September 17 – September 24, 2009 Edition

Backlash on Google Settlement Deepens

Mountain View, CA (Authorlink News, September 14, 2009)—Google Inc’s announcement late last week that it will sell access to millions of out-of-print books to third parties, including competitors, has done little to quiet critics, according to The Wall Street Journal (September 11, 2009, Subscription).

Following a Congressional hearing last week, Amazon Vice President Paul Nisener said Amazon wants to work directly with rights holders and not through Google.  “We don’t need anyone between us and rights holders,” he said.

Authors Guild Executive Director Paul Aiken, however, applauded Google’s move saying it would generate additional book sales.

The so-called Google settlement with the Authors Guild and Association of American Publishers, now pending in a federal court, initially was an attempt by the two industry organizations to stop Google from illegally scanning copyrighted books. The proposed settlement would share revenue from out-of-print books with rights holders through the Book Rights Registry, a new entity initially funded by Google. A final fairness hearing is scheduled October 7.

Amazon, Microsoft Corp. and others have stepped up to oppose the deal along with several library organizations. The U.S. Copyright Office added its voice Thursday at the hearing, as its head, Marybeth Peters, raised several concerns and said “key parts of the settlement are fundamentally at odds with the law.”

The settlement “would create mechanisms by which Google could continue to scan with impunity, well into the future, and to our great surprise, create yet additional commercial products without the prior consent of rights holders,” said Ms. Peters.

The Copyright Office can’t block the deal directly but has been talking to the Department of Justice to represent its concerns to U.S. District Court Judge Denny Chin who must ultimately approve it, according to people familiar with the matter.

The Justice Department, which has been discussing its concerns about the deal with the parties, is weighing whether to flag those concerns to the court, according to these people. Judge Chin has given the Justice Department a deadline of Sept. 18 to file a brief.

Among other measures, the department is worried that the agreement doesn’t contain enough checks and balances to prevent publishers from charging higher prices for digital book subscriptions.

Numerous groups have joined in opposition to the settlement including Microsoft and Yahoo.