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Google Book Settlement, Part I: How Disputes Are Resolved

Introduction

In 2003 Google announced it had begun scanning books. Its goal was to create a digital library of every piece of printed work that has been put in fixed form. It was, and still is, a noble goal. Google placed these scanned books in a database and made them searchable. On the side of the searchable content were ads through which Google earned revenue.

Arguing that Google’s scanning and displaying a portion of copyrighted work was infringement, Authors’ Guild commenced suit on behalf of all authors, known and unknown, and the authors’ heirs, to either stop the displaying of copyrightable material or make Google pay for it. Others, like the American Association of Publishers, joined in the suit, as well. Before the question of whether Authors’ Guild could speak for all authors, known or unknown, and the authors’ heirs was answered, the parties to the suit made a deal.

A Bit About Class Action Suits

Traditionally, class action suits are designed to provide compensation (money damages to put the injured party in the position that she should have been had the wrongdoing not occurred) and/or injuctive relief (to get the party to stop doing the wrong deed). In a common settlement, this would include the payment of money to authors whose works had been unlawfully displayed and/or Google’s cessation of displaying of copyrighted works. Going forward, Google would have had to obtain permission from the rights holders to scan and then display the books in its BookSearch.

The Orphan Works Dilemma

Approximately 10% are books that are in print (or in Google Book Settlement Agreement parlance “commercially available”) and under copyright. In other words, many of the books that are of interest to the readers and authors who visit Dear Author are in that 10% category.

The problem for Google is that there are many works for which obtaining permission is quite difficult because the author is unknown, or the publisher who holds the copyright refuses to respond, or for many other reasons. These have become known as “orphaned works”. Over 70% of the books under copyright are orphan works. Without the ability to protect itself from late cropping lawsuits by the owners of orphan works, the settlement would not likely be as attractive to Google.

Consequently, Google Book Settlement Agreement (hereinafter “GBKS”) became more than remediation/compensation or injunctive relief. Instead, GBKS created a prospective agreement altering copyright terms for all copyrighted books.

How Disputes Are Resolved

The GBKS is a topic too great for simply one post. This is merely an introduction. There is more to follow. Today’s post will be how disputes between “Rightsholders” are resolved. (Note all words in quotations are terms defined by the legal document and therefore have special meaning).

1. For every book that has been scanned and displayed without permission, the copyright owner will be paid a minimum of $60 for a
Principal Work“, $15 for an “Entire Insert“, and $5 for a “Partial Insert“.

2. Google intends to display portions of the “Book” on the internet, sell subscription access to the “Books” it has scanned, generate ad revenue, and leverage the scanned “Books” for profit in other revenue models.

3. A “Rightsholder” designates what “Display Uses” Google is permitted to utilize.

4. There are more than one “Rightsholder” to each “Book.” At a minimum, an in print, “Commercially Available” “Book” has an author and a publisher. If the “Book” is an anthology, each anthology author is a “Rightsholder” (and no, the GBKS makes no special provisions for multi authored items. This is just one of its many flaws).

5. If there is a disagreement between author and publisher over the “Display Uses“, then the most restrictive use prevails. In other words, if Author A of Anthology wants 20% of the Book shown and Author B doesn’t want any of it displayed, Author B wins.

6. In the case of a dispute, Authors and Publishers are sent to arbitration. Of particular note, disputes between Publishers who are parties to the GBKS are not bound by Arbitration. They get to use the court system. Authors, though, have no such right.

7. Arbitration is set out in Article IX of the GBKS. The decision of the Arbitrator is final and binding. The place of Arbitration is New York, NY. The Arbitrator is drawn from a special pool of arbitrators picked by Google and the Registry. Some issues such as the subscription issues are allotted a three arbitrator panel. There is no stare decisis in GBKS Arbitration.

Stare decisis is a fundamental legal concept. It means that decisions that are made before instruct the conduct for the future. In the GBKS, Author A and Author B could bring the same but separate dispute against Publisher and arbitrators could decide the exact same issue differently with no repercussions.

