* Settlement ends seven years of litigation
* Publisher can choose not to participate in Google's Library Project
* Settlement does not affect Google's current litigation with Author's Guild
(Adds Author Guild statement)
Oct 4 (Reuters) - Google Inc and a group of publishers have agreed to a settlement over making digital copies of books, capping seven years of litigation involving the search giant's mission to become the world's library.
Google and the Association of American Publishers (AAP) said on Thursday that U.S. publishers can choose to make available or choose to remove their books and journals digitized by Google for its Library Project.
Thursday's settlement does not affect Google's current litigation with the Authors Guild.
"Google continues to profit from its use of millions of copyright-protected books without regard to authors' rights, and our class-action lawsuit on behalf of U.S. authors continues," Paul Aiken, executive director, Authors Guild said in a statement.
The heart of the issue with the publishers involved Google scanning millions of copyrighted books making them available to anyone. The publishers contend that Google violated copyright laws when it failed to seek their permission.
"It shows that digital services can provide innovative means to discover content while still respecting the rights of copyright-holders," Tom Allen, AAP's president and chief executive officer, said in a statement.
The lawsuit was filed by AAP members McGraw-Hill Companies Inc , Pearson Education Inc and its sister Penguin Group USA, John Wiley & Sons and CBS Corp's Simon & Schuster.
Google has scanned roughly 15 million books in what it has said was an effort to provide easier access to the world's knowledge. It is carrying out the scans in partnership with major libraries around the world, including the New York Public Library and Stanford University Libraries.
Google Books allows users to browse up to 20 percent of the books in its library and then purchase digital versions through Google Play.
The book industry has been reeling from a raft of challenges as more people use tablet devices like Amazon's Kindle and Apple's iPad to read books.
Google was sued in 2005 by the Authors Guild and the Association of American Publishers for violating copyright laws, but reached an earlier settlement by agreeing to pay $125 million to people whose copyrighted books have been scanned, and to locate and share revenue with the authors who have yet to come forward.
But critics contended the settlement gave Google an unfair competitive advantage. A federal court agreed, and rejected the earlier settlement.
(Reporting by Jennifer Saba in New York and Siddharth Cavale in Bangalore; editing by Saumyadeb Chakrabarty, Matthew Lewis and Carol Bishopric)
Keywords: GOOGLE PUBLISHERS/