GBS: Status Conference Status

The status conference was brief, but the courtroom was packed. Every available seat was taken, and some would-be attendees couldn’t fit inside. It was a brief, fairly efficient proceeding. The highlights:

  • Chin asked the parties how they planned to proceed. Michael Boni, speaking for them all, said they hoped to offer an amended settlement in early November, with a final fairness hearing in late December or early January. This is a very aggressive schedule, and it puts to rest my theory that the parties were stalling for time.
  • Judge Chin said that schedule was agreeable to him. He specifically set November 9 as the new date for submission of the amended settlement. He said that a delay of many months “would not be acceptable to the Court.”
  • The parties plan to renotice, but with an abbreviated period. They expect the supplemental notice will cover only the amendments, and that objections will be confined to the amendments. There will be a fresh opportunity to opt-out or to opt-in. Judge Chin indicated his general approval of this plan. This is a significant limitation
  • Boni indicated that the amended notice would largely explain additional “benefits” to the class. That could be interpreted as his lawyerly spin on the changes, an indication that about their scope, or both.
  • Boni said that the parties were working daily to negotiate the amended settlement in communication with the DoJ and “in tandem” with the DoJ. William Cavanaugh from the DoJ then spoke briefly, at Judge Chin’s request, to say that while it was having ongoing discussions with the parties, it had not yet seen the proposed amendments.
  • There’s currently a January 5, 2010 deadline for copyright owners to file claim forms for cash payments; in light of the schedule slippage, the parties expect to extend that deadline until June 5, 2010.
  • Judge Chin asked about the state of discovery, in case the settlement talks break down. Daralyn Durie, representing Google, said that it would be “premature” to address that issue. Boni indicated that the parties had conducted document production and review running to “millions of pages,” but had not conducted any depositions.
  • Judge Chin asked about ways to make the submission process easier. The court has a single scanner, and spent four straight days scanning the hard-copy submissions. The Clerk’s office, however, is concerned about asking non-lawyers to use the electronic filing system. Judge Chin asked about the possibility of an email address for electronic submission of comments and objections, possibly through the settlement administration site. Boni said that the settlement agreement requires that objections be served on the parties, so they would be happy to take on the scanning burden.

Judge Chin is trying to move this case, and his overall attitude seemed to be that he wants as clean a record as possible, and soon, so that he can act on it. That would incline me to think that he is hoping to be able to approve the settlement, or at the least to kick some of the legal issues upstairs to the Second Circuit for its guidance. His desire to make the filing process online—thematically appropriate, in this case—is appealing, but I fear that there is such distrust of the parties and of class counsel in this case, that leaving the processing of objections in their hands will not be a palatable solution to many who have concerns about the settlement.

In any event, we are now all set for continuing drama throughout the fall.

“There will be a fresh opportunity to opt-out or to opt-in.”

Does this mean that rights-holders who have opted out will be compelled to opt out all over again?

Of course, we won’t know until they submit the actual motion for preliminary approval, but my guess is no. Consistent with treating the revised version as an amendment, they will probably treat class members’ round one actions as the default. Those who opted out will remain opt-outs unless they submit a form to opt back in; those who did not opt out will remain in the class unless they submit a form to opt out.

What this new timetable looks like is a bad example of a legislative process that we are unfortunately, used to seeing in Congress, where lobbyists submit a lot of last minute amendments that no one has a chance to study, review, or understand, but that still swallow the original draft bill and pass into law.And how could the parties have kept the DOJ in the dark about any proposed substantive amendments which they are discussing as of today? If the “amendments” announced by the Nov date are minor, how can the DOJ(and France, Germany, and the thundering herd of some 400 others) change its position asking Rejection of the overall deal. Creating an e-filing link for world wide pro pers does not solve the issues of defective notice that many of the loudest objectors raised. I am surprised Judge Chin did not give some guidance today on the Notice issue. Will there be any movement on the joint venture/anti trust issues, on Book Rights Registry governance , on the overbroad future release of infringement violations, on the inclusion of non-display rights in the default grant to Google , on the forfeiture/cy pres escheats objected to by the States Attorneys General, etc., as well as continued confusion over class definition regarding childrens book illustrators, photographers and their estates, and music scores and librettos, issues which came up in several of the objections. Does Judge Chin want this over before his confirmation hearing? Will the mess that today’s announced timetable and comments by counsel portend become an issue in his confirmation hearing? If the DOJ is not serious about this thing,and OK’s whaever the parties can dish up by early November, maybe it will get District Court OK at a fairness hearing crammed down in 90 days. But I think what occured today still indicates that the whole GBS as formulated by the parties,ultimately remains a doomed endeavor.

Thanks for this, Jerry. What you say in your comment chimes closely with my reaction to the reports of the hearing, but as a foreigner, and someone unfamiliar with the operations of the class-action system, I wasn’t sure whether I was misreading the clues.

The lack of attention paid at this point to the notice issue has struck me as very strange.

Google has posted an interview that Sergei Brin and Eric Schmidt gave with several journalists including Ken Auleta while the court hearing was in process, and there were reports of post hearing comments by the Publishers Assn head, all of which belittled the objections, promised only minor amendments to the GBS and , still forecast fairness approval. Not having been there, I can only try to understand how at the start, Judge Chin confirmed the original GBS was completely: “off the table,” but still allowed a discussion and future time table to be based on the past , much criticized notice process, and the parties promises of only minor amendments. One reported observer got to court early, was misdirected to the 6th Floor chambers of Judge Chin, and seemed to have stumbled on the parties’ attorneys having a pre-hearing caucus with the Judge, at which, one supposes, the public scenario was discussed and plotted out. Forgive me for sounding presumptious, but I don’t think today’s events in court reflect well on any of the parties of record, and in so far as Google is concerned, they don’t relect well on its claimed status as a responsible, and important, public corporation, which truly stands astride the Internet, like a Colussus. And in its role as a court of equity, supervising this extraordinary Rule 23 proceeding, I believe today’s record also does not reflect well on the District Court.

I have just read the Financial Times report of the interview with Brin and Schmidt. It includes the following strange specimen of Schmidt’s discourse:

Having taken such a strong position as a company, if somehow we went into a room with the evil light, and somehow evil came all over us and we exited that room and we announced an evil strategy, we would be destroyed.

Gillian was kind enough to leave a comment on my blog about this outrageous assumption by Google that they have any right at all to anyone’s book!!! I also posted a cartoon on Slate about this issue.

Sounds like the UK hasn’t protested enough either…