Court Rejects Google Book Settlement

Yesterday, U.S. Circuit Judge Denny Chin rejected the Book Rights Registry settlement between Google and the US Authors Guild. The $125 million commercial agreement would have rewarded both parties for the largest mass infringement of authors' copyrights in history. Instead, the judge ruled it a business deal "too far."

"A Reversal of Copyright Law" is what we called this agreement in our warning to illustrators September 29, 2009. Like the visual arts "databases" we opposed during the Orphan Works fight, we wrote:

"this agreement would allow both Google and a yet-to-be-created Book Rights Registry to commercially profit from an author's work whenever they say they can't locate the author.

"Both schemes would force authors to opt out of commercial operations that infringe their work or to 'protect' their work by opting-in to privately owned databases run by infringers. This Hobson's Choice for authors reverses the principle of copyright law."

Judge Chin held this to be the case. "A copyright owner's right to exclude others from using his property is fundamental and beyond dispute," he ruled. "[I]t 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."

The judge also noted objections to the "Adequacy of Class Representation."  In short, this holds that neither Google, nor any organizations claiming to represent authors, nor the university libraries that gave Google "permission" to digitize their holdings, own the copyrights to the works this agreement would have allowed them to exploit. 

Therefore, they have no standing to broker deals based on claims that they represent the "class" of authors. 

The judge held this to be the case even where organizations asserted the right to "expropriate" "orphaned" royalties belonging to rightsholders.  Noting that "After ten years, unclaimed funds may be distributed to literary-based charities," the judge concluded:

"[A]t a minimum a fair question exists as to whether this Court or the Registry or the Fiduciary would be expropriating copyright interests belonging to authors who have not voluntarily transferred them. As Professor Nimmer has written: 'By its terms Section 201(e) is not limited to acts by governmental bodies and officials. It includes acts of seizure, etc., by any 'organization' as well.' 3 Melville B. Nimmer & David Nimmer, Nimmer on Copyright §10.04 (Rev. Ed. 2010) (footnote omitted)." [Page 31 of the judge's ruling, emphasis added.]

In rejecting the settlement, Judge Chin also echoed the US Justice Department's antitrust objections: The deal, he wrote, "would give Google a significant advantage over competitors, rewarding it for engaging in wholesale copying of copyrighted works without permission..." He suggested the settlement might win approval if it were revised to cover only those who opt into the agreement.