The Internet Archive and representatives of book publishers went to court recently to argue the IA's appeal of a lower court ruling against them. The case involves what is known as “controlled digital lending,” CDL for short. It is the process whereby a book is converted into a digital copy and then lent in a manner similar to the way libraries lend physical books. Does it violate copyright law by copying a book, or does it constitute “fair use” which allows libraries to lend physical books?
The Internet Archive, among other things, offers a large digital library, the “Open Library.” Like a public library, they offer their books free to the public. Unlike physical libraries, they aren't limited to serving a local area. Being an internet library, they can loan their digital copies anywhere in the world. For everyone to have access to physical copies at libraries all over the world, those libraries would have to buy tens of thousands of copies of a book. The same would apply to digital copies or “e-books” purchased by libraries from the publisher. The Internet Archive needs but one, unless they want to lend multiple copies at the same time. So, they may need several copies, but even then, they may receive copies as gifts rather than having to buy them. No wonder the publishers are unhappy. The “first sale” legal doctrine allows you to lend or give your legally obtained physical book to anyone you choose. If digitizing your legally obtained physical books is legal, the first sale doctrine would apply to those copies too.
To the publishers, what the Internet Archive does is a simple case of illegal copying, a violation of copyright law. To the IA, the case is a little more nuanced. What they are doing is simply converting their book into a separate form that allows it to be lent electronically under the same rules that it is lent physically. They create a digital copy from the legally obtained physical one and lend it under standard library terms. While technology would make it possible to lend multiple electronic copies from the original physical book, they don't. They lend out no more electronic copies at one time than they own physical copies. That copy cannot be lent again until it has been “returned,” or digitally erased from the borrower's account. To be certain they are operating within the rules, they keep the physical copies of the books from which they have created electronic copies, but they do not lend these, avoiding the possibility of that one book being lent out (in different forms) more than once at a time.
That provides a quick summary of the positions brought before a panel of three judges from the Second Circuit U. S. Court of Appeals. The lower court had ruled in favor of the publishers, hence the appeal is by the IA. The appeals court panel set aside 20 minutes to hear the case, but it ended up running closer to an hour and a half. That is a sign they are taking this issue quite seriously. Some observers thought the questioning indicated which way the judges might be leaning, but it is very difficult to make assumptions from that, especially when it is from a panel of judges rather than the whole court. Estimates are the court will reach a decision in the Fall, though it could come sooner or maybe even run into next year. Whatever their decision, the two sides seem deeply entrenched in their views, meaning an appeal to the Supreme Court by the losing party is a strong possibility. However, the Supreme Court is asked to review many more cases than it can handle, so they decline to hear many appeals, allowing the Appeals Court verdict to be the final judgment.