The Court now concludes that Google's creation and public display of "thumbnails" likely do directly infringe P10's copyrights. The Court also concludes, however, that P10 is not likely to succeed on its vicarious and contributory liability theories.
This is a quite unfavorable outcome for the dispute over Google Print: Copyright vs. Innovation vs. commercial value.
Some key elements:
i. Commercial Versus Noncommercial Use
In assessing whether a use is commercial, the focus here is not on the individuals who use Google Image Search to locate P10's adult images. Nor is it on whether their subsequent use of the images is noncommercial (e.g., titillation) or commercial (e.g., to print and sell). Rather, it is Google's use that the Court is to consider. That use, P10 contends, is commercial in nature. The Court agrees.
Courts have defined "commercial uses" extremely broadly. [...] Google unquestionably derives significant commercial benefit from Google Image Search in the form of increased user traffic--and, in turn, increased advertising revenue. The more people who view its pages and rely on its search capabilities, the more influence Google wields in the search engine market and (more broadly) in the web portal market. In turn, Google can attract more advertisers to its AdSense and AdWords programs.
Note this is very unfavorable for the Google Book fair-use argument. Because there, Google's use is also commercial in nature, under similar reasoning.
A distinguishing factor from an earlier, more favorable, decision (Kelly v. Arriba Soft):
But unlike Arriba, Google offers and derives commercial benefit from its AdSense program. AdSense allows third party websites "to carry Google-sponsored advertising and share revenue that flows from the advertising displays and click-throughs."
And regarding the factor of effect on potential markets:
On the other hand, Google's use of thumbnails likely does harm the potential market for the downloading of P10's reduced-size images onto cell phones. Google argues that because "P10 admits [that] this market is growing," its "delivery of thumbnail search results" must not be having a negative impact. Apart from being more relevant to the quantification of damages, this weak argument overlooks the fact that the cell phone image-download market may have grown even faster but for the fact that mobile users of Google Image Search can download the Google thumbnails at no cost. Commonsense dictates that such users will be less likely to purchase the downloadable P10 content licensed to Fonestarz.
That's a strong legal rebuff to a commonly-seen argument on these issues.
D. Public Interest
Google argues that the "value of facilitating and improving access to information on the Internet . . . counsels against an injunction here." This point has some merit. However, the public interest is also served when the rights of copyright holders are protected against acts likely constituting infringement. Furthermore, in this case a preliminary injunction can be carefully tailored to balance the competing interests described in the first paragraph of this Order: those of intellectual property rights on the one hand and those promoting access to information on the other.
Though this is just a preliminary injunction, it's a stark reminder that courts do not necessarily agree with arguments we echo.