Google has finally settled its legal dispute with publisher groups over its plans to digitize books and make them searchable. But the company is still engaged in legal dispute with authors.

The settlement should end a lawsuit filed by five publishing houses in 2005. Previous courtroom deals between the two sides have fallen to legal challenges, but this out-of-court settlement should be binding; the American Association of Publishers believes it doesn’t require formal court approval.

The dispute centers on Google’s plans to scan every book in print and add the contents to its search database. Google believed that doing so counted as fair use because it only made a short extract of the book (the page containing the search term) available to users. Because of this, it took the attitude it only had to get permission if it wanted to sell digital copies of the entire book.

Publishers disagreed and began the legal case. They’ve now agreed with Google that the company must get publisher permission before scanning a book. Google says that when this happens, it will also make the digital copy available for the publisher to use themselves.

This overturns Google’s original suggestion that it scan every book unless a publisher specifically opt out. While that might have been a workable policy in practice, a court could never have sanctioned that idea.

It appears the agreement means publishers can decide to make all their titles available, or work on a case by case basis. Any deal they make for Google to sell copies of one book won’t affect their rights over other books.

The full terms aren’t being made public, so it’s not known if Google is paying any compensation for the books it did scan and use without permission.

Google will now continue working with author groups to reach a settlement on the same issue. The two sides did previously reach a deal but a judge agreed with the Department of Justice’s objections against the agreement and threw it out.

The main problem there was that Google and the Author’s Guild wanted Google to have the exclusive rights to scan orphan titles: those which are in copyright but where the rights holder is either unknown or can’t be traced.

The judge ruled that giving Google such powers would be such a fundamental change to copyright principles that only Congress could do it.