US Judge Stops Google's Digital Library

Tuesday, a US judge dealt a severe setback to Google's digital book-scanning project, rejecting a settlement with authors and publishers that would have paved the way for the Internet giant to run a vast online library.

US District Court Judge Denny Chin said in a 48-page ruling handed down 13 months after the parties had their day in court that the proposed agreement "is not fair, adequate and reasonable."



Building a digital version of ancient Egypt's fabled Library of Alexandria has long been one of Google co-founder Larry Page’s pet projects. He and his partner, Google co-founder Sergey Brin, say they want to provide access to all the knowledge in the world's books to anyone with an Internet connection, an ambition that make an appeal or an attempt at a revised settlement more likely.

Chin said, "While the digitization of books and the creation of a universal digital library would benefit many, the (proposed settlement) would simply go too far." He said the settlement would grant Google "significant rights to exploit entire books, without permission of the copyright owners."

Chin explained that the settlement would give Google "a significant advantage over competitors, rewarding it for engaging in wholesale copying of copyrighted works without permission." James Grimmelmann at The Laboratorium explains in his extensive analysis that Chin's ruling did more than complicate Google's efforts to make digital copies of the world's 130 million books and possibly sell them through an online book store that it opened last year. It also touched upon antitrust, copyright and privacy issues that are threatening to handcuff Google as it tries to build upon its dominance in Internet searches to muscle into new markets.

Google has many other legal problems awaiting decisions:

• The company is trying to persuade the US Justice Department to approve a $700 million purchase of airline fare tracker ITA Software nearly nine months after it was announced.  
• In Europe and the state of Texas, antitrust regulators are looking into complaints about Google abusing its dominance of Internet search to unfairly promote its own services and drive up its advertising prices.
• Google is still trying to fend off an appeal in another high-profile copyright case, one stemming from its 2006 acquisition of YouTube, the Internet's leading video site. Viacom Inc. in charging YouTube with misusing clips from Comedy Central, MTV and other Viacom channels is seeking more than $1 billion in damages. A federal judge sided with Google, saying YouTube had done enough to comply with digital copyright laws in its early days.

Judge Chin left the door open for the parties to go back to the negotiating table. He said "The motion for final approval of the (proposed settlement) is denied, without prejudice to renewal in the event the parties negotiate a revised settlement agreement."

The settlement agreement resulted from a class action lawsuit filed in 2005 by the Authors Guild and the Association of American Publishers (AAP) charging Google with copyright infringement.

The settlement called for Google to pay $125 million to resolve outstanding claims and to establish an independent "Book Rights Registry," which would provide sales and advertising revenue to authors and publishers.



Google already has been criticized around the world for collecting personal information sent over unprotected wireless networks while its cars photographed neighborhoods and streets in more than two dozen countries from 2007 to 2010. Just this week, France's privacy watchdog fined Google about $141,000 for the intrusions in that country.

Although Chin said worries about data collection by themselves wouldn't have been enough for him to block the settlement, the judge emphasized: "The privacy concerns are real." Clearly this is going to require a reworking of the agreement and acceptance by all parties involved.