Reports: US Dept. Of Justice Looking At Antitrust Issues Over Google Books Lawsuit

After skirting one antitrust action involving a proposed ad deal with Yahoo, Google may be facing a new one — this over the proposed settlement of the lawsuit involving Google Book Search.

Both the New York Times and the Wall St. Journal are reporting that the US Department of Justice is examining the terms of the settlement, to see if it would give Google too much power over digitizing books.

Earlier today, the presiding judge in the case granted a four month extension on the deadline for authors and other involved parties to opt-out of the proposed settlement. In the weeks since the settlement terms were announced, there has been growing criticism of the proposal.

One argument against the deal is that competitors wouldn’t be able to compete, because the class-action settlement would grant Google rights that others would have to negotiate one-by-one: As Pamela Samuelson wrote:

An estimated 70 per cent of the books in the Book Search repository are in-copyright, but out of print. Most of them are, for all practical purposes, “orphan works,” that is, works for which it is virtually impossible to locate the appropriate rights holders to ask for permission to digitize them….

Virtually the only way that Amazon.com, Microsoft, Yahoo!, or the Open Content Alliance could get a comparably broad license as the settlement would give Google would be by starting its own project to scan books. The scanner might then be sued for copyright infringement, as Google was. It would be very costly and very risky to litigate a fair use claim to final judgment given how high copyright damages can be (up to $150,000 per infringed work). Chances are also slim that the plaintiffs in such a lawsuit would be willing or able to settle on equivalent or even similar terms.

Of course, Google already has a considerable book search service that exists from scanning works that aren’t in copyright or are in copyright but included through the explicit permission of authors. Anyone one willing could compete on both fronts — if they are willing.

That leads to Microsoft. Ironically, it was one of the chief competitors to Google in the book search space. It scanned out-of-copyright works and never pursued deals with those authorized to grant permission for works in copyright. Then it pulled out of book search last year, deciding it wasn’t “commercial” enough to pursue. Microsoft is now funding some of the opposition to the proposed lawsuit settlement.

Potentially, the terms could be renegotiated to solve concerns the Dept. of Justice and/or affected parties might have. And potentially, Google could choose to go to trial, sticking with its original argument that the act of scanning books and showing short descriptions is not a copyright violation.

In contrast with the Yahoo action, which Google overtly went after, it’s hard to argue that Google somehow set itself up for a potential antitrust action in this case. The settlement terms came about as a result of a lawsuit, and through negotiations with those who supposedly were working in the interest of authors and publishers. Now, more and more are speaking out that those interests are not properly being looked after and question the larger implications of a deal in general.

For related discussion, see Techmeme. For past coverage of Google Book Search from us, see our Google: Book Search archives.