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January 28, 2010

Today is the Deadline for Objections and New Opt-outs in the Google Books Settlement

By Mary Rasenberger

Today is the deadline for filing objections to the amended settlement agreement in the Google Books case. It is also the deadline for opting back in to the settlement (for those who opted out of the original settlement) and for opting out (for those who did not opt out of the original settlement and wish to do so now). There are clear directions on the Google Books Settlement site http://www.googlebooksettlement.com for opting out or opting back in.

The original settlement agreement, filed in October 2008, was the result of two years of negotiations among the named parties in the class action lawsuit brought by U.S. authors and publishers claiming that Google infringed their copyrights by scanning their books and displaying excerpts without authorization. The amended settlement agreement was filed this past November in response to objections submitted by the U.S. Department of Justice and numerous class members.

We'll see what today brings, but so far it's been relatively quiet compared to the storm of filings that preceded the original September 4th deadline for objections to the original settlement agreement. Hundreds of objections had been filed well in advance of that deadline.

The first objections to the amended settlement agreement were filed Tuesday; and less then a dozen appear on the court's docket as of this writing. A couple dozen opt-outs have been filed with the court, some expressing their objections - although anyone who opts out technically does not have standing to file objections. Ursula LeGuin's petition requesting that the United States be exempt from the settlement and signed by over 350 authors does not appear on the docket yet - but she states on her website that the petition has been filed. In addition, a couple of letters in support of the amended settlement have been filed.

One explanation for the apparent relative apathy is that objectors and supporters feel they have already said their piece in objections filed to the original settlement and don't have much to say about the amendments. Indeed, the amendments do not address most of the objections to the original settlement raised by class members, but are mainly directed to the anti-trust and class action concerns that the Department of Justice raised in its brief. Judge Chin clearly instructed in his November 19, 2009 order that objections be limited to the amendments, which thus far most objectors seem to be heeding to.

Most of the actual objections filed thus far (i.e., not amicus or opt-outs) focus on the amended definition of the settlement class. Class members are now limited to authors or publishers of a book published and registered in the U.S., or published in, the U.K., Australia or Canada prior to January 5, 2009. This amendment was clearly intended to remove many foreign rights holders and their objections from the settlement, including the Germans and French, whose governments had filed objections. Over three-quarters of the more than 400 objections to the original settlement were filed by foreign rights holders. The new definition does not actually remove many foreign right holders, however. It encompasses right holders of any book published at any time prior to January 5, 2009 in any of the named countries; and this includes numerous books by authors and publishers of excluded countries. Go to any foreign language or university book store in Canada, the U.K. or Australia, and you will find many foreign language books. Thus, many of the objectors this time around have complained that the new definition is murky and does not resolve their concerns.

Another explanation for the relative quiet around this deadline might be mere ennui - is this becoming like the health bill - how much longer can we talk about it? Also, there appears to be a coming to terms with the settlement, or perhaps its inevitability, at least among some of the former opponents. Gail Steinbeck, an early and vocal opponent of the settlement, has recently come out in support of it.

The filing that will undoubtedly have the most influence is the U.S. Department of Justice Statement of Interest on the amended settlement agreement, due next Thursday, February 4th. It will be interesting to see what positions Justice takes to the amendments, since so many of them are intended to directly address its objections -- mainly the more easily remedied specific anti-trust concerns. The amended settlement agreement does not fully address all of Justice's concerns, however, most notably the issues Justice raised about the opt-out provisions for out-of-print works, especially as applied to unclaimed works. Justice indicated that converting the opt-out to an opt-in would resolve many of the problems with the settlement, but never stated that it was necessary to eliminate the opt-out provisions. The opt-out is likely an area of some contention within the government, given Google's heavy lobbying and public insistence that eliminating the opt-out would kill the deal, side by side with a recognition that opt-outs in copyright law are better suited to legislation. As such, I would expect to see continued ambiguity in the government's brief.

The Fairness Hearing scheduled for February 18, 2010. Objectors and supporters may discuss issues related to the original settlement and the amendments. If you wish to appear, you must file your notice of intent to participate by next Thursday, February 4th.

Mary Rasenberger is an attorney with Skadden, Arps, Slate, Meagher & Flom. This blog entry represents her personal views in her individual capacity and not those of Skadden, any other law firm or any client. This blog is not sponsored by Skadden or any other law firm, or any client.

February 15, 2010

Justice Department's Statement of Interest - Google Books Case

By Mary Rasenberger


A careful reading of the Statement of Interest filed in the Google Books case by the Justice Department last week shows a harsher assessment than was evident in its earlier filing. The government’s brief rejects the amended settlement agreement (“ASA”), finding that the parties’ attempts to cure the issues the government identified in its earlier brief do not go nearly far enough: “Despite this worthy goal [trying to create a mechanism to allow for lawful large-scale book digitization], the United States has reluctantly concluded that the use of the class action mechanism in the manner proposed by the ASA is a bridge too far.”

Given the stakes and pressures that were likely put to bear on the government, it is an incredibly strong document. It will be remarkable if Judge Chin (or his successor in the case, if he is moved up to the Second Circuit soon) approves the ASA as-is, even after the substantial responses filed by the parties.

The government’s main issue with the ASA is that it uses the class action suit to create a far-reaching commercial arrangement that looks far into the future (indeed in perpetuity) and far beyond the claims off the suit. It does this by granting Google legal rights that it never could have obtained through a private arrangement or through a judicial resolution of the suit – and these legal rights fly in the face of “the core principle of the Copyright Act that copyright owners generally control whether and how to exploit their works during the term of copyright.” Secondarily, providing these rights, the government argues, confers significant, possibly anti-competitive advantages to Google.

The government’s September 18th brief focused on the anti-competitive concerns and more technical class action issues, and did so in an equivocal enough way that it left room for the parties to make the minor changes they did in the ASA and be able to wipe their hands with a straight face. The recent brief, in contrast, does not mince words and hits hard on the underlying problem many objectors have with the ASA - it attempts to use the class action process to get around the existing legal system rather than to support it. As Marybeth Peters, the Register of Copyright, has said, and many have repeated: the settlement turns copyright on its head. It creates a whole new legal system of opt-out regime for the benefit of a single entity, which is totally at odds with copyright’s grant of exclusive rights to authors.

To summarize the government’s brief at a very high level, there are three key objections to the ASA:

1. Class action law does not permit settlements to replace commercial transactions that go far beyond the claims at issue in the case or restructure the law;

2. The settlement turns copyright on its head by creating an opt-out regime for the vast majority of works at issue; and

3. Granting an across-the-board license to Google for non-commercial works on an opt-out basis creates potential anti-competitive advantages, as no competitor will be able to obtain those rights, especially in the case of unclaimed works.

At the same time, the government is rightly sympathetic with the parties’ attempt to use the class action process in this way. The current law and practice is arguably defective, and makes mass-digitization, even when it serves a good public purpose, impossible to do legally. Orphan works legislation might help some, as would collective licensing arrangements or perhaps a statutory license for libraries. But you don’t have to be a class action lawyer to know that Rule 23 (the civil procedure rule allowing for class action lawsuits) is not intended to be used to create new law. We have one mechanism for fixing the law in this country – legislation. As judges in countless cases have said: you have a problem with the law, take it to Congress.

Sure, it’s been impossible in recent years to pass copyright legislation, but that doesn’t mean we get to amend the law ourselves in class action lawsuits.

For those interested in more detail, I’ve summarized some of the specific arguments in the government’s February 4th Statement of Interest below. The arguments are made in the context of two separate sets of laws: class action law and antitrust law.

Class Action Law Related Issues

The Government’s brief states: “The Supreme Court has cautioned that 'Rule 23… applied with the interests of absent class members in close view, cannot carry the large load of restructuring legal regimes in the absence of congressional action – however sensible that restructuring might be.'”

