Justice Dept.: What right does Google have to e-book exclusivity?

In a court filing that seriously jeopardizes a proposed settlement of the e-book publishing dispute between Google and members of the Authors Guild and other publishing groups, the US Dept. of Justice has raised serious allegations that the settlement as it stands now may violate the country's antitrust law. The keyword here is "may," as that final determination "may" be up to a judge.

The main problem is this: Google would like to be able to electronically publish a wide variety of titles, including out-of-print works whose publishers or former rights holders may not even exist anymore. The keyword here is still "may." The settlement as proposed is clearly between those publishers that do exist and Google; but can Google necessarily claim the right to unilaterally assume that all those who didn't respond, aren't necessarily present?

Silence has never implied consent before, and this time is no exception, claim DOJ attorneys in a court filing last Friday. What's more, Google may not have the exclusive right to claim just what it has the exclusive right to, if no one else claims it first.

"The rights conferred are so amorphous and malleable," the attorneys write, "that it is difficult to see how any class representative could adequately represent the interests of all owners of out-of-print works (including orphan works). The parties appear willing to address this problem by limiting the future rights that may be controlled by the Registry and Google."

The "Registry" to which the attorneys refer is an independent database of out-of-print titles, to be maintained and operated by an as-yet-undetermined source separate from Google. The government officially supports this aspect of the settlement, at least as an ideal. But since print publishing through the centuries hasn't used such registries historically (imagine a comprehensive list of everything we don't know about), it's essentially impossible to determine for fact, the attorneys argue, which works are officially "orphans." "One goal of the settlement -- making large numbers of copyrighted works available to the public in electronic form while providing compensation to authors and publishers -- is a public benefit that, to date, has not come to pass due to certain realities of the copyright system, including, for example, the fact that copyright owners are not required to formally register or otherwise assert their ownership," writes the DOJ.

It's all a bit of a conundrum, but the results are plain and simple, they argue: For the government to agree to the settlement, it would need to ask all parties whether it's acceptable; and "all parties" in this instance would imply that somebody, somewhere, represents the interests of rights holders for orphan books. That's not exactly like saying that dead people need to be alive to have their cases heard; there are matters of something called "estates." Who knows just what types of injuries or infringements these estates would claim, if they could?

No one, says the government, citing a Supreme Court case involving a class-action settlement proposal that was supposed to benefit individuals who may have been exposed to asbestos at work, but who hadn't filed claims yet because they hadn't shown symptoms yet. On the surface, it would be nice to save them some money and settle on their behalf for the sake of their future; on the other, you can't make up the amount of that settlement out of thin air.

In such cases, the attorneys wrote, "the courts have cast doubt on the circumstances in which class representatives could adequately represent absent class members with respect to as-yet uncertain injuries or rights that were far removed from the facts underlying the complaint."

And what constitutes a "symptom" in the case of rights holders of orphaned works who may not know their rights today, but discover them in the future after Google has already scanned and published their books online? The settlement as proposed guarantees the existing rights holders the right to prohibit Google from scanning and publishing their works. That's a little different than setting aside some cash; in this case, an orphaned works claimant can't exactly prohibit Google from putting on the Internet something that's already there.

The government's other problem with the proposed settlement is that it would enable Google to negotiate with the existing rights holders for a fair price. Depending on how the market is structured at the time, that could constitute collusion under existing anti-trust laws, which would prefer that rights holders name their prices and that Google (and every other e-publisher in the market) accept them at face value. On the other hand, should Google wish to provide e-books at a discount, the settlement would have Google negotiate with rights holders to do this -- which the DOJ says is unfair to Google. A physical book retailer has the right to offer discounts without making deals with publishers; Google should have that same right, says the DOJ.

So the settlement as proposed may be contrary to current antitrust laws, but in so many contrary respects to one another as to not favor one side or the other as the "trust" in this situation. No matter: The DOJ still recommends that US District Court reject the settlement.

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