The Fair Use Doctrine and New Media Technology

By:  Rob Hassett

Casey Gilson P.C.

Atlanta, Georgia

770-512-0300 Ext. 557

http://www.internetlegal.com/

           and

Adam H. Alexander

In-House/Corporate Counsel

Sammons Corporation

Dallas, Texas

 

Background and Summary

An earlier version of this article first appeared in the program materials for the conference sponsored by the Entertainment & Sports Law Sections of the Georgia, Florida & Tennessee Bar Associations which was held in Dana Point, California from November 6 through November 8, 1997. This advanced level article addresses the subject of copyright fair use on the Internet. (12 Pages)

The law of copyright has evolved with technological change, with each new technological advancement creating complicated questions of copyright interpretation and application. Nevertheless, the new technologies . . . have been made to fit within the overall scheme of copyright law and to serve ends which copyright was intended to promote. The Internet is no exception; . . . it must be judged in reference to the already flexible considerations which fair use affords.(1)

 

I. COPYRIGHT & DEVELOPMENT OF THE FAIR USE DOCTRINE

The policy goals of the Copyright Act are found in the Constitution. The progress of science and the useful arts is fostered by granting the individual who has expressed his or her idea the limited monopoly to profit from its dissemination.(2) This limited grant is “intended to motivate the creative activity of authors and inventors by the provision of a special reward, and to allow the public access to the products of their genius after the limited period of exclusive control has expired.”(3) In this way, the Copyright Act rewards the author and benefits the public.

An important outgrowth of this policy is the idea/expression dichotomy. This concept insures that no author can protect his or her idea; only his or her expression of that idea.(4) For reasons that will become apparent, this concept is instrumental in protecting First Amendment rights and in helping one recognize some of the goals of fair use under the Copyright Act.

With respect to the First Amendment, the idea/expression dichotomy “[strikes] a definitional balance between the First Amendment and the Copyright Act by permitting free communication of facts while still protecting an author’s expression.”(5) Because of this balance, “[c]opyright laws are not restrictions on freedom of speech [because] copyright protects only the form of expression and not the ideas expressed.”(6) An example of this idea can be found in the balance between copyright and the First Amendment rights of disseminating the news. The news element is the “history of the day” and is thus entitled to very little copyright protection.(7) However, “copyright assures those who write and publish factual narratives . . .that they may at least enjoy the right to market the original expression contained therein as just compensation for their investment.”(8)

In addition to the idea/expression dichotomy, the fair use doctrine assists in allowing others to build upon the ideas contained within copyrighted works without eliminating copyrights.(9) The fair use doctrine is an old common law idea that was not a part of original the Copyright Act in 1790. Something akin to the fair use doctrine existed in England as far back as 1710, and appeared in the States compliments of Justice Story as a judicially created doctrine in Folsom v. Marsh in 1841.(10) As Justice Story would later explain,

in truth, in literature, in science, and in art, there are, and can be, few, if any, things, which in an abstract sense, are strictly new and original throughout. Every book in literature, science and art, borrows, and must necessarily borrow, and use much which was well known and used before.(11)

 

Fair use remained a judge-made doctrine until the passage of the 1976 Copyright Act,(12) yet to this day remains an equitable doctrine.

II. FAIR USE DOCTRINE BASICS

The fair use doctrine is now set out in §107 of the Copyright Act and reads as follows:

Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include —

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.(13)

The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.

Section III of this article will discuss the manner in which a court determines each of these factors as well as how they are weighed together. Fair use is an affirmative defense which is raised after a prima facie case of copyright infringement has been established.(14)

When Congress incorporated fair use into the Copyright Act, it intended §107 “‘to restate the present judicial doctrine of fair use, not to change, narrow, or enlarge it in any way and intended that courts [would] continue the common law tradition of fair use adjudication.”(15) This intent, together with the language of the statute, “permits [and requires] courts to avoid rigid application of the copyright statute when, on occasion, it would stifle the very creativity which that law is designed to foster.”(16)

The application sought by Congress has been recognized and affirmed time and again by the Supreme Court. The case by case analysis is required by statute and there are no bright-line rules or short cuts.(17) Accordingly, all four factors are to be explored and weighed together in light of the purposes of copyright and never to be treated in isolation.(18) As a means of guidance, Congress provided examples of the types of uses which are generally considered fair uses. These examples are meant to be illustrative and not limiting; indeed, “whether a use referred to [as an illustration] is a fair use in a particular case will depend upon the application of the [four] determinative factors.”(19)

Case by case analysis has resulted in inconsistent, sometimes conflicting decisions in cases with similar fact patterns. Identical cases have found courts reversing each other as a case works its way through the appellate process. For example, in Michigan Document Services v. Princeton University Press, the district court found “willful” infringement and no application of the fair use doctrine.(20) A three-judge panel of the 6th Circuit Court of Appeals reversed the district court, finding that the copying was permissible fair use.(21) A rehearing en banc resulted in another reversal, with a slight majority of the active 6th Circuit judges finding that the copying in question was not a fair use.(22) These reversals and re-reversals serve not as an example of how a court misapplied the fair use analysis, but are simply illustrative of how difficult the issues can be and how “reasonable minds can differ” on close questions of judgment as different individuals weigh the different factors.(23)

Problems of analysis and precedent are often compounded by technology. The development of modern technology and communications has radically changed the way in which the public perceives copyrighted material.

