Inside Google

The Author’s Guild has urged members to go along with a lawsuit settlement that would allow Google to digitize millions of books from libraries and make them available in its Book Search service.

A prominent literary and talent agency has urged just the opposite.

Meanwhile, the Department of Justice currently has the settlement under review for possible violations of antitrust laws. A federal court has extended the deadline to Sept. 4 for authors and publishers to opt out of the proposed agreement.

Now U. S. District Judge Denny Chin of the Southern District of New York in Manhattan, who is charged with reviewing the settlement, has set a deadline of Sept. 18 for the government to present its views in writing.

Judge Chin has also scheduled a "fairness" hearing on the settlement for Oct. 7 and said the government could also lay out its views orally at that time, according to a report by Miguel Helft in The New York Times.

The $125 million settlement agreement was intended to resolve a class action lawsuit filed in 2005 by the Authors Guild and the Association of American Publishers against Google. In the suit, the guild and publishers said Google’s plan amounted to a violation of their copyrights.

The Author’s Guild has told members that  "unless you want to sue Google, there are no good reason to opt out of the settlement. If you want to allow your book to be searchable in Google’s database, and you want to be fairly compensated for Google’s use of your work, and you want to retain complete control over whether, and how, your book is displayed or sold to users, you should remain in the settlement."

The court has been inundated with proposed changes to the settlement, including one filed by a group of California professors who suggest the settlement isn’t fair to academic writers. A group of professors from Harvard Law School, and the Internet Archive, have each independently filed motions to intervene in the case on the grounds of antitrust violations. Several groups, including The Internet Archive and Consumer Watchdog, have also raised concerns about the issue to the Justice Department in what many consider the literary flap of the century.

The settlement would give Google the right to display the books online, and to profit from them by selling access to individual titles and by selling subscriptions to its entire collection to libraries and other institutions. Revenue would be shared among Google, authors and publishers.

Sources at the Justice Department told the Examiner that a threatened antitrust ruling could torpedo the settlement. They recall that Yahoo! and Google abandoned their advertising agreement after the Justice informed the companies that it would file an antitrust lawsuit to block the implementation of the agreement. Although the companies proposed various modifications to their original agreement in an effort to address the antitrust concerns, Justice determined that such modifications would not eliminate the competition concerns raised by the agreement.

The recently merged William Morris Endeavor agency has advised writers to opt out of the settlement because it would “bind copyright owners in any book published prior to January 9, 2009 to its terms, ” according to an internal memo leaked to media.

The terms of the agreement call for authors and publishers to split 63 percent of any revenue that Google generates from the sale of a digitized book either individually or in a database, as well as ad revenues from pages where an author’s work appears.

Agency attorneys argue that under copyright law, you don’t have anything without express written consent from the copyright holder. They argue that  "the court is now saying Google is free to sell your book unless you expressly tell them not to.”