Courtesy of FastCompany.com:
A Kuwaiti national using fake names and selling others’ copyrighted stories in the Kindle Store sheds light on black hat hacker forums–and the theft, taboo sex, and swindles festering in the recesses of Amazon.
When David H. Springer, a prodigiously productive erotica writer under such naughty pen names as Oediplex and TrojanSnake, learned that one of his stories, “I Remember Mother,” had been scraped off the Web and resold for the Kindle as My Step Mom Loves Me by someone he never heard of, he was, he says, more amused than angry. Still, the 64-year-old security guard, who initially began penning erotica to gain free access to porn sites, could use any income the book generated, no matter how inconsequential. But he doubted it was worth going after Luke Ethan, the person who stole his “stuff-for-stiffies,” nor did he have resources to hire a lawyer.
What he could do was complain to Amazon, which he did by writing to its firstname.lastname@example.org email address, asserting that he was the sole copyright holder and had not given permission for his tale of incest to be republished. “Any compensation,” he complained, “should come to me.”
Amazon had already pulled the book–and around 100 others sold by a half-dozen faux authors I outed in my recent story, “Amazon’s Plagiarism Problem,” which detailed a hotbed of copy-paste copyright infringement in the Kindle store. A few days later, an Amazon copyright/trademark agent returned Springer’s email. “The ability to purchase the title” has “been disabled,” the agent wrote, and was “no longer searchable on our site.” He informed Springer that Amazon had sold 187 copies of this ebook, with sales totaling $559.13. “If you believe you are entitled to compensation, you may wish to contact the party who made the title available for sale on Amazon.com,” and provided the ebook pirate’s name, address and email.
Springer shared the email with me and I tracked down the pirate. His real name is not, of course, Luke Ethan, although that’s how I’ll refer to him. He’s a Kuwaiti national who claims he didn’t know the story had been plagiarized. In fact, he swears he, too, was the victim of a swindle. Since he lives in the Middle East and could face dire consequences if Kuwaiti authorities found out about his sexy shenanigans, he insisted on anonymity before he would tell me what, why, and how he did what he did.
It all started with Luke frequenting Warrior Forum, an assemblage of Web discussion groups devoted to Internet marketing. There you can learn everything from the nuts and bolts of ad networks to affiliate programs, copywriting, mobile marketing tips, programming, website design and just about anything else connected to making money online. Interested in ginning up some extra cash, Luke plunked down $500 to join a private forum where he knew black hat methods–hacking, typically with nefariious intent–were bought and sold.
Soon after, Luke met a member who called himself Kurniyo, who offered to sell a collection of material that could be reformatted and sold as Kindle ebooks. Luke paid $100 in bitcoins and received a 64-kilobyte zip file with the text to a dozen stories of varying lengths and rendered in a variety of software. He picked four titles, including My Step Mom Loves Me, all in Microsoft Word. Either Kurniyo (or whomever accumulated the material) understood Amazon policy. Amazon forbids works that portray sex with minors, straight incest, and real bestiality (although apparently sex with a werewolf is OK.) That explains why David Springer’s original title, “I Remember Mother,” and any oedipal reference to “mother,” had been changed to “step mom.” (Other than that the stories were identical.) Luke spent $15 for cover images, another $35 to gain access to a demonstration video on how to make an Amazon Kindle book, and pasted the material into the authoring tool. Then he put up the titles for sale under two pen names: Luke Ethan and Jason Godwin.
Around that time Amazon had begun addressing a slightly different copywrong: cracking down on duplicate content sold in its Kindle store. In August a Warrior Forum member using the name Brobdingnagian posted an email he received from Amazon, which informed him certain books he had been selling were “either undifferentiated or barely differentiated from an existing title in the Kindle store. We remove such duplicate (or near duplicate) versions of the same book because they diminish the experience for customers. We notify you each time a book is removed, along with the specific book(s) and reason for removal.” If he continued to try and sell “multiple copies or undifferentiated versions of the same book,” Amazon could “terminate” his account.
“I had 22 books up, which only took a long weekend to ‘write’ (more like format) and publish,” Brobdingnagian complained. “I wasn’t making a ton of money on them, maybe $60 over 2.5 months. Still, it was one of my first tastes of online success–albeit small–and to have it yanked away is a kick in the pants.”
Nine minutes later, another Warrior Forum member, replied, “Yep–This was bound to happen.” He couldn’t believe people were “running around” and “telling others to grab” content, “throw it together,” call it a book “and build an ‘Amazon book empire.’ All the ‘create a book on Amazon in less than 10 minutes’ crap was like lighting the touch-paper on an Amazon clamp-down.”
Nevertheless, Warrior Forum continues to be awash in copyright infringement come-ons. “If you go to the warriorforum and ask around, there are hundreds of people offering to sell you books with publishing rights,” Luke says. Check out this ad, posted in its special offers group, for “The Kindle Secret: Want to Create Kindle Books in 15 Minutes or less?” The person behind it hawks a guide for $17 that explains how he’s “dominating” one “hidden Kindle niche.” He claims to be “outsourcing books” for “$20 a pop (can you get a whole Kindle book created for $20?) and selling them on the Kindle for $2.99 each,” promising that his books “require no marketing and still sell like crazy,” with each title earning between $40 and $300 a month. “I don’t write a thing,” he brags. He just creates the covers, uploads the content then moves on to the next book. “This is completely scalable. Want to go big? Create 100 books for $2,000 and you’ll have major passive income set up for you in just a couple of weeks.”
