Court Rejects Google Settlement
Earlier this week, a federal judge dealt a significant blow to Google Inc.'s six year effort to make all of the world's books available online. In a 48 page decision, U.S. District Court Judge Denny Chin, rejected a 2008 proposed settlement agreement between Google and author and publisher groups. The rejected settlement was an attempt to resolve a class action suit that was brought against Google by The Authors Guild and the Association of American Publishers. The suit was brought in response to Google's ongoing efforts to scan and digitize millions of books and make them available to users of Google's online search engine. The suit alleged that such actions were a violation of the publishers' and authors' copyrights in the works.
Among other things, the rejected settlement agreement would have approved Google's digitizing efforts, and would have required Google to pay $125 million into a fund and to establish a registration system whereby authors and publishers could register their works and receive payment when someone viewed their works. The settlement also allowed for authors to "opt out" of the program by notifying Google and thus preventing their works from being made available. Another part of the settlement agreement would have allowed Google to scan and make available thousands of works that were out of print but still subject to a valid copyright.
Parties objecting to the settlement included the Open Book Alliance (a group that includes Google competitors Microsoft, Amazon,com, and Yahoo), and the United States Justice Department. According to the Justice Department, the settlement agreement would have allowed Google to take unfair advantage of works whose authors have not been identified or where copyright ownership may be in question - so called "orphaned" works.
In rejecting the settlement, Judge Chin acknowledged the potential benefits of a universal digital library. However, the judge believed that the proposed settlement went too far and would give Google an unfair advantage over competitors by rewarding it for engaging in wholesale copying of works without the authors' permission. He also raised antri-trust concerns over the possiblity that the settlement agreement would arguably give Google control over the search market for books.
In his decision, Judge Chin rejected the settlement agreement "without prejudice" meaning the parties can submit a revised agreement. The judge even suggested that one way to revise the agreement would be to replace the "opt out" provision with an "opt in" system whereby authors had to expressly agree to have their works included in Google's online database. In court filings last year, Google attorneys had rejected such an "opt in" system as being not workable.
The full text of the court's decision can be found at: http://www.nysd.uscourts.gov/cases/show.php?db=special&id=115