The reason that stare decisis is so important is that it provides finality to disputes. If a high court says that copyright issues are to be determined in X way and not Y way, then we know going forward that we have to do things X way. If precedent is not followed, then confusion and inconsistent decisions follow with no certainty creating only more and more disputes.

8. In some jurisdictions (a region of courts like the upper East Coast is the 2nd Circuit; several states in the Midwest are in the Eight Circuit and so forth), decisions made in arbitration can be binding in cases not involving the GBKS so long as the issue is the same and the parties are the same. For example, if Author A gets into fight with Publisher over whether Publisher has the right to authorize certain pricing under the GBKS, the two get sent to Arbitration. The Arbitrator makes a decision.

Author A and Publisher have disagreement over pricing issues outside the GBKS and Author A takes Publisher to court. Publisher can say to the court “Hey, Author A and I fought over this already and this is the decision that was made” and Court can say “Bye Bye Author A”.

Thus, question no. 1 for an agent or lawyer is “If my existing contract with my publisher does not require Arbitration or the Arbitration terms in my existing contract are different, to what extent do I have to abide by the terms of the GBKS?”.

More next week.   Please note that I will be away from the computer for much of this week but will try to respond to direct questions about the general settlement agreement. Further, as the above is not legal advice and no one is in an attorney/client relationship here, I cannot answer specific questions. In fact, I urge you to contact a lawyer if you have specific questions about how your contract is affected by the GBKS.

Definitions from the GBKS used in this post and are reprinted exactly from the Settlement Agreement:

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Principal Work means a Book’s principal written work. A Principal Work can be a collective work, such as a collection of short stories or plays. A Book contains only one Principal Work but may contain other text, such as a foreword, afterword and annotations. A foreign language translation or an abridged version of a Principal Work is a different Principal Work. Two (2) or more Books that contain the same Principal Work but that each contains different or additional Protected Expression are considered to be different Books. By way of example, two (2) Books that have the same Principal Work (e.g., The Old Man and the Sea) but have different forewords or additional annotations (e.g., the Hueber Verlag and the Scribner editions) are different Books under this Settlement Agreement. A hard cover Book and a soft cover Book may have the same Principal Work, but are considered different Books under this Settlement Agreement (even if they contain no additional matter) if the hard cover Book and the soft cover Book have different ISBNs.

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Insert means the following content, if and to the extent such content is independently Protected by the Copyright Act and, if a "United States work" as defined in 17 U.S.C.  § 101, is covered by a registration with the United States Copyright Office as of the Notice Commencement Date, and is either (a) contained in a Book if there is no Person who has a Copyright Interest in such content and a Copyright Interest in such Book’s Principal Work, (b) contained in a Public Domain Book, or (c) contained in a Government Work that, on or before the Notice Commencement Date, was published or distributed to the public or made available for public access: (i) text, such as forewords, afterwords, prologues, epilogues, essays, poems, quotations, letters, song lyrics, or excerpts from other Books, Periodicals or other works; (ii) children’s Book illustrations; (iii) musical notation (i.e., notes on a staff or tablature); and (iv) tables, charts and graphs. The term "Insert" does not include (1) pictorial works, such as photographs, illustrations (other than children’s Book illustrations), maps or paintings, or (2) works that are in, or as they become in, the public domain under the Copyright Act in the United States.

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Entire Insert means an Insert that is an entire work, including forewords, afterwords, introductions, entire works included in anthologies, and entire poems, short stories, song lyrics or essays.

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Partial Insert means an Insert other than an Entire Insert.

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Display Uses means the following: Snippet Display, Front Matter Display, Access Uses and Preview Uses.

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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.

