Thursday 24 March 2011

Google Book Settlement hits brick wall

On Tuesday, Circuit Judge Chin rejected the Google Book Settlement. Is this the end of the road for the Settlement or merely another inconclusive step in proceedings that have been ongoing for six years (see potted history at the end of this post if you would like a refresher)? The parties can appeal within 30 days but as the Scrivener’s Error blog explains, this is unlikely to succeed. If the judge’s opinion stands, how much room for manoeuvre does it give the parties to redraft the Settlement?

The opinion states:
‘While the digitisation of books and the creation of a universal digital library would benefit many, the ASA [Amended Settlement Agreement] would simply go too far. It would permit this class action – which was brought against defendant Google Inc. (“Google”) to challenge its scanning of books and displays of “snippets” for online searching – to implement a forward-looking business arrangement that would grant Google significant rights to exploit entire books, without permission of the copyright owners. Indeed, the ASA would give Google a significant advantage over competitors, rewarding it for engaging in wholesale copying of copyrighted works without permission, while releasing claims well beyond those presented in the case.…

‘In the end, I conclude that the ASA is not fair, adequate, and reasonable. As the United States and other objectors have noted, many of the concerns raised in the objections would be ameliorated if the ASA were converted from an “opt-out” settlement to an “opt-in” settlement…. I urge the parties to consider revising the ASA accordingly.’
On the face of it, this language does not amount to insisting on right owners ‘opting in’ but when the opinion is taken as a whole, this does seem to be almost mandatory. The most significant reasons for which the judge finds the Settlement unacceptable hinge on its ‘opt-out’ nature:

1. It is for Congress to create any mechanism for the exploitation of unclaimed books (including orphan works).
2. The original litigation was about display of snippets in Google Book Search – it is an unacceptable use of the class-action process that the Settlement releases claims in respect of the extensive further uses that are permitted under the Settlement.
3. ‘It is incongruous with the purpose of the copyright laws to place the onus on copyright owners to come forward to protect their rights when Google copied their works without first seeking their permission.’
4. The Settlement would give Google ‘a de facto monopoly over unclaimed works’.

There seem to be only two ways to fix these problems:

1. Make the Settlement ‘opt-in’, in which case it would not be a class-action settlement but the settlement of claims by a specific list of people. They, and only they, would agree to waive their claims against Google and to offer Google licences to exploit their works.
2. Keep the suit as a class action and draft a settlement that only covers past uses of works in Google Book Search. It would not grant future licences, not even ongoing licences for exploitation in Google Book Search.

Potted History of the Google Book Settlement

From 2004 certain libraries have allowed Google to scan their stocks. Google makes the public domain books available in full on Book Search. For in-copyright books a search returns ‘snippets’. Google say they do not need permission from the copyright owners for this: it is covered by fair use.

In 2005 Google was sued for copyright infringement by the Authors Guild (in a class action) and by five American publishers, subsequently deciding to settle, drafting the Google Book Settlement. In 2006 the La Martinière publishing group sued in France. In December 2009 the French court decided that Google Book Search did infringe French copyright. In April 2010 photographers, illustrators, graphic artists and photo libraries launched a suit.

The Settlement Agreement is far wider in scope than the original litigation over snippets. Google acquires US rights to sell ebooks, print-on-demand copies, online access; to include in institutional and consumer subscriptions; to make available free on library computers; and to return 20% of book in internet search. For in-print books, Google needs the express authorization of rightsholders but for out-of-print books this grant of rights is assumed and rightsholders must opt out.

Since it is the settlement to a class action, the Settlement can only be approved by the court after a hearing and on finding that it is fair, reasonable and adequate. The court gave the original Settlement preliminary approval in 2008, fixing the hearing for 2009. An avalanche of objections to the settlement were submitted to the court and the US government rejected it. The court therefore allowed the parties to submit an amended settlement.

The most significant change in the Amended Settlement was that it basically only included books published in the US, UK, Canada and Australia, instead of the whole world. The Settlement had received strong opposition from Continental Europe, especially France and Germany, but barely a murmur from the UK. It is obvious that the revised geographical scope of the Amended Settlement was designed to cut out opposition from the main critics. The US government again rejected the Amended Settlement but expressed willingness to continue to work with the parties. At the hearing on 18 February 2010, the judge said he was not going to rule. His judgment was reserved – until 22 March 2011.

During these protracted proceedings, Google has continued to scan books at an ever-increasing speed. In October 2008, when the Settlement was first drafted, Google had scanned 7 million books. A year later 10 million books had been scanned. Now the figure has passed 15 million.

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