The arguments regarding non-compliance with the Rule 23 class action rules are some of the more interesting and compelling ones raised in the case. The Rule 23 law gets at some of the smell test issues in this case, described above – i.e., even though it sounds good, it looks good, it doesn’t smell quite right. It seems at odds with some of our underlying basic legal principles to allow a class action law suit filed by a small group of associations and individuals, who admittedly do not represent all author and publisher class members throughout the world or even the U.S., to take away hundreds of thousands (if not millions) of individuals’ rights without their consent. It’s even odder when you consider that the law suit was brought to enforce those very rights.

It turns out, according to one Justice (and certain other objectors, e.g., Microsoft, Amazon, Scott Gant) that the class action law does have standards, if not crystal clear ones, that don’t necessarily promote this kind of sweeping conversion of rights.

Both the parties’ and the government’s briefs discuss the standards set forth in the Supreme Court’s Firefighters case (Local Number 93, Int’l Assoc. of Firefighters v. City of Cleveland, 478 U.S. 501 (1986)). Under Firefighters and its progeny, the Court may approve a settlement that meets the following three-prong test: (1) the settlement springs from and serves to resolve a dispute with the Court’s subject matter jurisdiction, (2) the settlement comes within the general scope of the case made in the pleadings, and (3) it furthers the objectives of the law on which the complaint was based. The government concludes that:

1. It’s difficult to see how this settlement meets the first prong in that it resolves future claims by absent class members for activities well beyond the facts underlying the complaint;

2. The ASA does not meet the second prong because it creates a business relationship that covers future conduct that goes way beyond the claims in the complaint and provides Google with benefits that it never could have obtained through the litigation itself or even through a privately negotiated deal (i.e., the opt-out for non-commercial works); and

3. The ASA does not further the objectives of copyright law, but is inconsistent with the policy of Copyright Act, which provides for exclusive rights and not opt-outs.

The government concedes that a settlement of a class action may go “somewhat” beyond the conduct complained of in the complaint, but can’t go so far as “to abridge or enlarge substantive rights” and “usurp the legislative function.”

The government further states that the ASA does not remedy the lack of adequate representation of the interests of a large number of members (namely, unclaimed work owners, foreign rightsholders) in the settlement negotiations, and that appointing a fiduciary with limited powers for unclaimed works at the Registry does not solve the problem. It also exhorts the Court to look more closely at the notice provided to potential class members to determine if it was adequate, specifically requesting that the Court “undertake a searching inquiry to ensure both that a sufficient number of class members have been or will be reached and that the notice provided fives a complete picture of the broad scope of the ASA…”

Last, the government raises concerns about Attachment A of the ASA. Attachment A is a sub-agreement that controls potential disputes between authors and publishers, mainly regarding possession of rights and splits, and supersedes all agreements between publishers and authors, even foreign ones. The government notes that there may be a conflict of interest between subclasses of authors and publishers, which raises “serious questions” regarding adequacy of representation under Rule 23.

Antitrust Issues

The antitrust issues discussed in the brief are essentially the same ones addressed in the government’s September 18th brief; and they are the primary issues that the parties attempted to address in the ASA’s amendments. The government states that the parties made “constructive revisions” to address these potential anti-competitive problems, but that the amendments do not go far enough to remedy:

1. The creation of an industry-wide revenue-sharing formula at the wholesale level applicable to all works;

2. The setting of default prices and the effective prohibition on discounting by Google at the retail level; and

3. The control of prices for orphan books by the known publishers and authors with whose books the orphan books likely will compete.

With respect to the first issue, the government notes that the ASA gives Google the right to renegotiate the wholesale revenue split with rights holders, but only for commercially available works. The government believes that the carve-out for non-commercial works may render the amendment somewhat meaningless, given the fact that the vast majority of works at issue are not commercially available under the ASA’s definition and that this will be especially true if the publishers take commercially available books out of the settlement, as many have suggested they will do.

The government also does not believe that the “fixes” regarding the use of pricing algorithms go far enough to prevent a de facto horizontal agreement. It analogizes the publishers’ and authors’ agreement to allow Google to price the works (using its algorithms) to the delegation of pricing to a common agent - a practice found to be unlawful. Far preferable would be actual bilateral negations than the ability to opt-out of the default use of algorithms.

The government’s biggest concern, however, relates to the pricing of orphan works, since the Registry’s board, consisting primarily of commercial publishers and authors, would have the ability and incentive to limit competition from unclaimed works. The parties have responded to this criticism (also in the government’s September brief) by providing in the ASA for an “Unclaimed Works Fiduciary,” but this fiduciary’s powers are limited – for instance, he or she will not have the ability to set prices for works, or renegotiate splits. As such, the government does not believe the appointment of fiduciary cures the underlying problem.
Last and most importantly perhaps, the government finds that the amendments do not address Google’s de facto exclusive rights to use orphan and rights-uncertain works. The government states that no other entity will have the ability to offer these works legally. Although the ASA attempted to address this concern by expressly allowing resellers to provide access to these works, the government does not equate these reseller rights with the right Google has to freely exploit orphan and other unclaimed works. It concludes: “the reseller clause cannot create new competitors to Google.”

So now what?

The government’s brief advises the Court that the public interest would best be served by direction from the Court encouraging the continuation of settlement discussions between the parties. But if we can be realistic for a moment – what are the chances of Google agreeing to all of the concessions that Justice’s analysis would require to make the settlement copasetic? Google has made it clear that, from its perspective, the opt-out for out-of-print works, and especially the orphans, is essential to the deal. If you read the government’s brief carefully, it does not appear that its cumulative objections all could be adequately addressed without getting rid of the opt-out for non-commercial works. The government does state, however, that if the opt-out is retained, Google should be required, among other things, to conduct a search for unclaimed work prior to their use, similar to the reasonable search requirement in the last iterations of the orphan works bill. Google has publicly stated that, although it supports orphan works legislation, that legislation would not provide it with the flexibility it would need to create the inclusive database envisioned.

Briefs Filed in Support of the Amended Settlement Agreement in the Google Books Case

By Mary Rasenberger

An impressive number of pages were filed this past Thursday (February 11, 2010) by the parties in the Google Books Search case in support of the amended settlement agreement (“ASA”). Only a week after the Justice Department filed its brief, both Google and the named Plaintiffs (publishers and authors collectively) filed briefs worthy of fat binder clips. The Plaintiffs' briefs alone comprise nearly 250 pages, including a 170 page Supplemental Memorandum Objecting to Specific Objections (and with the numerous declarations and exhibits the parties' papers amount to over 2,500 pages altogether).

The briefs remind the Court of the benefits of and support for the settlement, and as would be expected, address the government’s concerns set out in its February 4th Statement of Interest. Google’s brief addresses the government’s objections in great detail supported by substantial case law; the brief also discusses a somewhat random, handful of objections filed by others (fairness to third parties, burden of determining whether a book was registered, inaccuracies in the database, security, and time limit on removal).

The Plaintiffs’ principal brief makes some compelling arguments as to why the ASA is preferable to the alternative outcomes in this case (e.g., protracted litigation, the risk of an on/off decision) and why the settlement is reasonable in light of the case. It summarizes the ASA and its benefits and takes on some of the Rule 23 and other concerns raised by the government. The Plaintiffs’ supplemental brief appears to take on the entire catalog of objections filed by all objectors with standing. Impressive as it is, the supplemental brief may have bit off more than it could chew. Some of the responses, some even to significant objections, come off as non-responsive or conclusory. Moreover, the same objections in some cases are addressed separately in the two briefs, not always completely consistently. They don’t always cross-reference arguments made in the other brief (e.g., the discussion of adequacy of notice in the supplemental brief seems very conclusory if not read alongside the discussion in the principal brief, which is not referenced).

