For the University of Minnesota, the dream of a universal electronic library has been derailed -- or at least delayed -- by a federal judge's rejection of a settlement between Internet search leader Google and the book industry.

For a year, the U's library has been shipping its books to Google to be digitized and become part of a huge database of computerized library books that would be widely available.

The U planned to ship 1 million books, with the understanding that most of the digital copies would remain largely out of the public view until the Google settlement was approved.

But on Tuesday, a federal judge rejected the $125 million settlement, which would have put online millions of volumes from libraries around the country. The judge cited antitrust concerns over Google's clout in the publishing industry and the need for involvement from Congress, while at the same time acknowledging the potential benefit of a vast computerized library.

What happened? Google's 2004 plan to digitize 15 million books from the world's major libraries ran afoul of U.S. copyright law, which protects authors and publishers from the theft of their work. Books published before 1923 are no longer protected and can be copied. But books published after that will remain copyrighted for the author's lifetime plus 70 years. Google was sued in 2005 by authors, represented by the Authors Guild, and book publishers, represented by the Association of American Publishers. The two sides reached a settlement in 2008, but it became the focus of hundreds of objections from Google rivals, consumer watchdogs, academic experts, literary agents and even foreign governments.

The judge's ruling leaves in limbo many of the digital copies Google has made of about 15 million library books.

Google's managing counsel, Hilary Ware, called the decision disappointing and said the company was considering its options.

"Like many others, we believe this agreement has the potential to open up access to millions of books that are currently hard to find in the U.S. today," Ware said in a statement.

That was also the belief of the University of Minnesota, other state universities and the University of Chicago that have been cooperating with Google to create a vast digital archive of the books Google is scanning. But now it's unclear what will happen to the majority of the digitized University of Minnesota books, said Wendy Lougee, the university's librarian.

"I was disappointed the Google settlement didn't come to fruition," Lougee said. "There was a lot of public interest served. And, while I appreciate concerns about Google and its potential hold on the book market, the agreement certainly left the door open for others to do what Google has done."

At issue are 70 percent of all books and magazines that have ever been published in the U.S. Those volumes are scarce because they're copyrighted but out of print, so unavailable except at a library that bought a copy.

About 700,000 books the University of Minnesota is offering to let Google digitize fall into that category, Lougee said.

Under the Google settlement, such scarce books and magazines would have been readable on computer screens at public libraries across the nation by tapping into a Google database, she said.

But U.S. Circuit Judge Denny Chin in New York said the creation of a universal library would "simply go too far," and he was troubled by the differences between Google's views and those of everyone affected by the settlement. Chin noted it would have given Google exclusive access to millions of orphan works -- the name given to copyrighted books whose copyright owners aren't known -- without the holders of those rights ever agreeing to it. He also said the settlement was "not fair, adequate and reasonable."

Still, he left the door open for an eventual deal, noting that many objectors would drop their complaints if Mountain View, Calif.-based Google set it up so book rights owners could choose to join the library rather than being required to quit it if they wanted out.

With the settlement blocked, scarce copyrighted books and magazines can be read only by trekking to the library that owns a physical copy -- even if it's 1,000 miles away -- or hoping your local library and work out a lending arrangement with the distant library.

Readers also can see small snippets of digitized, copyrighted books from the U of M and other big libraries by doing a keyword search of the text through Google.

"That's still valuable," Lougee said. "It's useful just to know if the information you want is in a certain book or if it can't be found anywhere."

The New York Times contributed to this report. Steve Alexander • 612-673-4553