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New Fair Use Cases for 2015: Rosen v. eBay and Fox v. DISH

It’s Copyright Week, a series of actions and discussions supporting key principles that should guide copyright policy. Every day this week, various groups are taking on different elements of the law, and addressing what’s at stake, and what we need to do to make sure that copyright promotes creativity and innovation!  Today’s topic is “Fair Use Rights: For copyright to achieve its purpose of encouraging creativity and innovation, it must preserve and promote ample breathing space for unexpected and innovative uses.”

In 2014, courts gave us some wonderful fair use cases, including several dealing with creation of searchable databases. In Authors Guild v. HathiTrust, for example, the Second Circuit strongly affirmed the right of fair use, finding in favor of HathiTrust’s creation of a full text search database and provision of accessible formats for the print disabled. In the long-awaited opinion White v. West Publishing, the Southern District of New York affirmed that ingesting briefs into a search database was a new use with a different character from the original briefs. Fox News v. TVEyes provided yet another case in which aggregating copyrighted works into a searchable database, this one dealing with video and audio works rather than text, was affirmed as fair use. For more fair use cases from last year, Dan Nabel, guest posting on Eric Goldman’s blog, has a great roundup of the top ten cases in 2014.

Just weeks into 2015, the Central District of California has already decided at least two new cases with fair use components (both cases involved several other copyright and contractual issues), finding largely in favor of fair use.

Rosen v. eBay — Photographing physical works for the purpose of re-selling the physical works

This case involves a lawsuit by Barry Rosen, a professional photographer, against eBay asserting, among other issues, that photographing physical magazines containing his images and posting them on eBay’s auction site violated his copyright. eBay argued that a photograph of the physical magazine was fair use.

The district court found that the photographs of the magazine “as used to represent physical magazines for resale, constitutes fair use.” It found that the use was transformative because while the original photographs were created for artistic purposes, the photographs of the magazines were used to provide information as to the condition and content of the magazines being sold. The court noted that, “the public also benefits greatly from being able to evaluate the magazines offered for sale legitimately under the first sale doctrine.” The court also found that photographing the magazine was necessary for its purpose and that the effect on the market was minimal.

Furthermore, the court rejected Rosen’s claim that fair use applies only to certain types of infringement and “the fair use doctrine applies to all forms of use of copyrighted works.” Holding otherwise, the court stated, “would drastically limit the ability of any person to resell any visual copyrighted work except to those in the physical presence of the work.”

Fox Broadcasting v. Dish Network — Time-shifting and place-shifting

Dish Network offered services that record television shows and skip over commercials, asserting that such technology was fair use, and was subsequently sued by various networks. The case involved a number of copyright and contractual issues; while the court found largely in favor of fair use for time-shifting and place-shifting technology, it also found that Dish Network may be liable for breach of contract.

The district court found that the “PrimeTime Anytime” service, which allowed users to record prime time television shows and skip over the commercials, constituted fair use under Universal Studios v. Sony (the “Betamax” case in which the Supreme Court ruled that videotaping a television broadcast was fair use). The district court summarized, “Sony established that it is fair use for users to make individual copies of television shows from broadcast television for purposes of noncommercial, nonprofit time-shifting.” The district court found that even though a market exists in which Fox licenses its programming to third parties to be distributed commercial-free, DISH’s PrimeTime Anytime service constituted fair use because the service did not compete with this market. The court noted that DISH subscribers had access to other services to record programming manually using other DVR technologies and that the recordings through the PrimeTime Anytime service was only available for eight days unless the subscriber affirmatively saved the recording in another folder. The district court then concluded that “The potential for market harm to the secondary market for Fox’s program caused by PTAT alone is simply too speculative to defeat a finding of fair use by a time-shifting technology which enhances consumers’ non-commercial private use of recorded programming.” While finding in favor of fair use of the PTAT technology, however, the court ruled against fair use for the copies DISH made as “quality assurance” copies finding that they were non-transformative.

After ruling in favor of DISH’s time-shifting technology, the court also noted that place-shifting is fair use: “Hopper Transfers is a technology that permits non-commercial time- and place-shifting of recordings already validly possessed by subscribers which is paradigmatic fair use under existing law. See Recording Indus. Ass’n of Am., 180 F.3d at 1079 (making copies ‘in order to render portable or ‘space shift’ those files that already reside on a user’s hard drive . . . is paradigmatic noncommercial use.” While this use is itself a fair use, however, DISH may have violated its contractual agreements with Fox.

