Inside Google

The Department of Justice said the Google Book Search settlement would violate class action, copyright and antitrust law and said it should not be approved without changes. The DOJ suggested the parties limit the provisions for future licensing; eliminate potential conflicts among class members; provide more protections for unknown rights holders; address the concerns of foreign authors and publishers; remove the joint-pricing mechanisms among publishers and authors; and enable book-scanning rivals, such as Amazon, to access the books for resale.

The Department of Justice Sept. 18 said the Google Book Search settlement would violate class action, copyright and antitrust law and said it should not be approved without changes.

New York District Judge Denny Chin gave the DOJ a Sept. 18 deadline to voice its opinion on Google Book Search, a deal that would let Google scan millions of books online and charge readers to use them, with authors and publishers getting a share of the proceeds. Other parties were required to file their concerns by Sept. 8. Chin is holding a hearing on the proposed settlement Oct. 7.

The DOJ urged the court to order Google and the Author’s Guild and the Association of American Publishers to make changes to the deal: "This court should reject the proposed settlement in its current form and encourage the parties to continue negotiations to modify it so as to comply with Rule 23 and the copyright and antitrust laws."

The DOJ suggested the parties limit the provisions for future licensing; eliminate potential conflicts among class members; provide more protections for unknown rights holders; address the concerns of foreign authors and publishers; remove the joint-pricing mechanisms among publishers and authors; and enable book-scanning rivals, such as Amazon, to access the books for resale.

Echoing concerns voiced by other opponents of the deal, the DOJ said it is concerned the deal will restrict pricing competition among authors and publishers.

Orphaned works are those that are out of print and whose authors cannot be found. The DOJ believes the proposed settlement would grant Google too much power over these works, limiting competition with rival book providers. Amazon, which has its own effort to scan books online and offer them through its Kindle electronic readers, has made similar claims. Google moved to assuage such concerns by offering to let book retailers resell books from its Google Book Search catalog.

Google, which is reportedly modifying the Google Book Search deal for the DOJ, chose to see the silver lining in the DOJ’s filing, noting in a statement: "The Department of Justice’s filing recognizes the value the settlement can provide by unlocking access to millions of books in the U.S.  We are considering the points raised by the Department and look forward to addressing them as the court proceedings continue."

Consumer advocates were joyous about the DOJ’s finding:

"This is a victory for consumers and the broad public interest," said John M. Simpson, consumer advocate with Consumer Watchdog. "Consumer Watchdog supports digitization and digital libraries in a robust competitive market open to all organizations, both for-profit and non-profit, that offer fundamental privacy guarantees to users. But a single entity cannot be allowed to build a digital library based on a monopolistic advantage when its answer to serious questions from responsible critics boils down to: ‘Trust us. Our motto is "Don’t be evil."’"

Proponents of the deal had a different take. Ed Black, president and CEO of the Computer & Communications Industry Association, said the DOJ was overstating the antitrust concerns, in a statement:

"We believe this deal enhances competition among books and paves the way for competition in the online book marketplace, and helps disseminate information and knowledge in the best traditions of our industry. The DOJ makes a variety of arguments about class action procedure and antitrust. Some antitrust conerns outlined by the DOJ are overstated, and in any event can certainly be addressed. These should not be an obstacle to the court approving the legal settlement."

The DOJ, meanwhile, noted that its antitrust division is still investigating the proposed settlement, but acknowledged its filing is a good gauge for how it feels about Google Book Search as it stands.

Read more about this issue on TechMeme here, but Search Engine Land’s Danny Sullivan dissects the filing best here.