A federal judge noted the many objections to a $125 million deal giving Google Inc. digital rights to millions of out-of-print books as he agreed Sept. 24 to postpone a fairness hearing so the agreement can be rewritten to comply with copyright and antitrust laws.

U.S. District Judge Denny Chin said the deal reached last year between U.S. authors and publishers and Google "raises significant issues, as demonstrated not only by the number of objections, but also by the fact that the objectors include countries, states, nonprofit organizations, and prominent authors and law professors."

He added: "Clearly, fair concerns have been raised."

Chin encouraged the parties to revise the settlement as quickly as possible, saying a fair deal "would offer many benefits to society." He cited a statement by the Department of Justice saying an agreement "has the potential to breathe life into millions of works that are now effectively off limits to the public."

In a statement, Google highlighted Chin’s words of encouragement and reiterated its belief that a court-approved settlement would "unlock access to millions of books in the U.S., while giving authors and publishers new ways to distribute their work."

The comments in Chin’s two-page order indicated the judge had taken a critical look at the settlement after receiving nearly 400 submissions about the deal, many of them expressing disapproval.

In a Sept. 18 filing, the Department of Justice said the agreement as it now stands probably violates antitrust law. That conclusion led the plaintiffs, who include the Authors Guild and the Association of American Publishers, to say that they and Mountain View, Calif.-based Google had decided to renegotiate.

This time, the plaintiffs said, negotiations will include Justice Department officials.

The judge said it made no sense to stage the fairness hearing on Oct. 7 when it appears that the deal will be rewritten. He asked parties to the case to appear on that date to discuss how it will proceed but said he will not hear from objectors or supporters, though they are free to attend.

In a statement on its web site acknowledging the postponement, the Authors Guild said: "We’ll continue to work on amending the settlement to address the Justice Department’s concerns."

John M. Simpson, a consumer advocate with Consumer Watchdog who testified about the deal before the House Judiciary Committee, said any agreement also should involve input from Congress.

He said the agreement as it now stands would have given Google a monopoly over the digitizing of books.

"The judge put his fingers exactly on the issues in the case," Simpson said.

In its current form, the settlement would entrust Google with a digital database containing millions of copyright-protected books, including volumes no longer being published. The internet search leader would act as the sales agent for the authors and publishers, giving 63 percent of the revenue to the copyright holders. Authors and publishers could either set their own prices for their books, or rely on a formula drawn up by Google–a provision that has raised fears of the partnership turning into a price-gouging cartel.

The Justice Department sided with those arguments, saying the settlement could lessen competition among U.S. publishers. The agency also expressed concern that Google would gain a monopoly on so-called "orphan works"–out-of-print books that are still protected by copyright but whose writers’ whereabouts are unknown.

The arrangement "appears to create a dangerous probability that only Google would have the ability to market to libraries and other institutions a comprehensive digital-book subscription," the department said in its brief.

Hoping to ease those concerns, Google had promised to share its electronic index with its rivals–an idea that drew an icy response from Amazon.com, one of the world’s biggest book merchants and the maker of the Kindle, an electronic reader.

Google already has gone into some of the nation’s largest libraries to scan about 6 million out-of-print books into its electronic index. So far, though, it has only been able to show snippets of those digital copies. The settlement would clear the way for Google to sell all those out-of-print books and scan even more into its index.

Links:

Justice Department

Google Books


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