The thing is IA wasn't lending the copy they purchased, they were lending a reproduction of the copy. The question here is if it was legal for them to make that

The thing is IA wasn't lending the copy they purchased, they were lending a reproduction of the copy. The question here is if it was legal for them to make that copy which is where the fair use argument comes in. I wonder if they could buy ebooks and lend those instead of starting with a physical copy.