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No, that is NOT happening. They can only nose around the books that are on their server. We had a huge discussion about this in the beta group as well. If you remember, there have been folks on MR who have wanted to have non-kobo purchased books available for syncing and management through the desktop app. The privacy laws in Canada would make this kind of thing very expensive for Kobo in terms of fines/legal action if they were messing around in this way without the explicit permission of individual users.
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