But ... that's what the browser itself does. We aren't shown raw HTML, we're shown a user-friendly rendering of that HTML.
By the way, Axel Springer SE, the "media" company suing, is investing heavily into the US market.
Even if you did… since when has distributing a used book with extra notes, highlighting, or even white-out in place been considered copyright infringement? You're selling an existing, authorized copy—even if it was later modified—not making a new one.
(I think most people would agree that the 9th Circuit's decision is wrong, though, but it remains binding precedent in that circuit.)
While in a browser the "reader mode" or an and blocker may reformat content and remove ads, etc, it's done strictly for the browser's user, the modified version is not distributed.
But e.g. Pocket allows to share a "pocketed" article with all the ads and most formatting removed; they even advertise some articles on their homepage. This may count as distribution of a derived work. They of course give the credits and a link to the original, but I wonder if some publishers might be unhappy enough to challenge this.
There are still only two legal entities involved - the operator of the web site, and the user displaying a page from the web site. What's the third entity that would redistribute a modified work to the user displaying a page from the web site?
Would that not be legal, as long as my software doesn't contain pieces of the original book copied verbatim?
Same thing here, if the modifications were happening on the server side and then sent to your browser that's probably not legal
Publishing it, however, is where copyright law kicks in. Publishing is a specific right that you need to be granted by the rights holders.
I don't see how software running on a client's computer that changes rendering of copywritten work is the same thing as publication. Browsers, video players and Adobe's products all allow users to view and modify copyrighted works on their machines, and that isn't publication at all.
Note too that trademark law can still apply. So your Harry Potter can be in trouble even if the only thing that remains is the name and the universe. (You can do a Harry Potter as the horse in your western novel)
[1] See. e.g., https://grr.com/publications/copyright-myth-ten-percent-rule...