For instance, in response to arguments that the ASA cannot bind foreign members of the class because (1) the law is at odds with that of other countries and (2) the Court lacks personal jurisdiction, the Plaintiffs state in the supplemental brief (pp. 61-63) that members of the class can be bound so long as notice meets the Rule 23 requirements, and that notice was compliant (here referencing their arguments as to why it was compliant). Admittedly, I have not read the cases they cite, but maybe they could explain why compliant notice would address these concerns.

In response to Justice’s and others’ concerns about the fact that Google alone will have the right to offer orphan works (i.e., books for which a copyright owner cannot be located) and the impossibility for others to obtain the rights to the orphans and enter that market, in the Supplemental Motion (pp 149-150), the Plaintiffs summarily respond: "This argument relies on unsupported and illogical speculation that the subset of out of print [orphan] books is so uniquely valuable and desired that other subscription products will be unable to compete with the Institutional Subscription."

Considering that the government and many others viewed this as a significant issue, the response seems flippant. Of course, a subscription database that includes all books, including out-of-print books for which no owner has come forward, is much more valuable than one that is created on an opt-in basis and so would not include orphans. As a library, which one would you chose? And if these works don’t increase the value of the database, then why is the opt-out so crucial to the settlement? Why does Google insist it needs these out-of-print works (a huge portion of the books at issue in the settlement)? If the out-of-print, unclaimed works really are so valueless, then make them available to Google on an opt-in basis and 95% of the objections go away.

Some odd responses aside, the parties’ recent briefs keep the ball in play. Perhaps most interestingly, filing these briefs indicates that the parties do not intend to go back to the negotiating table again as the government recommended. Moreover, the briefs contain some solid, convincing arguments. They are worth a thorough read for the interested – who have a lot of free time. (It does feel like reading the original settlement agreement all over again.) Most importantly, one hopes that Judge Chin will have the time to read it all. He may just want to run for the hills when he sees all that paper. I mean the Second Circuit.

The briefs have good table of contents, as you’d expect. One approach to reading the briefs is to do so on a topic by topic using the table of contents, rather than try to read them in linear fashion. And for those of us who’d love to see a list of all objections filed in the case, the supplemental brief serves as a pretty good proxy.

March 9, 2010

Supreme Court Clarifies Jurisdictional Requirements; Revives Copyright Class Action Settlement

By Cliff Sloan, Judith Kaye, Mary E. Rasenberger & David W. Foster

On March 2, 2010, in Reed Elsevier, Inc. v. Muchnick, the Supreme Court reinstated a class action settlement, approved by the district court, of copyright claims entered into by freelance authors, publishers and electronic database companies. In doing so, the Supreme Court provided important guidance on whether mandatory pre-conditions for suit, such as the requirement for copyright registration in the copyright statute, are jurisdictional.

The Reed Elsevier case involves a longstanding dispute between freelancers and publishers and databases. Nearly a decade ago, in New York Times Co. v. Tasini, 533 U.S. 482 (2001), the Supreme Court held that “owners of online databases and print publishers had infringed the copyrights of six freelance authors by reproducing those authors’ works” in electronic databases “without first securing their permission.”

After Tasini, attention turned to a class action lawsuit by freelance authors against publishers and databases in the Southern District of New York. After years of negotiation and mediation, the freelancers, publishers and electronic database companies agreed on a global settlement. Although the copyright statute requires registration of a creative work before a copyright infringement suit can be brought, the class action settlement resolved potential claims regarding both registered and unregistered works. The district court certified the class and approved the $18 million settlement.

Ten freelancers objected to certain provisions of the settlement on procedural and substantive grounds, and they appealed. The Second Circuit sua sponte asked the parties to address whether the district court lacked jurisdiction to approve the settlement because it included unregistered works. All parties maintained that there was no jurisdictional problem with the settlement, but the Second Circuit disagreed. Ruling that the district court lacked jurisdiction, it threw out the settlement.

The publishers and databases then sought certiorari from the Supreme Court, which was granted. Because none of the parties agreed with the Second Circuit’s holding on jurisdiction, the Supreme Court appointed a law professor as amicus to defend the Second Circuit’s opinion. Skadden filed an amicus brief in the Supreme Court supporting reversal on behalf of ten leading media and publishing companies and organizations.

In an 8-0 ruling (with Justice Sotomayor recused), the Supreme Court reversed. It held that the copyright registration requirement — Section 411(a) of the copyright statute — is mandatory, but not jurisdictional and thus the Second Circuit should not have thrown out the settlement on jurisdictional grounds. Writing for the court, Justice Thomas applied the rule from Arbaugh v. Y & H Corp., 546 U.S. 500 (2006), for distinguishing between jurisdictional statutes, which govern a court’s power to hear a case, and mandatory claim processing rules. The court held that Congress had not clearly stated that the limitations in Section 411(a) are jurisdictional. As a result, the court would not conclude that the mandatory registration requirement is jurisdictional.

Justice Ginsburg, joined by Justices Stevens and Breyer, concurred in part and concurred in the judgment. They stated that there appears to be some tension between the rule announced in Arbaugh and the result in Bowles v. Russell, 551 U.S. 205 (2007), which found that a time limit for an appeal was jurisdictional. The concurring justices resolved that tension by reading Bowles to apply only when a long line of Supreme Court cases has held a statute to be jurisdictional, and that interpretation has been left unchallenged by Congress.

The Supreme Court emphasized the limits of its Reed Elsevier decision. In sending the case back to the Second Circuit, the court expressed no opinion on the merits of the settlement. It also observed that the registration requirement remains a “precondition to suit,” and left open the possibility that “district courts may or should enforce sua sponte” the registration requirement by “dismissing copyright claims involving unregistered works.” The court also noted that it did not reach the question whether, even if the registration requirement were jurisdictional, the court would have authority to approve the settlement.

Beyond the impact in the Reed Elsevier case itself, the most important effect of the decision is the court’s emphasis that it will not lightly presume that statutory requirements are jurisdictional. A conclusion that a requirement is jurisdictional is warranted only if it is clearly stated or mandated by Congress. The court stressed, as it has in other recent opinions, that it will look skeptically at “drive-by jurisdictional rulings” ­— casual statements about “jurisdiction” in past opinions that are unsupported by clear authority in statutory language or intent.

The decision leaves open the question of whether and how compliance with section 411(a) may be waived by a defendant, whether expressly or by default. Until there is a fully developed body of law on the issue, copyright litigators would be wise to raise failure to comply with section 411(a) at the earliest practical moment in the litigation.


Cliff Sloan, Judith Kaye, Mary E. Rasenberger, David W. Foster are attorneys with Skadden, Arps, Slate, Meagher & Flom. This blog entry does not represent the views of Skadden, any other law firm or any client. This blog is not sponsored by Skadden or any other law firm, or any client. The blog is provided for educational and informational purposes only and is not intended and should not be construed as legal advice.

February 23, 2011

A Friday Night: Reflections on the Critiques of "Would the Bard have Survived the Web?"

By Mary Rasenberger

The excellent op-ed entitled "Would the Bard have Survived the Web?," written by Scott Turow, Paul Aiken, and James Shapiro (the Authors Guild's President, Executive Director and a member, respectively) and published in the New York Times on February 15th (available at: http://www.nytimes.com/2011/02/15/opinion/15turow.htm?_r=2), generated numerous responses and a great deal of controversy in the blogosphere. The op-ed took a look at the golden age of English theater in the late 16th and early 17th centuries when there was "a wave of brilliant dramatists", and described how the erection of walls around theaters (literal pay-walls) allowed theaters to charge theater-goers, which enabled playwrights and actors to get paid by the public for the first time, rather than only by patrons. When authorities knocked the walls down in the mid-17th century to silence the seditious political ideas they feared were being expressed within, the ability to make a living from playwriting came to an end for a time and so did the "explosion of playwriting talent." The article warned that if we allow the copyright system we currently have in place to crumble under prevailing attitudes and internet piracy, the explosion of creative talent we have today may likewise dwindle. A number of letters to the editor and blogs have criticized the op-ed and used it against copyright law generally. The primary arguments can be summarized as follows: (1) there was no copyright at the time of Shakespeare, so clearly money can be made without copyright, and (2) Shakespeare copied from others, showing that copyright law restricts rather than induces creativity.

