Google and the Association of American Publishers (AAP) have made a deal to digitize books and journals for the Google Library Project. This agreement ends years of litigation that began in 2005 when five members of the AAP — McGraw-Hill, Penguin, Wiley, Pearson Education, and Simon & Schuster — brought an infringement suit against Google for their scanning of copyrighted materials from libraries. The new deal allows publishers control over what content is used by Google, and gives publishers access to digital copies for their own use.
The ongoing lawsuit between Google and the Authors Guild over unauthorized book scanning is not affected by this arrangement, and that litigation continues.
For more, see the Google blog post on the agreement.