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Book means a written or printed work that (a) if a "United States work," as defined in 17 U.S.C.  § 101, has been registered with the United States Copyright Office as of the Notice Commencement Date, (b) on or before the Notice Commencement Date, was published or distributed to the public or made available for public access as a set of written or printed sheets of paper bound together in hard copy form under the authorization of the work’s U.S. copyright owner, and (c) as of the Notice Commencement Date, is subject to a Copyright Interest. The term "Book" does not include: (i) Periodicals, (ii) personal papers (e.g., unpublished diaries or bundles of notes or letters), (iii) written or printed works in which more than thirty-five percent (35%) of the pages contain more than fifty percent (50%) music notation and lyrics interspersed, if any (for purpose of this calculation, "music notation" means notes on a staff or tablature), (iv) written or printed works in, or as they become in, the public domain under the Copyright Act in the United States, or (v) Government Works. References in this Settlement Agreement to a Book include all Inserts contained in the Book, except where this Settlement Agreement provides otherwise.

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Rightsholder means a member of the Settlement Class who does not opt out of the Settlement by the Opt-Out Deadline.

Jane Litte is the founder of Dear Author, a lawyer, and a lover of pencil skirts. She spends her downtime reading romances and writing about them. Her TBR pile is much larger than the one shown in the picture and not as pretty. You can reach Jane by email at jane @ dearauthor dot com

27 Comments

  1. Shiloh Walker
    Jul 12, 2009 @ 05:54:30

    This google thing is a fricking headache. Really makes me despise google sometimes.

  2. ReacherFan
    Jul 12, 2009 @ 11:01:32

    Fascinating reading, but if I’m reading this correctly, the authors got screwed.

  3. Robin
    Jul 12, 2009 @ 12:18:20

    If I were an author, I’d be less focused on Google here and more on the AG, which acted as the author’s rep in the settlement. I mean, do you look to your opponent to protect your interests or to your advocate? I would not expect any less of Google than to protect what they believe are their legitimate interests, and ditto with the AG on behalf of authors (assuming all class certification/representation issues were reasonable to begin with). If (some) authors are in a problematic position regarding a settlement both sides entered into willingly, why would that be Google’s fault? After all, there is no legal determination at this point that anything Google was doing constituted unlawful infringement. . .

  4. KB Alan
    Jul 12, 2009 @ 12:21:25

    If I am reading everything correctly (a big if), then this does not affect anything published after 1/5/09. So, does that mean that they are no longer scanning books? Or that different rules will apply? Shiloh is right, this is a huge headache.

  5. Patricia Briggs
    Jul 12, 2009 @ 12:54:23

    Huge is an understatement. The Author’s Guild (to which I do not belong and have come to thoroughly dislike) has decided (after Google paid them Big Money) that Google can be my publisher — no matter what the contracts that I and my current publishers have worked out between us. (Things like the definition of In-Print and when rights revert back to me.) I would not have been allowed to break the terms of our contracts. My publishers would not have been allowed to break the terms of our contracts. But Google and the Author’s Guild can.

    Don’t get me wrong. Copyright has Huge issues right now. It’s a shame that so many works with limited/no commercial value are impossible to find because of copyright. I have been putting my collection of Jeffry Farnol (regency romance writer from the early 1900’s) books together over the last thirty years and I’m still missing titles. Its problematical that, for instance, my publishers cannot put Mercy working on a VW on the cover of a book because of copyright violations. We are losing our culture. Common sense plays no role in copyright.

    I just don’t think the Google settlement is the way to go.

  6. Meljean
    Jul 12, 2009 @ 12:54:28

    @Robin: Agreed. I’ve ranted about this before, but I don’t know if AG just rushed into the settlement, but for an author advocate, I personally don’t feel they represented author interests very well. To me, it’s not about the money — it’s about the (staggering number of) authors whose rights were essentially just handed over to Google.

    @KB Alan: I don’t think anyone really knows what is going to happen with books published after 1/5/09. Anyone who does know, correct me if I’m wrong — but as far as I know, that’s still a big question mark.

  7. Meljean
    Jul 12, 2009 @ 12:59:34

    @Patricia Briggs:

    The Author's Guild (to which I do not belong and have come to thoroughly dislike) has decided (after Google paid them Big Money) that Google can be my publisher -‘ no matter what the contracts that I and my current publishers have worked out between us.

