A U.S. judge on Tuesday rejected a settlement between Google and book authors that would have let Google publish books online on its Google Books digital library.

Google proposed a $125 million settlementwith book authors in an Amended Settlement Agreement (ASAH). However, judge Denny Chin (U.S. District Court Southern District of New York) concluded that the the ASA is not fair, adequate, and reasonable. "While the digitization of books and the creation of a universal digital library would benefit many, the ASA would simply go too far," the judge said, according to this document.

Google is scanning books and displays "snippets" for on-line searching, without permission of the copyright owners. The judge added that the ASA would give Google a significant advantage over competitors, rewarding it for engaging in wholesale copying of copyrighted works without permission. Accordingly the motion for final approval of the ASA was denied.

Google was sued in 2005 by the Authors Guild and Association of American Publishers for violating copyright laws, but reached a settlement by agreeing to pay $125 million to people whose copyrighted books have been scanned, and to locate and share revenue with the authors who have yet to come forward.

Since the settlement, Google launched in December an electronic bookstore with three million books, with permission from the relevant publishers.