turbocharged - 4:59 pm on Oct 15, 2011 (gmt 0)
The original purpose of Panda is to devalue low quality content and rank high quality content according to Google. Scraping/copying content is indeed a component of this as seen at [googleblog.blogspot.com...]
This update is designed to reduce rankings for low-quality sites—sites which are low-value add for users, copy content from other websites or sites that are just not very useful.
Despite Panda's flaws, and apparent deviation from its original purpose, from everything I have read on the topic Panda's purpose has not changed.
I understand your frustrations, and I too share in them. It seems Google's actions are making it a very unpredictable and hostile environment for smaller enterprises. Fortunately, my in-law's website appears to have been one of the few lucky ones that has not lost its ranks. For a 40+ year old service business, struggling in this economy, even one or two lost sales may be all that it takes to push them into insolvency. While they do not get many "leads" from their website, such a loss in ranks would be very harmful for them at the present time.