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14 Apr 2023
The Internet Archive has for several years run a program they call Controlled Digital Lending (CDL.) The Archive takes physical paper books, scans them, puts the books in storage, and then lends out the scans, with each scan lent to only one person at a time. Their theory is that the scans are equivalent to the books, so what they're doing is the same as when a library lends physical books. Not surprisingly, book publishers don't like this since they have their own idea about how e-books work. In 2020 several publishers sued, and on March 24 the court ruled quite firmly in favor of the publishers and said there is no such thing as CDL. While there was a lot not to like about the plaintiffs, and there are certainly reasons to want CDL to exist in some form, this decision reminds us that wishful thinking is not a substitute for legal research. What we think the law should say, or wishes it said, is not what it actually says. It also reminds us yet again why copyright law is such a poor fit for digital materals. The complaint lays out the case, including a long list of books that the Archive has scanned and lends. It throws in a conspiracy theory that the whole thing is just a front to get commissions from business it sends to a used book store owned by Archive founder Brewster Kahle. (It does get commissions that support the Archive, but it's silly to claim that they're in it for the money.) They added some other oddly petty complaints, including one that asserts that poor quality scans have showed up on Amazon and gotten bad reviews. Three years of legal skirmishing ensued, with each side submitting piles of expert reports and amicus briefs, most of which I didn't read because they turned out not to matter. Many of the amici were explaining how bad the pricing for publishers' ebooks is, and the public beneftits of CDL, both of which are true but, again, irrelevant, Both sides submitted motions for summary judgement, which assert that since there are no significant disputes about the facts, the judge can just rule on the law. Which he did, granting the publisher's motion and denying the Archive's. The legal analysis was surprisingly simple. The Archive's main argument in favor of CDL was that it's allowed by the fair use carveout in copyright law, and the judge said, very clearly, it's not. The law tells courts to use a four factor analysis to evaluate fair use claims, the purpose and character of the use, the nature of the work, the amount copied, and the market or value effect on the work. In practice, the first factor is by far the most important. Courts look to see if the use is "transformative", whether it does something different from the original purpose. The judge flatly says: There is nothing transformative about IA's copying and unauthorized lending of the Works in Suit. The scanned books are a substitute for the paper books because people use them for the same primary purpose. While one can dislike the result, it's hard to argue with that. He compares this case to HathiTrust which scanned books to make a searchable index, and to Google Books which created a snippet view. Courts found to both be transformative. The appellate court further noted that if Google had provided full copies of books, the result would have been different. HathiTrust provides full copies to print-disabled people, but that's because there is a specific law about making copies for the blind. (There have been audiobooks for the blind since 1948, using the same exception.) The judge waves off arguments that the first sale doctrine—that you can do anything you want with a physical book once you've bought it—protects CDL. For one thing, he already decided that the scans are not the same as the books. For another, the ReDigi case, about a company that tried to provide a service to resell downloaded music, established that first sale doesn't apply to digital media, even if you try very hard to ensure that there's only one copy at a time. The analysis of the other three factors goes no better for the Archive. I am not entirely persuaded by his fourth factor analysis (the effect on the market for the works) but the Archive did itself no favors when it pitched CDL to public libraries as “You Don't Have to Buy It Again” and in any event with the first three factors all favoring the publishers, it didn't matter. At this point the Archive's options are few. They could try to appeal the decision, but the appeal would go to the Second Circuit, which recently decided Google Books, and it's hard to imagine them doing a U turn and saying distributing full scans is allowed now. US copyright law has statutory damages, a large fixed amount per violation. In theory the publishers could ask for millions of dollars but that seems unlikely since it would put the Archive out of business. Even in the complaint, the publishers admit they have no objection to scanning public domain works nor to the Archive's other activities. So I expect a negotiated result with no damages or only a token amount, and CDL will go away. While I think that the judge correctly interpreted the law. this does not mean that anyone other than the publishers is happy with the way the law applies to e-books, or with the state of e-book publishing. Ed Hasbrouck, head of the book section of the National Writers' Union, and a long time opponent of CDL, blogged about the decision and noted that writers usually regained the rights to their out of print books. (Indeed, I have the rights to a few of mine.) If the Archive and other libraries would talk to the writers, they could likely make deals more favorable to both than what publishers offer. In the next blog post I will look more at the poor fit of copyright law and digital media, and how they might be improved to the benefit of readers.
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