The fortunes of the law of copyright have always been closely connected with freedom of expression on the one hand, and with technological improvements in the means of dissemination, on the other. Successive ages have drawn different balances among the interest of the writer in the control and exploitation of his intellectual property, the related interest of the publisher, and the competing interest of society in the untrammeled dissemination of ideas.(24)

The radio, cassette recorders, photocopiers, VCRs, and computer have all been initially thought to render the fair use doctrine obsolete.(25) However, the doctrine has remained unchanged and continues to apply successfully to new technologies. The Internet will be no different. All that will be required, as in the past, is creative thinking and logical application of the four factors while keeping in mind the goals of copyright.

III. FAIR USE ANALYSIS – STATUTORY EXAMPLES AND FACTORS

A. Statutory Examples:

Congress provided examples of the types of uses that might constitute fair use. Examples cited that may constitute fair use are those “for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research. . .”(26) It is important to realize that this list does not create a presumption of fair use, and indeed many uses that might at first seem to be included within the list have been found unfair. For example, in American Geophysical Union v. Texaco, the Second Circuit found that photocopying articles from a scholarly journal (to which Texaco subscribed) for use by Texaco researchers was not a fair use.(27) Likewise, in Los Angeles News Service v. KCAL-TV Channel 9, the Ninth Circuit held that a television news program’s use of a videotape of the Reginald Denny beating during the L.A. riots was not fair use.(28) These are just two of the numerous examples of uses that are named in the statute (research, news-reporting), yet were nevertheless found to be infringing.(29)

B. §107(1) Factor One – The Purpose and Character of the Use:

The first determination that must be made under factor one is the nature and objectives of the user.(30) Invariably, this boils down to whether the use is commercial in nature. Prior to Luther K. Campbell v. Acuff-Rose Music (the case involving 2 Live Crew’s recording of a parody version of Roy Orbison’s “Oh Pretty Woman“), it was widely believed that a commercial use by the alleged infringer created a presumption against fair use. Indeed, the Supreme Court itself had held in Harper & Row v. Nation Enterprises (where The Nation magazine had included unauthorized excerpts of former President Gerald Ford’s unpublished memoirs before authorized excerpts were to be published in Time magazine) that “[every] commercial use of copyrighted material is presumptively an unfair exploitation of the monopoly privilege that belongs to the owner of the copyright.”(31) However, in Campbell, the Court explicitly reversed itself, noting that for commercial uses to be presumptively unfair would swallow the permitted uses if they were for profit.(32)

The other side of the question regarding purpose and character of the use is whether the use is transformative. The Supreme Court described a transformative work as one which “supersedes the objects of the original,” or adds something new, with a further purpose or different character, altering the copyrighted work with new expression, meaning or message.(33) Justice Souter has suggested that using an original “to get attention or to avoid the drudgery in working up something fresh” indicates non-transformative use. The transformative nature of the new work will be considered together with the issue of whether the work is commercial. In Campbell, the Supreme Court noted that while

transformative use is not absolutely necessary for a finding of fair use, the goal of copyright, to promote science and the arts, is generally furthered by the creation of transformative works. Such works lie at the heart of the fair use doctrine’s guarantee of breathing space within the confines of copyright, and the more transformative the new work, the less will be the significance of other factors, like commercialism, that may weigh against a finding of fair use.(34)

When analyzing the commercial nature of a work with its transformative nature, a sliding scale is created. The closer the new work is to direct copy, the smaller the range of permitted commercial uses. The more transformative the new work, the greater the range of allowed commercial uses. Weighing all of these factors together, a trial court will articulate the “winner” on this factor, and to what extent that party prevailed. A finding on this first factor is not dispositive however, for all four factors must be considered together.

C. §107(2) Factor Two – The Nature of the Copyrighted Work:

This analysis focuses exclusively on the copyrighted work that has been infringed. It is made up of two major determinations: how close the original is to the “core of copyright protection” and whether the original is published. First, a court must determine what level of protection should be accorded the copyrighted work. This is achieved by determining how close the original is to the core of copyright protection – how creative or highly expressive a work is versus its being factual in nature. Copyright provides higher protections to creative works, but also “recognizes a greater need to disseminate factual works than works of fantasy or fiction.”(35) While it is obvious that a news broadcast would receive less protection than a science fiction motion picture, courts must often make difficult decisions under this factor, and reasonable people can differ as to how a work should be characterized.

[Even] within the field of fact works, there are gradations as to the relative proportion of fact and fancy. One may move from sparsely embellished maps and directories to elegantly written biography. The extent to which one must permit expressive language to be copied, in order to assure dissemination of the underlying facts, will thus vary from case to case.(36)

For example, in numerous cases in different courts over the same copyrighted material, different determinations were reached regarding the nature of the works of L. Ron Hubbard, the founder of the Church of Scientology.(37) While some judges found Hubbard’s works to be very creative and imaginative,(38) others found Hubbard’s writings more factual and informative.(39)

Second, a court will determine whether or not a work is published. While this is ordinarily a relatively easy finding, the implications are great. The scope of fair use is narrower with respect to unpublished works.(40) Again, policy goals of the Copyright Act are at work. The Supreme Court said it best in Harper & Row:

While even substantial quotations might qualify as fair use in a review of a published work or a news account of a speech that had been delivered to the public or disseminated to the press, the author’s right to control the first public appearance of his expression weighs against such use of the work before its release. The right of first publication encompasses not only the choice whether to publish at all, but also the choices of when, where, and in what form to publish a work.(41)

