(Fortune Magazine) -- On Wednesday, Oct. 4, New York Times reporter John Markoff bought a copy of Carly Fiorina's memoir, "Tough Choices," in a Seattle airport - five days before its official on-sale date. Normally this wouldn't be a problem, except the book's publisher had sold Newsweek the rights to an exclusive excerpt scheduled for publication the following Monday.

Markoff wrote a front-page story in the next day's Times that revealed the best bits from the ex-HP (Charts) chief's memoir, rendering Newsweek's upcoming excerpt damaged goods.

The Times seeks out embargo-breaking book-sellers to mess with rival's exclusives.

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"By the time it got to us, there didn't feel to be that much newsworthy left in it," says Kathleen Deveny, the Newsweek assistant managing editor who negotiated the deal with the Penguin Group's Portfolio imprint. "[These days] it's a bit of a free-for-all when it comes to serial rights."

Newsweek isn't the only publication burned by the Times' embargo busting. The paper of record used a similar tactic at the end of September to foil the Washington Post's plans to run the first excerpts from Bob Woodward's "State of Denial." This was even more galling, as Woodward is the Post's assistant managing editor.

Why does all this matter? Because magazines and newspapers bank on blockbuster excerpts to drive newsstand sales - and if those sales don't materialize, they don't want to pay the book publishers.

"Understand, when someone takes an embargoed book and runs a story on the content, that person's not performing a public service. This is not information, like the Pentagon Papers, that was going to be suppressed. It was going to be released in the time and manner of the publisher's choosing, which they have every right to do," says Adam Rothberg, a Simon & Schuster vice president of corporate communications.

If publishers successfully embargo books by keeping them off shelves until an agreed-upon date, they can cut exclusive deals and orchestrate the hype that helps create a bestseller. The serial rights, which can fetch a five-figure price, are also an opportunity for publishers to recoup a portion of the author's advance.

But with everyone from grocers to gas stations selling books, the embargoes are nearly impossible to enforce, and news outlets including Newsweek and the Washington Post send out APBs to various bureaus when looking for a hot title pre-publication. Markoff says that Times reporters look for embargoed books in airports "because they're often aggressive and often clueless about embargoes."

"It will be interesting to see how these practices evolve over the next few years," says Portfolio associate publisher William Weisser. All sides agree, though, that these exclusive rights deals can't survive in their current incarnation, and that a publishing tradition may soon go the way of the two-martini lunch.

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Fiorina talks about her "Tough Choices"

Freedom of the Press