Despite asking a federal judge to cancel the scheduled October 7 fairness hearing, the parties in the Google Book Search Settlement said they were eager to fix the deal and move forward. As the legal dust settled last week, however, a growing number of critics and observers claim the settlement has been effectively killed. “The settlement is dead,” noted the Open Book Alliance in a statement, “and any hope for revival of a settlement will require fundamental reforms.”
The motion to cancel the fairness hearing, which Judge Denny Chen approved late last week, capped a stunning September fall for the settlement, including damaging testimony from Register of Copyrights Marybeth Peters at a September 10 congressional hearing and a Statement of Interest from the U.S. government filed on September 18 that urged the court to reject the settlement, citing problems with copyright, class action and antitrust law.
While Chin approved the motion, he ordered that a status conference be held October 7—the parties had asked for a November 6 hearing. The settlement parties remained publicly upbeat about their ability to revise the agreement, noting the government's support for some kind of deal and reiterating their commitment to “rapidly advancing” negotiations on an amended deal. “Of key importance is that the U.S. Statement of Interest confirmed the DoJ's reciprocal desire to work with the parties to address concerns,” stated the memo from the AAP and Authors Guild that accompanied the motion (Google was not part of the motion, but didn't oppose it).
While the government's brief urged rejection of the deal, it has been widely praised for its balance. “The Department of Justice appreciates both the potential and the dangers of the settlement,” observed New York Law School's James Grimmelmann. “They're clearly trying to lay the groundwork for a constructive way forward.” Copyright attorney Lois Wasoff agreed. “The brief is very constructive,” Wasoff told PW. “It's not a bashing brief. It doesn't leave the parties without a path.”
That path, however, may not be an easy one to follow. “One thing that's important is that there was inadequate representation by the plaintiffs in the negotiations,” author and class action lawyer Scott Gant explained. “That was my position, and the position of the government and many other objectors. Simply renegotiating the settlement with the same defect will lead to another defective agreement.” In his objection, Gant suggested there are at least four subclasses that must be represented and have their own counsel: copyright owners whose work has been copied, owners whose work hasn't been copied, orphans whose work has been copied and orphans whose work hasn't been copied—and there may be more, for example, foreign rights holders. “Those people need to be injected into the process now, otherwise renegotiation will be pointless,” Gant said. “You will have a process defect no matter what the outcome.”
The larger question, however, is whether revising the deal to ease the government's concerns would effectively remove the necessity for the settlement. The government brief suggested fundamental alterations were necessary—for example, its suggestion to make the deal opt-in rather than opt-out. “That would actually address almost all of my concerns,” Gant said of making the deal opt-in. “But if it is an opt-in case, then you don't need the settlement. You can just set up some commercial mechanism.”
Meanwhile, another wild card now looms: Congress. At the September 10 hearing, the Register of Copyrights told Congress its role in setting copyright law was being usurped in the settlement. While AAP's Allan Adler said after that hearing it was unlikely Congress would introduce any legislative fixes to issues raised by the settlement, the recent hearing certainly put the issue on Congress's radar, and some groups, such as Consumer Watchdog, have now explicitly called for congressional action.
Do-Over
Perhaps the first challenge now facing the settlement parties is to accept reality. While the deal was sold as a public good, it was always a private deal, something of a gamble and, at best, working on the fringes of class action and copyright law. Now with the original deal dead, what's next? “[The parties] must create a robust process that includes input from all stakeholders, including authors, libraries, independent publishers, consumer advocates, state Attorneys General, the Justice Department, and Congress,” noted the Open Book Alliance. “The promise of the mass digitization of books is too important to be left to another round of secret negotiations.”
For all its shortcomings, the settlement did offer significant public benefits—benefits that other stakeholders—particularly Congress—have shown little willingness or ability to address. If this settlement is not to be, will the public be the ultimate loser? More importantly, the fundamental questions of the original lawsuit remain unaddressed, and litigation could resume.
For his part, Judge Chin seems eager to move the case forward and to take control of it. Said Grimmelmann: “The sleeping giant wakes; this is Judge Chin's case now, not the parties' or the objectors' or the DOJ's.”