    Yes. This! Yes. I’m trying very hard not to use words that should be covered up by punctuation marks, but they are what comes to mind when I think of what this settlement has done.

    With new technology and different distribution models, there needs to be a new definition of rights (especially digital) and how different entities can use them. This settlement isn’t the way to do that, IMO.

  8. Edie
    Jul 12, 2009 @ 21:31:50

    I am pretty much a dumbarse.. but can the author guild act for those who are not part of their org?? How does that work?

  9. Nora Roberts
    Jul 13, 2009 @ 04:26:55

    I am so confused and irritated by this whole mess. As far as I understand I have to opt out or they can just basically have my books.

    Which means I have to physically opt out on round about 200 books, listing titles, USBNs, etc. It’s going to take a huge chunk of my time.

    Why should I have to fill out a form to say no? The logical thing is to fill out a form to give permission not to deny it.

    I have said many, many very bad words over this business.

  10. J L
    Jul 13, 2009 @ 05:39:49

    I’ve avoided thinking about it but it still is like the Elephant In The Room, lurking on my STD (Sh*t To Do) stack. I only have a dozen or so books involved, but it will be a time sink to figure out the ISBNs, etc. I can only imagine the headache for the biggies (NR, JAK, SEP, etc.)

    As Nora Roberts said: why can’t we fill out a form to GIVE permission? Hunh?

  11. Shannon Stacey
    Jul 13, 2009 @ 07:20:55

    I've avoided thinking about it but it still is like the Elephant In The Room, lurking on my STD (Sh*t To Do) stack.

    Ditto.

    I don’t even want to wrap my head around this, so I keep putting it off. I can’t even grasp the summaries, never mind the actual settlement.

    Freakin’ Google.

  12. Suzanne Allain
    Jul 13, 2009 @ 07:50:30

    I’m confused about the whole copyright thing. I assumed you didn’t actually have to register for a copyright with the US copyright office. A printed book that has a copyright statement was sufficient. But is google saying if the work doesn’t have a registered copyright then it is fair game?

    Also, what if you want to let Google show the cover and sales information as a marketing tool? I don’t think there’s anything wrong with them doing that, as long as they don’t put the entire book on-line for anyone and everyone to read.

    And are they calling the same book with a different isbn a separate book? For example, if a book was originally released as a hardcover by one publisher under one ISBN, then the book went out-of-print and was re-released by a different publisher under a different ISBN, are they going to say they have rights to the hardcover because it’s no longer being sold when there is a paperback copy being sold and the text of the book is the same? (That’s what I got from the “Principal Work” definition.)

    I don't even want to wrap my head around this, so I keep putting it off. I can't even grasp the summaries, never mind the actual settlement.

    I’m so glad to know I’m not the only one. :)

  13. Meljean
    Jul 13, 2009 @ 09:34:32

    @Suzanne Allain:

    I assumed you didn't actually have to register for a copyright with the US copyright office. A printed book that has a copyright statement was sufficient.

    Most of the time — it depends on your contract — but most print publishers will register the copyright for you. So that copyright statement at the opening of the book refers to the official copyright date.

    If you aren’t sure, you can go to the copyright web page and do a search by title, name, or pseudonym. (Although I’m not sure how up-to-date they are. I just looked, and a few of mine are missing.)

    Works that are out of copyright and in the public domain are fair game, anyway. The concern and the confusion comes in with orphaned works — which are books that are still under the protection of copyright, but they are no longer in print (that is, the publisher isn’t printing new copies when the distributors run out of them). According to the settlement, Google can snatch up orphaned works and essentially republish them.

    This is great for the books that are hard-to-find, and for books where no publisher is likely to renew the contract with the author to get them into stores again. But when you’ve got authors like, say, Mrs. P. Boggs, who has a backlist that might be out of print but whose recently skyrocketing popularity makes that backlist valuable again, it’s a problem. Because if Google grabs the “orphaned works” in her backlist and makes them widely available, there is less commercial incentive for her publisher to do it, and suddenly Boggs is out a whole crapload of money and she’s lost control of her work and Google is her new publisher, even though she’s never made a single agreement with Google. And depending on her contracts with her publisher regarding in-print and out-of-print works and when she gets back her distribution rights after the books go out-of-print, she and/or they might be suddenly breaking the contract terms, even though she hasn’t actually made another agreement with a different publisher — the settlement did.