The first point does not even merit a response, since the op-ed authors themselves describe how copyright developed a half century later, providing a new, more stable way for authors to make a living. The second point belies a complete over-simplification and misunderstanding of U.S. copyright law. Incorporating elements of a prior work into one's own is not necessarily infringement and has always been part of the creative process. Copyright law, as construed by the courts, has long-since accommodated this process through, among other doctrines, the substantial similarity test, lack of protection for ideas, facts, common expression, and scènes a faire, the fair use doctrine, and for older U.S. works, formalities that put a large number of works into the public domain, as well as the almost 80 pages of exceptions and limitations in the Copyright Act. As a copyright practitioner, rarely a day goes by when I don't tell a client, usually a copyright holder, that it is free to use elements of another's work in some manner or another. While the courts don't always get copyright right, they often do, and through the last two centuries they have demonstrated enormous flexibility in their applications of the copyright law as technologies have shifted, including expanding fair use considerably in a manner that reflects evolving practices and technological advancements.

While the analogy to Shakespearean theater in the op-ed was imperfect, as most analogies are, the point of the article was clear and an excellent one - that "a rich culture", such as we now have requires a large number of creative individuals - "authors and artists", who devote their careers to their art. Indeed, our Founders were wise enough to understand that a true democracy requires a proliferation of free expression, that individuals not be beholden to any patron including the government, and that this can only be achieved by allowing professional creators to earn money from their works on the open market. Copyright is a brilliant way to achieve that end. The Shakespearean era theater grew out of the literal pay-wall described in the op-ed; our vast, prolific culture today has largely grown out of copyright law, a legal pay-wall.

The Guild's op-ed acknowledges that there is a place for free creative work online; and certainly there are those who will create for free, as many of the responses also point out. Indeed, many professionals who make a living from their works often will produce, perform and/or distribute works for free for any number of reasons (marketing, friendship, philanthropy, or the desire to see a particular work "out there"). Copyright gives creators the flexibility to do that - to decide when they want to assert their rights. Yet that is not what the op-ed is talking about; rather, it reminds us that copyright law enables artists and authors to make a living and is why we have the tremendous creative output we have today -- just as the theater's literal pay-wall was key to the creative burst in the theater in Shakespeare's time.

Let me give you a concrete example. Friday, after finally having acknowledged that my son was too sick to join my husband skiing, I cancelled our plans and we found ourselves with a delightfully free weekend ahead of us. I worked late and, among other things, read posts critiquing the op-ed forwarded to me by my co-teacher at Fordham Law (of a seminar "Copyright Reconsidered - Authorship in Historical Perspective"). Pondering the posts, I signed off and decided to indulge myself for the rest of the evening: I went to the gym and watched a movie on TV. As I later realized, it had been a truly indulgent evening -- over the next four hours my two kids (ages 13 and 14) and I had consumed millions and millions of dollars' worth of copyrighted works.

First, my daughter and I listened to the radio on the way to the gym, switching stations to find songs one or both of us liked; we heard some hard rock that was too hard for me, the Rolling Stones, Pink Floyd, and Rihanna (my choice --over her eye rolling). At the gym, she listened to her iPod, with a collection of about 2000 songs -- post-1990 alt-rock, punk rock and hard rock (all legally downloaded). I watched and listened to music videos licensed by the health club chain. I surfed between 6 or 7 stations, including dance, top hits, rock, alternative, rap, and whatever was playing songs that would keep me moving, some of which were creative and fun - lots of great choreography, dancing and/or special effects. On the way home, we listened to Evanescence (I'd been watching one of their videos when my daughter came to find me and we started to talk about it), and an Angels and Airwaves song that my daughter had heard in the locker room and wanted me to hear, on her iPod. She also played me a Blink 182 song and another sister band of Angels and Airwaves to compare the music.

At home, my son suggested I watch the "The Other Guys" on video-on-demand (a superb, hilarious movie). He listened to his iTunes songs (a collection of pre-1980 rock, also legally downloaded) on the computer while playing Wii Ski (which has wonderful artwork - it makes you feel like you are there on the powder covered mountain). He also watched the George Lopez sitcom simultaneously while checking out interactive ski trail maps. My daughter took pictures on her digital camera of our new kitten, then edited them and added special effects using iPhoto and Picnik software, chatted with friends on Facebook, texted others, all while listening to her iTunes collection on her computer. Then, we all got into bed and read - different books. (I read Just Kids by Patti Smith - a testament to the artistic soul and the difficulties creators experience for their art. Thanks to copyright, Smith's and Mapplethorpe's days of privation when "just kids" paid off and they both were eventually able to make a living off of their art.)

As spoiled as we are with an abundance of creative content, our activities on Friday evening were not completely atypical for Americans. I am sure that even those who object to copyright laws and believe that somehow art gets produced without it, also have iPods full of songs, watch TV and movies, read books, and rely on a large assortment of software programs, and would feel deprived without this "content."

The reason why I describe all this is because it's important to bear in mind that it took hundreds of professional creators who work full-time honing their art so that we can enjoy it to produce what the three of us consumed in just one evening. At a minimum, the following full-time creative professionals were involved in creating our evening at home, most of whom you can assume need to earn a living:

• Recorded music: performers (lead and side musicians) and song writers for about 50 songs, amount to at least several hundred people.

• Music videos: recording artists, professional dancers (hundreds among all the videos), choreographers, sound engineers, directors, cinematographers amount to several hundreds of people for all of the videos combined.

• Movie and TV: screen writers (probably several for just the movie), actors (who clearly added some of their own creativity/improvisation), directors, editors, cinematographers, special effects artists, sound artists. Don't forget the scores and accompanying background music, which are in addition to the music listed above.

• Wii Ski: visual artists, computer programmers -a couple dozen at least, I'd guess.

• Computer programs (iPhoto, Picnik, digital camera, cell phone, interactive maps, Facebook ... among others) - involving dozens, if not hundreds of people

• Books: Each one probably took the author the equivalent of at least one year (and probably much longer) of full-time work, plus there may have been ghost writers, and editors likely played a creative role.

All of those people make a living doing their work and had to get paid (in most cases, not a heck of a lot but enough to make a living) - before the big bad media companies who are, according to some, ruining the world with copyright, made a cent of profit. Although I paid for every item of content where payment was required, my amortized costs for our evening were maybe $20.

How fortunate we are. We have access to so much wonderful and creative art that brings us together in the ways we share and experience it. Yet we take all this content and the shared experiences it provides us for granted. Try to imagine our lives without music everywhere we go, TV, movies, books, newspapers and software. (What if we didn't have music, movies, TV, and books to share and talk about with our teenage kids? The arts afford so many opportunities for sharing thoughts, feelings and learning - and the kids don't even realize it!) The reason that we are able to have access to an abundance of really great content is that we live in a country with so many creative people who have devoted their lives to their art -- and they can do so because we have copyright laws that work.

What if we couldn't support professional creators anymore because no one could afford to pay them - which, as the Authors Guild op-ed warns, could happen if it becomes impossible to make money on content because everyone is stealing it online? The op-ed authors' point is that we, as a culture, have been lulled into taking that kind of creative output for granted, but there is no guarantee it will continue. While it's certainly true that there will always be people who will create regardless, do we really want to rely on the creativity of kids, academics, moonlighters and retirees, or, blogs for our culture? Without copyright, we certainly wouldn't have anyone to underwrite the significant costs of creating film, videos, computer games or software - so just say good bye altogether to those arts. There are few creators who could afford the time to write a book, write or record original music, or choreograph if they had to find other ways to make a living.