Thus, published works, while still protected, are nevertheless available to be transformed into new works, commented upon, criticized, or utilized in teaching or research. An example of the published/unpublished determination can be found in yet another Church of Scientology case where the court ultimately found fair use of published works, but against fair use with respect to unpublished works posted on the Internet.(42)

D. §107(3) Factor Three – The Amount and Substantiality of the Portion Used:

This factor is also made up of two elements: a quantitative analysis and a qualitative analysis. With respect to the quantitative element, the extent of the permissible copying varies with the purpose and character of the use as determined in factor one as well as foreshadowing the fourth statutory factor by revealing the degree to which the new work may serve as a market substitute for the original or its potentially licensed derivatives.(43) For example, in Harper & Row, the Court said that substantial quotations of Ford’s memoirs would have been permissible had Nation not “scooped” Time, thus destroying the commercial value of the serialization rights (factor four).

When measuring this factor, courts often use percentages to express the amount of copying that has taken place. However, because no percentage can be called a bright line, courts also will simply characterize the amount of copied material. Some will do both.(44) Because “no plagiarist can excuse the wrong by showing how much of his work he did not pirate,”(45) a second analysis is warranted.

The second portion of this analysis measures the qualitative element of the copied work. The closer the copied material comes to the “heart” of the original work, the less fair use is allowed. In Harper & Row, Nation had taken only 300 words from Ford’s entire manuscript. However, those words constituted “the heart of the book” as they dealt with Nixon’s pardon. As one editor testified at the trial, the chapter on the pardon was “the most interesting and moving part of the entire manuscript.”(46) Likewise, the Court in Campbell found that the use of the opening guitar riff from Roy Orbison’s Oh Pretty Woman, was the heart of that work. It too was the portion taken by 2 Live Crew and incorporated into the new work.(47) A problem under this determination is deciding who measures the “heart” of the work. In many cases, it is the portion taken by defendant that is deemed the “heart” of the work. In one case involving raw video news footage, the Ninth Circuit held this factor against the defendant who had taken only several seconds of footage for use on the evening news. The court reasoned that in preparing a newscast, editors selected the most effective and illustrative scenes from the raw footage available.(48) The analysis was similar in Michigan Document Services v. Princeton University Press where an 8-5 split full panel of the Sixth Circuit held that a commercial copyshop’s reproduction of substantial segments of copyrighted works of scholarship was not fair use when bound into “coursepacks” and sold to students for use in fulfilling reading assignments given by university professors.(49) The panel noted that the excerpts were selected by the professors, and that alone could serve as an indicia of the heart or “value” of the copied work.

Balancing these two determinations together provides another opportunity for courts and reasonable people to differ. While copying of entire works generally causes this factor to tilt toward the original author, other cases are not so clear cut. Courts have had to consider the amount and substantiality of portions taken from photographs(50) and film clips,(51) motion picture series characters and plots,(52) television series,(53) children’s book series,(54) and radio programs,(55) just to name a few.

E. §107(4) Factor Four – Effect of the Use on the Market:

The Supreme Court stated in Harper & Row that the fourth statutory factor, the effect on the potential market, was “undoubtedly the single most important element of fair use.”(56) Although a couple of recent appellate court opinions have suggested that the Supreme Court may have now abandoned that idea and considers no one factor to be more important than the others,(57) one can easily surmise that this is the most important factor to the litigants, and probably the motivating factor in the lawsuit.

Like the other factors and elements of the fair use analysis, the fourth factor does not operate in a vacuum. Determinations and characterizations made in factors one through three will affect the outcome of factor four. “Market harm is a matter of degree, and the importance of this factor will vary, not only with the amount of harm, but also with the relative strength of the showing on the other factors.”(58)

The burden of proof to show market effect hinges on whether the court has determined the use to be commercial or non-commercial. If the challenged use is non-commercial, the burden of showing market effect (usually harm) lies with the copyright holder. Conversely, the party asserting the fair use defense has the burden of showing no market effect if their use has been deemed commercial in nature.(59)

Once the burden has been laid upon the appropriate party, market harm (or lack thereof) can be shown several ways. First, a party can show the direct effect on the market. An example of this can be found in Sega Enterprises v. Maphia, et. al.(60) Sega involved a BBS (which is a computer bulletin board accessible to users by modem) which offered 22 video games created or licensed by Sega as well as six “beta” versions of games soon to be released. Subscribers to the BBS could upload or download games onto the system. The defendant sold “converters” that allowed the downloaded data to be converted into a game that could be played on a Sega machine. Obviously, this was not a fair use. The infringement competed in the marketplace with its original author.

A second way to measure market harm is to “show that if the challenged use should become widespread, it would adversely affect the potential market for the copyrighted work.”(61) Evidence of “substantial harm”(62) would weigh against a finding of fair use because the licensing of derivatives is an important economic incentive to the creation of originals. This is the preferred test. A commercial use infringer is thus burdened with the awesome task of showing that if its use were to become prevalent, that it still would not affect the potential market for the copyrighted work.

