Google's much-discussed plans to create an online digital book library suffered yet another setback at the weekend when the US Justice department intervened against the net giant.

At issue is the settlement reached last October, in which Google Books will create a registry to pay authors for any book it scans and makes searchable online.

Time to renegotiate

Presently, a Manhattan court is considering whether or not the agreement is lawful. The Justice Department has told it the deal should be thrown out, saying it should, "reject the proposed settlement in its current form and encourage the parties to continue negotiations to modify it so as to comply with... copyright and antitrust laws."

On top of criticisms that Google is looking for an unfair advantage in the early days of the digital book business, the government intervention could prove a body blow to the company's ambitious plans.

EU opposition too

The settlement, as it stands, calls for Google to pay $125 million (£77 million) into a registry, from which authors and publishers can get paid for their books being reused.

Moreover, the deal is also facing a probe in Europe after EU regulators were urged by opponents to scrutinise it over fears it will create a monopoly.