Copyright propelled a huge explosion of creative output in America. The production of our creative works is so vastly more complex than any patronage system could muster, even if we were willing to give up expressive and artistic freedom - which we are not. Furthermore, creativity is one of the things we are really good at in this country. We excel at teaching our kids to think creatively in and out of school, and as a society at large. As a result, copyrighted works are one of our largest exports. Let's celebrate that creativity. Let's not let rhetoric and the imperfections of current copyright law diminish it. Rather, let's learn from the past and help steer copyright law so that it continues to morph to accommodate the evolving technologies and practices of our arts today.

Google Books Settlement - Deadline to File a Claim Extended

By Mary Rasenberger

After a year of almost complete silence from the court in the Google Books Settlement case, it has approved a stipulated request by the parties to extended the deadline for filing a "claim" for an upfront payment in the Google Book Settlement from the upcoming March 31, 2011 deadline until one year after the Court's final approval of the settlement to file.

Any author or publisher whose works were scanned by Google on or before May 5, 2009 may be entitled to claim a Cash Payment as compensation for the scanning. Google has agreed to pay for works it scanned prior to that date, at least US$60 per Principal Work, US$15 per Entire Insert, and US$5 per Partial Insert.

For more information on how to file a claim and to determine whether a book was scanned, go to the Google Books Settlement site at http://www.googlebooksettlement.com/

Per the court's order the following should soon appear on the Google Books Settlement site:
The parties amended the Settlement by extending the deadline to make a claim for a Cash Payment. The deadline has been extended from March 31, 201 1 to the one year anniversary of the date on which the Court grants final approval of the Settlement. (If the Court does not grant final settlement approval, then, of course, there are no longer any deadlines). Please visit www.googlebooksettlement.com and read the "Important Update" for details on how to make a simplified claim for a Cash Payment. Also, please visit that website periodically to learn when the Court has made its determination whether or not to grant final settlement approval.

The deadline to remove works from the Google databases remains unchanged. It is still April 5, 2011. An author or publisher may request that a book not be scanned or if it has already been scanned that it be deleted from the database. Google is only obliged to honor these requests if made prior to the April 5th deadline if the work has already been scanned. After April 5th, the author or publisher may request that no display uses, including display of snippets and display of the entire work for a fee, be made, but cannot prevent Google from making non-display uses such as indexing and data-mining.

Once a book is removed, the digital copies of it will not be accessible to Google, other than on back-up tapes or other electronic back-up storage media. There is no guarantee that it will later be added back in to the database if the rights holder changes their mind and decides that they want it included, as the book may have to be rescanned.

The case is still before Judge Chin, now sitting by designation in the Southern District of New York after being elevated to the Second Circuit, and the Amended Settlement Agreement is still awaiting approval. It is hoped that a decision will be forthcoming soon.

See the Authors Guild's announcement at:

http://www.authorsguild.org/advocacy/articles/google-book-settlement-update-court-extends.html

March 23, 2011

Judge Chin Rejects the Amended Settlement Agreement in the Google Books Case

By Mary Rasenberger

Judge Chin issued his long-awaited decision in the Google Books case yesterday, rejecting the Amended Settlement Agreement (ASA). He did so on the grounds that the ASA does not meet the "fair, adequate and reasonable" standard for class actions settlements. Acknowledging the many benefits of the ASA, Judge Chin nevertheless found that the ASA "would simply go too far."

As described in prior posts on this blog, the ASA was the result of a copyright infringement lawsuit brought by the Authors Guild and the Association of American Publishers against Google for Google's scanning all of the books found on the shelves of its library partners - the libraries of major academic institutions - and then displaying snippets of those books on its Google Book Search service. The parties negotiated a settlement agreement in the form of a class action settlement on behalf of all authors and publishers of a book (or "Insert," portion of a book, such as an article, chapter, or preface) and their assignees or heirs who owned a copyright interest in the book as of January 9, 2009. The ASA, a complex 160-plus page agreement (and a true masterpiece of an agreement), released Google from claims for its scanning and past snippet use of the books and Inserts and gave Google the rights, among others, to display and sell copies of out-of-print books without permission (but a right holder cold opt-out) and of in-print books with permission.

Judge Chin notes that approximately 500 submissions were filed commenting on the settlement, with the vast majority objecting, and that 6,800 class members opted out altogether. He succinctly summarizes the principal legal arguments made objecting to the ASA and addresses each in turn:

1. Inadequate notice to the class: Some class members argued that as huge an effort as the notice was (1.26 million individual notices were sent), it did not reach all class members.

Judge Chin rejected this argument because of the number of individual notices, the fact publisher and author associations worldwide were notified, and a website was established to provide information, as well as the enormous publicity surrounding the case, which together ensured adequate notice. He states that "it is hard to imagine that many class members were unaware of the lawsuit."

2. Inadequate class representation: Certain objectors argued that they were part of a group of authors or publishers that were not adequately represented by the author and publisher class representatives because they had different interests. This included academic, foreign and insert authors, as well as those who have not claimed their works but who, by their silence, would be granting Google a future license.

The court concluded that "there is a substantial question as the existence of antagonistic interests between the named plaintiffs and certain members of the class" and viewed the differing interests as "troubling."

3. The forward-looking and opt-out licenses exceed what a court is permitted to approve under Rule 23: One of the main arguments put forth by various objectors was that the claims in the suit related to Google's acts of scanning and making snippets available, activities Google argued were fair use, but the relief included broad grants of future licensees, including from those who never consented. These licenses would relieve Google and others from future claims for acts not necessarily contemplated in the lawsuit. In other words, the settlement releases "claims not properly before the Court."

Judge Chin concludes that the licenses for future uses do exceed what the court is permitted to approve under Rule 23. He quotes the Justice Department's brief stating that the ASA "is an attempt to use the class action mechanism to implement forward looking business arrangements that go far beyond the dispute before the Court." Judge Chin finds three aspects of the ASA particularly troubling under Rule 23 - inadequate representation (discussed above), over-breadth of the releases and the encroachment of Congress' authority to create and revise the copyright laws (discussed below). In particular, Judge Chin finds that the released claims do not come within the scope of the pled claims under the Firefighters and Wal-mart Stores standards.

4. The ASA encroaches on Congress' legislative prerogative to enact and amend copyright laws: Congress alone, and not the courts, has the right to address issues presented by new technologies. The ASA's opt-out provisions for out-of print books (i.e., the automatic license to Google unless a right holder comes forward and opts out) expropriates rights of authors and publishers without permission in contravention of the exclusive rights of copyright in the U.S., international treaties, foreign copyright laws and section 201(e) of the Copyright Act -- which expressly prohibits any government body (including the judiciary) from expropriating or taking any copyright rights without voluntary transfer of the copyright owner.

The court agrees with these arguments -- that Google's license to display and sell out-of-print books without the permission of the rights holders (who may only opt-out) encroaches on Congress' authority to enact and amend copyright laws. Judge Chin cites to Supreme Court and other precedent stating that it is up to Congress to determine whether and how copyright should be amended to address issues such as orphan works and mass-scale digitization. He also concurs with many of the objectors who argued that the opt-out provision for out-of-print books is contrary to the fundamental principles of copyright -- "that it is incongruous with the purpose of copyright law to put the onus on copyright owners to come forward ... when Google copies their works without first seeking their permission."

5. The ASA would give Google a de facto monopoly over unclaimed works: Only Google will have the right to make all out-of-print books available without having to seek permissions on an individual basis. No one else can effectively compete with that, as no one else will have the rights to the out-of-print, unclaimed works.

