The lawsuit was seeking $750 for each of the more than 20 million copyright books that Google has already copied. Google had estimated its damages could have surpassed $3 billion a significant blow even to a company with more than $56 billion in the bank.
Chin's ruling won't necessarily close the book on the case. The Authors Guild plans to appeal, opening the next chapter in a legal saga that some experts believe will ultimately land in the U.S. Supreme Court.
If the decision stands, Google's Internet search engine will be in a better position to become an even deeper reservoir of human knowledge.
As it expands its stockpile of digital books, Google's search engine is likely to be seen as an even more indispensable resource.
Although Google doesn't display ads next to the excerpts from digital books, anything that spurs people to think of its search engine as the best place to find information usually boosts the company's profits. That's because habitual use of Google's search engine typically produces more opportunities to show the ads that generate most of the company's revenue.
Chin conceded Google might make money from its book-copying project, but concluded it is being done in a way that complies with intellectual property laws while enriching society.
"In my view, Google Books provides significant public benefits," Chin wrote. "It advances the progress of the arts and sciences, while maintaining respectful consideration for the rights of authors and other creative individuals, and without adversely impacting the rights of copyright holders."
Paul Aiken, the executive director for the Authors Guild, maintains that Google is exploiting writers.
"Google made unauthorized digital editions of nearly all of the world's valuable copyright-protected literature and profits from displaying those works," Aiken said in a statement vowing to appeal Chin's decision.
In its statement, Google said it was delighted with the decision.
"As we have long said, Google Books is in compliance with copyright law and acts like a card catalog for the digital age giving users the ability to find books to buy or borrow,'" the company said.
Google had previously negotiated a truce as part of a $125 million settlement. But that deal unraveled in 2011 after the U.S. Justice Department and other critics persuaded Chin that the terms of the deal would give the already influential company too much power in the still-developing market for digital books.
After the settlement came apart, the Authors Guild renewed its push to extract even more money from Google for alleged copyright infringement.