Breaking up is hard to do, as the song goes, and for the parties in the Google Books litigation, a potentially messy breakup now looms unless they can make significant progress on a revised settlement agreement in the next six weeks.
The latest development comes after a July 19 status conference in Manhattan federal court, where judge Denny Chin expressed concern over the lack of progress in the case and gave the parties until September 15 to return with the principles of a new settlement in place, or, he warned, it's back to litigation and a "very tight" discovery schedule.
The question now is whether a narrow, opt-in settlement is possible—a question that appeared to be on the judge's mind as well.
"What's the prognosis?" the judge asked bluntly at one point, noting that Google officials are on record stating they would never accept an opt-in settlement. Boni, speaking for the parties, declined to handicap the chances of completing a revised deal. "We're trying," he offered, as the hearing wound to a close.
Try as the parties might, the odds of a revised, "opt-in" settlement aren't looking good. Maybe that's just a function of the parties battling through a hangover. After years of intoxicating talk about universal digital libraries, the task of negotiating a narrower, opt-in deal in the wake of a public rebuke can't be generating much enthusiasm. In the honeymoon days of 2008, the forward-looking settlement, despite its flaws, was hailed as "visionary." The revised settlement process, in contrast, feels like the parties are looking for a backdoor.
At this point, the lawyers remain, but not the visionaries. The original settlement's chief architects, Bertelsmann's Richard Sarnoff and Google's Dan Clancy, are gone. And the most obvious benefit of striking a revised settlement is that it makes the litigation go away. But here, the fragile relationship between publishers, authors, and Google is starting to show signs of cracking.
With the original forward-looking business deal off the table, simply ending the lawsuits doesn't appear to be compelling enough to push Google into a quick, narrow settlement. That's no surprise—the boldness with which Google pursued book digitization is core to the company's success, and Google shows no inclination to retreat from that boldness. Practically speaking, an "opt-in" settlement would settle very little for Google. It would not offer much, if any, cover from future lawsuits over its book-scanning program. And the company already has a successful "opt-in" e-book program, with millions of books and over 30,000 partners, including the plaintiffs, no settlement required.
Publishers and authors, meanwhile, are already sizing up new opponents: each other. The common goal of fighting Google's scanning efforts brought them together. But publishers and authors are now embroiled in serious disagreements over such issues as who owns digital rights to backlist books, contract terms for digital rights, and, most glaringly, digital royalty rates.
Certainly, Google's scanning and limited display of deep-backlist, out-of-print books and orphan works no longer seems so do-or-die. The dire predictions about losing control made six years ago by publishers and authors have not come to pass. In fact, with the advent of new e-book platforms, publishers are now able to exercise significant control over their works, perhaps too much control, critics argue. Unlike print books, users can't re-sell their used e-books, or lend them to friends more than once. Some publishers refuse to let libraries purchase and lend e-books. Others, notably HarperCollins, have capped the number of library lends. For the most part, the Google case has largely become a footnote for the major trade houses now that there is real e-book money on the table. And there is a growing realization among publishers and authors that their time and money is better spent on ensuring that digital growth tracks favorably with the decline of print, and how to fairly divide the digital pie.
To the court, however, the case is more than a footnote. As of September 15, if there is no progress on a revised settlement, it's back to litigation.
Resuming discovery in the Google case would be a costly turn of events, observers note. "Discovery is where the bulk of fees for a case are generated," explains Patrick O'Connor, a Miami copyright attorney. "Discovery is the heart of the litigation process: depositions, interrogatories, the exchange of documents, and so on. If there is a lot of document discovery, for example, and I imagine there is a huge amount of documents to be exchanged in this case, all those documents have to be reviewed by attorneys before they are turned over to the other side. That eats up a lot of time and would mean considerable legal fees."
Seeing Other People
In his remarks at the status conference, Chin told the parties that tight deadlines usually help slow-moving parties act with more urgency. Urgency is certainly in Chin's interest. The judge has already moved up to his new job on the Second Circuit Court of Appeals, one of the busiest, most backlogged courts in the nation, and the Google case remains one of his last holdovers from trial court. Chin even suggested that an easier path to resolution might be to solicit cross-motions on whether Google's display of snippets is fair use, and decide the case that way.