Google Book Search Settlement: A Reader's Guide

Legal Analysis by Fred von Lohmann

As we reported earlier this week, Google has settled the lawsuit brought in 2005 by authors and book publishers regarding its massive book scanning and indexing project. Although the settlement must still be approved by the court and is unlikely to go into effect until sometime late in 2009, commentary has already been flooding the blogosphere. Generally, opinions are split between excitement for users ("better access to zillions of out-of-print books") and suspicion of Google ("one library to rule them all, and in the darkness bind them").

We are still digesting the ~300-page proposed settlement agreement (for those seeking a good overview, the 39-page notice to class members is a good place to start).

So far, two things are plain.

First, this agreement is likely to change forever the way that we find and browse for books, particularly out-of-print books. Google has already scanned more than 7 million books, and plans to scan millions more. This agreement will allow Google to get close to its original goal of including all of those books into Google's search results (publishers got some concessions, however, for in-print books). In addition to search, scanned public domain books will be available for free PDF download (as they are today). But the agreement goes beyond Google's Book Search by permitting access, as well. Unless authors specifically opt out, books that are out-of-print but still copyrighted will be available for "preview" (a few pages) for free, and for full access for a fee. In-print books will be available for access only if rightsholders affirmatively opt in. The upshot: Google users will have an unprecedented ability to search (for free) and access (for a fee) books that formerly lived only in university libraries.

Second, this outcome is plainly second-best from the point of view of those who believe Google would have won the fair use question at the heart of the case. A legal ruling that scanning books to provide indexing and search is a fair use would have benefited the public by setting a precedent on which everyone could rely, thus limiting publishers' control over the activities of future book scanners. In contrast, only Google gets to rely on this settlement agreement, and the agreement embodies many concessions that a fair user shouldn't have to make.

But the settlement has one distinct advantage over a litigation victory: it's much, much faster. A complete victory for Google in this case was probably years away. More importantly, a victory would only have given the green light for scanning in order to index and provide snippets in search results; it would not have provided clear answers for all the other activities addressed in the settlement, such as providing display access for out-of-print books, allowing nondisplay research on the corpus, and providing access for libraries. Litigating all of those fair use questions could easily have taken a decade or more. As University of Michigan head librarian Paul Courant points out, those are years that we would never get back. (University of Virginia's Prof. Siva Vaidhyanathan offers a differing view: "These claims are not convincing when one considers just how great an alternative system could be, if everyone would just mount a long-term, global campaign for it rather than settle for the quick fix.").

Conclusions beyond those two are harder to draw. Many devils are buried in the details of the 300-pages of legalese, and much will turn on how the agreement is implemented. Here are the 6 "big picture" concerns that I'm keeping in mind as I review those details:

Fair Use: How will this agreement impact future fair use cases involving book scanning? Others (like the Open Content Alliance) are scanning books, and they may not have Google's ability (or budget) to strike a deal with the world's publishers. UCLA Law's Prof. Neal Netanel has a few preliminary thoughts along this line at the Balkinization blog.

Innovation: It seems likely that the "nondisplay uses" of Google's scanned corpus of text will end up being far more important than anything else in the agreement. Imagine the kinds of things that data mining all the world's books might let Google's engineers build: automated translation, optical character recognition, voice recognition algorithms. And those are just the things we can think of today. Under the agreement, Google has unrestricted, royalty-free access to this corpus. The agreement gives libraries their own copy of the corpus, and allows them to make it available to "certified" researchers for "nonconsumptive" research, but will that be enough?

Competition: In the words of Prof. Michael Madison, "Has Google backed away from an interesting and socially constructive fair use fight in order to secure market power for itself?" Does this deal give Google an unfair head start against any second-comers to book scanning? The agreement creates an independent, nonprofit Book Rights Registry to dole out Google's royalties, and the parties clearly hope that the Registry will be able to license others on similar terms. But the Registry is empowered to cut a deal with Google on behalf of all rightsholders by virtue of the class action; in order to offer similar blanket licenses to others, it would have to independently acquire rights from each and every copyright owner individually. How long will that take? What about the Registry itself? It hopes to be a monopoly that fixes prices for the entire market of copyright owners -- precisely the kind of thing that landed ASCAP and BMI, which dole out blanket licenses for music, in antitrust trouble decades ago.

