> The Archive purchased 78s likely destined to be destroyed.
It's worse than that.
Many large collections were donated to the archive, under the agreement they would be made available to the public. Part of what influenced Brewster to double down on his original error.
> The Joe Terino Collection, a collection of 70,000 78 rpm singles stored in a warehouse for 40 years.
> The Barrie H. Thorpe Collection, which had been deposited at the Batavia Public Library in Batavia, Illinois, in 2007 by Barrie H. Thorpe (1925–2012). It contains 48,000 singles.
> The Daniel McNeil Collection, with 22,359 singles.
Many more listed at Wikipedia: https://en.wikipedia.org/wiki/The_Great_78_Project
At the same time Internet Archive also launched the "Unlocked Recordings" collection of modern "out of print" LPs, as if that somehow made them free to distribute. The inclusion of Jimi Hendrix, Paul McCartney, and Nina Simone records is called out in the lawsuit.
This is how you ruin the reputation of an organization.
If a copyright holder refuses to make a work available to the public in any way (without a really good reason -- I don't agree with it, but I see Warner Bros. point in withholding certain WWII cartoons, for example) then to me at least they have no ethical claim against someone else who will.
Again, the Music Modernization Act (2018), which the Archive itself celebrated, was meant to put a dent in this problem. You prepare a list of works, then send a spreadsheet to the copyright office. Copyright holders then have 90 days to state that they're using the material commercially. If not, the library or archive (or individual) is free to make these works downloadable.
Orphaned works are a problem, but here was a way to move things a tiny bit forward. Unfortunately, just like Controlled Digital Lending it was left in the hands of some particularly careless people. I'd imagine the settlement also prohibits them from submitting the list (and thus causing the parties to do an enormous amount of research work).
I'm always up for a good ethics debate and likely wholeheartedly agree with your position. But this is a very different issue that resulted in clear damage to the culture we share and the future we all want.
"Legal" vs "ethical" summarizes everything that is wrong about the current state of copyright.
Yeah, I chose that word on purpose. :-(