This is perhaps the most troubling aspect of the ASA - that it would give Google a "right, which no one else in the world will have..." (citing the Internet Archives' submission), giving it a monopoly over unclaimed (or orphan) out-of-print books. No other entity will be able to license as complete a database as Google. The ASA would also arguably give Google even more control over search, given its exclusive rights to the data on the unclaimed books.

6. The ASA does not provide enough protection for privacy of users: The concern is that Google will be entitle to collect enormous amounts of data from users and their use of Google Books Search and has not agreed to sufficient protections in the ASA.

Judge Chin is sympathetic to these arguments, but does not find them to be severe enough that they alone would provide a sufficient basis for rejecting the ASA.


This well-reasoned, sound decision itself explains the long wait. It is clear that Judge Chin carefully reviewed all of the briefs and submissions, as well as scholarship on the case and case law precedent, and carefully and judiciously weighed the various arguments in light of the precedent. While there is certain to be an appeal, this will be a very hard decision to overturn.

June 1, 2011

Maria Pallante Appointed as Register of Copyrights

By Mary Rasenberger

Today, concluding an 8 month search, the Librarian of Congress, Dr. James H. Billington, announced the appointment of Maria A. Pallante as the new Register of Copyrights.

Maria has been Acting Register since January 1st of this year following the retirement of long-time Register Marybeth Peters at the end of 2010.

Until her recent appointment as Acting Register, Maria served as Senior Advisor to the Librarian following two senior positions in the Copyright Office. She was the Associate Register for Policy and International Affairs from December 2008 to October 2010 and Deputy General Counsel from January 2007 to December 2008. While in those positions, Maria was instrumental in developing and implementing domestic and international policy initiatives, including policies relating to copyright exceptions for the reading disabled, orphan works, Google books and the gap in termination provisions under the copyright law. Before returning to the Copyright Office in 2007, Maria had already had a long, esteemed career in copyright law, including a former stint at the Copyright Office as Policy Advisor in 1996-97 and serving as intellectual property counsel and director of licensing for the Guggenheim Museums, on the legal staffs of the Writers Guild and the Authors Guild, as well as in private practice.

"The position of Register of Copyrights is extremely important to the copyright community, the Library of Congress and the United States, and requires a significant skill set," said the Librarian of Congress.

The Register of Copyrights, as director of the Copyright Office of the Library of Congress, administers the U.S. Copyright Office and is responsible for all administrative functions and duties under the U.S. Copyright Act, including overseeing the copyright registration system. In addition, the Register (i) advises Congress on national and international issues relating to copyright, (ii) provides information and assistance to Federal departments and agencies and the Judiciary on national and international issues relating to copyright, (iii) participates in meetings of international intergovernmental organizations and meetings with foreign government officials relating to copyright, including serving as a member of United States delegations as authorized by the appropriate Executive branch authority, (iv) conducts studies and programs relating to copyright and related matters, and (v) performs any other function vested in the Copyright Office by law, including educational programs conducted cooperatively with foreign intellectual property offices and international intergovernmental organizations and any other functions as Congress may direct.

We wish Maria the very best in her new position.

September 19, 2011

Update on Google Books Settlement

By Mary Rasenberger

In a new twist in the Google Books case, it appears that the publishers and authors may be going separate ways. The parties had a conference with Judge Denny Chin this past Thursday September 15th. Judge Chin had admonished the parties in the last conference on July 20th to hasten their settlement discussion and to come prepared on September 15th with a new settlement agreement, and if no settlement could be reached, a discovery and briefing schedule on the merits. From the start of the conference, it was clear that the parties had not come prepared to discuss a new settlement.

Michael Boni, the attorney for the Authors Guild, commenced the conference by proposing a scheduling order that provides for discovery and briefing on Summary Judgment to be completed by the end of July 2012. Judge Chin followed up with the obvious question - whether this meant they had given up on settlement. The parties indicated that settlement discussions will continue as they proceed on the merits. Bruce Keller for the publishers and Daralyn Durie for Google stated that they were close to settlement. Keller explained that the publishers believed they had made sufficient movement forward that they did not think they would need to rely on the schedule. Durie agreed that it "appears to be probable" that they will reach a settlement. The Authors Guild did not appear as optimistic about settling, although Boni conceded that the authors would like to "continue a dialogue."

Boni and Keller also indicated that they may want to separate their cases (by filing amendments to the joint third Amended Complaint); further suggesting that the publishers may settle without the authors and the Authors Guild might proceed alone with the suit on the merits. When asked if Google was agreeable to the proposed schedule, Durie stated that Google would like to see the proposed amendments to the complaint before it agrees to the schedule.

Judge Chin agreed to the scheduling order proposed by the Authors Guild. Noting that the case would then continue for almost another year, he called the schedule "generous," but agreed with Keller that the parties may need extra room in the schedule to continue settlement discussions. The schedule will have discovery completed by the end of May and all briefs on summary judgment motions submitted by the end of July 2012. Judge Chin noted that he would pick a day for a hearing, but that they will have to find another courtroom, as he will finally lose his in the Southern District (having been promoted to the Second Circuit over a year ago).

Judge Chin seemed anxious to see a settlement in the case and asked if there was anything the court could do to help the parties reach a settlement, offering first to obtain a mediator, which was rejected by Google as unhelpful, since the discussions had thus far been among principals. He then discussed finding a new magistrate judge to assist with settlement if needed, and identified Judge James Cott, the magistrate assigned to the parallel photographers' case against Google. (Judge Chin reported that Judge Eaton, the magistrate judge originally assigned to the case, has since retired - the case was originally filed in 2005 after all.) The Authors Guild is amenable to such assistance, according to Boni, who did not think the discussions necessarily had to continue between principals of the parties, rather than the attorneys.

More GBS Litigation: Authors Guild et al. v. HathiTrust et al.

Another indication of a possible rift between the publishers and authors regarding Google Books is the complaint filed last Monday in the Southern District of New York (see: http://authorsguild.org/advocacy/articles/authors-3.attachment/authors-v-hathitrust-9834/Authors%20v.%20HathiTrust%20Complaint.pdf ) by the Authors Guild --without the publishers--against the principal libraries participating in the Google Books Search case, only several days before the awaited conference in the Google Books case. The Authors Guild, together with authors' groups from Australia, Quebec, the U.K. and a small group of authors, sued HathiTrust and 5 state universities whose libraries are participating in HathiTrust's digital repository, 4 of which have also joined a consortium of HathiTrust members called the HathiTrust Orphan Works Project.

Although key participants in the Google Books Search project (as Google scanned books in the libraries' collections to create the Google Books Search database), the libraries were not part of the Google Books litigation and only participated in the periphery of settlement discussions. Pursuant to separate agreements with Google, each participating library had agreed to let Google scan the books in its library and Google in return agreed to provide the library digital copies of the scans to use for its own purposes. The HathiTrust, a partnership of more than 50 research institutions, was formed to combine the partners' digital libraries, which are comprised largely of the Google scans delivered to the libraries thus far, to create a shared digital repository. According the authors' complaint, approximately 73% of the 10 million volumes already in this digital collection, called the HathiTrust Digital Library, are protected by copyright.

Users can search bibliographic data of the scanned works in the HathiTrust Digital Library and can search the texts for the number of times a search term appears. In addition, full access to works identified as "orphaned" is provided to authorized users. The Orphan Works Project was initiated by HathiTrust to identify those works for which a copyright owner could not be found and to make those works available online through the HathiTrust Digital Library. Using a modified version of the "reasonable search" requirement outlined in the several iterations of the never-enacted orphan works legislation, the Orphan Works Project, led by the University of Michigan library, is researching the ownership status of various works. According to the HathiTrust's protocol, if a copyright owner cannot be identified through a specified multi-step diligence process, the HathiTrust will then post the work on a HathiTrust Orphan Candidates webpage for 90 days. If no copyright owner comes forward during that 90 day period, the work is made available for "full" view to authenticated users of the universities' libraries, including students, faculty, other staff and possibly alumni.