“Potential market” includes the market for derivative works as well as licensing possibilities. While this initially would seem to be almost limitless, it is in fact limited by common sense. As the Second Circuit recognized in American Geophysical, a copyright holder with no license agreement can always claim some degree of adverse effect on its potential licensing revenues because of the defendant’s use.(63) However, “[t]he market for potential derivative uses includes only those that creators of original works would in general develop or license others to develop.”(64) In fairness, only “traditional, reasonable, or likely to be developed markets” are considered. Evidence of a copyright holder’s current and future plans for derivative works or licensing would be highly probative in defining the copyrighted work’s “potential market.”(65) A defendant may be permitted to fill a market niche that the copyright owner has no interest in occupying.(66) Likewise, if the copyright holder has an interest or has begun to exploit a licensing market, then potential revenues from such licenses are appropriately considered under the fourth factor.(67)

An illustrative case applying this factor is Infinity Broadcasting v. Kirkwood.(68) Kirkwood had placed radio receivers in each of America’s ten largest radio markets. Through use of a touch-tone telephone, his customers could dial into a receiver in a particular city and listen to a broadcast in these cities in real-time. Kirkwood’s service thus rebroadcast copyrighted radio programs for a profit and without the payment of royalties to any of the radio stations which he made available to his customers. The court found that Kirkwood’s use was fair. This decision was based in large part on the fact that Kirkwood served a different market than the radio stations. Infinity’s purpose, the court said, was to generate revenues from advertisers and syndication rights, thus their market was the masses. The parties had stipulated however, that Kirkwood’s service was not intended for the general public, but had been marketed to radio stations, consultants, advertisers, performance rights organizations and others in the advertising and entertainment industries.(69) The court determined that Kirkwood’s service had no impact on the value of Infinity’s copyrighted programs as a means of generating advertising or syndication revenues.(70)

Other examples of the nuances of the fourth factor demonstrate that while the market must be “traditional and reasonable”, the harm experienced by that market may go beyond the normal economic harms. In Dr. Seuss Enterprises v. Penguin USA,(71) the court found market harm from the adverse affect on Dr. Seuss’s reputation and good will resulting from the defendant’s book about the O.J. Simpson murder trial.(72) In Metro-Goldwyn-Meyer v. American Honda,(73) the court found market harm in loss of potential endorsement value and “tie-in” marketing of products with motion pictures.(74) Market harm is not always found just because litigants are market competitors. In Sega Enterprises v. Accolade,(75) the Ninth Circuit Court of Appeals found that notwithstanding the fact that the parties were competitors and that Sega would suffer minor economic loss, Accolade’s copying of a limited amount of source code in the process of reverse engineering that code was permissible because it was necessary for Accolade to produce games compatible with the Sega player.(76) As these examples have shown, the fourth factor analysis has evolved into an amorphic and sometimes unwieldy determination. Counsel should always consider the wide variety of arguments that can be made under this factor.(77)

IV. INTERNET SCENARIOS/HYPOTHETICALS

As mentioned earlier, new technologies in multimedia and especially the Internet have heightened concern among many that copyrights will no longer be respected in the digital age. This has resulted in a spate of bills being introduced into Congress in an effort to amend the Copyright Act for purposes of clarification and sometimes to grant immunities.(78) Regardless of the outcome of these bills, the fair use defense still remains a viable argument in the face of infringement. The following are a series of scenarios and hypotheticals which are provided to show the range of situations in which the fair use defense could be raised in the context of the Internet.

• Al browses on-line and “surfs the web.” As he does so, Al’s computer makes copies onto its hard drive of every page viewed during Al’s on-line session. While it’s generally considered that there is an implied license for users to do this, one court has suggested that this is also a fair use.(79)

Ÿ While surfing the web at the office, Betty visits CNBC.com. There she sees an interesting but rather long story on the life of Princess Diana. Not having time to read it, Betty prints it out to read on the train ride home. Betty’s use is similar to media/time shifting which was approved by the Supreme Court in Sony.(80) It also is permissible to make copies for convenience,(81) and clearly making a single hard copy of an interesting article on the web would constitute fair use under both Sony and American Geophysical.

Ÿ Charlie is concerned about the plight of Angola. He maintains a non-commercial(82) web site espousing the increase in U.S. aid to Angola and detailing the conditions of Angolans and the corruption in their government. To lend credibility to his position, Charlie copies sections of text as well as some photos and maps from magazines and news-related web sites such as CNN.com which are incorporated into his web site. Charlie’s use of the copyrighted material is probably fair. Newsgroup discussions and web sites of current events, political or celebrity figures, social movements, news or editorial commentary would generally be fair(83) because 1) news-related and factual materials are accorded lower protections than other types of copyrighted materials;(84) 2) comment and criticism are recognized fair uses under §107; 3) the copied portions are only what was necessary to convey the facts or ideas;(85) 4) the use is non-commercial in nature;(86) and 5) there is a First Amendment free expression aspect to web sites of this type. This is reflected in the idea that the scope of fair use is wider when the use relates to issues of public concern.(87)

• Dolly is a big fan of daytime soap operas, particularly All My Children. While watching each day, Dolly faithfully takes notes detailing the plot twists of the show. Later, she updates the non-commercial web site she maintains as a sign of her devotion to the show. It contains an on-going general plot summary dating back to 1993 along with Dolly’s commentary on the characters and her predictions about where the show should go. She also provides a means for visitors to exchange commentary about the show with each other. Dolly has many “regulars” and has even proudly posted a letter she received from the head writer of All My Children commending her on her home page.(88) Dolly’s use would most likely be fair, in large part because her use is transformative, non-commercial and because she does not cause any market harm. Her commentary and predictions would be sufficiently transformative to negate what little market harm she might do to the show. Further, there seems to be little market for syndication of daytime soap operas after they have aired, and Dolly’s letter from the head writer would seem to be an acquiescence.

