Google, Publishers and Authors Debate Google's Print for Libraries Program

October 24, 2005. The Copyright Society of the USA and the DC Bar Association's Patent Copyright and Trademark Section hosted a luncheon panel discussion titled "Google Print for Libraries: Fair or Foul?".

The panel included Alexander Macgillivray, Intellectual Property Counsel for Google, Allan Adler, Vice President of the Association of American Publishers (AAP), and Paul Aiken, Executive Director of The Authors Guild. The other panelists were Jonathan Band, an attorney in private practice, and Siva Vaidyanathan, a professor at New York University). Rob Kasunic, of the Copyright Office, moderated, but expressed no opinions.

Google started as a company that provided web based searching of content on the web. It has since branched out into other activities. Recently, it began to provide searching of printed books. First, there was the Google Print for Publishers, which involves agreements between Google and book publishers regarding the scanning of their books. Since this is pursuant to negotiated agreements, there is no dispute between the publishers and Google.

More recently, Google began it Google Print for Libraries (GPL) program, which involves the scanning of books in the collections of five large libraries. One of these, the University of Michigan (UM), has stated that it will make available for scanning all books, including those under copyright. UM wrote in its web site that "We get a copy of the digital files with no significant constraints on our ability to use them in ways that are consistent with copyright law."

Oxford and the New York Public Library have stated that they will allow Google to scan only those works that are in the public domain. Harvard and Stanford, the other two participating libraries, have been less clear.

This GPL program, and especially Google's arrangement with the UM library, is the source of the present controversy, and the two pending lawsuits. For the nature and terms of Google's and UM's activities, see Cooperative Agreement [12 page PDF scan] and UM's summary of the project [8 pages in PDF].

Pending Court Cases. On October 19, 2005, five book publishing companies filed a complaint [35 pages in PDF] in U.S. District Court (SDNY) against Google alleging that its GPL infringes copyrights. The plaintiffs are McGraw Hill, Pearson Education, Penguin, Simon & Schuster, and John Wiley & Sons. All are members of the AAP.

See, story titled "Major Book Publishers Sue Google for Digitizing Copyrighted Books" in TLJ Daily E-Mail Alert No. 1,237, October 20, 2005. This case is McGraw Hill Companies, Inc., Pearson Education, Inc., Penguin Group (USA) Inc., Simon & Schuster, Inc. and John Wiley & Sons, Inc. v. Google Inc., U.S. District Court for the Southern District of New York, D.C. No. 05-CV-8881.

On September 20, 2005, the Author's Guild and others filed a similar complaint in the same District Court against Google alleging copyright infringement in connection with the same GPL. The plaintiffs in that action seek class action status. See, story titled "Author's Guild Sues Google for Copyright Infringement" in TLJ Daily E-Mail Alert No. 1,218, September 21, 2005.

See also, story titled "University Publishers Accuse Google of Systematic Infringement of Copyright on a Massive Scale" in TLJ Daily E-Mail Alert No. 1,142, May 25, 2005.

Neither the UM, nor the other libraries, are named as defendants.

Panel Discussion. The panel discussion on October 24 focused on several topics, including the facts regarding Google Print for Libraries (the participants were not entirely in agreement as to the nature of the GPL), application of fair use analysis to the GPL program, the opt out nature of Google's GPL program and the application of economic analysis of transactions costs to fair use analysis, and the underlying purposes and justifications for intellectual property rights.

Google's Macgillivray stated that Google's "mission is to organize all of the world's information", but "not to replace going out to buy a book".

Macgillivray's summary often used the language of the 9th Circuit's opinion in Kelly v. Arriba Soft, in which the Court held that placing thumbnail copies of copyrighted photographs in a web image search engine was protected fair use. This case, and related cases, are discussed below.

He said that while Google scans entire books under copyright, it only makes available to users "snippets", that the GPL program will benefit the public, and will not harm copyright holders.

However, Google's term "snippets" is not defined in Kelly v. Arriba Soft, the Copyright Act, or regulations promulgated thereunder.

NYU's Siva Vaidyanathan said that this is "potentially the most disruptive copyright case in decades". He is the author of Copyrights and Copywrongs: The Rise of Intellectual Property and How It Threatens Creativity [Amazon] and The Anarchist in the Library: How the Clash Between Freedom and Control is Hacking the Real World and Crashing the System [Amazon].

Vaidyanathan offered both support for, and criticism of Google. He backed up Google on its claim that GPL will not harm the market for books. He offered his opinion that it "will not undermine the sale of books". However, he offered little support for Google's assertions regarding the public benefits of its program. He said that GPL will not enhance the sale of books, and that it "won't revolutionize access and research".

He also criticized the commercial nature of Google. He said that there is a disturbing trend of outsourcing and privatization of library functions, and that the GPL is a part of this trend. He said that he is concerned by Google's commercial motive, and its use of proprietary software and inventions. Moreover, he said that Google, like most companies, will not last. In contrast, UM will.

