$125m in the kitty, but who will get the cream?

On Monday Google announced during a European Commission hearing in Brussels that it will exclude from the US Google Book Settlement all European books that are still commercially available [Note only those that are “commercially available”. Could we have a definition please, Google?]. This means that European books will no longer be available to American consumers through Google Book Search unless the author/publisher has expressly agreed to be included. Although they say this is a “step in the right direct”, European authors and publishers, as well as national governments, still expressed serious concern regarding the Google Book Settlement.

As reported by the IPKat (here, here and here), the Google Book Settlement made in November 2008 was a result of a class action lawsuit brought by the Association of American Publishers, the Authors Guild, and other select authors and publishers who had alleged that Google’s scanning of their books infringed their respective copyrights. If approved by federal court in a fairness hearing scheduled in October, the Settlement would enable Google to scan copyright, out-of-print and orphaned works in the US for online inclusion in exchange for $125 million payment to a Books Right Registry from which authors and publishers would then be compensated. The online functionality of the Google Book Search, in conjunction with the approved Settlement, would enable Google to use the content for a multitude of permitted acts such as sales, advertising and third-party licensing. 37% of revenue earned from these uses would go to Google. In the US, Google had previously given authors until 5 May 2009 to “opt-in” or “opt-out” of the settlement terms. Failure to do so would have the effect of “opting in” an author/publisher to the settlement – in effect a compulsory licensing system. This and the issue of Google acting as a de facto exclusive licensor of “orphan works” generated waves of concern throughout the U.S., resulting in the Justice Department commencing a formal inquiry into the Settlement’s antitrust implications this past summer.

European concern also continues to mount. France has begun the process of filing formal objections to the case in New York, while Germany has already submitted its opposition to the settlement citing contravention of national German copyright laws and the European initiatives to create non-commercial digital libraries (more on this below). As reported by Bloomberg, Nicolas Georges, the director responsible for books and libraries at the French Ministry of Culture stated at the hearing:
“The settlement isn’t in line with intellectual property rights, secondly, the settlement raises serious issues in antitrust law and thirdly the settlement poses an evident risk to cultural diversity ... The right of Google to digitize orphan works in American libraries, but coming from around the world, gives them an unequal licensing right for exploitation in the future, a monopoly.”
But what is Europe to do? Due to the territorial nature of copyright law a pan-European settlement or licensing deal would be near impossible to achieve – a problem which in fact had already been addressed last year by the ¡2010: Digital Libraries Initiative’s High Level Expert Group (HLEG) and Copyright Subgroup’s Joint Report which addressed the problem of digitization of orphan works. The Digital Libraries Initiative 2005 launch was followed by a Recommendation adopted by the European Commission in August 2006 in which it called upon Member States to create mechanisms to facilitate use of orphan works and promote the availability of a known orphan works directory. The European Council then invited Member States to have mechanisms in place by 2008 to facilitate the digitization and online access to orphan works. Google, unsurprisingly, beat Europe to the punch.

Information Society Commissioner Viviane Reding and Internal Market Commissioner Charlie McCreevy issued a joint statement yesterday in relation to the Google Books hearing which stated:
“"It goes without saying that digitisation of copyrighted works must fully respect copyright rules and fairly reward authors, who could be the biggest winners from better access to a Europe-wide online audience. However, we also need to take a hard look at the copyright system we have today in Europe. Is the present framework still fit for the digital age? Will the current set of rules give consumers across Europe access to digitised books? Will it guarantee fair remuneration for authors? Will it ensure a level playing field for digitisation across Europe, or is there still too much fragmentation following national borders? What could be the contribution of Europeana, Europe's digital library, when it comes to working on a European response to digitisation efforts in other continents? [This Kat is worried: Europe’s previous recommendations and Joint Reports were derived from the premise of promoting the public sector and ‘cultural and public good’. These are arguably not appropriate frameworks in which to reassess the legal implications of orphan works in the commercial sector.]
Is Europe's copyright framework modern enough when it comes to digitising orphan works and out-of print works? [Well, no! Europe’s recommendations in regard to orphan works have been emphatically lacking. Their addition really has been only to codify the common-sense approach of a ‘due diligence’ search. Can anyone point to a European legal definition of an “orphan work”?]
These books represent the vast majority of European libraries' collections (around 90%). In our view, these books must be recovered and given a new lease of life".
The European Commission will be discussing the above questions with stakeholders, the European Parliament and the Council in the coming weeks with the stated aim of presenting proposals for “the modernization of Europe’s still far too fragmented copyright system…with the focus on finding an online family for orphan and out-of-print works” to the new Commission.
It seems to this IPKat that Europe has a proverbial ‘gun to their head’ in the guise of the Google Book Settlement. Because of this, this IPKat is concerned that any proposed legislation or solutions now put forward will not adequately address the legal and practical ramifications of orphan works and similar issues.