• Eddie, Dolly’s cousin, is a devoted fan of the sitcom Seinfeld. Like Dolly, he too maintains a web site to pay homage to his favorite show. As a matter of fact, there are about 75 other web sites maintained by people like him. But Eddie’s site is very popular, and for good reason. By visiting his page, one can download audio and video clips of the show Eddie dubbed off his VCR. Eddie also has posted the entire script (along with stage directions) of every Seinfeld episode. After Eddie started getting over a thousand “hits” a day on his site, he decided to start selling advertising on his page to off-set his expenses and make a little money on his hobby. Eddie’s use is not fair. Not only is his use commercial, but the extent of his copying rises to a level where it could potentially interfere with the market for derivative works or decrease the syndication value of the show.(89) It is possible that a person who missed Seinfeld on Thursday night could visit Eddie’s site and read the script, as well as see and hear some of the “highlights” of the show without having to rent a video or tune-in to the re-run.(90)

• Frank just developed a new technology that will provide a means by which “micropayments” can be made for viewing material on-line. For example, as a part of a user’s monthly access fee with his Internet provider, he deposits a sum into a debit account. Now when he visits the New York Times site on-line, he is presented with an initial menu page. When he selects a story to read, several cents are deducted from his account. Frank’s invention could have profound effects on the Internet, because now, every hyperlink is potentially commercial in nature(91) and market harm under the fourth factor would be more easily shown. This technology, by the way, is only a few years from reality.

• Gertrude is a consumer activist. She heads an organization called LobbyWatch which publicizes the activities of lobbyists to those outside the beltway. Her principal targets are the lobbying activities of big tobacco, the gun lobby, and insurance carriers. Gertrude’s web site regularly posts flyers and mass mailings that such groups send to their members (Gertrude is on the mailing list) and form-letters that such groups mail to Congressional representatives which Gertrude surreptitiously obtains from a friend who is a Capitol Hill staffer. Gertrude posts the letters in their entirety, and offers no comment on the page with them. In an effort to frustrate Gertrude, several of the lobbyists began placing copyright notices on their letters before sending them out . They then bring suit against LobbyWatch for copyright infringement. Gertrude’s assertion of the fair use defense presents some interesting questions. Gertrude’s use would be considered comment or criticism, and arguably news, scholarship or research. Gertrude’s use is non-transformative. Although the use of the letters would be competitive in the sense the user is criticizing the lobbying efforts, such type of use is not considered to affect the market as is relevant under the fourth fair use factor.(92) There is a First Amendment aspect to Gertrude’s use in that it fosters public debate in the marketplace of ideas. The lobbyists letters are surely eloquent, but would likely be held to be of a factual or informative nature.(93) Additionally, their nature as brief, persuasive documents would make it difficult to separate the ideas contained within them from their expression.(94)

With respect to the letters that Gertrude received from the lobbyists which they mailed to their constituents, her use would likely be held fair. The posting of documents she obtained surreptitiously however, may not be fair use. Assuming the letters to the Congressmen were held to be unpublished, this would militate against an application of fair use. Gertrude’s acts could also be found to constitute bad faith, and as such would weigh against her under the fair use analysis.(95)

This hypothetical is an example of how complex a fair use fact pattern and analysis can become in the face of competing interests and policies. The outcome of a case such as this could vary from court to court and could be easily be overturned numerous times on its way through the appellate process.

V. CONCLUSION: FAIR USE IN THE DIGITAL FRONTIER

The old adage “the more things change, the more they stay the same” is particularly appropriate when discussing the effect of new technology on the fair use defense to copyright infringement. While the fair use doctrine dates back to the English common law, it can still be applicable in today’s digital age. A steady eye on the underlying policies of the fair use doctrine and a creative commitment to applying the doctrine to the challenges of multimedia, digital and Internet technologies will allow the practitioner to confidently raise the fair use defense in the face of the most sophisticated technological infringement claims.

___________________________

ENDNOTES

1 Religious Technology Center v. Lerma, 40 U.S.P.Q.2d 1569 (E.D.Va. 1996).

2 U.S. Constitution, Art. I, Sec. 8.

3 Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417, 429 (1984).

4 Nimmer On Copyright §1.10[B][2].

5 Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 556 (1985) quoting Consumers Union of U.S. v. General Signal Corp. 724 F.2d 195, 203 (2nd Cir. 1983).

6 Harper & Row, 471 U.S. at 556 (explaining Justice Brennan’s concurrence in N.Y.Times v. U.S. 403 US 713, 726 (1971)).

7 International News Service v. Associated Press, 248 U.S. 215, 234 (1918).

8 Harper & Row, at 556-57.

9 Luther R. Campbell v. Acuff-Rose Music, Inc., 114 S. Ct. 1164 (1994) citing Carey v. Kearsley, 4 Esp. 168, 170, 170 Eng. Rep. 679, 681 (K.B. 1803) (Lord Ellenborough).

