I agree it was going to be a hard case, but I don't think CDL properly implemented is automatically illegal. The issue here is IA had a lack of control and couldn't assert the print copy came down in their CDL implementation. It's unfortunate this was the case used to test CDL since it was a loser from the start.
The point is that providing access to archives of web pages that were once public--especially if robots.txt is even retroactively honored--and CDL, while perhaps not adhering to the letter of copyright law, are sufficiently close to the spirit that most reasonable people see those actions as legit. (There's probably at least a case that you're just providing an equivalent proxy for physical access. IANAL) Especially by an entity which is reasonably viewed as an archive/library.
It is clearly illegal. It doesn’t matter whether you have a physical copy backing it. It doesn’t matter if you have control over your digital lending. Making a copy (digitization or ctrl + paste) and distributing it is illegal by default without permission of the copyright holder. This is the core of copyright law.
You can defend against the default presumption by arguing fair use. The IA did try this but it was very clearly doomed to fail, because they are providing whole copies for normal use. It was so obvious it was a summary judgement. “Fair use” is not a general term about what we think should be allowed, it has a specific statutory definition and there is no serious debate over whether CDL can be twisted into it. It may be morally right but it’s clearly legally wrong.
It may be ridiculous that yes, if you scan in a book, send it to your friend, burn your physical copy and delete your copy of the scan, that you inarguably committed copyright infringement. But that’s the law.
It's not clearly illegal. If IA had taken the 1 physical copy and loaned out 1 digital copy (not copies) at a time like it was the physical copy, there is a an argument for fair use (traditional format shift requires no commercial way to purchase the item, so that's the big change). The problem is that IA didn't do the controlled part. Lawyers smarter than me seem to think there is a case here, and are working on a real test case though it may be years away.
There is an “argument” because that does seem like common sense. It is nevertheless clearly illegal.
The ruling clearly addresses this in the section about the application of fair use to the idea of the CDL (that is, where the lending is controlled in the way we’re idealizing) and it was deemed obviously illegal. The very act of making and distributing a copy is what is infringement, and as the ruling clearly lays out none of the pillars of fair use come close to applying as a defense. Crucially, it is not transformative (it’s the same book used in the same way) and the entire work is copied.
The law is bad and it sucks and we need to change it. It’s depressing to me that so many really smart people don’t have a good understanding of this, probably because most infringement usually goes unpunished. We don’t get to deem it okay simply because it logically makes sense that controlled digital lending is obviously equivalent to physical lending. Unfortunately the act of making the copy and then distributing it changes everything.
> "This appeal presents the following question: is it “fair use” for a nonprofit organization to scan copyright-protected print books in their entirety and distribute those digital copies online, in full, for free, subject to a one-to-one owned-to-loaned ratio between its print copies and the digital copies it makes available at any given time, all without authorization from the copyright-holding publishers or authors? Applying the relevant provisions of the Copyright Act as well as binding Supreme Court and Second Circuit precedent, we conclude the answer is no."
