Google Settlement Goes Back to Drawing Board

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On Tuesday, March 22, in federal court in New York, Judge Denny Chin rejected Google’s Amended Settlement Agreement (ASA) with the Authors Guild and the Association of American Publishers (AAP). Chin said that “while the digitization of books and the creation of a universal digital library would benefit many, the ASA would simply go too far.” The judge raised several concerns, but suggested these would be ameliorated if the ASA were changed from an “opt-out” to an “opt-in” settlement. A status conference is scheduled on April 25.

While Chin said that he thought the settlement was made in good faith, he was troubled by several issues including that the ASA proposed to acquire the rights of copyrights owners without their consent and that it would give Google “a de facto monopoly over unclaimed works,” raising antitrust issues.

In response to the ruling, Google Managing Counsel Hilary Ware issued the following statement: “This is clearly disappointing, but we’ll review the Court’s decision and consider our options. Like many others, we believe this agreement has the potential to open up access to millions of books that are currently hard to find in the U.S. today. Regardless of the outcome, we’ll continue to work to make more of the world’s books discoverable online through Google Books and Google eBooks ™.”

It should be noted that Judge Chin’s ruling has no effect on the partnership between Google and the American Booksellers Association that enables IndieCommerce stores to sell Google eBooks via their websites.

On behalf of the publisher plaintiffs in the Google Settlement case, Macmillan CEO John Sargent issued a statement this week that said, although Chin’s response was “not the final approval we were hoping for, it provides clear guidance to all parties as to what modifications are necessary for its approval. The publisher plaintiffs are prepared to enter into a narrower Settlement along those lines to take advantage of its groundbreaking opportunities. We hope the other parties will do so as well.”

Sargent reiterated publishers’ dedication to providing digital content as well as their commitment to the ASA’s ultimate approval. “For more than a decade, publishers have been making substantial investments to enable and enhance online access to content in accordance with copyright laws and we will continue to do so regardless of the outcome of the litigation,” he said. “For that reason, publishers are prepared to modify the Settlement Agreement to gain approval. We plan to work together with Google, the Authors Guild, and others to overcome the objections raised by the Court and promote the fundamental principle behind our lawsuit, that copyrighted content cannot be used without the permission of the owner, or outside the law.”

Authors Guild President Scott Turow said, “Although this Alexandria of out-of-print books appears lost at the moment, we’ll be studying Judge Chin’s decision and plan on talking to the publishers and Google with the hope that we can arrive at a settlement within the court’s parameters that makes sense for all parties.

“Regardless of the outcome of our discussions with publishers and Google, opening up far greater access to out-of-print books through new technologies that create new markets is an idea whose time has come.”