10 See Id. at 12-13. All citations to the Campbell decision are to 1994 U.S. LEXIS 2052 pagination.

11 Emerson v. Davies, 8 F. Cas. 615, 619 (No.4,436) (CCD Mass. 1845).

12 Campbell, at 15.

13 The statute is clearly influenced by Justice Story’s early judicial doctrine. In Folsom v. Marsh, Story set forth what became the basis for statutory fair use: “look to the nature and objects of the selections made, the quantity and value of the materials used, and the degree in which the use may prejudice sale, or diminish the profits, or supersede the objects, of the original work.” 9 F. Cas. 342, 348 (No. 4,901)(CCD Mass. 1841).

14 Nimmer On Copyright §13.05; a prima facie case of copyright infringement is established by the plaintiff showing: 1) ownership of the copyright, and 2) copying of the constituent elements of the work that are original. Nimmer, at §13.01.

15 Campbell, at 16 (quoting H.R. Rep. No. 94-1476, p. 66 (1976); S. Rep. No. 94-473, p. 62 (1975)) (hereinafter Senate Report).

16 Campbell, at 16 (quoting Stewart, et. al v. Abend, 495 US 207, 236 (1990)).

17 Campbell. at 17; Nation at 560; Sony at 448.

18 Campbell, at 17.

19 Campbell, at 17 (quoting Senate Report at 62).

20 855 F. Supp. 905 (E.D. Mich. 1994).

21 74 F.3d 1512 (6th Cir. 1996); 1996 WL 648261

22 99 F.3d 1381 (6th Cir. 1996), cert. denied, 117 S. Ct. 1336 (1997).

23 “The malleability of fair use emerges starkly from the fact that all three [of the Supreme Court’s recent fair use decisions – Harper & Row, Sony, and Campbell] were overturned at each level of review, [and]two of them split opinions at the Supreme Court level.” Nimmer, at §13.05.

24 B. Kaplan, An Unhurried View of Copyright, vii-viii (1967).

25 Religious Technology Center v. Lerma, 40 U.S.P.Q.2d 1569 (E.D.Va. 1996).

26 §107

27 37 F.3d 881 (2nd Cir. 1994).

28 108 F.3d. 1119 (9th Cir. 1997).

29 Conversely, the Supreme Court found the taping of programming for later viewing to be a non-infringing fair use although “time-shifting” is not one of the named uses. Sony, 464 U.S. 417 (1984).

30 American Geophysical Union v. Texaco, 60 F.3d 913, 922, n. 8 (2nd Cir. 1994).

31 Harper & Row, at 562; citing Sony, at 451. In Harper & Row, the Supreme Court said the use of the excerpts was not a fair use.

32 Campbell, at 28-33. In Campbell, the Supreme Court sent the case back for further proceedings.

33 Campbell, at 19.

34 Campbell, at 19-20.

35 Harper & Row, at 563.

36 Id. at 563, quoting Gorman, Fact or Fancy? The Implications for Copyright, 29 J. Copyright Soc. 560, 561 (1982).

37 “[R]easonable people can disagree over how to classify Hubbard’s works.” New Era Publications Int’l v. Carol Publishing Group, 904 F.2d 152, 158 (2d Cir. 1989).

38 “The undisputed evidence shows that L. Ron Hubbard’s works are the product of his creative thought process, and not merely informational.” Bridge Publications, et. al. v. Vien, 827 F. Supp. 629, 635-36 (S.D. Cal. 1993)

39 Religious Technology Center v. Lerma, 908 F.Supp. 1362, 1367 (E.D.Va. 1995).

40 Harper & Row, at 564.

41 Id.

42 Religious Technology Center v. Netcom, 1995 U.S. Dist. LEXIS 16184 (N.D.Cal. 1995).

43 Campbell, at 34 citing Sony, at 449-50, Harper & Row, at 564, and Leval, Toward a Fair Use Standard, 103 Harv. L. Rev. 1105, 1123 (1990).

44 See Harper & Row, at 565. The Court mentions a percentage, but then says infringing article “structured around quotes which serve as dramatic focal points.”

45 Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d. 49, 56 (2d Cir. 1936).

46 Harper & Row, at 565.

47 Campbell, at 37. The Court recognized that in cases of parodies, taking the heart of the original is necessary because it is assured of conjuring up the original in the minds of the parodist’s audience. The Court further said that a parodist should take no more than is necessary to conjure up the original.

48 Los Angeles News Service v. Audio Video Reporting Service, 973 F.2d 791 (9th Cir. 1992).

49 99 F.3d 1381 (6th Cir. 1996), cert. denied, 117 S. Ct. 1336 (1997).

50 See Art Rogers v. Jeff Koons, 960 F.2d 301 (2d Cir. 1992) (photograph of couple holding eight puppies copied by defendant in sculpture not fair use); Leibovitz v. Paramount Pictures, 948 F. Supp. 1214 (S.D.N.Y. 1996) (Leslie Neilsen advertisement for upcoming film Naked Gun 33 1/3: The Final Insult held fair use parody of Demi Moore’s nude, pregnant photo for cover of Vanity Fair).

51 See Monster Communications, Inc. v. Turner Broadcasting System, Inc., 935 F.Supp. 490 (S.D.N.Y. 1996) (court denies plaintiffs request for injunction against the release of Turner’s When We Were Kings, a movie about the life of Muhammad Ali; court finds that Turner is likely to show that its use of less than two minutes of footage from Ali’s 1974 heavyweight title fight is a fair use).