These first fair use cases of 2015 involve vastly different circumstances, but highlight the importance of the fair use right. Fair use, working in tandem with the first sale doctrine, can provide information to the public about the quality of an item being sold. It can also provide valuable services with new technologies to consumers. As these cases demonstrate, fair use is relied upon every day and the doctrine helps balance copyright law. Of course, fair use extends far beyond the scope of these cases.

As an extremely crucial right touching upon so many facets of every day life, fair use deserves to be highlighted multiple times and we hope you will join us in celebrating this important doctrine during the upcoming Fair Use Week!  More information on Fair Use Week 2015, which will be held February 23-27, is available here.

End of the Authors Guild v. HathiTrust Saga, A Victory for Fair Use

For the past several years, the HathiTrust and five of its member universities have been engaged in litigation after being sued by the Authors Guild. On January 6, 2015, the parties entered a settlement on the sole issue remaining before the district court, ending the litigation in a victory for HathiTrust and fair use.

In its litigation, the Authors Guild alleged that HathiTrust Digital Library’s (HDL) digitization of works for the purposes of use in a full-text search database, providing access to the print disabled, and preservation, as well as the Orphan Works Project developed by the University of Michigan, constituted copyright infringement. The Orphan Works Project was abandoned and not considered ripe for adjudication, while the other issues advanced. The district court found in favor of HDL’s motions for summary judgment on the remaining three issues.

In June 2014, the Court of Appeals for the Second Circuit strongly affirmed fair use, finding that HathiTrust Digital Library’s creation of a full-text search database and providing access to the print disabled constituted fair use. On the issue of preservation, the Second Circuit remanded back to the district court – without determining the merits of whether such preservation constituted fair use – to determine whether the plaintiffs had standing to bring the claim. In its press release on the opinion, the Library Copyright Alliance applauded the decision noting that the

 Second Circuit rightly concluded that HDL’s activities are protected by fair use, ensuring the ‘safety valve’ of fair use is well-functioning and providing meaningful balance through limitations on the copyright holder’s rights. Fair use has long been relied upon to provide important protections for the public and promote new and transformative uses of copyrighted works, such as those facilitated by HDL.

Summaries and analysis of the Second Circuit’s opinion available here and here.

On January 6, 2015, the Authors Guild and HathiTrust settled the preservation issue, with the defendant libraries stipulating that they have complied with Section 108(c) of the Copyright Act and have only made replacement copies where the original was damaged, deteriorating, lost or stolen, and that an unused replacement could not be obtained at a fair price. The defendant libraries further agreed that for a period of five years, if the libraries do not comply with the stipulation, it will notify the Authors Guild, “which, although not a Remaining Plaintiff in this Action, will accept notice.”

While an appeal to the Supreme Court would still be possible, it appears from a release issued by the Authors Guild today that the Guild will not pursue this path. The Authors Guild begins its release noting that the settlement “brought to an end the Guild’s copyright infringement lawsuit against the group of research libraries known as the HathiTrust.”

Ultimately, the Authors Guild v. HathiTrust saga ended in a strong victory for fair use as the Second Circuit opinion will now stand. The library community applauded this opinion when it was released. The opinion had a number of notable implications. It strongly affirmed the use of mass digitization for purposes of facilitating fair uses (such as creation of a full-text search database or access for the print disabled). The Second Circuit also endorsed a “functional transformation” approach in conducting its fair use analysis, finding that a use is transformative if the works is used for a significantly different purpose than its original market purpose. Additionally, the Second Circuit, in a quick footnote, rejected the Authors Guild’s repeated claims that Section 108 of the Copyright Act restricts fair use.

Furthermore, while the parties settled the issue of preservation for purposes of use as a replacement copy, essentially noting that the parties will comply with Section 108(c) of the Copyright Act, practically speaking, as noted by Jonathan Band’s analysis, What Does the HathiTrust Decision Mean for Libraries?, libraries engaged in the activities of HathiTrust can make digital copies:

Because providing full-text search capability justifies the creation and maintenance of a database of text files, a library could create and maintain a database of text files if the library provided full-text search capability of those text files. Likewise, because access to the print disabled justifies the creation and maintenance of a database of image files, a library could create and maintain a database of image files if the library provided the print disabled with access to those image files. Additionally, the library could create appropriate backup copies of these databases.

 

[…]

 

In short, the HathiTrust decision indicates that a library could make digital copies of all the analog works in its collection, and store those copies as text and image files, if the library provided full text-search capability and full-text access to the disabled.

HathiTrust’s press release on the resolution of the litigation is available here.