Google Book Search Deal Gets Its Day in Court
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Google was lauded as a visionary intent on spreading the world's knowledge and reviled as a copyright infringer cavalier about protecting users' privacy in a hearing on Thursday to discuss its plan to digitize millions of books.
Under the terms of the proposed settlement of a 2005 lawsuit brought by the Authors Guild, Google (NASDAQ: GOOG) would pay $125 million to create a book rights registry, where authors and publishers would register works and be paid for books and other publications the search giant puts online.
Manhattan federal court Judge Denny Chin did not specify when he would issue a ruling.
"To end the suspense, I'm not going to rule today at this hearing," Chin said at the start of the proceeding. "There is just too much to digest."
Chin did seem concerned about a portion of the agreement that allows Google to put books online unless the author contacts the company to opt out. The provision is in conflict with normal copyright law which requires affirmative agreement.
Google counsel Daralyn Durie, who had used the word "evil" to describe discrimination discussed in a class action case cited as a precedent, seemed surprised when Chin shot back at her: "Some might say that copyright infringement is evil."
"Copyright infringement is evil if it is not compensated," she replied.
Lawyer David Nimmer for Amazon.com (NASDAQ: AMZN) said that in Amazon's view, the deal essentially says, "The settlement agreement is lawful because the settlement agreement says the settlement agreement is lawful."
"That turns copyright law on its head," he said.
Durie defended opt-out as essential. "No one has even argued that the economic rights of these rights holders is negatively impacted," she added, estimating that half of the 10 million books covered by the settlement were still in print.
The judge seemed sympathetic to several critics who worried that Google had no specifics in its agreement to ensure reader privacy.
"How do you fix it? How is it fixable?" asked Chin.
One critic argued that Google's software was set up to allow Google to see what was actually read and to record notes that were taken. One suggested requiring Google to delete reader information after a limited time and only give it to law enforcement only on receipt of a court order.
Google's Durie acknowledged that some privacy would be lost by those who looked at the books on their personal computers.
"This service will be available at public libraries," she added, where readers would have anonymous access to the material.
The Justice Department shared the copyright concerns and had its own set of antitrust concerns, said William Cavanaugh, a Justice Department deputy assistant attorney general. "This may well be a per se violation of antitrust laws," he said.
Further, Google has made an inadequate effort to reach out to members, other critics complained.
"I never received notice," said Scott Gant, an author.
Critics of the proposed settlement include Amazon.com Inc and Microsoft (NASDAQ: MSFT), while Sony Corp (NYSE: SNE), which makes an electronic reader, favors the pact.
Google's plan has been praised for expanding access to books. But the U.S. Justice Department criticized it in legal briefs on February 4 on a variety of grounds, saying it potentially violated antitrust and copyright laws. The governments of France and Germany also oppose the deal.
But at least one legal academic spoke in favor of approving the settlement.
"Copyright is designed to be an engine of social development, not a brake on it," said Lateef Mtima of the Institute of Intellectual Property and Social Justice at the Howard University School of Law in Washington, D.C.
The case is The Authors Guild et al v. Google, Inc, U.S. District Court, Southern District of New York, No. 05-08136.