A Cross and a Clove of Garlic

It seems that the saga of the Google Books Settlement has been dragging on for years. We may now be approaching the denouement. Hostility to the Google Books Settlement has been widespread, with its defenders increasingly isolated as the full implications and impact of the proposed settlement become appreciated.

Four principle concerns have been expressed. The proposed settlement:

• Drives a coach and horses through international copyright law

• Forces authors and publishers to choose between two deeply unattractive options: unfair terms or effective exclusion from the digital world

• Creates a court-sanctioned monopoly for millions of works, and

• Gives Google the means to further entrench its monopoly in search and search advertising

All this as a result of a class action (which has no equivalent in Europe) in a court in the Southern District of New York and without recourse to the legislative process; either in the United States or Europe.

The original court hearing on the proposed settlement was due to be held in September 2009. As a result of many objections, including from the French and German governments and, perhaps most significantly, the US Department of Justice, the hearing was pushed back to 2010.

Some changes to the proposed settlement were made. However, for many these did not go nearly far enough and numerous further objections have been lodged with the court. Representatives of publishers and publishers’ groups, collecting societies, author organisations and individual authors from Austria, France, Germany, India, Israel, Italy, Japan, New Zealand, Spain, Switzerland, and the United Kingdom have all filed their objections.

However, once again, it may be the comments filed by the US Department of Justice which carry the most weight. In a ‘statement of interest’ filed with the Court on 4 February 2010, the Department of Justice repeats its earlier concerns that a class action procedure is the wrong way to decide such important issues.

Of equal importance are the Department’s objections that:

• The proposed settlement would “confer significant and possibly anticompetitive advantages on a single entity – Google”

• In relation to the pricing mechanism “It is unlawful for competitors to agree with one another to delegate to a common agent pricing authority for all of their wares.”

• “There is no serious contention that Google’s competitors are likely to obtain comparable rights independently”, and

• “Google already holds a relatively dominant market share in [the search] market. That dominance may be further entrenched by its exclusive access to content through the [proposed settlement]. Content that can be discovered by only one search engine offers that search engine at least some protection from competition. This outcome has not been achieved by a technological advance in search or by operation of normal market forces; rather, it is the direct product of scanning millions of books without the copyright holders’ consent and then using [a class action procedure] to achieve results not otherwise obtainable in the market.”

The seal of the Department of Justice bears a picture of a bald eagle. Google may be feeling today that a picture of a cross and a clove of garlic might be more appropriate.

David Wood
ICOMP legal expert