Sai Vinod Nayani, a fourth year student of NUJS has sent us this incsive post on the lawsuit filed by Tasini et. al. against the Huffington post.
HUFFERS CRISIS! Claim for Equitable Compensation for Enriching the HuffPost
by Sai Vinod Nayani
by Sai Vinod Nayani
This past April, a class action suit was instituted against Ariana Huffington and the Huffington Post by one of their blogger and labour activist, Jonathan Tasini, demanding a share in the $315 million sale of the latter to AOL accusing them for having “unjustly enriched by luring carefully vetted contributors to provide valuable content while reaping the entirety of the financial gain delivered from such content”. Contributions from bloggers, the complaint alleges, drew large volumes of traffic to the news portal and at the same time ensured minimal costs in content production. Furthermore, publishing content provided by bloggers has generated revenues and has contributed to the goodwill of HuffPost. Also, by retaining the benefits from the content, the associated downside risks were unfairly thrust upon contributors. On the other hand, the HuffPost promised visibility, promotion and distribution of their content. Remuneration, however, was never on the cards, a fact admitted by the complainant. Claim for compensation for the content and the incidental contribution to the value of the enterprise is the subject matter of the suit.
WHO HAS THE RIGHTS OVER THE CONTENT?
The terms and conditions of the HuffPost confers to itself all rights subsisting in the content published and with respect to voluntary contributions, specifically, it enjoys publishing and distribution rights. Valuation of the HuffPost would ideally factor voluntary contributions to the overall goodwill of the organization in addition to the content itself. After processing the content provided by few selected bloggers by the editorial team, the content was to be published. Complainant cries injustice in allowing them to benefit despite being in such dominant position. The assignment of rights, however, entails the HuffPost to make use of the content even for ‘promotional and marketing purposes’. Hence, the HuffPost attempts to reach out to wider audiences and simultaneously building credibility seem to fall well within its contractual rights.
It has been mistakenly argued elsewhere that the bloggers are entitled to seek takedown of their content post the sale since the rights were assigned to HuffPost and not AOL. This is, however, incorrect because the sale meant transfer of ownership from Ariana to AOL and the HuffPost is still a legal person in the eyes of the law. Similarly, claim for an exclusive right over benefits from goodwill is unfounded and also render the assigned rights meaningless. The reputation acquired by the HuffPost is merely incidental to exercising its legitimate rights over the content. It is unfounded because the author has copyrights only with respect to the work and does not extend to the effect created by assigning his rights over the work or all other works combined. For instance, Reebok might place advertisements because of the sports related content in a blog, but this has no relation to the assigned rights. Moreover, recognizing another distinct right will eat into the commercial aspect of other bundle of rights under a copyright. For instance, when Penguin Group bids for publishing rights of a book, it would account not only for the volume of sales but also to protect and enhance the reputation of publishing quality books. Accruing goodwill, therefore, is implicit in these rights.
Tasini, in a similar dispute, had previously sued the New York Times and succeeded in getting compensation for selling his articles to electronic databases such as LexisNexis. The US Supreme Court ruled that the rights assigned by the freelancers to NYT as a ‘collective work’ in their periodical, distinct from other exclusive rights, and hence he privilege extends only to sale as a ‘collective work’. Because, the sale through electronic databases is capable of isolating individual article from the ‘collective work’ as published in the print version, unassigned exclusive copyrights of the author under the US Copyright Act were infringed. Here, unlike the agreed terms with the HuffPost, the assignment of rights was specific and this meant that the authors retained other exclusive rights over the work by implication.
WHAT IS SO ‘UNJUST’ ABOUT THE WHOLE DEAL?
The HuffPost business model in not unique and in fact it is identical to video libraries such as the Youtube where the service provider promotes content provided by users in ways to enrich themselves. Same is the case with Op-Eds in newspapers or opinions in trade magazines generally. On most occasions, however, waiver of rights is a precondition for publication and therefore rights and obligations are pre-determined. Even in the absence of any such contract, claim for compensation on grounds of unjust enrichment, as pleaded by bloggers in the present case, is unlikely to succeed.
This is so because, theoretically, a claim for unjust enrichment presupposes absence of any contractual relationship between parties. The whole idea is to prevent injustice caused by benefiting from ones services without being duly compensated. For a successful claim, the bloggers have to establish that (a) the HuffPost was enriched due to their contributions and (b) in equity and good conscience they should be remunerated and (c) there is an expectation of remuneration for the contributions. Nonetheless, satisfying these requirements is a daunting task for the bloggers. Firstly, the content was voluntarily provided by bloggers at their will and the publisher does not exercise any control over the output such as the subject matter of the post, timelines and the like. Secondly, there is neither a promise for remuneration from the publisher nor any monetary expectation by contributors. This is adequate to eliminate any employment relationship between them. Thirdly, it is definitely equitable that the HuffPost compensate bloggers from their gains, however, the compensation need not necessarily be in monetary terms. The promise of ‘visibility, promotion and distribution’ of one’s views on their web portal could very well be a valid consideration. Lastly, on the count of expectation too, it would be hard for bloggers to rebut the traditional view that blogging is primarily an avenue to exhibit ones opinions voluntarily and accessible freely.
So, can Amitabh Bachchan sue Anil Ambani for his contribution to the goodwill of Bigadda in an event of sale? Unless there is an agreement to the contrary, the claim is unlikely to succeed because the blog is seen predominantly an opportunity to connect to his fans and does not intend to make any money out of it. Huffers will have hard time claiming an equitable right over and above the terms of the contract and not to mention of multitude of other problems concerning certification of the class.