Access: This agreement promises unprecedented access to copyrighted books. But by settling for this amount of access, has Google made it effectively impossible to get more and better access? The agreement allows you to "purchase" digital access for out-of-print books, but does not include the right to download the book (unlike public domain books). So you can read the book, but only on Google's terms. Libraries get more access, but for an undisclosed price (OK, one computer for free) and still with a variety of restrictions. In the words of Harvard's head librarian, "As we understand it, the settlement contains too many potential limitations on access to and use of the books by members of the higher education community and by patrons of public libraries."

Public Domain: Early reports are that public domain materials are not regulated by the agreement. Moreover, Google has negotiated a "safe harbor" that protects it from liability for mistakes in evaluating the copyright status of a book. That should result in more willingness to forge ahead with the free PDF posting of books published between 1923-1963, where a public domain determination turns on checking government records to see whether the copyright had been renewed. But will Google impose restrictions on these "safe harbor" public domain works? Will the libraries that receive a digital copy of their own public domain holdings impose restrictions on those copies?

Privacy: The agreement apparently envisions a world where Google keeps all of the electronic books that you "purchase" on an "electronic shelf" for you. In other words, in order to read the books you've paid for, you have to log into Google. Google is also likely to keep track of which books you browse (at least if you're logged in). This is a huge change in the privacy we traditionally enjoy in libraries and bookstores, where nobody writes down "Fred von Lohmann entered the store at 19:42:08 and spent 2.2 minutes on page 28 of 0-486-66980-7, 3.1 minutes on page 29, and 2.8 minutes on page 30." If Google becomes the default place to search, browse, and buy books, it will be able to keep unprecedented track of what you read, how you read it, and collate that with all the other information it has about you. Does the agreement contain ironclad protections for user privacy?

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Federal Circuit Reins In Business Method Patents

Legal Analysis by Corynne McSherry

The Court of Appeals for the Federal Circuit yesterday issued a decision that imposes firm limits on business method patents. The ruling effectively overturns a key part of the court’s decision in State Street Bank and Trust v. Signature Financial Group, which opened the door to an explosion of patents on "methods" of doing business so long as the methods involved use of a computer and produced a "useful, concrete, and tangible result."

Bilski applied for a patent on a method of managing the risk of bad weather through commodities trading. Upholding the Patent Office’s rejection of Bilski’s application, the Federal Circuit held (in line with Supreme Court precedent) that processes can be patented only if they are implemented by a machine or transformed something into a new or different thing. The court found that Bilski’s method was not patentable because “transformations or manipulations of…business risks, or other such abstractions cannot meet the test because they are not physical objects or substances….” The court affirmed that business methods are still patentable, but explicitly rejected State Street’s “useful, concrete, and tangible result” test, which many believed had cleared the way for improper patents on fundamental principles and everyday activities that had no connection to technological innovation:

[W]hile looking for "a useful, concrete and tangible result" may in many instances provide useful indications of whether a claim is drawn to a fundamental principle or a practical application of such a principle, that inquiry is insufficient to determine whether a claim is patent-eligible under § 101. And it was certainly never intended to supplant the Supreme Court's test. Therefore, we also conclude that the "useful, concrete and tangible result" inquiry is inadequate and reaffirm that the machine-or-transformation test outlined by the Supreme Court is the proper test to apply.

EFF submitted an amicus brief (in conjunction with The Samuelson Law, Technology & Public Policy Clinic at UC Berkeley Law, Public Knowledge, and Consumers Union) supporting the rejection of Bilski's patent application.

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The Two Best Books About the DMCA

Commentary by Fred von Lohmann

The blogosphere is doing a great job examining the legacy of the Digital Millennium Copyright Act (DMCA), which was enacted into law ten years ago this week. But people frequently ask me where they can turn for a more in-depth analysis of the DMCA, DRM, and their impact on digital culture. For them, there are two books I recommend first and foremost.

First, there is Jessica Litman's Digital Copyright, which does a masterful job explaining how the DMCA (and much of the rest of our copyright law) came to be. Tracing the law from its beginnings in the internal bureaucracy of the Clinton administration in 1992, over to the international treaty realm of the World Intellectual Property Organization (WIPO), and back to Congress, her account lays bare the political realities that produced a law that put corporate interests before the public interest.

