search engine copyright liability

When Google searches the web and indexes and caches and makes thumbnail copies of visual works available to the public, is it liable for copyright infringement?  Also, which country’s copyright laws apply to determining Google’s liability? Is it US law where much of the indexing and caching take place and from where Google transmits thumbnails and links to original works of art to the public? Or is it the place where the thumbnails are viewed (or communicated to)?

These issues were considered by the Paris Court of Appeal in the La société Des Auteurs des Arts Visuels et de L’image Fixe Visual Auteurs (SAIF) v Google France  S.A.R.L.…