Vaidyanathan, who works for a university, argued that universities should be providing, and controlling, this service.

The UM's web site offers an explanation for why Google, an efficient market competitor, rather than UM, an inefficient government subsidized and protected entity, should conduct this project. The UM wrote that "it would have taken us 1600 years and hundreds of millions of dollars to convert these materials on our own."

Allan Adler, the publishers' representative on the panel, made the argument that Google is essentially trying to create a new legal principle, that is not contained in the Copyright Act, or court precedent. He said that this might be called the "presumptuous benefactors exemption". He said that this exemption is now being asserted by "cutting edge technology companies".

Basically, Google and these other tech companies assert that "rights holders don't know what is good for them", but Google and other tech companies do. Adler said that this argument is based on the assumption that publishers "don't understand our markets".

Adler argued that Google does not know the publishing market, but whatever, decisions regarding use copyrighted works should be left to the rights holders. That is the nature of proprietary rights. And, in the publishing industry, without these proprietary rights, publishers would have no business.

He said that Google's claim that its GPL is protected by the doctrine of fair use has "tortured that doctrine beyond all reasonable recognition".

Paul Aiken of the Author's Guild spoke at length about Google's market capitalization, ad revenues, profits, and profit motives. He contrasted Google to other companies, pointing out for example that Google's market cap and revenues dwarf those of the New York Times and other media companies. His main point was that the GPL project is a commercial project.

Aiken also raised the subject of security. He stated for example, that while Google states that its digital copies of copyrighted works will not be made available to users, this might neverthelessl happen if Google's servers are hacked. He added that since Google is not negotiating agreements with copyright holders, there are no guarantees regarding security, audits, or compensation for loss.

Vaidyanathan also lamented that Google has a "soggy and ill defined privacy policy".

Jonathan Band reviewed the applicable case law. He said that there are two cases on point, Kelly v. Arriba Soft, a 9th Circuit case, and UMG v., a Southern District of New York case. The former supports Google, while the latter supports the copyright holders. These are discussed more below.

He acknowledged that the 9th Circuit has a reputation for being made up of "borderline socialists". But, he added, if Kelly applies, "Google has a stronger fair use argument than Arriba Soft did".

Fair Use Doctrine. The fair use doctrine is codified at 17 U.S.C. § 107. The relevant language of the fair use exception provides: "In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include -- (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work."

UMG v. There is little legal precedent to apply in analyzing Google's argument that its GPL activities are protected by the fair use doctrine. However, there are two cases, which reached opposite results.

In UMG v., the U.S. District Court (SDNY) rejected the fair use claim. Perhaps it is therefore no coincidence that both the publishers and the Authors Guild filed their complaints in this district. provided a music storage service that allowed subscribers to copy and store online the content of purchased CDs, and then play them back via the internet. However, the service was broad. The District Court found that "purchased tens of thousands of popular CDs in which plaintiffs held the copyrights, and, without authorization, copied their recordings onto its computer servers so as to be able to replay the recordings for its subscribers." The Court thus concluded that "although defendant seeks to portray its service as the ``functional equivalent´´ of storing its subscribers' CDs, in actuality defendant is re-playing for the subscribers converted versions of the recordings it copied, without authorization, from plaintiffs' copyrighted CDs."

On January 21, 2000, five recording companies, including Universal Music Group (UMG), filed a complaint [10 pages in PDF] in the District Court against The Court granted the plaintiffs' partial summary judgment on April 28, 2000. It issued its opinion [PDF] on May 4, 2000. This opinion is also reported at 92 F. Supp. 2d 349. asserted the defense of fair use. The Court applied the four prong fair use test, and found's defense lacking.

First, on the issue of "the purpose and character of the use", the Court wrote that "does not dispute that its purpose is commercial, for while subscribers to are not currently charged a fee, defendant seeks to attract a sufficiently large subscription base to draw advertising and otherwise make a profit."

The Court added that "Consideration of the first factor, however, also involves inquiring into whether the new use essentially repeats the old or whether, instead, it "transforms" it by infusing it with new meaning, new understandings, or the like." But, the Court concluded that there was no transformation.

Second, on the issue of "the nature of the copyrighted work", the Court held that the recordings being copied are close to the core of intended copyright protection, and conversely, far removed from the more factual or descriptive work more amenable to fair use.

Third, on the issue of the amount and substantiality of the portion of the copyrighted work used by the copier in relation to the copyrighted work as a whole, the Court held that "copies, and replays, the entirety of the copyrighted works here in issue".

Finally, on the issue of "the effect of the use upon the potential market for or value of the copyrighted work", the Court wrote that's "activities on their face invade plaintiffs' statutory right to license their copyrighted sound recordings to others for reproduction."

The Court also addressed's argument that its activities would nevertheless enhance plaintiffs' sales.

And here, the District Court offered an analysis that may prove key in the cases against Google. It wrote that "Any allegedly positive impact of defendant's activities on plaintiffs' prior market in no way frees defendant to usurp a further market that directly derives from reproduction of the plaintiffs' copyrighted works."