Somehow Luke’s wares flew under the radar, and over the span of four months he was able to sell his pirated books on Amazon. Not all of his titles were erotica but they had one thing in common. They didn’t make much money. “My first book was a diet guide,” Luke says. “Total copies sold: one.”
Then my story came out and Amazon informed him he was peddling copied works and suspended his account. “How was I supposed to know that they are rehashing the stuff and selling them as original?” Luke asks. When he complained to Warrior Forum administrators that Kurniyo had sold him stolen property, their response was to boot him out of the forum.
It’s hard to feel sorry for Luke, of course, but what about Amazon’s role in this? It sold a book that was plagiarized and violated another writer’s copyright and Amazon has done nothing to claw back the money it made on sales. Its response was, in essence, to tell the aggrieved party to work it out with the thief while it kept its cut–usually 30%, in Luke’s case it was 40%, he says, because he resides abroad.
It profits no matter what. Why doesn’t Amazon give some or all of the money it makes off the sale of bogus products to victims of copyright infringement? Amazon may or may not have any legal obligation to do so, depending on whom you ask. Lloyd J. Jassin, a New York-based copyright attorney who has represented Publishers Marketing Association (PMA) and co-authored The Copyright Permission and Libel Handbook, pointed to the Digital Millennium Copyright Act. To take advantage of the § 512(c) safe harbor provision, Amazon, as a service provider must, among other things, “not receive a financial benefit directly attributable to the infringing activity, in a case in which the service provider has the right and ability to control such activity.”
Jassin says, “Under current law, it is unclear what Amazon must do with monies received by it from an alleged infringement carried out via its eBooks service but not yet remitted to the infringing party.” The DMCA does not contain any language addressing this problem and a search of federal case law did not turn up any relevant authority.
But in section 5.7 of the Kindle Direct Publishing Agreement, entitled “Rights Clearances and Rights Dispute Resolution,” he found a clause that addresses this very issue. A person who can prove a book sold through Kindle’s publishing platform is a work whose copyright he owns, and the copyright is being infringed through its unauthorized listing for sale, then Amazon “will pay you the Royalties due in connection with any sales of the Digital Book through the Program, and will remove the Digital Book from future sale through the Program, as your sole and exclusive remedy.”
Still, not everyone sees it this way. Evan Brown, a technology attorney with Hinshaw & Culbertson in Chicago, points to the section of the Kindle Agreement that follows, 5.8, where Amazon could put the onus on the publisher. On this point, the terms and conditions provide that “[y]ou represent and warrant that . . . [none of the] materials embodied in the content nor its sale or distribution . . . will violate or infringe upon the intellectual property, proprietary or other rights of any person or entity. . .”
“If Amazon were to get sued, it would look to the publisher to pick up the tab,” Brown says, since “the terms and conditions call for indemnification.” Here’s the legalese: “You will indemnify, defend and hold Amazon, its officers, directors, employees, affiliates, subcontractors and assigns harmless from and against any loss, claim, liability, damage, action or cause of action (including reasonable attorneys’ fees) that arises from any breach of your representations, warranties or obligations set forth in this Agreement.”
Want more on digital piracy? Read Fast Company‘s ongoing coverage of the federal crackdown on file-sharing site Megaupload and the arrest of its playboy founder Kim Dotcom. Also, read more on SOPA, PIPA, and Congressman Darrell Issa’s plans for combating piracy.
Then there’s the problem of proving infringement. “Copyright is a Federal statute,” says Jane Shay Wald, a partner emeritus at Irell and Manella, and a former president of Los Angeles Copyright Society. “No company can make a finding of copyright infringement that’s binding on the alleged infringer. That’s the job of a judge and jury.”
She envisions a number of scenarios in which someone could believe he owns the copyright but doesn’t. He might have inadvertently acquired the copyright to a work that had been copied previously. Maybe he had transferred ownership to another party or been employed by someone else who holds the copyright. Or the copyright might be invalid for a number of technical reasons. Amazon could tie up any potential litigant in court for years.
Now you likely know why Amazon–and Google, Reddit, Wikipedia, and many others–have been so adamant in their opposition to the Senate’s heavy-handed Stop Online Piracy Act (SOPA) and the House’s sister bill, the Protect IP Act (PIPA). If made into law both could have armed copyright holders with weapons to do battle with websites that host infringing material. In theory, without the hassle of attaining a court order, a single complainant might have been able to force credit card companies to suspend Amazon’s financial transactions, Google and Bing to erase it from search results, and DNS providers to cloak the site so users couldn’t easily find it. One slip up and the impact on a site like Amazon could be devastating.
The vehemence and widespread popularity of anti-SOPA/PIPA protests, which caught senators and congressmen by surprise, effectively hobbled chance of passage. Instead, Amazon continues to act under the oft-maligned Digital Millennium Copyright Act (DMCA), which under its “safe harbor” provision puts the onus on the infringer, not the platform. Amazon is in the clear as long as it makes a good-faith effort to remove material that might violate someone’s copyright.
“One could try to formulate a claim against Amazon based on the fact that it kept these ‘ill-gotten gains,” Brown, the technology attorney from Chicago, says. “That case might fall under the heading of ‘unjust enrichment.’ But I think a case like that would have some problems, likely being tossed out by a court for being preempted by federal copyright law.”
Meanwhile, David Springer says he’s thinking of contacting Luke to demand compensation.
As for Luke, he just wants to forget the whole thing. “I’m putting this behind me,” he says, “chalking” the money he spent on the bogus books “down to experience.”
Adam L. Penenberg is a journalism professor at NYU and a contributing writer to Fast Company. Follow him on Twitter: @penenberg