The complaint alleges infringement of the reproduction right by virtue of the various copies of copyrighted works in the HathiTrust Digital Library made in the course of scanning, ingesting, storing and preserving digital copies, providing back-ups and access to bibliographic data or search and, in the case of the designated orphans, full viewing. In addition, the complaint alleges unauthorized distribution, presumably of the designated "orphans." The authors also noted concerns with the security employed by the HathiTrust against further copying and distribution of the works in the HathiTrust repository. Wherein the proposed Google Books Settlement, rejected by Judge Chin, the authors and publishers had negotiated an agreement with Google to provide specific robust security measures; it is not clear how the works will be protected in this repository.

Oddly, the complaint also alleges violations of § 108 of the Copyright Act, which contains specific exceptions applicable to libraries and archives, including for preservation of unpublished works, making replacement copies of damaged or destroyed published works and for certain inter-library loans. One condition to the preservation and replacement exceptions is that any digital copies not be made available outside of the premises of the library or archive. While the activities of the HathiTrust alleged in the compliant are certainly outside the scope of what is permitted under § 108, it is difficult to see how those acts are "violations" of § 108 rather than violations of the § 106 reproduction, distribution and display rights that fail to qualify under the § 108 exceptions. (Section 108 sets out exceptions, not a basis for a separate cause of action.) It is all the more peculiar in that § 108(f)(4) expressly states that nothing in § 108 "in any way affects the right of fair use as provided by section 107." Fair use, of course, is the defense the HathiTrust and participating libraries are relying upon (in addition to the fact they are each state entities and so protected from damages by sovereign immunity).

In the meantime, according to the Authors Guild, it, its members, and others have identified or found leads to the owners of the literary property rights to 50 of the 167 or so books that the Orphan Books Project had already identified as orphaned and was ready to be made available next month. In a statement (located at: http://www.lib.umich.edu/news/u-m-library-statement-orphan-works-project) released last Friday by the University of Michigan Library, the Library announced the temporary suspension of the Orphan Works project due to errors that had been discovered, stating: "The close and welcome scrutiny of the list of potential orphan works has revealed a number of errors, some of them serious. This tells us that our pilot process is flawed." Michigan promised to re-examine its procedures for identifying orphans, explaining that it has no intention to make available any works that are not in fact orphaned. In the statement, the library explained: "The widespread dissemination of the list [on the HathiTrust Orphan Candidates webpage] has had the intended effect: rights holders have been identified, which is in fact the project's primary goal. And as a result of the design of our process, our mistakes have not resulted in the exposure of even one page of in-copyright material."

Stay tuned...

*Submitted by Mary Rasenberger, Partner, Cowan DeBaets Abrahams and Sheppard.

**Any views expressed in this blog are personal views of the author and not of Cowan DeBaets or any client of the firm.

February 16, 2012

What Your Trade Association Can Do For You: The Issue of Associational Standing to be Addressed in American Society of Media Photographers v. Google and Authors Guild v. Google

By Mary Rasenberger and Joseph Gregory

Last week in the Google Books case, the Authors Guild (the "Authors Guild") and the American Society of Media Photographers ("ASMP") filed oppositions to Google's motions to dismiss the copyright infringement claims brought by the Authors Guild and ASMP on behalf of themselves and their members. In Google's motions, filed in December, it argues that the associations lack the requisite standing to bring infringement claims on behalf of their members. Google argues that, in order for ASMP and the Authors Guild to be eligible for "associational standing"--on which it presumes the Authors Guild and ASMP rely to sue on behalf of their members, it must be shown that participation of each association's individual members in the lawsuit is not necessary to the claim asserted or to the relief requested. In this case, Google contests, each individual work alleged to have been infringed must be separately analyzed, including as to the fair use defense; and, as such, the associations lack standing to assert copyright infringement on behalf of their members.

In their briefs in support of their oppositions to Google's motions to dismiss, both ASMP and the Authors Guild respond that the associational standing "requirement" is merely a prudential requirement aimed at administrative convenience and that district courts have discretion is deciding whether or not it must be satisfied for a party to attain associational standing. ASMP further argues that the Supreme Court has allowed associational standing in cases such as this, recognizing the benefits of the participation of the association. The Author's Guild also counters Google's contention that each work needs to be analyzed separately under the fair use defense.

ASMP's Response

In its brief, ASMP first points out that Google's position is "particularly incongruous, given that Google has copied and distributed plaintiffs' works en masse without performing the individualized analysis it now avers is required." ASMP explains that "Google's consistent position to date has been that its actions are categorically protected as fair use irrespective of the individual work at issue." Ironically, Google's argument to support its motion to dismiss undermines its defense on the merits.

ASMP sets forth multiple legal theories as to why the District Court for the Southern District of New York should deny Google's motion. First, ASMP argues that the issue of whether the associations have "association standing" is wholly unnecessary with regard to the overall standing issue. ASMP cites numerous cases in support of a "well settled" principle that where at least one plaintiff has satisfied the standing requirements to bring a claim, a court need not consider whether other named plaintiffs (i.e., the associations) also have standing. In this case, individual representative members of ASMP are indeed named as co-plaintiffs to the suit, and Google apparently concedes the fact that such individual member plaintiffs do have standing to bring their respective infringement claims. Therefore, the issue of associational standing should be moot and the case should be allowed to proceed with the associations as co-plaintiffs.

Benefits Provided by Associational Standing

ASMP also relies on Supreme Court precedent that emphasizes the importance of permitting associations to have standing, along with individual plaintiffs, in order to ensure that individual members' claims are properly litigated. Among the justifications that the Supreme Court has provided in favor of allowing associational standing include: (i) the ability of associations to draw upon a preexisting reservoir of expertise and capital; and (ii) the primary reason people join an organization is often to create an effective vehicle for vindicating interests that they share with others. (See Int'l Union, United Auto, Aerospace & Agricultural Implement Works of Am. V. Brock, 477 U.S. 274, 289-90 (1986).)

ASMP also addresses Google's argument that since one of the requirements for associational standing--namely, a requirement that that neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit--is lacking, the associations should be barred from proceeding as plaintiffs in the suit. ASMP cites Supreme Court case law, which indicates that this requirement is merely a matter of administrative convenience and efficiency, meaning, the requirement has no impact on constitutional standing and the district courts therefore have discretion in deciding whether or not to apply it. ASMP argues that practical obstacles prevent each and every individual association member concerned from instituting individual actions, and therefore any such prudential rationale regarding administrative convenience is outweighed. Thus, the district court should exercise its discretion and allow the association plaintiffs to proceed as parties to the suit.

The Authors Guild's Response

The Authors Guild similarly argues that no prudential considerations compel the dismissal of the Authors Guild as an associational plaintiff. Citing the fact that it has already actively participated in the case as an associational plaintiff for over six years, the Authors Guild argues that, not only will its continued participation present no administrative difficulties, but its participation furthers the interests of judicial economy. Like ASMP, the Authors Guild is quick to point out that Google did not make a book-by-book determination as to whether to include each book in its library; thus, to deny group relief to those collectively affected by Google's copying would be manifestly unjust.

The Authors Guild also deconstructs Google's fair use defense to determine whether, as Google claims, it must be analyzed on a case-by-case basis for each individual member of the Authors Guild. In analyzing fair use, courts consider the following factors: (i) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (ii) the nature of the copyrighted work; (iii) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (iv) the effect of the use upon the potential market for or value of the original work. Google argues that the individualized participation of every Authors Guild member is necessary to assess the second and fourth fair use factors.

