The Internet Archive Loses Copyright Case in Major Legal Battle

In a significant blow to the world of internet history, the Internet Archive has lost its appeal in a major copyright case. The US Court of Appeals for the Second Circuit ruled against the digital archive, upholding a previous decision that found one of its book digitization projects to be in violation of copyright law. The case, Hachette v. Internet Archive, was brought by book publishers who objected to the archive's digital lending library.

The appeals court's ruling dealt a blow to the Internet Archive's argument that its lending practices were protected under the fair use doctrine, which allows for limited copyright infringement in certain circumstances. The court found this argument "unpersuasive" and upheld the earlier ruling.

The legal battle stems from the Internet Archive's program called the National Emergency Library (NEL), launched in March 2020 in response to library closures caused by the pandemic. The NEL was an extension of the archive's ongoing digital lending project called the Open Library. The project involved scanning physical copies of library books and allowing people to borrow digital copies, similar to borrowing physical books from a library.

However, the NEL removed the limitation of lending books to one person at a time, allowing multiple users to borrow the same scanned book simultaneously. This move sparked backlash from authors and publishers, who argued that it infringed upon their copyrights and amounted to piracy.

Although the Internet Archive discontinued the NEL's unlimited lending approach and reinstated lending caps within two months, the damage had already been done. In June 2020, major publishing houses, including Hachette, HarperCollins, Penguin Random House, and Wiley, filed a lawsuit against the Internet Archive.

In March 2023, the district court ruled in favor of the publishers, determining that the Internet Archive had created "derivative works" without transforming the content. The parties then negotiated terms, although the details of these discussions remain undisclosed. Nevertheless, the Internet Archive filed an appeal, which has now been rejected by the Second Circuit.

While the Internet Archive did not prevail in the appeal, the Second Circuit clarified that it did not view the archive as a commercial entity, emphasizing its nonprofit nature. This distinction was seen as a positive outcome by legal experts, as it reaffirms the archive's mission as a non-profit organization. James Grimmelmann, a professor of digital and internet law at Cornell University, expressed his satisfaction with the Second Circuit's recognition of the archive's nonprofit status.

The ruling has been hailed by the Association of American Publishers, whose president and CEO, Maria A. Pallante, stated that the decision underlines the importance of authors and publishers being able to license and receive compensation for their works. She emphasized that transforming entire works into new formats without permission or appropriating the value of derivative works goes against fair use jurisprudence and is both costly and against the public interest.

The Internet Archive's loss in this copyright case has broader implications for the future of internet history and the balance between fair use and copyright protections. It serves as a reminder that digital platforms must carefully navigate copyright laws and seek proper permissions to avoid infringing on the rights of creators and publishers.