DoJ objects to (revised) Googlebooks pact

The US Department of Justice is still concerned that Google's $125m book-scanning settlement conflicts with class-action, copyright, and antitrust law, even after Google and American authors and publishers negotiated changes to the pact meant to appease its critics.

"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," the DoJ said today in a court filing.

In September, the DoJ told the court to reject the original settlement if it weren't changed to address "significant problems." A little more than a month later, Google and its fellow parties filed an amended settlement - but the DoJ still sees problems, and recommends that the parties return the negotiating table.

"At this time, in the view of the United States, the public interest would best be served by direction from the court encouraging the continuation of settlement discussions between the parties and, if the Court so chooses, guidance as to those aspects of the ASA [amended settlement agreement] that need to be addressed," its filing reads.

In October 2008, Google settled a lawsuit from the US Authors Guild and the Association of American Publishers over its Book Search project, a effort to digitize texts inside many of the world's leading research libraries and make them searchable online. So far, the web giant has scanned more than 10 million titles, many still under copyright protection.

The pact creates a "Book Rights Registry" where authors and publishers can resolve copyright claims in exchange for a cut of Google's revenues. But it also gives Mountain View the unique right to digitize and make money from "orphan works," books whose rights are controlled by authors and publishers who have yet to come forward. And although other organizations could negotiate the rights to Registry titles, the Registry alone would have the power to set prices.

In essence, Google and its fellow parties are rewriting copyright law with a civil settlement.

In amending the original settlement late last year, Google proposed that for up to ten years, an independent fiduciary would retain orphan works revenues that would have gone to the rights holder. Some of these funds would be used to locate the orphans' right holders, and anything left over would eventually go to charity. But the pact would still give Google the right to digitize orphaned works - a right no one else has.

The DoJ still believes this is a problem. "The ASA suffers from the same core problem as the original arrangement: 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."

A court hearing is scheduled for February 18. Asked for comment, Google provided a statement on behalf of itself and the case's plaintiffs. "The Department of Justice’s filing recognizes the progress made with the revised settlement, and it once again reinforces the value the agreement can provide in unlocking access to millions of books in the U.S," it reads.

"We look forward to Judge Chin’s review of the statement of interest from the Department and the comments from the many supporters who have filed submissions with the court in the last months. If approved by the court, the settlement will significantly expand online access to works through Google Books, while giving authors and publishers new ways to distribute their works.” ®

Update: This story has been updated to show that the independent fiduciary mentioned in the revised Google Books settlement would merely retained orphan works revenues that would have gone to rights holders.