From Hugh Stephens Blog:
In my year end blog post looking back at significant developments for copyright and creators in 2022 and looking forward to topics that will be at the top of the agenda in 2023, I identified questions over the legality of a contrived and unproven concept, so-called “Controlled Digital Lending” (CDL), as one of the big issues likely to be clarified this year.
Back in June 2020, four major publishers (Hachette Book Group, HarperCollins Publishers, John Wiley & Sons and Penguin Random House), all members of the American Association of Publishers (AAP) filed suit against the Internet Archive for “Systematic Mass Scanning and Distribution of Literary Works”. The Internet Archive (IA), an organization that brands itself as “a non-profit library of millions of free books, movies, software, music, websites, and more”, provides a number of services including archiving the internet through its “Wayback Machine”, archiving television programs and audio recordings, and digitizing documents and books, both those in the public domain and others still protected by copyright. Although registered as a US non-profit, it was founded and still led by Brewster Kahle, a multimillionaire entrepreneur and digital “guru”.
The publishers’ lawsuit was provoked by the IA’s decision to create a self-described “National Emergency Library” in March 2020, during the peak of the COVID pandemic. The Emergency Library expanded the untested theory of Controlled Digital Lending (CDL), championed by the Archive, by eliminating even the pretence of limits on the numbers of digital copies of books that could be borrowed, in effect eliminating all wait times. As I noted in an earlier blog post (“Are Authors the Enemies of Authors and Publishers?”), COVID was the pretext used by the Archive for pushing the envelope on CDL. Under the IA’s interpretation of CDL, a digital scan of a book can be substituted for the original work by a lending library as long as the library holds the requisite number of physical copies. As is the case with legitimate lending of licensed e-books, there is no need for the borrower to physically collect the work; it is all done digitally including terminating the loan once the book is due.
The issue of scanning a book without authorization in order to provide a substitutable digital version is clearly at odds with the law, especially when it comes to US case law which has been very clear and consistent on this point. As authors and publishers point out, it is a form of copying that destroys the licensing market for e-books. Despite this obvious fact, this has not stopped advocates, like the Internet Archive, from claiming that the practice is somehow fair use under US law. Until COVID hit, the Archive purported to follow what it characterized as normal lending rules by allowing only as many digital copies into circulation as it physically held in its inventory, with a digital copy having to be “returned” before a new copy could be loaned out. However, in reality it exercised no actual controls, simply asserting that it was following the correct “own to loan” ratio. Then, with the arrival of COVID, the Archive dropped all pretence of controls and announced that it was suspending the normal practice of maintaining a wait list and would allow unlimited digital copies to go into circulation.
While a few initially misguidedly lauded the Archive for taking measures to assist consumers who were self-isolating because of the pandemic, it didn’t take long for authors and publishers to push back, pointing out that this unilateral move was a case of giving away someone else’s property without consultation or permission. Although the possibility of litigation had been simmering for some time, the IA’s declaration of the “National Emergency Library” was the precipitating event leading to the filing of suit by the publishers. The IA then ended the Emergency Library program prematurely and Kahle appealed to the publishers to settle the dispute in the boardroom rather than the courtroom. The hypocrisy of this appeal was not lost on authors and publishers who had been trying for years to engage the Archive in meaningful discussions. Both sides moved for summary judgment, and those motions are currently pending in front of the judge.
Link to the rest at Hugh Stephens Blog and thanks to R. and others for the tip.
PG recalls this type of “controlled digital lending” theory having appeared in various guises on past occasions.
As the OP suggests, it won’t work.
Fundamental copyright law requires the author’s approval before anyone can make a copy of the author’s creation, be it words or paintings or anything else.
When a library purchases a physical book and lends it to someone, the library has entrusted its copy to one of its patrons. If the patron doesn’t return the book or loses it or if the patron’s dog eats the book, if the library wishes to allow other patrons to borrow the book, the library’s only legal option is to purchase another physical book from the author or publisher or locate a helpful friend of the library who has purchased a copy of the book and ask if the helpful friend will donate her/his/their physical copy of the book to the library.
Every digital lending scheme PG has examined involves making a copy of the book each time someone wishes to read it. If the library scans one of its physical books, it’s making a copy without permission. It doesn’t matter whether the library destroys the physical book after scanning it. The library has still made a copy.
If a library acquires an ebook, absent permission from the owner of the ebook’s copyright, the library can’t make a digital loan to a patron via an electronic copy while still maintaining a copy of the ebook on the library’s computer system or anywhere else.
Just because electronic copying is very simple to do and happens trillions of times per day on computers around the world doesn’t mean that making an electronic copy of a bunch of organized electrons that are protected by copyright law is not a violation of copyright law.
Please note that that the copyright law includes an exclusion for Fair Use of the copyrighted material. Fair Use does not constitute a violation of copyright law.
Here’s a reasonable general definition of Fair Use from The Stanford Libraries:
In its most general sense, a fair use is any copying of copyrighted material done for a limited and “transformative” purpose, such as to comment upon, criticize, or parody a copyrighted work. Such uses can be done without permission from the copyright owner. In other words, fair use is a defense against a claim of copyright infringement. If your use qualifies as a fair use, then it would not be considered an infringement.
Of course, as with all laws, Fair Use contains more than a few gray areas. However, making a complete copy of a creative work and lending, selling, etc., the copy to one or more others is not protected under the Fair Use exception to general copyright law.
(Personal note – PG believes all of his excerpts of copyright-protected material in TPV constitute fair use. He asks himself if that is the case for at least one or more items he posts each week. His judgement has been questioned on only one occasion, many years ago, but the questioner stopped complaining after PG sent his analysis of fair use for the challenged post.)