    Also, what if you want to let Google show the cover and sales information as a marketing tool? I don't think there's anything wrong with them doing that, as long as they don't put the entire book on-line for anyone and everyone to read.

    My understanding is — and maybe Jane will touch on this later in her series — that there is another program called Google Books Partners (Terms of Service here: https://books.google.com/partner/terms) that essentially gives you the same benefits of the settlement (search capabilities, online purchase) without handing over your rights. As far as I know, it’s completely separate from the settlement, although the method is the same: they scan your books.

    If you don’t opt out, they don’t show your entire book for free, only excerpts (much like Amazon’s Look Inside feature). There will still be a purchasing requirement before someone can read the whole thing.

    But I don’t think you can have it both ways with the settlement — opt out but still get them to market for you.

  14. Castiron
    Jul 13, 2009 @ 10:17:00

    Meljean is correct about the Google Books Partners program; the books that are searchable and viewable online through that program have been put up with at least the publisher’s permission. The lawsuit was over Google’s Library Project scans, which were done using all the books in the participating libraries whatever their copyright status was.

  15. Lane
    Jul 13, 2009 @ 10:53:26

    Am I reading the definition of ‘Book’ correctly? It looks like e-pubbed works are not affected by the agreement at all unless that book is also given a print run.

  16. Robin
    Jul 13, 2009 @ 11:00:14

    @Suzanne Allain: Theoretically, everything that one writes is copyrighted, but if you ever want to enforce your copyright against potential infringement, it must be registered with the US copyright office. Which means that if you ever wanted to take any kind of legal action to stop an alleged infringement, your copyright would have to be registered to do so. As Meljean said, in the case of published books, the publisher will generally do this, but if they don’t, the author can.

  17. Moth
    Jul 13, 2009 @ 11:10:23

  18. Suzanne Allain
    Jul 13, 2009 @ 11:17:07

    everything that one writes is copyrighted, but if you ever want to enforce your copyright against potential infringement, it must be registered with the US copyright office.

    Thanks Robin and Meljean. That’s how I understood things to work, also, but when I read the Google definition of a rightsholder it made me wonder if the author did not qualify as a rightsholder if the book was not officially registered at the copyright office.

    This google business really is a major pain. As if authors don’t already have enough things to do that we don’t get paid for….

  19. Sunita
    Jul 13, 2009 @ 11:38:05

    @Moth: According to the comments for that post, the blogger misunderstood what the application did. The app supposedly allows you to download the pages available in the Limited Preview Google offers, not the entire book.

  20. GrowlyCub
    Jul 13, 2009 @ 12:12:43

    As Meljean said, in the case of published books, the publisher will generally do this, but if they don't, the author can.

    A fairly prominent pair of SF authors recently found out that their (now defunct) publisher did not do the registering for several of their books. It might be a good idea for authors with smaller print pubs to ascertain if their publishers did do so or if not. I assume that the big houses do so automatically, but I may be wrong.

    I cannot get over the fact that the whole deal is considered legal in any way, shape or form. It baffles me that any court can look at the scope of Google’s ambitions and financial goals and the way they disenfranchise the little authors and can consider this is legal and proportionate. I cannot get my mind to bend that way and I’m very glad I’m not an author with any copyrighted work.

  21. Robin
    Jul 13, 2009 @ 12:45:13

    @GrowlyCub: But no court has adjudicated this matter; the parties went to settlement instead. And I think you could argue (I would, at least) that it’s not Google that’s the problem in the settlement at all, that it’s not Google that is the problem for authors here. Castiron’s point often gets lost in the GBKS discussion, but IMO it’s crucial. Moreover, the suit itself was a copyright infringement complaint, and the settlement has gone well (welllllllllllll) beyond that.

