For a long time, the Japanese publishing industry was in the dark about the Google Book Search Library project, the ambitious endeavor by the Mountain View, Calif.-based Internet giant to create a vast online library by scanning millions of books. Google announced the start of the project in 2004, but people in Japan were indifferent for years, thinking that it was just taigan no kaji, or “fire on the other side of the river.”

Then the fire spread to Japan in late February, when Google Inc. put a legal notice in vernacular publications, including the dailies Asahi Shimbun and Yomiuri Shimbun, declaring that book authors, publishers and other copyright owners of books in Japan could also be affected by a class-action settlement reached last October between the firm, the Authors Guild and the Association of American Publishers.

Google, through tieups with major universities and public libraries around the world, has already scanned more than 7 million books — including a sizable collection of in-copyright, Japanese-language books held at U.S. universities.

While the Internet search and advertising giant argues that the scanning of these books constitutes “fair use,” and that it does not plan to display their full contents without approval by rights holders, the U.S. authors and publishers sued the company in 2005, saying the digitization of books without permission amounted to copyright infringement.

Authors and publishers outside the U.S. are also affected because it is a class-action suit, and also because of the Berne Convention for the Protection of Literary and Artistic Works, an international treaty signed by 164 countries. Under the treaty, authors outside the U.S. are considered to have “U.S. copyright interest.” Thus, authors and other rights holders around the world — including those in Japan who have published their works in Japan — have been automatically included in the “class” of this class-action settlement.

What baffled many publishers and authors in Japan was the fact that they were given only three months to “opt out” before the deadline, which was originally May 5. What was more, the possibility that Japanese books circulated only in Japan could be considered “out of print” in the U.S. — and therefore available for commercial use by Google — further added to the confusion. Noted poet Shuntaro Tanikawa expressed outrage at an April 30 news conference held by the Japan Visual Copyright Association (JVCA), a rights management group to which he belongs, saying the settlement demonstrated “arrogance that is typical of the United States.”

Later, however, the “opt out” deadline was extended to Sept. 4. The U.S. plaintiffs’ lawyers also visited Japan in late May, explaining that books currently distributed in Japan would not be considered out of print. Still, the settlement leaves many questions unanswered.

Many industry sources as well as authors say that their concern is not so much the digitization of books per se, which would be implemented by somebody if not by Google, but the lack of explanation on this complicated deal from Google Inc., and the degree to which the firm, with its abundant cash and a pool of talented lawyers, could monopolize the copyright management of digitized books in the future.

According to the settlement, which is awaiting court approval, Google will set up a third-party “Book Rights Registry,” through which it will pay rights holders 63 percent of all revenues it plans to raise through a range of business activities, including sales of access to an online database of out-of-print books and, with permission from rights holders, in-print books. Google will also pay $34.5 million to set up and fund the initial operations of the registry, and at least $45 million to pay cash to authors and other rights holders as compensation for books it scanned on or before May 5.

U.S.-based lawyer Junji Suzuki, who represents 180-plus authors belonging to the JVCA who have expressed their desire to opt out of the settlement, noted that there is a major problem with the Google suit, saying that class-action suits are normally for individuals who want to correct wrongs/mistakes committed in the past. In this case, however, the settlement would not only resolve the disputes over what plaintiffs have argued is the illegal scanning of books in the past but also authorize the firm to continue scanning books in the future.

Japanese rights holders might have been slow to react to the settlement because in Japan legal provisions such as “class action” and “fair use” do not exist. Also, under Japanese copyright laws, publishers have no copyright over books that they publish — the authors are the only ones with copyright interests, and they are not responsive to the Google settlement, industry experts said.

If Google had scanned copyrighted books in Japan without the authors’ approval — as it did in the U.S. — it would be considered illegal, said Takanori Minamikawa, an official at the copyright division at the Cultural Affairs Agency. But neither the agency nor the Foreign Ministry have shown any sign that they will act against Google, with officials at both agencies saying that they are just “collecting information” at this stage because it concerns a “private-sector” business deal in the U.S.

Akio Makabe, professor of economics at Shinshu University in Nagano Prefecture, who has authored more than 10 books, said that he feels Google “jumped the gun” on its Book Search project. “It’s like we (people in Japan) are asked to play a game of mah-jongg according to rules Google has created,” he said.

An editor of manga books at a major publishing house, who asked not to be named, meanwhile, said he is concerned because the project contradicts Google’s corporate mission. “The project, under which only people in the U.S. will have access to the database, goes against Google’s mission to organize the world’s information and make it universally accessible,” he said.

He also said that in Japan, it is very difficult to determine whether a book is in print or out of print, as some books are often reprinted shortly after going out of print. If the settlement gets court approval, Google will determine whether a book is in print or not.

The editor, however, says most publishing houses have decided to go along with the settlement, not so much because they endorse it but because they see little chance of winning a case against Google.

“Raising an objection means that you will have to file a suit in the U.S.,” the editor said. “That means hiring a lawyer that would cost up to ¥500,000 a day. That cost alone is making (most publishers) wary of opting out.”

The Japan Book Publishers Association, an industry association of 464 publishers, has outlined five options for rights holders in a booklet about this issue published in April:

• Participate in the settlement by taking no action

• Opt out of the settlement, in which case rights holders must notify settlement administrators by Sept. 4. They can file a new suit against Google or lodge a legal protest, but will lose their rights to receive $60 per book in compensation to be given by Google.

• Raise objections on the terms of the settlement by Sept. 4. If the court rejects objection claims, the rights holders will have no choice but to agree to the settlement.

• Participate in the settlement, then ask for out-of-print books not to be displayed online

• Participate in the settlement, then ask Google to erase all information about their books from the online database

Tamio Kawamata, a manager at the association, said many of its members are now leaning toward recommending authors to choose the fourth option, saying there is no financial incentive to opt out or raise objections, since in-copyright books would be exempted from full display anyway. He added that it is mostly due to logistic reasons that publishers will agree to the settlement.

“It doesn’t mean we forgive Google for the act (of scanning books without permission),” Kawamata said. “But our view is that we won’t gain much by fighting to kill the settlement.”

Lawyer Suzuki, however, said he believes the fight is far from over. He said he wants to negotiate the creation of a Japan-based book rights registry similar to the one to be established by the settlement in the U.S. He argues that Japanese rights holders cannot afford to travel to the U.S. every time they have a copyright issue to resolve with Google.

In late June, Suzuki sent a letter to Google Inc. expressing his clients’ desire to open negotiations with the firm. He was recently contacted by a Google Japan representative over the issue, he said.

The fate of the Google book settlement, perhaps the biggest event in the history of publishing since the invention of the printing press, remains uncertain. The U.S. Department of Justice on July 2 notified a U.S. district court handling the settlement that it has opened an antitrust investigation, having “reviewed public comments expressing concern that aspects of the settlement agreement may violate the Sherman Act (aimed at limiting cartels and monopolies),” according to a court document cited by Bloomberg.

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