Posted by Victoria Strauss for Writer BewareLast September, the US Justice Department urged the courts to reject the Google Book Settlement, citing concerns about class action, copyright, and anti-trust laws. The DOJ's brief put the Settlement's approval process on hold, and forced the parties back to the negotiating table--resulting, in November, in the filing of an Amended Settlement. New deadlines were set for authors and for the filing of objections, and the Fairness Hearing (to determine if the Settlement will stand) was postponed to February 18, 2010. On Thursday, in a statement of interest filed with U.S. District Court Judge Denny Chin in New York, the DOJ indicated that, while it continues to believe that the Settlement could provide a major public good, and acknowledges that the Amended Settlement Agreement includes "substantial" changes, it's still not satisfied. (The filing can be seen here.) The DOJ's strongly-stated concerns fall into the same areas it highlighted in its previous filing. - Copyright. Not to put too fine a point on it, the ASA violates current copyright law, by requiring rights holders to opt out rather than to opt in. "In its current form," the DOJ writes, "the ASA is inconsistent with the policy of the Copyright Act, as established by Congress, making the argument that the ASA furthers the purposes of the Act a difficult one. The ASA seeks to carve out an exception from the Act’s normal rules and presumptions, which require a rightsholder to affirmatively grant permission for the kinds of uses contemplated by the ASA. The parties claim that creating an opt-out exception would better serve the purposes of the Constitution’s Copyright Clause by promoting the progress of science and the useful arts. That, however, is a judgment better suited for legislative consideration, rather than one for courts to make in the context of approving a settlement." - Anti-trust law. The DOJ feels that the legal rights granted by the ASA "confer significant and possibly anticompetitive advantages on a single entity – Google. Under the ASA as proposed, Google would remain the only competitor in the digital marketplace with the rights to distribute and otherwise exploit a vast array of works in multiple formats. Google also would have the exclusive ability to exploit unclaimed works (including so-called 'orphan works') without risk of liability." In other words, although the ASA leaves Google competitors theoretically free to build a digital library by the same methods Google has used, it's highly unlikely that any entity would be willing to open itself to the infringement lawsuits that would surely follow. Google thus gains what amounts to a monopoly. "Nothing in the ASA," the DOJ writes, "addresses this concern." - Class action issues. "Although the United States believes the parties have approached this effort in good faith and the ASA is more circumscribed in its sweep than the original Proposed Settlement, the ASA suffers from the same core problem as the original agreement: it is an attempt to use the class action mechanism to implement forward-looking business arrangements that go far beyond the dispute before the Court in this litigation." In other words, while the original lawsuit was intended only to address Google's unauthorized scanning of in-copyright works, the ASA empowers Google to go far beyond simply scanning, enabling it also to become a dominant publisher and retailer of digital books. The DOJ is concerned that the class representatives don't have the right under existing laws to grant Google these sweeping rights. It also questions whether the class adequately represents absent members (foreign rightsholders and authors of orphan works), and whether class members received sufficient notice of the ASA and its terms. If the anti-trust concerns are resolved, and the Court decides that the class will stand, the DOJ recommends that a number of additional safeguards be incorporated into the ASA, including: - An "opt-in regime," or, if the Court approves an opt-out regime, a substantial waiting period before Google can exploit in-copyright works without permission from the rightsholders. - A delay in the acceptance of the ASA, to give the Book Rights Registry a chance to "set standards designed to further reduce the volume of unclaimed works after expiration of the waiting period"--i.e., to reduce the number of orphan works--and, to the same end, a "reasonably diligent search" for rightsholders of unclaimed works after the waiting period has expired. - Limiting Google's license to commercially exploit unclaimed works to a defined term, say five or ten years, with the option to renew. In conclusion, the DOJ reiterates the shortcomings of the ASA, but leaves the door open for continued negotiation: Despite the commendable efforts of the parties to improve upon the initial Proposed Settlement, many of the problems previously identified with respect to the original settlement remain in the ASA. The United States remains committed to working with the parties on the settlement’s scope and content. Will the parties return to the negotiating table, postponing the Fairness Hearing yet again? Stay tuned.
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