Legally speaking, what the Internet Archive was doing is exactly what copyright law prohibits: making and distributing an unauthorized copy of the book.
The first sale doctrine (which libraries depend on) says you're allowed to to sell, rent out or give away your own physical property, even if that property happens to be an embodiment of a copyrighted work. It doesn't say anything about it being legal to make another copy of a work, and then distribute it while you keep the original one for yourself.
The first sale doctrine (which libraries depend on) says you're allowed to to sell, rent out or give away your own physical property, even if that property happens to be an embodiment of a copyrighted work. It doesn't say anything about it being legal to make another copy of a work, and then distribute it while you keep the original one for yourself.