September 21, 2009 Google Working to Revise Digital Books Settlement By MIGUEL HELFT http://www.nytimes.com/2009/09/21/technology/internet/21google.html For months, Google and its partners in a class-action settlement that would allow the company to create a vast digital library appeared unmoved by a rising tide of opposition. Google and its settlement partners — the Authors Guild and the Association of American Publishers — argued that the agreement would not harm competition, and said they were confident that it would be approved in its current form by a federal court. But the Justice Department, in a filing on Friday, made clear that the parties were busily negotiating modifications that would address some of the concerns raised. Those negotiations are likely to accelerate now that the Justice Department has said that it too believes the settlement raises serious legal issues and has urged the court not to approve it without changes. Legal experts say the new round of discussions, and the government’s intervention, are almost certain to delay an agreement that Google and the other parties were eager to see ratified quickly. “The news out of this is that there are frantic negotiations going on in back rooms right now,” said James Grimmelmann, an associate professor at the Institute for Information Law and Policy at New York Law School, which raised antitrust and other objections to the settlement. “The parties are scared enough to be talking seriously about changes, with each other and the government. The government is being the stern parent making them do it.” Google, the guild and the publishers’ association said they were encouraged by the department’s view that the settlement offered many benefits, adding that they looked forward to addressing the department’s concerns. “Clearly, the Justice Department is saying ‘find something that would make this near universal library happen,’ ” said Paul Aiken, executive director of the Authors Guild. But Mr. Aiken said it was premature to discuss how the parties would proceed. The Justice Department’s filing on Friday, echoing other critics, said that the settlement could give Google a virtually exclusive license to millions of out-of-print “orphan books,” whose rights holders were unknown or cannot be found, making it impossible for anyone else to build a comparable digital library; the interests of some class members, including authors of orphan works and foreign authors, might not have been adequately represented; and the efforts to notify class members about the settlement might have been inadequate. But unlike some of the more strident opponents, who have argued that the settlement is so flawed that it must be rejected, the Justice Department said it hoped the accord could be fixed so that its benefits — most notable the unprecedented access to millions of out-of-print books it would offer — could be achieved. And it said the parties appeared willing to make changes to address such concerns. Laying out a path forward, the department said some of its antitrust concerns could be mitigated by “some mechanism by which Google’s competitors’ could gain comparable access to orphan works.” And it said that concerns about the fair representation of some authors could be addressed if some rights for Google to profit from out-of-print books were granted only if their authors agreed, rather than by default. Legal experts suggest that proposal could prove to be a sticking point, as it would not allow Google to offer a comprehensive library. But even the Justice Department suggested there could be other solutions. Andrew I. Gavil, a law professor at Howard University, said a judge was unlikely to approve the current settlement, “hence, it is also very likely that the parties will revise the settlement in an effort to secure its approval.” Judge Denny Chin of the United States District Court for the Southern District of New York has given the parties until Oct. 2 to respond to the objections and has scheduled a hearing on the case for Oct. 7. But some experts say the case is likely to be delayed well beyond that, as changes to the settlement are likely to require members of the class to be notified, a process that could take months. And even after that, a resolution may not be immediate. “Whatever action the district court takes, there could also be appeals,” Mr. Gavil said. “So I think we are probably still a ways off from a truly final resolution.”