Why The District Court’s Ruling Against Internet Archive Matters

The following op-ed is excerpted from a longer essay prepared by Association of American Publishers president and CEO Maria A. Pallante. The original can be found here.

By Maria A. Pallante

Following three years of litigation in the critical copyright case Hachette Book Group, et al, v. Internet Archive, we now have a strong and favorable result. In granting summary judgement for the publisher plaintiffs, Judge Koeltl resolved all four fair use factors in the Copyright Act against the Internet Archive (IA).

Maria A. Pallante

Everyone who values our global, creative economy should read the Court’s opinion. The holdings are a forceful validation of well-established law and an unequivocal rejection of the defendant’s upside-down assertions that its activities support “research, scholarship, and cultural participation by making books more widely available on the Internet.” As the Court observed, “Any copyright infringer may claim to benefit the public by increasing public access to the copyrighted work.”

The suit was prompted by IA’s mass digitization and distribution of millions of books, without the permission of authors or publishers. Internet Archive sought to justify its “Open Library” under a legal theory called “controlled digital lending” (CDL), but the Court firmly rejected that assertion, holding instead that it offers up a competing market substitute for authorized versions of the works in violation of authors’ and publishers’ rights.

Internet Archive’s central claim is that if it possesses a print book, then it can also make and distribute digital copies of that print book to members of the global public under a library lending model, provided it does not also lend the print copy simultaneously. In rejecting both the theory and operation of IA’s CDL defense, the Court recognized that digital books are inherently different from physical books, including in the ease of distributing them worldwide in an instant.

IA’s advocates often claim that libraries regularly engage in CDL to avoid copyright transactions, but the truth is that libraries regularly license e-books from publishers for fees that permit their patrons to access them for free while ensuring that authors get paid. According to an interrogatory in the case, as of December 24, 2021 only 62 libraries contributed to IA’s Open Library, and only 13 of those were public libraries out of 9,000 public library systems in the United States.

One of the most basic rules in the Copyright Act is that copyrights are divisible. That empowers authors to license a plethora of rights, formats, markets, and derivative uses that derive from their creative expression, and to strive to do so over the course of many years. The CDL theory frontally devalues the potential of the copyright bundle by presuming that physical and digital formats are systematically interchangeable.

This precedent also explains how separate copyright interests inform the marketplace. As Judge Koeltl explicitly recognized, the publishers “did not price print books with the expectation that they will be distributed in both print and digital formats” and they “are entitled to revenue from all formats.”

Publishers are entitled to create the contractual and technical controls that they deem necessary to protect their intellectual property and to have oversight of digital distributions.

As this holding reaffirms, injecting unauthorized digital copies of an author’s book into public circulation is not allowed. The public policy reasons for this conclusion are not new. Publishers are entitled to create the contractual and technical controls that they deem necessary to protect their intellectual property and to have oversight of digital distributions.

The Court also rejected Internet Archive’s argument that the underlying values beneath the first sale doctrine should be imported into the fair use analysis because that doctrine (codified by Congress) only permits a lawful owner of a print book to lend, sell, or otherwise redistribute it, not to reproduce it in a different medium. Observing that language from the U.S. Appeals Court in Capitol Records v. Redigi (involving music files) “applies equally to IA,” Judge Koeltl concluded that the Court is not free to disregard the terms of the Copyright Act “merely because the entity performing an unauthorized reproduction makes efforts to nullify its consequences by the counterbalancing removal from circulation of the preexisting copies.”

While the recent decision finds that Internet Archive’s activities far exceed fair use, the fair use doctrine is alive and well under the law, and anyone is free to apply it in accordance with the precedent set forth in this and other cases. Indeed, libraries, authors, and businesses all rely on the doctrine. Separate from fair use, the AAP supports efforts to update Section 108 of the Copyright Act (the library exceptions) to permit qualifying libraries, museums, and archives to make digital copies of works in circumstances that warrant such duplication.

Meanwhile, just as Congress intended, the Copyright Act supports billions of seamless transactions on the Internet. The lawful chain of commerce includes business models for noncommercial partners, which permit authors to convey—and publishers to deliver—a robust selection of e-books to public libraries for their patrons.

This litigation was about honoring the importance of copyright law to the public interest and not taking for granted the rights, remedies, and exceptions that Congress has legislated in its careful judgement over two and half centuries of attention to intellectual property.

Maria A. Pallante is President and CEO of the Association of American Publishers, and former U.S. Register of Copyrights. The RightsTech Project welcomes submissions from readers on timely and relevant topics.

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