On November 14, 2013, U.S. Second Circuit Judge Denny Chin dismissed the copyright infringement case Authors Guild filed against Google, Inc. (Google). In conjunction with various publishing firms and authors, the Authors Guild filed a class action lawsuit against Google, Inc. for copyright infringement after Google scanned millions of copyrighted books and provided excerpts of the materials to the public through an online searchable database. The parties attempted to negotiate and come to a settlement agreement on multiple occasions. While on appeal, Google notified the court of its intention to use a fair use defense, prompting the court to remand the case to the District Court for consideration of the fair use issues.
The Fair Use doctrine is embodied in the Copyright Act and is used as an affirmative defense to copyright infringement claims. The factors to be considered include: the purpose and character of the use of the copyrighted materials; the nature of the copyrighted work; the substantiality of the portion used in relation to the copyrighted work as a whole; and the effect of the use upon the potential market for or value of the copyrighted work.
Under the purpose and character of use factor, the court found that Google’s use of the copyrighted materials was transformative because it converted text into a word index that helped readers, scholars, researchers, and others find books. In scanning books for this project, Google used optical character recognition technology to generate machine-readable text, resulting in a digital copy of each book. From the scans, Google created an index that linked each word or phrase appearing in the book with the location of that word or phrase in the book. This allowed users to search the full text of a scanned book, for specific words or phrases. In return, Google displayed a snippet of the verbatim excerpt. Thus, the court decided that Google Books transformed book text into data for purposes of substantive research, including data mining and text mining in new areas.
Next, the court applied the second factor, which looks to the nature of the copyrighted work, and found in favor of fair use because the works at issue were already published and available to the public.
Evaluating the third factor, the court found that although Google limits the amount of text it displays in response to a search, the scan of the entire book weighs against a finding of fair use. A major critique of Google Books by the court was the fear that users would abuse the search engine, by searching words in successive passages in hope of revealing an entire book’s text. However, Google prevented this type of abuse by restricting users from accessing at least one out of every ten pages in each book. In effect, no user would be able to reproduce an entire copy of the book using Google Books.
In support of the copying, the court asserted that full-work reproduction is critical to the functioning of Google Books.  In order for Google Books to operate as efficiently as possible, the program had to digitize the entire text of each book, otherwise they would be unable to link the precise locations of phrases. When analyzing this factor, the court likely appreciated Google’s redaction of some of the copyrighted text. Although the court does not discuss how persuasive the redaction is for the finding of fair use, one out of ten pages was a conservative approach to reproducing the material. Had Google only eliminated one out of twenty or thirty pages, the court might have made a different decision.
Finally, applying the fourth factor, the court found that Google Books is actually beneficial to the copyright holders because it helps readers find their works.
This decision is a big win for Google and all companies dealing in new and transformative technologies, who assert the fair use defense. On the other hand, the decision is likely to cause much apprehension amongst copyright owners. Because of this court’s construction of fair use, copyright owners will seek enhanced protection from the fair use defense. The presence of the fair use defense was created to encourage creativity and innovation, but it could simultaneously lead to copyright owners to copyright their product as well as the possible transformative uses, or creatively contract to prevent digitalization of their works.
Not everyone is happy with this judgment; The Authors Guild has already noted their intention to appeal the decision. This isn’t The Authors Guild first lost in the courtroom. In a companion case against Hathitrust, the court found that Hathitrust’s creation of digital copies of copyrighted text in nonprofit university libraries constituted fair use of the works. The court pointed to the transformative use of the works and how the digitization allowed access for print-disabled persons, whom otherwise wouldn’t have access.
Although the court seems to promote fair use of material that provides a societal good, there are negative side effects. In an effort to avoid licensing content, companies who use copyrighted material will likely assess whether this fair use application could apply. This liberal interpretation of the fair use doctrine could allow companies to evade paying for the content they use. Alternatively, this decision celebrates innovation and encourages companies to engage in forward thinking that is beneficial to the public good.
 Authors Guild v. Google Inc., No. 05-CIV-8136, 2013 WL 6017130 (S.D.N.Y. Nov. 14, 2013).
 See also Authors Guild v. Google Inc., 770 F. Supp. 2d 666, 670 (S.D.N.Y. 2011).
 See id. at 673-674 (explaining that the court denied Google’s proposed settlement agreement that provided royalty payments to known copyright owners, and granted preliminary approval of the parties amended settlement agreement ).
 Authors Guild v. Google Inc., 721 F.3d. 132, 135 (2d. Cir. 2013).
 See 17 USCS § 107 (laying out the four factors of the fair use doctrine).
 See Authors Guild, 2013 WL 6017130, at *7 (providing the fair use framework to be used in the court’s assessment).
 See id. at *8 (applying the first prong of the fair use analysis).
 See id. at *3
 See id. (explaining that Google returns a list of books and snippets in which the search terms appear).
 Id. at *8.
 See Authors Guild, 2013 WL 6017130, at *9 (asserting that because the vast majority of the scanned books were non-fiction and already available to the public, a heightened level of protection was not warranted).
 See id. at *9 (finding the third prong in favor of Authors Guild because Google scans the entire text of books and it copies verbatim expressions).
 See id. at *3 (revealing Google’s instituted security measures).
 See id. at *9 (“copying the entirety of a work is sometimes necessary to make a fair use of the image.” (citing Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 449-50, (1984))).
 See id at *9 -*10 (finding that Google Books will influence the market positively).
 Round One to Google: Judge Chin Finds Mass Book Digitization a Fair Use, The Authors Guild (Nov. 14, 2013) http://www.authorsguild.org/general/round-one-to-google-judge-chin-finds-mass-book-digitization-a-fair-use-guild-plans-appeal/
 See generally Authors Guild, Inc. v. Hathitrust, 902 F. Supp. 2d 445 (S.D.N.Y. 2012) (detailing litigation where Hathitrust prevailed on the fair use defense).