The Authors Guild counters that, although the scope of fair use may be greater with respect to some works as compared to others, the Court is not required to separately analyze every book. Specifically, courts need not require individualized proof directed toward the second fair use factor, the nature of the work, in cases where large groups of works were infringed. In the cases cited by the Authors Guild, the courts either analyzed the works at issue by dividing them into separate large categories, or reviewed a sampling of the works to analyze the second factor. Neither approach requires the analysis as to each and every individual work.

With respect to the fourth fair use factor, the Authors Guild argues that the relevant evidence will be common to all of its individual members. Specifically, the Authors Guild argues that the potential market for and value of all in-copyright books will be adversely affected in similar ways by Google's use, and that this factor therefore can be fairly analyzed by the Court without the participation of each individual Authors Guild member.

What does this mean for future copyright litigation?

The Court's decision with regard to the associational standing theory in copyright infringement cases may have a profound impact on the ability of trade associations such as the Authors Guild and ASMP to enforce rights on behalf of their members. As discussed above, the reason why many people choose to join these organizations is for that exact reason; members seek to pool their interests and resources so as to receive protection when they need it most - i.e. when their interests are being violated in such a manner that litigation remains the only method of recourse. Further, given the expense associated with instituting individual lawsuits, the ability of such associations to adjudicate claims on behalf of their members may be the only way certain members might ever see relief.

Mary Rasenberger, Partner, Cowan DeBaets, Abrahams & Sheppard
Joseph Gregory, Law Student, New York Law School

March 5, 2012

Google Books Case Developments: Google Responds to ASMP and Authors Guild

By Mary Rasenberger

In the Google Books case, Google filed its responses on February 17, 2012 to the American Society of Media Photographers' (ASMP) and the Authors Guild's oppositions to Google's motions to dismiss ASMP and the Authors Guild for lack of standing. (See What Your Trade Association Can Do For You, http://nysbar.com/blogs/EASL/2012/02/what_your_trade_association_ca.html). Google took issue with the Plaintiffs' assertions, in their oppositions, that the third prong of the Hunt test for association standing is merely a prudential consideration that the Southern District need not apply rigidly. See Hunt v. Wash. State Apple Adver. Comm'n, 432 U.S. 333, 343 (1977). The Supreme Court in Hunt set out a three-part test for determining whether an association has standing to bring a claim on behalf of its members; the third prong at issue in Google's motions is a requirement that neither the claim asserted nor the relief requested requires the participation of the individual members in the lawsuit.

Google's Response

Google first argues that the requirements in Hunt are an important limitation on federal jurisdiction; whereas ASMP and the Authors Guild had argued that the third prong is instead a discretional consideration concerned with administrative convenience.
While Google concedes that the Supreme Court in United Food & Workers Union Local 751 v. Brown Group, Inc., 517 U.S. 544, 556-57 (1996), held that this third Hunt prong was not a "constitutional necessity," it argues that the Court still considers the prong to be an important limit on federal jurisdiction, rather than an optional inquiry for a court to simply disregard: "To see Hunt's third prong as resting on less than constitutional necessity is not, of course, to rob it of its value." 517 U.S. at 556. Thus, Google argues that, although the prong may be a prudential rule of self-governance susceptible to Congressional abrogation, the prong is nonetheless a rule that courts are not entitled to overlook.

The third prong of the Hunt test for associational standing requires that neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit. Under Google's strict reading of this prong, it argues that the associations' copyright claims, and Google's fair use defense, require the participation of each individual ASMP and Authors Guild member because the injuries suffered by each association member is particular to the individual, requiring individualized proof in analyzing the copyright claims and fair use defenses.

First, Google argues that the copyright claims need to be analyzed on a case-by-case basis, particularly the issue of copyright ownership, as there are factual issues surrounding copyright ownership of the works, including whether they were "works for hire." Additionally, Google maintains that individual inquiries are relevant in analyzing its fair use defense. Three of the four fair use factors set out in Section 107 of the Copyright Act require in an inquiry that will vary from book to book. These three factors are: (i) the nature of the copyrighted work; (ii) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (iii) the effect of the use upon the potential market for or value of the original work. (17 U.S.C. §107 (2)-(4).) Google argues that because the facts differ from book to book, these inquiries require analysis of individualized evidence. In other words, it states that its fair use defense cannot be assessed in a collective manner.

Google distinguishes the cases that the associations rely on in support of the proposition that association standing is permissible in copyright cases similar to the Google Books case, including Itar-Tass Russian News Agency v. Russian Kurier, No. 95 Civ. 2144 (JGK), 1997 WL 109481 (S.D.N.Y. Mar. 10, 1997), rev'd in part, 153 F.3d 82 (2d Cir. 1998). ASMP had argued that Itar-Tass in particular is "most pertinent to this Court's analysis." In Itar-Tass, the district court held that an association of Russian journalists had associational standing to bring copyright infringement claims on behalf of its members. Google distinguishes Itar-Tass on the grounds that the factual issues regarding ownership in that case did not vary among the works at issue, and the case did not involve fair use.

The Second Circuit's Decision may have Important Implications for Associational Standing

As discussed above, courts have in some cases found associational standing to be appropriate in the context of copyright litigation. Questions remain, however, regarding how broad a trade association's right is to adjudicate copyright claims involving issues of ownership and fair use on behalf of its members. Judge Chin's decision on these motions thus likely will set important precedent in determining what the limits are on a trade association's associational standing in fair use cases.

Putting the Motions in the Context of the Litigation on the Merits

The positions taken by Google in its motions and responses are also interesting for what they say about Google's strategy in the case on the merits. Will it continue to assert on the merits, as it claims here, that individualized inquiry need be made with respect to ownership of each work and fair use need be analyzed on a work by work basis? Will it request discovery on a case-by-case basis in an attempt to drag the case on indefinitely? There are millions of works at issue in the case. The idea of the court's analyzing each work on a case by case basis is, of course, absurd - all the more absurd given that Google claimed fair use for its scanning and fragment use on an across-the-board basis, with no consideration of individual factors.

Scheduling Dispute Regarding ASMP's Request to Brief Fair Use before Class Certification

ASMP and Google filed letters with the court on February 17th and 22nd, respectively, regarding an expedited discovery and briefing schedule on the issue of fair use. ASMP proposed that any motions for summary judgment as to infringement or fair use be filed on an expedited schedule, before a decision on class certification. Google states that this proposal "is both unworkable and unjust," and that resolving the merits before considering the question of class certification is appropriate only "where the merits of the plaintiffs' claims can be readily resolved on summary judgment, where the defendant seeks an early disposition of those claims, and where the plaintiffs are not prejudiced thereby."

June 1, 2012

Google Books Update

By Mary E. Rasenberger

Judge Chin issued his decisions today in the two motions in the Google Books case. He refused to dismiss the Authors Guild and ASMP for lack of associational standing, as predicted, and he certified the authors' class represented by the Authors Guild.

The case will go forward on the merits this summer.

Judge Chin called Google on the inconsistency of its arguments (as noted in the Authors Guild's and ASMP's briefs). Google scanned works indiscriminately claiming fair use - with no case-by-case analysis whatsoever - and here it is now arguing that fair use issues have to be analyzed on a case-by-case basis (and hence the right holders can't all be represented by an association).

Here's a quote from the decision:

Furthermore, given the sweeping and undiscriminating nature of Google's unauthorized copying, it would be unjust to require that each affected association member litigate his claim individually. When Google copied works, it did not conduct an inquiry into the copyright ownership of each work; nor did it conduct an individualized evaluation as to whether posting "snippets" of a particular work would constitute "fair use." It copied and made search results available en masse. Google cannot now turn the tables and ask the Court to require each copyright holder to come forward individually and assert rights in a separate action. Because Google treated the copyright holders as a group, the copyright holders should be able to litigate on a group basis.

The decision is availiable at: http://blog.authorsguild.org/wp-content/uploads/2012/06/2012-May-31-Authors-Guild-v-Google-Class-Cert-Opinion.pdf

About Mary Rasenberger

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