

Justice Dept. Opens Inquiry Into Google Books Deal - physcab
http://www.nytimes.com/2009/04/29/technology/internet/29google.html?hp

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jrockway
I like how nobody tried in the past to do this, then Google does it, and
everyone whines about the anti-trust implications. Sometimes I think there is
some sort of conspiracy to slowly push society back to the stone age.

~~~
pierrefar
Or... society didn't realize there might be a problem until someone did it.

For example, 23andme and other labs like it were sent cease & desist letters
by Californian health regulators. A few months later, the C&D was lifted and
license was granted. There is nothing wrong with society or government
checking that all is a-OK. There isn't a conspiracy to push anyone to the
stone age.

Ref: [http://www.genomeweb.com/california-grants-
navigenics-23andm...](http://www.genomeweb.com/california-grants-
navigenics-23andme-licenses-offer-services-state)

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fatdog789
The problem isn't that Google tried to do it, The problem is that Google set
up the deal so that nobody else could ever do something like this ever again.
Google set up a per se monopoly. It pulled a Microsoft. Hell, based on
publicly available information, it looks like Google has just committed a
violation of the Sherman Antitrust Act Sec. 2. (Note that the attempt to anti-
competitively monopolize is just as much a violation as establishing an actual
anti-competitive monopoly. Monopolies are only sanctioned when they arise
purely from competitive market forces, i.e., Apple getting away with 90+% of
the MP3 player market).

Both Microsoft and Adobe tried to pull off something like this in the past,
but both failed due to a break down in negotiations related to orphaned works.
Neither would pay the Author's Guild for access to orphaned works b/c the
Guild doesn't have the legal right to bargain on behalf of those authors. The
Justice Department did get involved in the MS attempt; I don't know if they
were snooping around in Adobe's attempt.

The fact that Google is willing to arrange payment to the Guild for rights to
works that the Guild doesn't have the power to grant says a lot about the lack
of research and general shoddiness of Google's transactions and antitrust
legal teams.

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frig
(not following closely)

I thought the difference between the prior attempts and this one is that:

\- the guild doesn't have authority to grant rights to orphaned works

\- but in this case the plaintiffs did a class action against google (where
the class == authors, essentially), and thus in the context of this agreement
the guild does have the authority to grant those rights, b/c the class's legal
representatives have granted the guild that authority in the interest of
obtaining a settlement

If that pocket summary is accurate it says a _lot_ about the quality of
Google's research, imho: it's quite a clever hack of the legal process.

~~~
fatdog789
Class representatives do not have the right to bargain on behalf of members in
materially different circumstances. Technically, orphaned book authors should
not even be part of this class action because an orphaned-book author is not
in the same position as an identifiable author. At best, the orphaned book
authors could be part of a subclass, but they would require a separate
settlement (or rather, sub-settlement). The problem is clear, as here, where
the Guild negotiated money on behalf of orphaned authors...to be paid to the
Guild. The Guild is not required to attempt to locate these orphan authors, or
their successors/estates...it can just keep the money until _the authors_
claim it. Even worse, the Guild is allowed to use this money for its own
purpose, rather than setting it aside into a trust account for the orphan
authors.

In this case, others have challenged the settlement on two grounds: (1)
antitrust, which is the most important issue, and (2) the orphaned authors
were not fairly represented by the Guild, as evidenced by the lack of proper
notice, the Guild negotiating to receive money for orphan authors, and the
Guild granting itself the right to use that money for its own efforts. (Note:
the challenge on (2) is both to the settlement AND to the class
certification.)

You're right, the pocket summary says a lot about the quality of Google's
research. But it's not a clever hack of the legal process, because a law
student could easily observe the antitrust issues arising here. It's an
example of Google's lawyer's fucking up on an issue, and getting the Justice
Department involved (and millions spent in responding to the JD's subpoena's
and information requests) where the JD didn't need to get involved. If this
had been an outside law firm, it would be considered malpractice.

~~~
frig
Question: are you familiar with lane's gifts versus google (clickfraud class
action settlement)? If not take a look; I think you'll be able to infer some
strategic similarities (I'm happy to elaborate, but I'd rather not bias your
judgment in advance).

~~~
fatdog789
There are no strategic similarities in the Lane's Gift case; in that case that
i can see, so you should elaborate on what you mean.

Google did what all class action defendants try to do: retain control over the
payment of monies (in LG)...Here... they transferred that right to the Guild
in exchange for the rights to orphan works. Google tried to make the class as
broad as possible so that it would be binding on as many authors as possible,
which all Ds do in every class action.

It's important to note that all the LG members were already Google customers;
here, most of the class members have no prior relationship with Google. It's
also important to note that the transfer of rights contemplated by this
settlement is not possible via a class action (at least, not on behalf of
absent members); see the Ars Technica article for more on that.

~~~
frig
Warning: a little long+rambly. At microlevel I don't see anything unusual.

At a more-macro level I _do_ think Google (generally) treads a lot of legally-
uncertain grounds, and thus often has something to _gain_ from being targeted
with (some types of) class action suits.

This makes me wonder if they on occasion do a brer rabbit -- "oh please don't
throw me in the briar patch" -- thing, and are secretly hoping to get to where
they can offer a settlement in a class action context.

Consider the Lane's case this way:

\- there were some potentially problematic aspects of Google's ad services (to
what extent are only "human" ad clicks supposed to be billed-for? what
recourse -- with Google, or via the legal system -- is available to those who
suspect they've been a victim of so-called clickfraud?)

\- the service about which the uncertainty centers is Google's primary profit
center (especially then; it's still the great bulk of revenues so far as I
know -- does anything else contribute > 10% of revenues?)

\- post-Lane's most of that uncertainty is removed: it's pretty much
impossible for their USA customers to bring any kind of case on any kind of
broadly similar grounds

Lane's was the first time I noticed this -- compared to more-standard class
actions, Google actually derived net _benefit_ from the suit and the
settlement (in my opinion, of course).

In the author's guild case there's something similar (and more arguably a case
of malfeasance on behalf of the AWG and AAP, also -- but again I've not been
following this case super-closely).

Pretty much any scenario that lets Google keep doing what it's been doing with
Google Book Search -- indexing, making a working book search engine -- is a
win (as it makes that space unattractive for rivals); the present agreement
seems likely to be modified but it'd have to be modified a lot before it
becomes a net loss for Google's interests (again: in my opinion).

Hence the brer rabbit speculation: on the scale google tends to operate (all
the web, all the world's books, etc.) individually-negotiated anything are to
be avoided; class-actions that're "lost" -- but only a little -- have some
strategic advantages.

This is to my knowledge the first major class action against Google since
Lane's; given how well it looked like it might turn out for Google got me
thinking about Lane's again.

