U.S. federal judge Denny Chin last week rejected the latest iteration of the settlement agreement between book authors and publishers and Google over Google’s massive-scale scanning and indexing of books.  Judge Chin rejected the proposed settlement after having heard from hundreds of parties that objected to it, including members of the author plaintiff class who did not agree with it, academic and public-policy amici curiae, and a coalition of the U.S. Justice Department and Google competitors (Microsoft, Amazon) organized by the prominent antitrust attorney Gary Reback.

The objections to which Judge Chin responded in his opinion focused on areas like Google’s de facto monopoly over the online availability of certain types of works, particularly so-called orphan works whose copyright owners are not in evidence, and the “blessing” that settlement approval would confer on steps that Google took without permission, such as scanning books and making snippets of their texts available online.  But the broadest objection that Judge Chin seized on was that the settlement’s structure has such fundamental impact on copyright that it should not be the product of litigation among private parties; it is more properly the domain of Congress.

Large commercial entities such as (in the case of copyright law) major book publishers, record labels, and film studios often bring lawsuits like this one in the first place as a second-best alternative to pushing for legislation.  It’s generally more expensive, time-consuming, and risky to litigate than to lobby Congress, but if Congress isn’t paying attention, then the legislative route is not viable.

A prominent example of this is the Supreme Court’s 2005 Grokster decision on file-sharing, which was the result of litigation that music companies instigated when it became clear that Congress wouldn’t enact a bill called the INDUCE Act of 2004.  The outcome of Grokster ended up being similar to the INDUCE Act: it established a new class of secondary copyright infringement liability for someone who “induces” people to infringe copyright, in the same manner that someone can induce people to infringe a patent by marketing and profiting from some technology that makes it easy to do so.  (The inducement principle for patents is long-established law.)

More recently, Viacom’s huge litigation against Google over YouTube is an attempt to increase network operators’ responsibility to act as “copyright police” over their own services beyond the notice-and-takedown requirements in the current law (17 USC 512).  That case is currently making its way through the appeals process.  Viacom would also most likely have preferred legislation over this protracted, expensive, and distracting lawsuit to achieve its ends.

Most of the talk over the rejection of the Google book settlement has focused on the issues that Judge Chin emphasized in his opinion: orphaned works, antitrust, and condoning unauthorized copying after the fact.  But disappointingly scant attention has been paid to a feature of the settlement that had the potential to improve the global copyright scene for the digital age in a major way: the establishment of a global Book Rights Registry, which Google would have paid over US $30 Million to build.

Many of the problems in managing digital rights to content could be solved if there were complete, consistent, up-to-date, and easily accessible sources of information about content and rights holders.  Private companies have made various attempts to solve this problem over the years; none have succeeded, owing to unrealistic profitability requirements, overly narrow scope, lack of cooperation from rights holders, and other factors.

Governments have been understandably reluctant to try to establish such databases — especially in an age where even registering copyrights is not considered mandatory.  But the need is there, and it’s sorely felt.  Notwithstanding its source, legality, or ethics, the Book Rights Registry could have been a real solution to this problem — moreover, one that would be paid for, not by taxpayers or even rights holders but by a company for whom the price would amount to a rounding error on its balance sheet.

Furthermore, the Book Rights Registry — now in the public view for at least two years — has become a source of inspiration for similar activity in other sectors of the media industry, such as the Global Repertory Database for music currently being contemplated in Europe.  Many highly qualified managers and potential implementers have been lining up to build and run the BRR, thus helping to ensure good design and operations.

Now, with Judge Chin’s rejection of the settlement, the BRR looks like a lost cause.  Judge Chin’s opinion suggests that a revised settlement could be approved if it works on the “opt in” instead of “opt out” principle, i.e., it should include only those works whose copyright owners proactively agree to let be included.  This may pass various legal sniff tests.  But any resulting Book Rights Registry under an opt-in regime would be of highly dubious value to the industry in general; in fact, it would scarcely differ from repositories of licensable material available today, such as Overdrive’s Content Reserve.

The parties to the proposed settlement are now in a daze over what to do next.  Sentiment seems to be toward Google lobbying Congress to pass legislation that would make orphan works available to the public.  Such legislation has been in the works for at least five years.  But Congress’s attention nowadays is taken up with issues such as unemployment, wars, the deficit, and other issues which (let’s face it) are more important to U.S. society.  Yet orphan works legislation has always sounded like a no-brainer.

Now that Google has an estimable lobbying presence in Washington, we may find ourselves in a world with orphaned works becoming available to the public and a Book Rights Registry that includes them as well as works with claimed ownership on an opt-in basis.  That’s well short of the “castle in the air” rights information database that some of us have been dreaming of… but I suppose it’s better than nothing.