Second, there is Tarleton Gillespie's Wired Shut, which picks up where Digital Copyright leaves off, tracing how the DMCA has been used as part of a larger effort to use technology and law to "weld the hood shut" on new digital devices. Tarleton's book is a bit more academic in tone than Jessica's, but at the heart of it are three fantastic chapters than provide a full historical accounting of the controversies surrounding (1) SDMI (chapter 5); (2) the development of CSS, used to encrypt DVDs (chapter 6); and (3) the broadcast flag for digital broadcast television (chapter 7). For those who want to get right to the action, I recommend starting at Chapter 5. EFF was deeply involved in all three of these watershed digital controversies, so to some degree these chapters are also a history of our digital copyright efforts.

If you want to understand what the DMCA does, and how we ended up with it as the law of the land, these two books are where to start.

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Human Rights and Internet Companies: Google, Yahoo and Microsoft Agree to Principles

Announcement by Danny O'Brien

For almost two years, EFF has been a participant in negotiations between human rights groups, investors, academics and Internet companies -- including Yahoo!, Google, and Microsoft -- aimed at improving how those businesses deal with free expression and privacy issues around the world.

Today, the results of that discussion have been announced. The Global Network Initiative is a set of principles on free expression and privacy that the companies have agreed to follow in all countries they do business within, together with a set of implementation guidelines and a skeleton for an independent watchdog body that will monitor companies for compliance with these principles.

Before now, Internet companies' first reaction to revelations of complicity in human rights abuses has been to deny that they can do anything at all. When Yahoo's involvement in the Shi Tao case in China was first revealed in 2005, Yahoo stated that it was obligated to "operate within the laws, regulations and customs" of countries.

The Global Network Initiative demonstrates that there is far more that companies can and will commit to do. They can train their employees to recognize requests that may violate international agreements. They can structure ways to evaluate requests and challenge them in the local courts. They can ensure that board-level executives are kept aware of potential human rights issues, and can acknowledge their responsibilities. They can build human rights requirements into contracts they sign with third-parties. They can, as they have done in this initiative, consult with their competitors, civil liberties experts, socially-conscious investment funds and academics to learn and improve how they behave in situations that might threaten the rights of users. The Initiative is a significant indication of the importance of accountability for better human rights practices online.

It's not a perfect set of documents. EFF continues to work in the Initiative, but we do have concerns with the limits of this initial agreement:

• There is no obligation to inform Internet users of the storage location of personal data, and from where it is accessible.
• There is no commitment to inform users when they hand over their information to agents of government and law enforcement.
• There is no binding requirement to develop privacy and anti-censorship technologies and include them in new products.
• GNI assessors are selected by the companies themselves from a list of neutral groups, and do not have untrammeled access to all relevant company documents.

When it comes to addressing their involvement in worldwide human rights abuses, the first step for Internet companies had been admitting that there is a problem. With the Global Network Initiative, Microsoft, Yahoo, and Google have gone further, and begun to embed human rights assessments into their own company structure. We hope many other companies will join them.

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Google Reaches Settlement With Authors and Publishers Over Google Book Search

News Update by Richard Esguerra

Today, Google announced a settlement with authors and publishers in the class action lawsuits over Google Book Search. The settlement still needs to be approved by a New York federal court, but under the plan, Google will:

• pay authors and publishers $125 million, part of which will be used to create a Book Rights Registry allowing copyright owners to register their works and receive a share of subscriptions, book sales and ad revenues;
• allow users to purchase full books, saved to an "electronic bookshelf;"
• will offer institutional subscriptions, including a free online portal for public libraries;
• will point users to locations to buy or borrow searched books.

The settlement also says that authors and publishers will be able to activate "preview" and "purchase" modes for books that are in-print and copyrighted, as well as monetize out-of-print books that are digitized by Google.

You can find more information from the settlement agreement website, the official Google blog, the Authors Guild (advocacy organization for authors), and the Association of American Publishers (trade association for U.S. commercial publishers)

Stay tuned for more as we digest the complete settlement agreement.

UPDATE: We have posted our additional thoughts about the settlement agreement here.

