they will exercise their exclusive rights—including in deciding whether to grant
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`licenses for the distribution of their works and under what terms. The discretion secured by these
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`rights enables publishers, wh