  22. GrowlyCub
    Jul 13, 2009 @ 12:52:52

    Maybe I’m misunderstanding, but the impression I got was that Google decided it could acquire, scan and most importantly *profit* from other people’s work (aka books) and that with the settlement they now think they can do so with impunity unless authors opt out.

    Obviously we are lacking an entity to address these kinds of right/property grabs when they happen on the internet. While it’s not a conspiracy by several entities to take over and defraud consumers, I’d think the Antitrust Division should be involved in something of this magnitude.

    But my main issue is with the fact that it’s somehow legal that AG got to make a deal on behalf of all authors, all over when they had no way of polling the impacted people to find out what they wanted! It’s bizarre!

  23. Meljean
    Jul 13, 2009 @ 15:24:43

    @GrowlyCub:

    While it's not a conspiracy by several entities to take over and defraud consumers, I'd think the Antitrust Division should be involved in something of this magnitude.

    The Justice Department has apparently begun an inquiry.

  24. Barb
    Jul 14, 2009 @ 15:29:10

    I have sympathy for authors being dragooned into Google against their will, and there ought to be an affirmative opt-out option.

    On the other hand, copyright is a fur-ball when it comes to access of materials for whom an author or rights owner cannot be located, and a sword for breaking through that mess is long overdue. Music is even more of a mess. Great productions from the fifties and sixties can’t be broadcast again today because the rights clearance process is excessively expensive and often fruitless. A better international copyright convention that takes into account the lack of national boundaries on the web would be another huge improvement.

    A system like the one BMI employs in the radio industry would be a marked improvement. Once licensed by BMI, radio stations can play whatever music they like, and BMI calculates, collects and distributes the royalties. If radio stations had to behave the way some authors would like Google to behave, there would be mighty few songs played.

  25. Mike Briggs
    Jul 14, 2009 @ 16:48:49

    @Barb:
    I agree completely. Copyright is a mess, and even the “Big Content Companies” are being adversely affected. More importantly, our culture is being locked away to protect a very, very few works with long-term commercial value.

    Copyright reform, including some means of cutting into the fur-ball of orphaned works is long overdue. I’ve even heard some very appealing suggestions on how it could be done fairly. . . but that takes us far afield of the current topic.

    While it’s obvious that something needs to be done, I don’t think letting a private settlement between two parties snowball into a full-fledged re-writing of copyright law is an acceptable solution. Particularly since the Author’s Guild, after getting to courts to certify it’s class status (so that they officially represent ALL authors), immediately quit rattling it’s saber, stuck out it’s hand, and said, “OK Google, we have the proverbial keys to the kingdom. How much is it worth?” It smells strongly of collusion.

    Writing is an art, but it’s also a business, and we take both parts seriously. Our contracts are closely studied and negotiated with care. Having uninvited parties horn themselves into those contracts by legal skulduggery is NOT something we’re prepared to be equitable about.

  26. Wednesday Midday Links: Judge Chin rejects the Google Book Settlement
    Mar 23, 2011 @ 09:32:27

    […] As I wrote in 2009, the Google Book Settlement became more about recompensing individuals for past misdeeds (as lawsuits are ordinarily about) or enjoining Google from improperly using copyrighted works in the future, and instead became a way in which parties to the lawsuit could craft a private, non legislative “solution” to the orphaned works problem. Consequently, Google Book Settlement Agreement (hereinafter “GBKS”) became more than remediation/compensation or injunctive relief. Instead, GBKS created a prospective agreement altering copyright terms for all copyrighted books. […]

  27. Friday Interesting Links | Tales to Tide You Over
    Jul 03, 2013 @ 12:08:18

    […] Apparently I am potentially part of the Google Settlement for my works appearing in anthologies. This is a solid breakdown of some of the issues with the settlement and it explains who is affected and how:http://dearauthor.com/wordpress/2009/07/12/google-book-settlement-part-i-how-disputes-are-resolved/ […]

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