By James Grimmelmann, Associate Professor of Law, New York Law School.
On Tuesday, Judge Denny Chin quietly deflated the Google Books settlement. His long-awaited opinion in Authors Guild v. Google, Inc. rejected a proposed settlement, which would have given Google the right to sell electronic copies of out-of-print books. The opinion is short, readable, and filled with eloquent quotations from objections, many filed pro se. It moves quickly through more issues than I could discuss in a blog post, so here I'll focus on its central holding, that this kind of "forward-looking business arrangement" is simply beyond the court's power to approve under Rule 23.
The basic issue posed by the settlement has always been that it turns an ordinary class action inside-out. The underlying lawsuit, filed in 2005 by authors and publishers, objected to Google's program to scan books, index them, and show short "snippets" of a few sentences as search results. In the normal course of things, this suit would have proceeded to a judgment, either that Google infringed copyright or that its book search engine was protected fair use.
And ordinarily, any settlement would have fallen somewhere between those two possibilities. Perhaps it would have allowed Google to continue some of its scanning but not all of it, and perhaps Google would have paid copyright owners, but not as much as they could have won at trial. It would have been, in short, a genuine compromise between the parties' legal positions.
When the settlement was proposed in 2008, and amended in 2009, however, it had metastazied into something much more ambitious: a combination of universal library and ultimate bookstore. Google would use its scans to sell complete digital copies of the books to consumers and libraries. It would keep 37 percent of the revenue, and the remaining 63 percent would be split between authors and publishers according to a complicated formula. The whole thing would be subject to an intricate, almost Rube Goldbergian governance scheme involving Google, authors, publishers, libraries, and a new Book Rights Registry to keep track of everything.