Deadlines to file amicus curae briefs have now passed. The US Government has until 18 September 2009 to file their written submissions to the court. The hearing is scheduled for 7 October 2009. This IPKat, in her guise as AmeriKat, will be in Manhattan during the hearings and hopes to be either in Judge Denny Chin’s courtroom or in the proximity thereof.
$125m in the kitty, but who will get the cream? $125m in the kitty, but who will get the cream? Reviewed by Annsley Merelle Ward on Wednesday, September 09, 2009 Rating: 5


  1. I'm confused as well, why isn't the "cultural and public good" a good way to frame how to deal with "orphan works" (whatever they turn out to be).

    Why is the commercial sector's framework more appropriate?

  2. My guess is that "commercially available" would be defined for the EU much as it is in the US under the settlement agreement:

    "1.28 “Commercially Available” means, with respect to a Book, that the
    Rightsholder of such Book, or such Rightsholder’s designated agent, is, at the time in
    question, offering the Book (other than as derived from a Library Scan) for sale new
    through one or more then-customary channels of trade in the United States."

  3. The commercial framework is not necessarily more appropriate but there are factors in terms of commercial practicability that must also be considered. My argument is that a solution for orphan works cannot be premised solely on Europe's previous objective, i.e. free access for non-commercial uses. This would ignore commercial uses - where does the money go, who does the money go to, does money go to anyone at all, who gives permission, etc. Failure to address the commercial practicalities will and in fact has resulted in inaction in relation to the commercial use of orphan works – enter current discussion regarding Google. I am not sure how one could argue that a solution centered on proposals made in relation to free non-commercial use of orphan works could be shoe-horned for the potential commercial applicability of orphan work uses. But, as always, I am keen to hear the counter arguments.

  4. No, I think you are exactly right: the considerations as to the commercial use of orphan works are different from those concerning non-commercial uses and its wise not to muddle them up even if some or all of the framework that is eventually adopted overlaps.

    The fact is that there are some valuable (both commercially and culturally) works that are currently only available by physically visiting libraries, and in some cases only to a small class of users. With digitisation we can and should find a way to make those widely available. Such a mechanism should not adversely affect anyone's commercial interests in copyright since it should only apply to works which are not available for any consideration.

    I suspect that any works for which it is worth having a system for collecting revenue (to pay to the rights holder) are going to be ones that could be put on the market in some other way (eg via POD or paid for digitised), but that the vast majority of orphan works are going to generate little individual interest, albeit that their collective availability will be large.

    It is certainly an interesting development.

  5. Aren't we living in the most wonderful world?

    On the one side, there is the US Government, with the BSA, RIAA, etc., frantically defending US copyrights and other intellectual property through its 301 reports, free trade agreements, the ACTA negotiations, etc.

    On the other, there is a US private company which turns copyright on its head and, save a decision by a federal court, is trying to hijack a vast chunk of the world's cultural heritage for private gain under the guise of providing a wonderful service to mankind and offering authors a way to "make money of their out-of-print books" (from the mouth of Google Book's Dan Clancy).

    The strategy of the second – undertake controversial (to say the least) projects and only backtrack if forced to – does not reflect well on the endeavours of the first.

    The issue goes beyond copyright, particularly into data privacy and, in the final analysis, global governance. Even though Google proclaims the best of intentions, the issue is a private sector Big Brother, or a mega-Citizen Kane.

    But this carries us away from copyright.

    One would have expected an announcement such as the one made in the Commission's hearing to be reflected in a press release from Google. I found none...

    I would also have expected an announcement about the non-US non-European books. I am still waiting...

    Some further reading:





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