52 See Metro Goldwyn Mayer, Inc. v. American Honda Motor Co., 900 F.Supp. 1287 (C.D.Cal. 1995) (Honda Del Sol commercial which portrays “a high-thrill chase of the ultra-cool British charmer and his beautiful and alarming sidekick by a grotesque villain in which the hero escapes through wit, aided by high-tech gadgetry” held not fair use of “classic James Bond adventures”).

53 See Twin Peaks Productions, Inc. v. Publication Int’l, Ltd., et. al., 996 F. 2d 1366 (2d Cir. 1993) (Defendant’s book describing aspects of the first season of the Twin Peaks television series and which contained information on characters detailed plot summaries and trivia held not fair use of series copyrights); Castle Rock Entertainment v. Carol Publishing, 955 F. Supp. 260 (S.D.N.Y. 1997) (Defendant’s Seinfeld Aptitude Test, a book consisting of trivia about the show, identified and appropriated the most important elements of the sitcom Seinfeld – no fair use).

54 See Dr. Seuss Enterprises v. Penguin Books USA, 109 F.3d 1394 (9th Cir. 1997) (Defendant’s book The Cat NOT in the Hat about the Brown/Goldman murders and OJ Simpson’s trial held not fair use of the Cat in the Hat).

55 See Infinity Broadcasting v. Kirkwood, 965 F.Supp 553, 557 (S.D.N.Y. 1997) (court held third factor against defendant’s service based on “fairness” because neither party could show the extent of actual retransmission, let alone the content, and defendant’s service allowed subscribers to monitor radio programs in distant cities 24 hours a day).

56 Harper & Row, at 566, citing Nimmer §13.05

57 See American Geophysical, 60 F. 3d, at 926.

58 Campbell, at 42, n. 21.

59 Sony, at 451.

60 948 F. Supp 923 (N.D.Cal. 1996).

61 Harper & Row, at 568, quoting Sony, at 451.

62 Campbell, at 46.

63 American Geophysical Union v. Texaco, Inc., 60 F.3d 913 (2d Cir. 1994).

64 Campbell, at 44.

65 Litigants should always address the market for derivatives and licenses. In Campbell, 2 Live Crew asserted that its use of the song Pretty Woman was a parody. While the Court did find the band’s use to be parody, the Crew was put at a disadvantage under factor four because they failed to address the potential market for a non-parody rap version of Pretty Woman. The Court sent the case back for further proceedings on this issue.

66 Twin Peaks Productions, Inc. v. Publication Int’l, Ltd., et. al., 996 F. 2d 1366, 1377 (2d Cir. 1993).

67 American Geophysical, at 930.

68 965 F. Supp 553 (S.D.N.Y. 1997).

69 These were the typical users of Kirkwood’s service who used it to monitor advertising, gather statistical data for performance rights organizations, or audition on-air talent.

70 This is a good place to remind the reader of the impact of the other three factors in the overall outcome of a fair use determination. The court found factor one favored Kirkwood because although his retransmissions were not transformative, they were for a limited and different purpose than used by Infinity. As Kirkwood’s use was for a commercial purpose, many courts would have held that this factor favored Infinity. Factor two went to Infinity with the recognition that its copyright was predominately a compilation composed of independently copyrighted works (songs, commercials). Factor three went to Infinity as well because Kirkwood offered the possibility of retransmission of entire copyrighted works.

71 109 F.3d 1394 (9th Cir. 1997).

72 The defendant’s book was an attempt at parody entitled The Cat NOT in the Hat! The court borrowed a market harm test from the Second Circuit which sought to “strike a balance between the benefit the public will derive if the use is permitted and the personal gain the copyright owner will receive if the use is denied. The less adverse effect that an alleged use has on the copyright owner’s expectation of gain, the less public benefit need be shown to justify the use.” Id at 1403, quoting MCA, Inc. v. Wilson, 677 F.2d 180, 183 (2d Cir. 1981).

73 900 F.Supp. 1287 (C.D.Cal. 1995).

74 The court found the fourth factor to tip in favor of MGM because Honda’s use of the James Bond-like character and scenes diluted the market value of movie tie-ins and endorsements by Bond movies. The court specifically noted the arrangements to feature the BMW Z3 Roadster in the movie Goldeneye. “The court can very well imagine [that] a majority of the public, when viewing the Honda commercial and a future BMW ad, would come to the conclusion that James Bond was endorsing two automobile companies.” Id. at 1301.

75 Sega Enterprises, Ltd. v. Accolade, Inc., 977 F.2d 1510 (9th Cir. 1992).

76 Significant to this case was the fact that deconstructing Sega’s code was essential to allow Accolade to produce a game to be played on the Sega game player. After noting that it was free to consider public benefit resulting from a particular use, the court held that “an attempt to monopolize the market by making it impossible for others to compete runs counter to the statutory purpose of promoting creative expression and cannot constitute a strong equitable basis for resisting the invocation of the fair use doctrine.” Accolade, 977 F.2d at 1523-24.

77 When the potentially infringing uses are parody or criticism, courts have recognized since Campbell that even if the use is commercial in nature, the parody or criticism does not generally cause market harm to the copyright holder because the two uses serve different purposes. Authors do not typically also produce parodies of their own works nor can a criticism, scathing though it may be, compete in the marketplace with the original. See Campbell, at 40-48.

