Compare to Basic Books v Kinko's Copies
A very similar example, the publishers won, see Basic Books, Inc. v. Kinko's Graphics Corporation
"In 1991, eight book publishers sued Kinko’s Graphics Corporation for copyright infringement. The suit alleged that, in photocopying copyright-protected materials to create university course packs, Kinko’s infringed on the publishers’ copyrights. Kinko’s unauthorized copying covered a wide range of materials, including text, trade and professional books. Kinko’s argued “fair use,” but the court disagreed. All told, Kinko’s paid almost $2 million in damages, fees and other costs. "
This lawsuit drove Kinko's out of the student and university marketplace. Some university copy centers continued the practice (claiming to be non-profit) but in most cases, professors had to cease using such course packets, and students were required to purchase whole books, not copied excerpts. With regard to out of print books, no option remained, and it was a total loss for the students and profs.