Friday, 13 November 2009

Revised proposal for a settlement of the Google Books copyright infringement lawsuit

Just minutes before midnight (New York time), the parties to the Google Books copyright infringement lawsuit filed a revised proposal for a settlement, together with a proposed schedule (see p. 27 of the PDF) for consideration of the revised proposal and for a second chance until, they propose, 28 January 2010 for authors and publishers to opt in (which remains the default if they do nothing), opt out, or object to the new proposals.

The parties propose to postpone consideration of any objections until a hearing proposed for 18 February 2010, after the Court has given "preliminary" approval to the new deal and it is on the verge of "final" approval, thus evading until the last minute the issues that have already been raised concerning, inter alia, the adequacy of representation of the entire class by class counsel Michael Boni et al.

On first reading, I see little in the parties' Plan B that addresses any of the fundamentals of the objections I had to their plan A, which they withdrew for (secret) renegotiation on the eve of the previously scheduled "final" hearing, in recognition of the fact that their initial proposal was about to go down in flames.

The revenue splits between print publishers and authors, overriding authors' existing rights or revenue splits under existing contracts, are unchanged (see p. 190 of 377 of the PDF of the redlined revised proposal).

It's still fundamentally an opt-out, license by default system, not opt in. Authors who do nothing will irrevocably forfeit some of their rights. The only supplemental notice of the new proposal will be to those who already filed a claim, objection, or opt out, which does nothing to help those who never heard about the settlement, didn't realize they were affected, or were misled by the original notice.

The parties have already posted a proposed supplemental notice on the settlement Web site, even though it hasn't yet been given even preliminary approval by the Court. Since the parties are already distributing this unapproved notice, it's worth giving it special and immediate scrutiny.

There's a really devious catch in the revised proposed arbitration provisions and this supplemental notice, designed to make it look like authors can't be dragged into arbitration by publishers against their will, and stripped of their rights by an arbitration process and/or provider controlled or dominated by publishers. The supplemental notice says in bold, "Dispute Resolution Optional For Rightsholders". But the actual revised settlement proposal (p. 140 of 377 of the redlined PDF) provides that parties to a dispute could choose to submit the dispute to a court instead of arbitration only by mutual consent.

So if your publisher claimed rights they don't own, you could sue your publisher only if they consented to be sued. Fat chance. Otherwise, you'd be stuck with an arbitration scheme whose rules have yet to be devised, and that could well be stacked against you. And if your publisher initiated the process (for example, to claim that they own your rights), your publisher could still force you into arbitration against your will.

And the supplemental notice calls arbitration "optional"? Clearly and materially false. Deeply, deeply deceptive. And clearly designed to mislead authors and give them unfounded reassurance that they won't be at risk of being forced into arbitration involuntarily, or deprived of their rights without the protection of judicial due process -- when in fact they still will if the revised proposal is approved.

[Addendum: Answers to Frequently Asked Questions about about the revised Google Book Search copyright infringement settlement proposal, from the National Writers Union.]

Link | Posted by Edward on Friday, 13 November 2009, 22:47 (10:47 PM) | TrackBack (0)
Comments

I can't imagine that any judge would have forced arbitration on parties when both of them agreed to forego it. This is a non-change.

Posted by: James Grimmelmann, 13 November 2009, 23:49 (11:49 PM)

I agree with James Grimmelmann that the option to take anyone to court by mutual consent isn't a real change. (If *both* parties wanted to go to court, what third party would have standing to force them into arbitration instead?)

So if it's a non-change, why was it made? And why is it so prominently (and misleadingly) described as a change in the short summary notice?

It seems pretty clear that the point was to make *some* change (albeit a meaningless one) so that it would be possible to say something in the notice to reassure writers concerned about the compulsory secret arbitration.

Presumably, the parties had figured out that writers were concerned about losing access to the courts to challenge print publishers' false claims about their rights. The parties weren't actually willing to make any meaningful concessions on this point, but felt they needed to be able to claim to have done so.

In other words, the only plausible reason to make the non-change in the proposed settlement was to provide an excuse for the misleading claim in the notice.

As I said, deeply and apparently deliberately deceptive.

Posted by: Edward Hasbrouck, 14 November 2009, 06:42 ( 6:42 AM)

Reading the revised proposal and the associated motions again in the light of day, I see a serious procedural problem with the proposal to limit any new filings to the changes from Proposed Settlement 1.0 to P.S. 2.0:

http://thepublicindex.org/docs/amended_settlement/memo_in_support.pdf

Most of the objections to P.S. 1.0, particularly those raised by writers in the USA have been ignored in the changes made to produce P.S. 2.0. Not surprisingly, since the objectors continued to be excluded from the negotiations.

But the parties will, no doubt, claim that their sham changes have "addressed" the objectors' concerns. Unless there is an opportunity for new filings reiterating the original objections, there will be no way for the Court to know that the original objectors remain unsatisfied, for the same reasons as before, and the parties' false claim to have addressed the original objectors' concerns will go unrebutted.

Posted by: Edward Hasbrouck, 14 November 2009, 10:19 (10:19 AM)
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