Google's Big Score: District Court Says Book Digitization Project is Fair Use

In the latest installment of the legal saga surrounding Google’s book digitization project,  Judge Denny Chin of the Southern District NY court has granted summary judgement in favour of Google, Inc. following eight years of litigation.

The court found that the scanning of over 20 million books and the provision of free snippets of the digitized copies over the Internet falls within the fair use exception provided in 17 USC § 107. This decision, which the Authors Guild plans to appeal, signals the court’s endorsement of Google’s practices, and is a further indication of American courts’ favourable view toward the role of the Internet and digital distribution.

The Google Library Project

In 2004, Google announced a program called the Library Project, a part of its digital books project which involved a collaboration with a number of public libraries and prominent American universities in an effort to digitize the institutions’ significant holdings. The project involved the use of optical character recognition, a technology that generates machine-readable electronic copies of the physical books.

Physical copies of books are scanned and placed in an index, which allows users to perform full-text searches in order to identify works relevant to their interests. After performing a search, a reader can access up to three “snippets” of text from a work containing the search terms. These snippets can change depending on the search terms, meaning it is possible (although impractical) to access an entire text by performing a large number of different searches.

A consortium of participating universities, involved in what is known as the HathiTrust Digital Library (HDL), were also provided with digital copies of their scanned works, and access to a full-text searchable database. The individual universities can download full copies of works contained in their collections, but can gain only limited access to works contained in the collections of other institutions.

Google and the affiliated universities sought no permission from rights-holders before beginning the project. As a result of these activities, the Authors Guild of America and several publishers initiated separate class actions against both Google and the HDL universities.

In 2012, a District Court found that the activities of universities and libraries involved in the HDL fell within the doctrine of fair use, and therefore the reproductions for use in databases and site-specific digital access to library holdings were not infringements of any rights held by the plaintiffs. This decision was appealed by the Authors Guild, and the judgement has not yet been released.

The Google case, however, continued. The commercial status of Google coupled with its decision to make the snippets widely available to the public made its claim of fair use less likely to succeed.

Class Action Litigation as an Alternative to Blanket Licensing

The American copyright system, administered by collective societies such a the Copyright Clearance Center, operates under a permission-based licensing process. This contrasts with the practice in Canada, which depends on blanket licensing agreements with collective societies such as Access Copyright, where fees are collected first, and then royalties are distributed among members of the collective according to subsequent audits of practices which fall within the terms of a licence or tariff.

In 2008, Google and the Authors Guild entered into an amended settlement agreement. This agreement was was eventually rejected in a decision also authored by Judge Chin, then of the District Court of NY on the grounds that it was not fair, adequate and reasonable. Through this class action settlement, Google attempted to lower the transactional costs attributed to permissions-based licensing and to avoid liability for its digitization of orphan works (works for which the author cannot be located, and therefore for which no permission can be obtained). While Google would be able to continue its digitization project, the Authors Guild would receive royalties over both works in its own repertoire and those works for which no author could be located.

As noted in the decision concerning the agreement, over 500 submissions were filed by interested third parties in response to the settlement, most objecting the to arrangement. Judge Chin noted the inadequacy of class notice and representation and antitrust concerns. Amazon and Microsoft, Google’s main competitors, arguing that the settlement infringed constitutional authority over copyright law, and that the agreement concerning orphan works resulted in an involuntary transfer of copyright in violation of US copyright law. In addition, were the settlement allowed to proceed, Microsoft and Amazon would have had to obtain permission from their main competitor in order to publish a significant number of unclaimed works.

With the settlement rejected and an application to the Second Circuit for certiorari of the class certification denied, the case proceeded on a consideration of the merits of Google’s fair use defence.

Fair Use – The Benefits of Google’s Project

The trial was a major success for Google, as the court rendered summary judgement in its favour on the grounds that all of Google’s activities fell within the fair use exception contained at 17 USC § 107.

The court found that the Library Project provided numerous and significant benefits. Among the benefits mentioned by the court were:

  • the increased efficiency in scholarly research;
  • the promotion of a type of research known as data mining or text mining, in which large amounts of textual data is analyzed in order to draw conclusions about “word frequencies, syntactic patterns, and thematic markers”;
  • the increased access the project provided to under-served communities, including people with visual impairments;
  • the preservation and promotion of old and out-of-print books; and
  • the promotion and resulting benefit to authors and publishers, as page containing the snippet included links to sellers of the book and libraries which contain the book in their collection.

Fair use, like Canadian fair dealing, is an equitable doctrine designed to promote the development of arts and sciences. As a result, the substantial benefits provided by the project significantly influenced the finding of fair use.

Fair Use – Analysis on the Facts

The court found that Google’s use of the protected works is highly transformative. Transformation, a concept not recognized under Canadian law, is a significant element of consideration under the US doctrine of fair use (although not “absolutely necessary”, according to a foundational decision by the US Supreme Court on fair use).

The transformative character of the Google Library Project significantly militated towards a finding of fair use. In considering the purpose and character of the use, the first statutorily mandated consideration under the fair use analysis, the court found that Google Books does not “supersede or supplant” books because it is “not a tool to be used to read books.” The transformative character of the use acts as a counterweight to the commercial character of Google’s operations – a factor that can tilt the balance against fair use.

The nature of the works in question also militated in favour of fair use. Unlike in Canada, US copyright law recognizes that it is harder to justify fair use in respect of fictional works in comparison with works of non-fiction. The vast majority of books digitized in the course of the Library Project were non-fiction. In another stark contrast to Canadian law, the fact that the books were published also weighed in favour of fair use. Unpublished works lead to a narrower scope of fair use in the American approach. In CCH Canadian Ltd v Law Society of Upper Canada, the SCC recognized that the unpublished status of works can render a dealing more fair, thus increasing the scope of the doctrine where works are not publicly available.

The amount of the work copied was the sole factor which weighed against a finding of fair use. Google digitized entire works as part of its Library Project although, crucially, the amount of text accessible to a user in response to a search was limited to snippets of text, rather than complete access to the full text.

The effect of the use on the potential for the market also weighed in favour of fair use. The court found that, far from undermining the market for works, the Library Project enhanced sales of books by bringing rare or obscure titles to the attention of readers. Snippets of text were accompanied by links to libraries or websites where authorized copies of the works could be obtained by readers who wished to continue their research. While the analysis of this factor figures more prominently in US jurisprudence than in Canada, the reasoning in the decision resembles that in SOCAN v Bell Canada, a recent SCC decision in which the Court found that the provision of short excerpts from songs as part of a preview function on an online marketplace constituted fair dealing for the purposes of research. In SOCAN, the Court found that the dealing promoted, rather than undermined, the market for the sound recordings (for the IPilogue’s coverage of the decision, click here).

While US fair use differs in many significant respects from Canadian fair dealing, the case is highly significant for Canadian copyright practice. Like many of the decisions rendered by the SCC in 2012’s copyright Pentology, the American court’s stance is pro-technology, favouring new forms of digital distribution over traditional approaches to rights-management which favour owners and authors. Many other aspects of Google’s project would also help a such a project qualify for fair dealing in Canada, notably the manner in which the project increases the dissemination of rare texts, promotes the sale of protected works, and limits the amount of a book available to users. Nevertheless, as fair dealing – like fair use – is heavily dependent on the specific facts of a case, it remains hard to accurately predict how a similar case would fare in Canada.

David Bowden is an IPilogue Editor and a JD candidate at Osgoode Hall Law School.

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