Judge Chin rejects Google Book Search Settlement

After many months of consideration, Judge Chin has finally issued his order rejecting the proposed settlement of the Google Book Search (GBS) class action. Overall, the decision is not too surprising. Class action law gives judges like Chin quite a bit of discretion in approving or rejecting settlements in terms of whether or not they are considered "fair, adequate, and reasonable." That's a lot of wiggle room, especially for uncharted waters such as the GBS case. With over 500 submissions, Chin had quite a bit to consider. In summary, Chin rejected the proposed settlement for five key reasons: (1) It overreached in trying to license orphan and international works; (2) it tried to settle legal issues that were not part of the original lawsuit (e.g. full display of books online); (3) Congress is better suited to craft the right legal rules for the future of online books than a class-action lawsuit; (4) there was significant diversity of opinion among the class of plaintiffs as to the right outcome of the case; and (5) it raised anti-trust concerns, especially regarding metadata markets such as search results related to the Google Book corpus. Chin suggests at the end of the order that changing the prospective relief licensing scheme from "opt-out" to "opt-in" might mitigate these concerns and lead to approval down the road. The following were passages I found most interesting in the order: "The questions of who should be entrusted with guardianship over orphan books, under what terms, and with what safeguards are matters more appropriately decided by Congress than through an agreement among private, self-interested parties. Indeed, the Supreme Court has held that "it is generally for Congress, not the courts, to decide how best to pursue the Copyright Clause's objectives." Second, the ASA would release claims well beyond those contemplated by the pleadings. This case was brought to challenge Google's use of "snippets," as plaintiffs alleged that Google's scanning of books and display of snippets for online searching constituted copyright infringement. Google defended by arguing that it was permitted by the fair use doctrine to make available small portions of such works in response to search requests. There was no allegation that Google was making full books available online, and the case was not about full access to copyrighted works. The case was about the use of an indexing and searching tool, not the sale of complete copyrighted works." "While the named plaintiffs and Google would argue that these authors can simply opt out, the comments underscore certain points. First, many authors of unclaimed works undoubtedly share similar concerns. Second, it is incongruous with the purpose of the copyright laws to place the onus on copyright owners to come forward to protect their rights when Google copied their works without first seeking their permission. Third, there are likely to be many authors – including those whose works will not be scanned by Google until some years in the future – who will simply not know to come forward." "The ASA would arguably give Google control over the search market." "The ASA would broadly bar 'direct, for profit, commercial use of information extracted from Books in the Research Corpus' except with the express permission of the Registry and Google." "Google's ability to deny competitors the ability to search orphan books would further entrench Google's market power in the online search market." "The privacy concerns are real. Yet, I do not believe that they are a basis in themselves to reject the proposedsettlement." … "I would think that certain additional privacy protections could be incorporated, while still accommodating Google's marketing efforts." "The fact that other nations object to the ASA, contending that it would violate international principles and treaties, is yet another reason why the matter is best left to Congress." "As the United States and other objectors have noted, many of the concerns raised in the objections would be ameliorated if the ASA were converted from an opt-out settlement to an opt-in settlement. I urge the parties to consider revising the ASA accordingly."

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