The Court continued that "This would be so even if the copyrightholder had not yet entered the new market in issue, for a copyrightholder's ``exclusive´´ rights, derived from the Constitution and the Copyright Act, include the right, within broad limits, to curb the development of such a derivative market by refusing to license a copyrighted work or by doing so only on terms the copyright owner finds acceptable. ... Here, moreover, plaintiffs have adduced substantial evidence that they have in fact taken steps to enter that market by entering into various licensing agreements." (Citations deleted.)

This case is UMG Recordings, Inc. v., U.S. District Court for the Southern District of New York, D.C. No. 00-CV-0472 (JSR), Judge Jed Rakoff presiding.

Kelly v. Arriba Soft. On February 6, 2002, the U.S. Court of Appeals (9thCir) issued its original opinion [25 pages in PDF] in Kelly v. Arriba Soft. Arriba Soft filed a petition for review. The Court of Appeals denied the petition, but issued its revised opinion [16 pages in PDF] on July 7, 2003. This revised opinion is also reported at 336 F.3d 811. See also, stories titled "9th Circuit Reverses in Kelly v. Arriba" in TLJ Daily E-Mail Alert No. 363, February 7, 2002; and "Petition for Rehearing Filed in Kelly v. Arriba Soft" in TLJ Daily E-Mail Alert No. 381, March 5, 2002.

This is a case involving the fair use exception to copyright infringement in the context of online digital images and search engines. The Court of Appeals held that Arriba Soft's use of small thumbnail copies of Kelly's copyrighted photographs in its search engine results constituted fair use.

First, on the issue of "purpose and character of the use" the Court wrote that "they benefit the public by enhancing information-gathering techniques on the internet." Thus, "this first factor weighs in favor of Arriba due to the public benefit of the search engine and the minimal loss of integrity to Kelly’s images."

Second, on the issue of the "nature of the copyrighted work" the Court wrote that "we find that this factor weighs only slightly in favor of Kelly."

Third, on the issue of the "amount and substantiality of portion used" the Court wrote that "This factor neither weighs for nor against either party because, although Arriba did copy each of Kelly's images as a whole, it was reasonable to do so in light of Arriba's use of the images. It was necessary for Arriba to copy the entire image to allow users to recognize the image and decide whether to pursue more information about the image or the originating web site. If Arriba only copied part of the image, it would be more difficult to identify it, thereby reducing the usefulness of the visual search engine."

Finally, on the issue of the "effect of the use upon the potential market for or value of the copyrighted work", the Court wrote that "This last factor requires courts to consider ``not only the extent of market harm caused by the particular actions of the alleged infringer, but also `whether unrestricted and widespread conduct of the sort engaged in by the defendant ... would result in a substantially adverse impact on the potential market for the original.´ ´´ A transformative work is less likely to have an adverse impact on the market of the original than a work that merely supersedes the copyrighted work."

The Court reviewed the potential markets for Kelly's photographs, and concluded that "Arriba's creation and use of the thumbnails does not harm the market for or value of Kelly’s images. This factor weighs in favor of Arriba."

"Having considered the four fair use factors and found that two weigh in favor of Arriba, one is neutral, and one weighs slightly in favor of Kelly, we conclude that Arriba's use of Kelly's images as thumbnails in its search engine is a fair use." The Court thus held that "Arriba's reproduction of Kelly’s images for use as thumbnails in Arriba’s search engine is a fair use under the Copyright Act. However, we hold that the district court should not have reached whether Arriba’s display of Kelly’s full-sized images is a fair use because the parties never moved for summary judgment on this claim and Arriba never conceded the prima facie case as to the full-size images."

This case is Leslie Kelly, dba Les Kelly Publications, dba Les Kelly Enterprises, dba Show Me The Gold v. Arriba Soft Corporation, U.S. Court of Appeals for the 9th Circuit, App. Ct. No. 00-55521, an appeal from the U.S. District Court for the Central District of California, Judge Gary Taylor presiding, D.C. No. CV-99-00560-GLT.

Campbell v. Acuff-Rose. There was also some discussion of the 1994 opinion of the Supreme Court in Campbell v. Acuff-Rose Music, Inc., which is also published at 510 U.S. 569. On March 17, 1994, the Court issued its unanimous opinion allowing a copying of music in the form of a parody, under the fair use doctrine.

This was the dispute involving the hideous and commercial parody of Roy Obison's classic titled "Oh, Pretty Woman". The Court reversed the Court of Appeals, which had held that the defense of fair use was barred by the song's commercial character and excessive borrowing. The Supreme Court held that "a parody's commercial character is only one element to be weighed in a fair use enquiry, and that insufficient consideration was given to the nature of parody in weighing the degree of copying". It held for the infringer.

Google's MacGillivray pointed out that the defendant in that case, like Google, has a commercial purpose. The publishers' Adler responded that the present dispute is not a music parody case, but that Google's argument is a "parody of fair use".