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November 4, 2014

Copyright Fair Use – Is “Transformativeness” The Key?

Fair use is a statutory defense to copyright infringement. The fair use statute, 17 U.S.C. § 107, suggests certain types of uses that generally may qualify as fair use, and identifies four factors a court must consider to decide when any particular use qualifies.  The statute 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.

Until recently, case law identified the fourth factor, the effect of the use on the potential market for the original work, as the most important.  But in a 2012 case, Cariou v. Prince, the Second Circuit arguably shifted emphasis to the first factor, and particularly whether the new use qualified as “transformative” .

Cariou is a professional photographer who published an anthology of photographs of Rastafarians.  Years later, the self-styled “appropriation artist” Prince, copied Cariou’s photographs and altered them to varying degrees to create a series of works of his own.  The alterations ranged from wholesale changes that left Cariou’s images barely recognizable to mere pasting of colored ellipses over the subjects’ eyes.  The district court found Prince guilty of copyright infringement ,but the Second Circuit reversed.  The most significant factor in the Second Circuit’s decision was the court’s finding that many of Prince’s works were undoubtedly “transformative”, defined as “add[ing] something new, with a further purpose or different character.”  The Second Circuit held that a number of the Prince works “manifest an entirely different aesthetic from Cariou’s photographs.”

A recent decision from the Seventh Circuit, however, suggests that emphasis on “transformativeness” may not take hold elsewhere.  In Kienitz v. Sconnie Nation the Seventh Circuit pointed out that the Second Circuit approach risks interfering with one of the rights the Copyright Law grants to copyright owners: the exclusive right to create derivative works.  Derivative work is defined in the Copyright Act as  “a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted.”  The Seventh Circuit asked, basically: what else is a derivative work but a transformative use of an existing work?  The court wrote: “We’re skeptical of Cariou ‘s approach, because asking exclusively whether something is “transformative” not only replaces the list in § 107 but also could override 17 U.S.C. § 106(2), which protects derivative works. To say that a new use transforms the work is precisely to say that it is derivative and thus, one might suppose, protected under § 106(2). Cariou and its predecessors in the Second Circuit do not explain how every “transformative use” can be “fair use” without extinguishing the author’s rights under § 106(2).  We think it best to stick with the statutory list, of which the most important usually is the fourth (market effect).”

These recent cases should cause parties analyzing their likelihood of success on a fair use defense to consider most carefully how they think they will fare on the first factor (purpose and character of the use, the factor in which courts consider whether a work is transformative) and the fourth factor (effect on the market).  Once they decide that, they may then seek to gain advantage by steering their case to, or away from, the Second Circuit and its emphasis on “transformativeness.”