The name is based on Project Gutenberg, a project that tries to make as many texts available for as many people as possible for as long as possible. Hille was the second person to ask Michael Hart, founder of Project Gutenberg, to use the name and was granted permission.
Projekt Gutenberg-DE claims copyrights on all its products, although the legal basis for such claims are disputed. Courts in several jurisdictions with similar copyright laws have found that mere sweat of the brow does not generate a copyright. (See for instance Bridgeman Art Library v. Corel Corp., which in turn seems to have built on Feist v. Rural.) Furthermore, the project only makes its etexts available gratis in a form in which readers have to browse the text page by page. This seems to fall short of Project Gutenberg's lofty bar of accessibility.
In 2004, the German project was at the center of a controversy, because it had started running a proofreading website based on the Distributed Proofreaders software, without mentioning that the resulting books would not be as free as those of the American project. People started proofreading in good faith, only to find out later that the fruits of their labour would receive a copyright claim and be sold, without remuneration going to the volunteers.