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DMCA: Ten Years of Unintended Consequences

Commentary by Fred von Lohmann

Today is the tenth anniversary of the Digital Millennium Copyright Act (DMCA), signed into law by President Bill Clinton on October 28, 1998. EFF is marking the occasion with the release of a 19-page report that focuses on the most notorious part of the law: the ban on "circumventing" digital rights management (DRM) and other "technological protection measures." The report, entitled Unintended Consequences: Ten Years Under the DMCA, collects reported cases where the DMCA was used not against copyright infringers, but instead against consumers, scientists and legitimate competitors.

The collected stories are like a trip down memory lane for those who have followed digital freedom issues over the past decade. Here are a few examples of DMCA abuse in the report that you might remember:

• In 1999, Sony sues Connectix over the Virtual Game Station, which let you play your legit Playstation games on your Macintosh.
• In 2001, the Secure Digital Music Initiative (SDMI) threatens Princeton Professor Ed Felten's research team over disclosure of vulnerabilities in audio watermarking technology.
• In 2001, Russian programmer Dmitry Sklyarov is arrested after speaking at Defcon, accused of building software for his employer, ElcomSoft, that converted Adobe e-books to PDF.
• In 2002, Blizzard sues a group of hobbyist open source developers over bnetd, server software that allows people to play Blizzard games against each other over the Internet.
• In 2003, Lexmark uses the DMCA to block distribution of chips that allow refilling of laser toner cartridges.
• In 2004, Hollywood succeeds in shutting down 321 Studios' DVD X Copy software, which allowed people to make backup copies of their own DVDs.
• In 2006, computer security researchers at Princeton delay disclosure of the Sony-BMG "rootkit" based on fears of DMCA liability.
• In 2008, Hollywood targets Real Networks over RealDVD, software that allows you to copy DVDs to a hard drive for later viewing.

The collection of stories makes vividly clear what EFF has been saying for the past ten years: the DMCA has harmed fair use, free speech, scientific research, and legitimate competition.

That's all the more galling because the law has failed in its stated goal of preventing digital piracy, instead being used to prop up weak DRM schemes whose only purpose is to hinder competition, innovation, and interoperability. That explains why the music industry has largely abandoned DRM, while the Hollywood studios cling to it more fervently than ever.

Not everything in the DMCA is bad. While the anti-circumvention provisions have proven to be a dangerous failure, the so-called "safe harbor" provisions for online service providers have succeeded in creating enough legal certainty to launch companies like Yahoo, Google, eBay, YouTube, and MySpace. Of course, copyright owners have been working hard in cases like Viacom v. YouTube and Io v. Veoh to erode these safe harbors. And, while the safe harbors have protected intermediaries like Google, they have not adequately protected the free speech interests of internet users, as the McCain-Palin campaign recently learned.

There have been recent rumors that the new Congress might reopen the DMCA, creating an opportunity for reform. Unfortunately, that may also create an opportunity for MPAA and RIAA mischief. For now, here's hoping that the DRM continues its slow death and the anti-circumvention provisions become less relevant to real businesses, while the courts continue to interpret the safe harbors to leave a door open to the Internet's disruptive innovators.

P.S. For more perspectives on the DMCA's origins and legacy during this 10 year anniversary week, see Freedom to Tinker and the Public Knowledge blog all this week.

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Hollywood Menaces DVD Rental Kiosks

Legal Analysis by Fred von Lohmann

Hollywood's distaste for disruptive innovation isn't limited to software products like RealDVD. Now it is targeting DVD rental kiosks, like the Redbox kiosk pictured here.

The idea couldn't be simpler, or the innovation more pro-consumer: Redbox makes DVD rental kiosks that rent authentic, Hollywood DVDs. It's just like Blockbuster, only without the trappings of the store, which means kiosk vendors can do it cheaper, quicker, and in more places. Simple $1 per night DVD rentals. Brilliant.

Hollywood apparently doesn't see it that way. According to a lawsuit filed by Redbox, the Universal Studios family of companies have demanded that Redbox sign a "revenue sharing agreement" that would require Redbox to:

• wait 45 days after a DVD's release date before renting it;
• pay a royalty of 40% of gross rental revenues;
• promise that prices never dip below $0.99 per night; and
• destroy all previously rented DVDs rather than offering them for purchase for $7, as Redbox currently does.

