Government Urges Changes to Google Books Deal

Government Urges Changes to Google Books Deal
By MIGUEL HELFT
Copyright by The New York Times
Published: September 18, 2009
http://www.nytimes.com/2009/09/19/technology/internet/19google.html?th&emc=th


SAN FRANCISCO — In the latest challenge to Google’s plan to establish the world’s largest digital library and bookstore, the Justice Department said late Friday that a proposed legal settlement between Google and book authors and publishers should not be approved by the court without modifications.

The Justice Department said that while the agreement would provide many benefits to the public, it also raised significant issues regarding class-action, copyright and antitrust law.

The Justice Department described recent discussions with the parties as “productive,” however, and asked the court to encourage them to continue talks to modify the agreement and overcome its objections.

“As presently drafted the proposed settlement does not meet the legal standards this court must apply,” the department wrote in a 32-page legal filing. “This court should reject the proposed settlement and encourage the parties to continue negotiations to comply with Rule 23 and the copyright and antitrust laws.” Rule 23 establishes procedures for class-action lawsuits.

Google and the groups representing publishers and authors that had helped structure the settlement cautiously welcomed the Justice Department’s filing for its clear indication that the government wanted to work with them to move the deal forward.

“Clearly the Justice Department sees the tremendous value that this settlement would bring to readers, students and scholars,” said Paul Aiken, executive director of the Authors Guild. “We don’t want this opportunity to be lost.”

In a joint statement with the guild and the Association of American Publishers, Google said, “We are considering the points raised by the department and look forward to addressing them as the court proceedings continue.”

The Justice Department said it was concerned that the agreement could violate antitrust law by giving book publishers the ability to “restrict price competition” and by giving Google “de facto exclusive rights for the digital distribution of orphan works.” Orphan works are books whose authors are unknown or cannot be found.

The department also said that it had concerns that the groups negotiating the agreement did not adequately represent all types of authors. It also said it was particularly concerned that the agreement granted Google the right to exploit orphan works “for unspecified future uses.”

In recent weeks, Google made some concessions to placate some opponents of the deal, and the department’s filing made repeated references to the parties’ willingness to make further changes to address its concerns.

A Justice Department official, who spoke on the condition of anonymity, said he didn’t know whether any modifications would require the parties to provide a new notice to class members, a costly process that could delay the court review by months.

The proposed $125 million settlement has ignited extensive controversy, and the Justice Department’s filing echoed some of the concerns that have been previously raised. Some critics have said that Google’s virtual lock on orphan works would make it virtually impossible for others to compete.

Others have said that by granting Google a blanket license to millions of books unless authors specifically object, the agreement turns copyright law on its head.

The parties to the settlement have strongly defended the agreement, saying that nothing in it prevents competitors from following in Google’s footsteps and obtaining similar licenses to orphan works. They argue that the agreement would give authors and publishers new ways to earn money from digital copies of their books, and it would benefit the public by making millions of rarely seen out-of-print books widely available online.

If approved, the settlement would resolve class actions filed in 2005 by the groups representing authors and publishers against Google in the United States District Court for the Southern District of New York. The suits claimed that the company’s plan to digitize millions of copyrighted books from libraries without prior approval from rights holders was illegal.

Federal District Court Judge Denny Chin has scheduled a hearing on the case for Oct. 7.

The Justice Department is not a party to the case but legal experts say the court is likely to seriously consider its views.

The settlement would allow Google to go forward with its scanning project and absolve it of copyright liability. It would also greatly expand what Google can do with digital copies of copyrighted books.

Under the settlement, Google could show online readers in the United States as much as 20 percent of most books. Readers would be able to buy from Google access to complete copies of individual books online.

Google would also be allowed to sell access to its entire collection to universities and other institutions. The company would grant free access to the full texts in its digital library at one terminal at every public library in the country.

Motoko Rich contributed reporting from New York.