Weekly Update

Aggregation aggravation

Traditional news publishers have long complained that online aggregators and search engines were “taking” their content and delivering little of value in return, but up to now publishers haven’t been able to do much about it.

Courts in this country have generally come down on the side of search engines when they’ve been challenged, most notably in Perfect 10, Inc. v. Amazon.com and Kelly v. Arriba Soft Corp., in which federal appeals courts found that presenting thumbnail images of copyrighted photographs in search results was sufficiently “transformative” to qualify as fair use. Governments around the world, meanwhile, were reluctant to be seen as anti-innovation by giving copyright owners more expansive rights over how their content is searched and sorted online.

Those winds may be starting to shift, however. In France and Belgium, Google has recently been forced to agree, under pressure from the respective governments, to settle long-running disputes with publishers on terms that amount to paying publishers for the right to include their content in search results.

In Germany, a new law making its way through the Bundestag and expected to pass strictly limits how much content can be used in search results. An earlier version of the law, in fact, would have barred display of news content in search results altogether without permission from the publisher, but last-minute lobbying by Google secured a carve out for use of a “small snippet” of a news story.

Google is claiming victory in Germany, just as it denies it is paying publishers to aggregate their content in France and Belgium. But as Matthew Ingram points out, the search giant is basically talking through its hat.

“The [German] legislation also clearly gives publishers the right to control what a third-party site or service does with their content, and in effect it leaves it up to them to determine what constitutes unfair use,” Ingram noted. “In a similar way, Google tried to argue that its deal with French publishers — which involved the payment of $82 million to set up a “digital innovation fund,” as well as a commitment by Google to help publishers with their digital advertising — was a victory, when what it really looks like is hush money or an extortion payment.”

In the U.S, meanwhile, a federal district court in New York last week handed publishers a major victory in a lawsuit brought by the Associated Press against online clipping service Meltwater News. In an unusually sweeping ruling, Judge Denise Cote held that not all uses of copyrighted content in search results automatically qualify as fair use.

“In short, use of an algorithm to crawl over and scrape content from the Internet is surely not enough to qualify as a search engine engaged in transformative work,” she wrote in a 91-page opinion.

Critically for publishers, Judge Cote ruled that reliance on automated technology to search and sort news content does not, by itself, immunize aggregators from liability for copyright infringement. Instead, courts should consider the aggregator’s intent, including its commercial motives:

Meltwater’s discussion of search engines is to some extent beside the point. While it is important to understand how Meltwater News functions, even if it were a search engine it would still be necessary to examine whether Meltwater had acted to violate the Copyright Act. The fact that Perfect 10 and Kelly addressed the issue of the fair use defense in the context of webpages created by a search engine, and found the defense available to those defendants, does not relieve Meltwater of its independent burden to prove that its specific display of search results for its subscribers qualifies as a fair use.

In other words, using the mechanics of search engines to scrape material from the Internet and provide it to consumers in response to their search requests does not immunize a defendant from the standards of conduct imposed by law through the Copyright Act, including the statutory embodiment of the fair use defense.

Meltwater has vowed to appeal the decision, and the case could ultimately be ticketed for the Supreme Court. But in the meantime, as the Electronic Frontier Foundation, which filed an amicus brief in the case on behalf of Meltwater, points out, publishers are likely to seize on Judge Cote’s ruling to bring legal challenges against other search engines and news aggregators.

Clearly, the last word on news search and aggregation has yet to be written.