Judge delays hearing on Google books deal

Thu Sep 24, 2009 8:48pm EDT

* Judge delays October 7 fairness hearing

* Says current settlement unlikely to be "operative one"

SAN FRANCISCO, Sept 24 (Reuters) - A judge delayed a hearing on a $125 million deal that would allow Google Inc (GOOG.O) to create a massive digital library.

In a two-page order on Thursday, U.S. District Judge Denny Chin postponed the fairness hearing scheduled for October 7 regarding a controversial settlement between Google and groups representing authors and publishers.

The settlement, which would allow Google to distribute and sell digital versions of out-of-print, copyrighted books, was criticized by the U.S. Justice Department on Friday. The DOJ urged the parties to modify the settlement, which it said appeared to pose antitrust issues.

On Tuesday, the authors and publishers groups that struck the deal with Google last year asked the court to delay the hearing in order to resolve the DOJ's concerns.

Judge Chin said that while the proposed settlement would offer many benefits to society, it also raises significant issues, as demonstrated by the number of objections to the deal by various parties, including countries, states and nonprofit organizations.

"Under all the circumstances, it makes no sense to conduct a hearing on the fairness and reasonableness of the current settlement agreement, as it does not appear the the current settlement will be the operative one," wrote Judge Chin.

Instead of the hearing on October 7, the judge scheduled a "status conference" on that date to determine how to proceed with the case.

Google issued a statement citing the Judge's statement that the settlement would benefit society.

"If approved by the court, this settlement stands to unlock access to millions of books in the U.S., while giving authors and publishers new ways to distribute their work," said the statement.

The case is Authors Guild et al v Google Inc 05-08136 in U.S. District Court for the Southern District of New York.

(Reporting by Alexei Oreskovic; Editing by Richard Chang)

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