In Authors Guild v. HathiTrust, the US Court of Appeals has ruled that scanning whole books for research purposes is fair use.
In HathiTrust, a group of universities took digital scans prepared by Google and stored them in a "digital library".
The library permitted 3 uses of the material:
(1) The public was allowed to search by keyword. The search results showed only the page numbers for the search term and the number of times it appeared; none of the text was visible.
(2) People with disabilities which prevented them from holding books and/or turning pages could be provided access to the full texts.
(3) Members could create a replacement copy of a lost, stolen, or destroyed book if a replacement was not obtainable in the market at a "fair" price.
The Court held the search function to be a fair use, finding that
-the creation of a searchable, full text database is a "quintessentially transformative use";
-it was "reasonably necessary" to make use of the entire works, and to maintain 4 copies of the database;
-the library did not impair the market for the works.
The Court likewise found it to be a fair use to make copies available to the disabled who are unable to access print books.
The Court declined to rule on the replacement book issue, on the ground that the plaintiffs lacked standing to raise that question.
June 10, 2014, Decision, US Court of Appeals, 2nd Circuit