On 18 September 2009 the U.S. Department of Justice (DOJ) advised a federal judge that, unless revised, the proposed legal settlement giving Google the digital rights to millions of out-of-print books threatens to block competition and drive up prices.
SLA has been active in discussions with Google since October 2008, and in late August 2009 SLA joined the Open Book Alliance to seek resolution on issues of copyright, access, anti-trust and privacy in the case.
The Justice Department’s 28-page Statement of Interest, filed in New York federal court, marks the first time that the DOJ had publicly shared its position about Google Book settlement agreement. As the top law enforcement agency in the U.S., the DOJ began looking at the Google book settlement earlier in the year as a swell of concern rose from both public and private entities.
The DOJ’s Statement of Interest is supportive but also concerned about the proposed settlement, stating: “The United States strongly supports a vibrant marketplace for the electronic distribution of copyrighted works, including in-print, out-of-print, and so-called “orphan” works. The Proposed Settlement has the potential to breathe life into millions of works that are now effectively off limits to the public.”
But the statement later continues: “Nonetheless, the breadth of the Proposed Settlement – especially the forward-looking business arrangements it seeks to create – raises significant legal concerns. As a threshold matter, the central difficulty that the Proposed Settlement seeks to overcome – the inaccessibility of many works due to the lack of clarity about copyright ownership and copyright status – is a matter of public, not merely private, concern. A global disposition of the rights to millions of copyrighted works is typically the kind of policy change implemented through legislation, not through a private judicial settlement.”
The DOJ thoughtfully raised some of the same substantive and serious issues that the Open Book Alliance, of which SLA is a member, and others have been talking about for months. In particular, the DOJ recommends moving from an “opt-out” to an “opt-in” option for all of the books in the settlement. It also points out that there are significant antitrust concerns with no roadmap for how to resolve them. In the words of the Justice Department’s brief: “As a threshold matter, changing the forward-looking provisions of the current Proposed Settlement applicable to out-of-print rightsholders from an opt-out to an opt-in would address the bulk of the Rule 23 issues raised by the United States.”
The brief also points out that, “This de facto exclusivity (at least as to orphan works) 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 seller of an incomplete database – i.e., one that does not include the millions of orphan works – cannot compete effectively with the seller of a comprehensive product. Foreclosure of newcomers is precisely the kind of competitive effect the Sherman Act is designed to address.”
The DOJ statement also addresses concerns with not only U.S. works, but also the adequacy of representation of foreign rightsholders, stating: “The Proposed Settlement operates to sweep in untold numbers of foreign works, whose authors, under current law, are not required to register in the same manner as U.S. rightsholders. Many of those authors have never published works in the United States and are not members of the Authors Guild or the Association of American Publishers, which exclude many foreign copyright owners from membership by virtue of their membership criteria. Moreover, the interests of these class members likely differ from those of the class representatives. As the filings of France and Germany make clear, some of the United States’ trading partners have serious concerns about application of the Proposed Settlement to foreign authors and, in any event, the parties have not demonstrated that the class included representation sufficient to protect the interests of these foreign rightsholders.”
It is SLA’s position that a completely electronic, searchable, and universally accessible repository of digital books has the potential to bring untold value and knowledge to individuals, organizations and libraries, making more information available to more people around the globe. SLA looks forward to that day. In the meantime, we are joining this effort because we believe that the U.S. Department of Justice (DOJ) must look into the full ramifications of this settlement on issues of copyright, access, affordability and privacy. SLA's goal is to ensure that any mass book digitization and distribution system addresses those extremely important issues, and that access to such valuable information remains open and competitive. We are also looking for some additional answers on how the settlement will achieve a fair and accessible system. The DOJ’s Statement of Interest reflects many of SLA’s concerns.
