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Reforming Digital Lending Libraries and the End of the Internet Archive

Reforming Digital Lending Libraries and the End of the Internet Archive

21.07.2020 | JULY 20, 2020 11:59:33 PMBinit Agrawal Edited by: Brianna Bell | 982

Four US publishers, including three from the big five, have sued the Internet Archive (IA) for mass copyright infringement under its emergency library program (ELP). IA is known for championing Controlled Digital Lending (CDL) through its open library, wherein it lends out e-copies of books it holds physically, maintaining a loaned-to-owned ratio. In response to Covid19, IA went a step ahead and did away with the loaned-to-owned ratio as part of ELP, lending out copies in excess of what it physically owned. While ELP seems to be violative of copyright laws, the legality of CDL too continues to remain uncertain. The fair use doctrine is proffered as the primary defense for CDL. In this post, by analyzing the current legal situation of IA and CDL under US law, I argue that fair use doctrine is not a good enough defense where there are gaps in the legislation and only legislative changes can safeguard CDL.

Section 108 of the US copyright act broadens the general fair use doctrine embodied in section 107 for libraries. §108 provides libraries and archives a conditional right to reproduce and distribute copyrighted works for preservation, inter-library loans, and replacement. It also authorizes them to make available copies of parts of copyrighted works to users solely for private study, scholarship or research. Section 108 was introduced to re-assure libraries of their extended rights by countering the uncertainty which fair use doctrine necessarily entails. §108 makes no provision for mass digitization of copyrighted works and lending of those e-copies. Hence, libraries using CDL are relying on the general fair use doctrine to continue their practice. This is a very uncertain and undesirable position. As noted by the judiciary committee on this issue, “Those with smaller legal budgets or a simple desire to focus their limited resources on preservation may prefer to have better statutory guidance than exists today[.]” This is the position IA finds itself in today. Having been sued, it quickly moved to end the ELP and has pleaded the publishers to not go ahead with the suit, which will most certainly bankrupt it.

CDL converts physical works into digital form, which implicates copyright law multiple times. Physical to digital conversion requires intervention by intermediary machines, which create copies of the work while rendering it. While these copies may be incidental and temporary, they nonetheless impinge on the publisher’s right to reproduction. US courts held that any reproduction unless it is momentary is actionable. This trend was established after the judgment in MAI Systems Corp v. Peak Computer Inc., wherein the reproduction of RAM copies was held to be actionable. In Donna R. Hotaling v. Church of Jesus Christ of Latter-Day Saints, making available microfiche copies (which used to be read using microfiche computers) of published work even within the library premises was held to be actionable distribution. Furthermore, since fair use exemption is an equitable rule of reason, every case is to be decided based on its peculiar fact situation. Hence, validating CDL on the basis of fair use would require robust factual defenses, which are lacking in IA’s case.

First, fair use requires that there should be transformativeness in the process. In the case of CDL, there is no to minimal transformativeness as the same content is converted into a digital format, without any new expression.

Secondly, fair use requires that the market effect of such use should be minimal. This was held to be the single-most-important factor in fair use analysis in Harper & Row Publishers, Inc. v. Nation Enterprises. CDL, however, has a direct and immediate effect on the market of publishers by affecting their e-book sales. This becomes graver as the e-book market and physical book market are seen as two distinct markets, as held in US v. Apple. CDL encroaches on the publisher’s right to reproduce its books to supply this e-book market. It allows free access to people who would otherwise have to buy an e-book because of a lack of access to the physical book. Furthermore, CDL also results in significant leakages and secondary infringement, as it is very difficult to prevent all forms of copying using the lent digital copy, affecting the market. Hence, lending e-copies cannot be equated to the lending of physical books, even if it is in a controlled manner.

Thirdly, IA has turned the tables against itself and CDL by introducing the ELP. IA has been operating CDL for the past 10 years without attracting litigations, even though publishers continuously opposed it. By introducing the ELP, IA has significantly altered the factual scenario. Publishers are seeking to utilize the mass infringement caused through the ELP to invalidate CDL itself by creating a precedent in their support. Indeed, there are precedents supporting certain forms of digitization of books. In HathiTrust, the court held that full-text search digitization of copyrighted works to aid disabled-users was covered by fair use. In Google, the court held that digitization of books to allow in text search and display of snippets was held to be fair use. Albeit, none of these precedents dealt with making full-text copies of books and making it available outside library premises. 

Thus, the fair use defense of CDL is very tenuous and does not provide the safe-harbor necessary to provide certainty of protection to the libraries.

The lack of certainty relating to the legality of CDL as fair use is hampering its growth by creating a chilling effect. Libraries are under the fear of costly litigations. IA itself is under the risk of bankruptcy, as the publishers are not inclined to take back their suit, even after IA stopped ELP. This is the very problem section 108 intended to resolve. Hence, it is pertinent that the section is amended to meet the needs of the digital age and provide certainty in this regard. Some countries have already moved in this direction. While Canada has permitted a limited right to provide digitized copies to patrons of other libraries, the EU has been considering proposals to allow digitization of cultural heritage institutions, including libraries.


Binit Agrawal is a final year law student at the National Law School of India University, Bengaluru. He is interested in everything public, whether it be the public domain, public healthcare, or public madness.

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