78 See, e.g., WIPO Copyright and Performance and Phonograms Treaty Implementation Act of 1997 (introduced in the Senate); Digital Copyright Clarification and Technology Education Act of 1997 (introduced in the Senate). Both available at <http://thomas.loc.gov>

79 Religious Technology Center v. Netcom On-Line, et. al., 1995 U.S. Dist. LEXIS 18173 (N.D.Cal. 1995). This court suggests that browsing on-line is the functional equivalent of reading a book in a library (although thousands can read at once) and that there is not, at least at this point, a market for licensing the temporary copying of digital works onto computer screens to allow browsing. Id. at 47.

80 Sony, at 455 n. 40.

81 American Geophysical, 60 F.3d at 923.

82 The term “non-commercial” web site will be used to refer to those sites which do not derive revenues through subscriptions, passwords, advertisements or other commercial support. Such sites are typically maintained by individuals who pay for the site out of their own pocket.

83 Compare Religious Technology Center v. Lerma, 40 USPQ 2d 1569 (E.D.Va. 1996) (even though defendant’s use was non-commercial, posting entire unpublished works went beyond fair use).

84 “The law generally recognizes a greater need to disseminate factual works than works of fiction or fantasy.” Harper & Row, at 563.

85 The greater the portion taken from the original, the less it looks like fair use. “[N]o more of a work may be taken than is necessary to make the accompanying comment understandable.” Supermarket of Homes, Inc. v. San Fernando Valley Board of Realtors, 786 F.2d 1400, 1409 (9th Cir. 1986).

86 However, the more transformative the use, the more commercial the site could be. The new work must be more than “merely the product of ‘the facile use of scissors.’ [or cut and paste as the case may be].” Maxtone-Graham v. Burtchaell, 803 F.2d 1253, 1260 (2d Cir. 1986) (quoting Folsom v. Marsh, at 345). See supra Section III.A.

87 National Rifle Association v. Handgun Control Federation of Ohio, 15 F.3d 559 (6th Cir. 1994).

88 These facts are a variation on one of many Beverly Hills 90210 sites on the web. One site in particular claimed “visits” from cast members and posted a letter from the show’s executive producer who offered suggestions and inside information.

89 Seinfeld’s producers, it turns out, have asserted their rights when individuals have sought to “cash in” on the show’s popularity. See Castle Rock Entertainment v. Carol Publishing, Inc., 955 F. Supp. 260 (S.D.N.Y. 1997). The court held that a Seinfeld trivia book took too much and competed in a marketplace which the plaintiff was likely to enter.

90 In Twin Peaks Productions v. Publications International, 996 F.2d 1366 (2nd Cir. 1993), the defendant’s unauthorized book about the characters, story and social phenomena of the first season of the television series Twin Peaks was found to make an unfair use of the copyrighted scripts of the show. The defendant’s detailed plot summaries, the court said, would allow someone to read the book to find out what happened the first season instead of renting a video. “The author of Twin Peaks cannot preserve for itself the entire field of publishable works that wish to cash in on the Twin Peaks phenomenon. But it may rightfully claim a favorable weighing of the fourth fair use factor with respect to a book that reports the plot in such extraordinary detail as to risk impairment of the market for the copyrighted works themselves or derivative works that the author is entitled to license.” Id.

91 See Pamela Samuelson, The Copyright Grab, Wired, Jan. 1996, available at <http://wwww.wired.com/wired/4.01/features/whitepaper.html> Samuelson’s article, among other things, criticizes a proposal, adamantly rejected to date, to exclude any material for which payments could be collected on a reasonable basis for even de minimus copying from being available under fair use.

92 It is unlikely that a lobby group would ever license this type of use, so the market analysis may be more akin to that of parody or criticism. There is no protectable derivative market for criticism. Courts have realistically acknowledged that it is “unlikel[y] that the creators of . . . works [would] license critical reviews . . . of their own product.” Campbell, at 45. Even if a court found Gertrude and the lobbyists to be competitors, it is likely that greater principals of public concern and freedom of expression issues would be over-riding. More than one court has factored in public concern and benefit when analyzing the fourth factor. See National Rifle Association v. Handgun Control Association, 15 F.3d 559 (6th Cir. 1994) (use was fair because it was related to petitioning the government on legislation and commenting of public issues); Sega Enterprises v. Accolade, Inc., 977 F.2d 1510, 1523 (9th Cir. 1992) “Public benefit need not be direct or tangible, but may arise because the challenged use serves a public interest.”

93 See Religious Technology Center v. Lerma, 40 U.S.P.Q. 2d 1569 (EDVa 1996) (works that were intended to be informational in nature rather than creative further from the core of copyright protection).

94 See Harper & Row, at 564 (President Ford’s characterization of the “smoking gun” difficult to convey without using his exact words).

95 See Religious Technology Center v. Netcom On-Line, 1995 U.S. Dist. LEXIS 16184 (N.D. Cal. 1995) (obtaining copies in an unauthorized manner, while not fatal to a fair use defense, tends to weigh in plaintiff’s favor and will be considered among the other factors). Often in such close cases, courts will look for “bad guy” behavior on the part of one party.

The above information is provided for general educational purposes and not as legal advice. Laws in areas in which we practice change continually and also vary from jurisdiction to jurisdiction. Therefore no visitor to our site should rely on any of the articles provided for legal advice, but should always consult their own attorney regarding legal matters.

© 1997, Rob Hassett, Atlanta, Georgia. All Right Reserved.

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