In Hachette v. Internet Archive, four major publishers sued the Internet Archive over its practice of scanning physical books and lending digital copies online, and they won at every stage. A federal district court ruled for the publishers in March 2023, the Second Circuit affirmed in September 2024, and in December 2024 the Internet Archive announced it would not seek Supreme Court review. Both courts rejected the Archive’s argument that its digital lending qualified as fair use, and the decision has effectively closed the door on controlled digital lending as a defense when the books being copied are commercially available as licensed e-books.
Who Sued and Why
The plaintiffs were Hachette Book Group, HarperCollins, Penguin Random House, and John Wiley & Sons. They filed suit in June 2020 in the U.S. District Court for the Southern District of New York, targeting the Internet Archive’s reproduction and distribution of 127 specific copyrighted books.1Justia. Hachette Book Group, Inc. v. Internet Archive
The Internet Archive is a nonprofit founded in 1996, registered as a library, with a stated mission of “universal access to all knowledge.” Since around 2010 it had been scanning books from its physical collection and lending digital versions through its Open Library, using a framework called controlled digital lending.2Internet Archive Blogs. Internet Archive Responds to Publishers’ Lawsuit
Controlled Digital Lending and the National Emergency Library
Controlled digital lending, or CDL, tries to translate the traditional library model into a digital one. A library that owns a physical copy of a book scans it and lends a digital version, but only to one borrower at a time per physical copy owned, with technical restrictions that make the file expire and prevent copying.3Controlled Digital Lending. FAQs Supporters ground CDL in the first sale doctrine, which lets someone who legally buys a copy resell or lend that specific copy without the copyright holder’s permission.4Office of the Law Revision Counsel. 17 U.S. Code 109 Publishers rejected that framing, arguing the first sale doctrine covers a specific physical copy and does not authorize creating a new digital reproduction.
The Open Library operated on CDL principles for roughly a decade without triggering a lawsuit. What changed was the National Emergency Library, launched on March 24, 2020, as COVID-19 closed schools and physical libraries. The program suspended the owned-to-loaned ratio entirely: unlimited users could borrow the same digital book at the same time.5Internet Archive Blogs. Announcing a National Emergency Library The publishers sued less than three months later. The Archive shut down the emergency program in June 2020, but the suit targeted both the emergency program and the standard CDL-based lending.
The Publishers’ Claim
The publishers’ argument was direct: scanning a book creates an unauthorized copy, and distributing that digital copy to the public violates the exclusive rights to reproduce and distribute the work. Every one of the 127 books in the suit was already commercially available as a licensed e-book.6Wikipedia. Hachette v. Internet Archive Libraries can and do lend e-books through licenses purchased from publishers or authorized distributors, generating royalties. By offering the same titles digitally for free, the Archive was serving that same market without paying into it.
How the Courts Ruled on Fair Use
The Internet Archive built its defense on fair use, which permits limited use of copyrighted material without permission and is analyzed under four statutory factors.7Office of the Law Revision Counsel. 17 USC 107 Both courts found that all four factors weighed against the Archive.
On the first factor, purpose and character of the use, the courts held that the Archive’s digital copies served the same purpose as the originals: letting people read the books. Changing format from print to digital is not, on its own, transformative. The district court and the Second Circuit split on whether the use was commercial, with the district court pointing to donation solicitations and a partnership with the used-book seller Better World Books, and the appeals court finding those revenue links too indirect. The disagreement did not matter to the outcome, because a noncommercial use that is not transformative still loses under this factor.1Justia. Hachette Book Group, Inc. v. Internet Archive
The second factor, the nature of the work, favored the publishers because even the nonfiction titles at issue contained original expression “close to the core of intended copyright protection.” The third factor, amount used, cut hard against the Archive: it copied every book in full, and that scale of copying was not justified by any transformative purpose.
The fourth factor, effect on the market, is often the most important, and it was decisive here. The Second Circuit found that free digital lending functioned as a direct substitute for the publishers’ licensed e-books. If borrowers can get the digital copy for free from the Archive, consumers and libraries have little reason to pay publishers for licensed access. The court concluded that if the Archive’s practices became “unrestricted and widespread,” they would “decimate” the publishers’ markets across formats. The publishers did not need to produce specific dollar figures on lost sales; when the unauthorized copy directly replaces the original, the court said, market harm is “self-evident.”1Justia. Hachette Book Group, Inc. v. Internet Archive
The Injunction and What Got Removed
After the district court ruled for the publishers, Judge John G. Koeltl issued a permanent injunction. It was narrower than a blanket ban: it covered only books commercially available in electronic format. The publishers identify their commercially available e-books, and the Archive removes those titles from its lending library.8Internet Archive Blogs. What the Hachette v. Internet Archive Decision Means for Our Library
Several activities are exempted. The Archive can still lend out-of-print books, digitize for preservation, provide accessible formats for people with print disabilities, participate in interlibrary loan, display short excerpts consistent with fair use, and make public domain texts freely available. Even so, the practical effect was large. The Archive’s director of library services confirmed that publishers forced the removal of more than 500,000 titles.9UKSG. Internet Archive Forced to Remove 500,000 Books After Publishers’ Court Win
The Archive also reached an agreement with the Association of American Publishers under which the AAP agreed not to pursue further litigation over controlled digital lending as long as the Archive follows the same takedown procedures for any AAP member publisher.
On December 4, 2024, the Internet Archive announced it would not petition the Supreme Court for review, ending the case.10Internet Archive Blogs. End of Hachette v. Internet Archive
What the Ruling Means for Libraries and Digital Lending
The Second Circuit did not confine its reasoning to the National Emergency Library or to any unusual feature of the Archive’s setup. It rejected controlled digital lending as a fair use defense whenever the scanned books are commercially available as licensed e-books. The logic was that scanning a book and lending a digital copy serves the same purpose as the original, and when publishers already sell licensed digital access, the unauthorized copy displaces the licensed market.
For libraries, the practical takeaway is that digital lending of copyrighted, in-print books requires a publisher license. Licensed e-book lending is significantly more expensive for libraries than buying physical copies, a cost disparity that has long frustrated librarians and that this case leaves in place. CDL may still survive in narrower contexts. The injunction itself carves out out-of-print books, and titles for which publishers offer no e-book license sit outside the market-harm reasoning the Second Circuit relied on. Whether a court would rule differently in those scenarios has not been tested.
The case also settled a broader point: nonprofit status and a public-interest mission do not, on their own, override copyright. The Second Circuit accepted that the Archive’s purpose was noncommercial but held that scanning entire books at scale and lending them as substitutes for licensed copies is not fair use, whatever the copier’s motives.