Editors Note: Caroline Horton Rockafellow is a member of the Research Triangle Park law firm of Daniels Daniels & Verdonik, P.A. TechLaw is a regular feature in Local Tech Wire.
________________________________________________________________________________________In December of last year, Google announced that it would undertake a colossal effort to scan and index materials from the New York public library as well as the libraries of Harvard, Stanford, Michigan and Oxford Universities. The idea was that by scanning and indexing this vast quantity of materials, Google would then be able to provide new search capabilities to its users, allowing such users to search works that could not otherwise be found on the Internet. This was promoted by Google as a revolutionary step in information gathering and access.

However, not everyone was quite so pleased with this initiative. In September of this year, the Author’s Guild sued Google asserting that the project constituted massive copyright infringement. Earlier this week, Google was hit with a second lawsuit filed by the American Association of Publishers, also claiming copyright infringement by Google. Google has responded by aggressively holding is position that such scanning and indexing is permitted under the fair use and other exceptions to copyright infringement.

Do Google’s Actions Constitute Copyright Infringement?

All copyright holders have (among other rights) the exclusive right to, and to authorize others to: (1) reproduce the copyrighted work; (2) prepare derivative works based upon the copyrighted work; and (3) distribute copies of the copyrighted work to the public.
There are some exceptions to these exclusive rights, including what is known as the “fair use” exception. This exception permits third parties, under certain circumstances, to reproduce copyrighted works for limited purposes, including teaching, news reporting, comment, scholarship and research. Whether a use of a copyrighted work is deemed to be a fair use will depend largely on the purpose and character of the use.

For example, whether the use is for commercial or nonprofit educational purposes, the nature of the copyrighted work, the amount and substantiality of the portion used in relation to the copyrighted work as a whole, and the effect the use might have on the market and value of the copyrighted work.

All of these factors taken together will determine, on a case by case basis, whether the otherwise infringing activity constitutes a fair use of the copyright work. Another exception to the exclusive rights under copyright is the right of reproduction by libraries and archives. This exception permits libraries and archives, under certain circumstances, to reproduce or distribute copyrighted works. While the archiving component of this exception may closely align with the Google Print project, it is important to understand that one of the key conditions of this exception is that the reproduction or distribution must be made without any purpose of a direct or indirect commercial advantage. It is difficult to argue that Google will not see at least an indirect commercial advantage from this project. After all, it is a commercial operation established to create value for its stockholders.

Google’s Argument

Google adamantly argues that this project is a critical means to indexing information. Its goal is to allow its users to search every word of every book that has ever been written. This is a relatively exciting project, particularly given the amount of information that exists today, and the amount of information that is lost every day in the form of out of print and out of existence text.

This is a project that has the ability to increase human knowledge by making more knowledge and more information available to more people. With that said, Google must still get past the argument that it is infringing copyrights. Obviously, it can still move forward by including only text where copyright has expired or been waived by the owner, but this would not accomplish the ultimate task of collecting all of the world’s written information.

Google is relying heavily on the fact that it is not distributing the text of the books, unless authorized to do so by the copyright holder. Rather, it is indexing the content of the books and if the relevant search locates the particular text, it is up to the user to purchase the book if the user wishes to read the text in its entirety. Google asserts that copying of the books is much like the copying of a TV show on a VCR for later review. They reference the arduous battle between producers and Sony over the VCR, and the fact that now these same producers are seeing the most significant portions of their revenues come from video and DVD sales.

Google argues that authors and publishers currently fighting the Google Print project will also ultimately realize great financial benefits from the technology they are currently opposing. That may well be true, but first Google will need to get past the copyright arguments.

The Big Picture

Copyright law is at a major crossroads and the courts are working diligently to address technological advances that were not even contemplated, let alone possible, at the time the relevant laws were drafted. The music and entertainment industries have been dealing with all the consequences and realities of the Napster and Grokster cases.

Now it is time for the information industries to begin their travels through very similar territory. Napster and Grokster have different fact patterns in that they dealt with downloading or uploading of copyrights works and access to the entire work by the public, while the Google case deals not with distribution of a copyrighted work to the public, but rather the copying of that work by Google for the purpose of allowing the public to access portions of the content.

We are living in the information age and the ability to access information on a timely basis is critical. As the world continues to become smaller, individuals and companies will become more and more demanding of access to larger volumes of information on a compressed time frame.

Regardless of the rulings in Napster, Grokster and now Google, we are on a path to reevaluate our view of copyright and the applicable laws in view of new digital capabilities. This dilemma will become even more complicated as new technologies evolve. Recent caselaw has only helped to create stop-gap measures that provide a limited fix in view of current technologies.

As technology evolves and the individual thirst for new information, data and materials continues to increase, we will need to develop new and creative ways to address copyright. The answers that develop over time will need to balance the desire for access with the rights of the creator. If we fail to properly balance the rights of the copyright owners, such that the value of each work is minimized, we will stifle creativity. At the same time, if the rights of the copyright owners are deemed to outweigh all rights to access, we will stifle the public desire to access such works and ultimately reduce the overall value of the copyrighted works.

The only way to make our copyright system work is to make sure the needs of both sides of the equation are properly balanced. This is a balance that will continue to change as technologies develop. If our system does not continue to change in response to new technologies, we risk deviating from that delicate balance.

Conclusion

In view of the exclusive rights granted to all copyright holders, it is clear that each such holder does have the right to prevent third parties, including Google, from copying or distributing their works, unless such activities fall into one of the exceptions under the copyright law. Accordingly, the holdings in these cases will rest on whether or not Google’s actions fall into a permitted exception under the Copyright Act.

This is a complex situation that will not likely be easily resolved. Both sides have strong and well-positioned arguments. In view of the relative stakes on both sides, it is reasonable to assume that the Google case may find its way to our nation’s highest court.

Regardless of which side prevails in the final rulings, it is clear that the holding in this case will be precedent setting and will likely have long term and far reaching implications with respect to the way we all access, search and store information.
_______________________________________________________________________________________

Daniels Daniels & Verdonik, P.A. has been serving the legal needs of entrepreneurial and high technology clients for more than 20 years. Caroline Horton Rockafellow is a licensed patent attorney who works primarily in the areas of technology deals and licensing. Questions or Comments can be sent to crockafellow@d2vlaw.com