What if Redbox refuses? Universal Studios allegedly threatened to cut off the distributors (Ingram and VPD) who sell Universal DVDs to Redbox. I'm guessing this threat is meant to get Redbox cut off by its distributors -- obviously, Ingram and VPD aren't going to be thrilled to lose all of their other customers over the Redbox account.

This is a breathtaking attack on the first sale doctrine, which makes it crystal clear that once you've bought a DVD, you can rent and resell it at any price and on any terms you like. Universal Studios apparently would prefer a world where millions of DVDs are shredded and put in landfills to one where consumers can rent a DVD for $1. (Although this is an improvement over its former corporate sibling, Universal Music Group, which believes that throwing promo CDs away is illegal.)

Hat tip to Paul Sweeting at ContentAgenda, who brought this story to light.

CC licensed photo by Eddie Does Japan

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minilinks for 2008-10-23

miniLinks by Hugh D'Andrade

• Hollywood (Unintentionally) Agrees with EFF
  The MPAA's response to an EFF blog post unwittingly validates our point -- that the MPAA's legal attack on RealDVD is about controlling innovation.
  
• Record Label 'Infringes' Own Copyright
  A donation-based record label that distributes its music for free had its site taken down for copyright "infringement."
  
• Interim Spying Report Kept Secret
  Why did the NSA mark a "public" report on wiretaps as "classified" instead?
  
• NSA Spy Boss: We'll Investigate
  Reports of NSA employees listening in on soldiers' private conversations has let DNI McConnell to launch an investigation.
  
• "Security Theater," With Your Host, Bruce Schneier
  The Atlantic gets tips from Bruce Schneier on how to outwit airport security -- with minimal effort.
  
• Another Win for Cached Content on Search Engines
  In Parker v. Yahoo, a judge rejected claims that the search engine was infringing when it stored copyrighted material in its indexes.
  
• Feds Use Trademark to Seize Gang's Identity
  A crackdown on the Mongols gang barred the gang from wearing their trademarked name.
  
• Privacy of Leaked Documents
  WikiLeaks describes the ways leaked documents can be traced back to
  the leaker.
  

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EFF's "Yellow Dots of Mystery" on Instructables

News Update by Richard Esguerra

Since late 2004, EFF has been warning the public about "printer dots" -- tiny yellow dots that appear on documents produced by many color laser printers and copiers. These yellow dots form a coded pattern on every page the printer produces and can be used to identify specific details about a document; for example, the brand, model, and serial number of the device that printed it and when it was printed. In short, the printer dots are a surveillance tool that can link each printed page to the printer that printed it.

To help individuals learn more about printer dots and how to find them, EFF posted a video and tutorial to Instructables, titled, "Yellow Dots of Mystery: Is Your Printer Spying on You?". You can also watch the video here:

Privacy info. This embed will serve content from youtube.com.

Printer dot surveillance is a disturbing end run around individuals' right to anonymous speech. Anonymity is a vital freedom -- it can help political or religious speakers, labor organizers, or whistleblowers avoid retribution for their beliefs and opinions. Around the world, anonymity is an important practical protection for dissidents and religious groups against persecution by repressive governments.

Furthermore, it's deeply troubling that printer manufacturers implemented this surveillance mechanism under the table after secret meetings between government representatives and technology manufacturers. Printer companies don't disclose the tracking to their customers and so the existence of these yellow tracking dots remains secret.

In the meantime, you can do your part by spreading the word about printer dots, sending EFF samples from your own color laser printers, and contacting manufacturers to express your privacy concerns directly through the Seeing Yellow site. And of course, you can support our work on privacy, anonymity, and free speech issues by becoming an EFF member.

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EFF's New NSA Spying Shirts

Announcement by Hugh D'Andrade

A few weeks back, we produced a new graphic to accompany our new case against the government, Jewel v. NSA, challenging the Bush administration's illegal spying program. The graphic is a retooling of the NSA's logo, featuring a glowering eagle using his talons to illegally plug into the nation's telecommunications system — with the help of telecom giant AT&T.

By popular demand, we are now offering t-shirts featuring our NSA logo in an exclusive offer to members only. With a donation of $65 or more you can help us continue the fight against illegal spying and receive a shirt (as well as other premiums) in return. Your support makes our work possible! Thank you!

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