Appeals Court Overturns Important Fair Use Win Concerning University 'E-Reserves' -- But Potentially For Good Reasons

from the for-the-encouragement-of-learning dept

A few years ago we wrote about an "obscure" but vitally important copyright/fair use case involving Georgia State University. The school was being sued by some publishers (though the lawsuit was financed by the Copyright Clearance Center -- a collection group that collects royalties on these sorts of things) because professors had put certain readings online for download by students as "e-reserves." The big question was how were such things viewed under copyright law. Did it hearken back to a series of lawsuits in the 1990s about "coursepacks" -- which were found to be infringing because they were reproduced by for-profit copy shops) or was it just traditional fair use. Remember, the actual law (17 USC 107) specifically says that "multiple copies for classroom use" is a form of fair use.

More than two years ago, a ruling came out and it was massive. In 350 pages Judge Orinda Evans did a four factors fair use analysis on each and every work named in the lawsuit, eventually declaring the majority of them to be fair use (5 were found to be infringing, others were dumped for not having shown that the publishers held the copyright or for de minimis use). The whole ruling was mostly good, but still fairly messy, and had some weird made up rules in there, such as claiming that it's fair use if the reserve was less than 10% of the book. As we noted, the judge seemed to get "excessively formulaic" in making the fair use call. While that might be expected having to go through so many separate analyses, it's not how fair use is supposed to work.

Now, the 11th Circuit Appeals court has basically overturned the ruling on fair use, in a ruling that comes in at only 129 pages. But the reasoning isn't that bad. It calls out the same problems that worried us when the original ruling came out. The main concern here is that Judge Evans "gave each of the four factors equal weight" when that's not how the factors are supposed to work. They're supposed to be the things that you look at before making a determination on the use as a whole. Furthermore, the appeals court seemed quite reasonably concerned about Judge Evans' formulaic conclusions. The court further rejects the publishers' misplaced argument about "media neutrality" as a reason why the e-reserves should be treated just like coursepacks. That's good.

In the end, the appeals court looks at the four factors, claiming that the use is not "transformative" but that it doesn't really matter, because the use here is for education. There's an awful lot of "on the one hand/on the other hand" reasoning that almost makes it feel like the judges on the panel kept going back and forth until finally deciding when to stop flipping a coin. Where it finally lands, goes back to that whole "multiple copies for classroom use" tidbit in the damn law itself. And thus:
In sum, Congress devoted extensive effort to ensure that fair use would allow for educational copying under the proper circumstances and was sufficiently determined to achieve this goal that it amended the text of the statute at the eleventh hour in order to expressly state it. Furthermore, as described above, allowing latitude for educational fair use promotes the goals of copyright. Thus, we are persuaded that, despite the recent focus on transformativeness under the first factor, use for teaching purposes by a nonprofit, educational institution such as Defendants’ favors a finding of fair use under the first factor, despite the nontransformative nature of the use.
The court says the district court got the 2nd factor wrong (nature of the copyrighted work) by not really looking at each instance, but assuming they were all in favor of fair use. But also admits that the 2nd factor really isn't a big deal in this particular case (again getting at the mistake of trying to weigh all four factors evenly). The 3rd factor (amount of the work) calls out Judge Evans for that weird 10% formulaic calculation.
Here, the District Court found that the third factor favored fair use in instances where Defendants copied no more than 10 percent of a work, or one chapter in case of a book with ten or more chapters.... The District Court’s blanket 10 percent-or-one-chapter benchmark was improper. The fair use analysis must be performed on a case-bycase/ work-by-work basis. Campbell, 510 U.S. at 577, 114 S. Ct. at 1170; see supra discussion accompanying note 20. We must avoid “hard evidentiary presumption[s] . . . and ‘eschew[] a rigid, bright-line approach to fair use.’” Campbell, 510 U.S. at 584–85, 114 S. Ct. at 1174 (quoting Sony, 464 U.S. at 449 n. 31, 104 S. Ct. at 792 n. 31). By holding that the third factor favored fair use whenever the amount of copying fell within a 10 percent-or-one-chapter baseline, the District Court abdicated its duty to analyze the third factor for each instance of alleged infringement individually.
While it can be worrisome to see a fair use win sent back, in this case, it seems to be mostly for the right reasons. That formulaic 10% rule was a strange one and a point that certainly concerned us in the original ruling. Here, the appeals court is pointing out that it's just the wrong way to do fair use analysis.

On the fourth factor, concerning the impact on the market, the court appears well aware of the simple trick of just saying "well, there was a license available, and thus the use harmed the market" noting that this is circular reasoning.
As previously explained, licensing poses a particular threat that the fair use analysis will become circular, and Plaintiffs may not head off a defense of fair use by complaining that every potential licensing opportunity represents a potential market for purposes of the fourth fair use factor.
This follows a lengthy back and forth discussion on whether or not there were licenses available, what impact that has on the fourth factor and which party has the burden here. In the end, the court found that the District Court was correct in its initial analysis of the state of licenses, but failed to take into account the fact that the use was transformative in judging the fourth factor.

Finally, the court is also troubled that the District Court separately looked at the fact that copyright law is supposed to "promote the dissemination of knowledge" saying that it's fine to recognize that, but it should be considered within the first fair use factor, rather than as a separate issue altogether. I'm not sure I agree with that directly, since I'd argue it not only goes way beyond the first factor but (again) is in the law itself outside of the factor. Still, it's not a horrible point.

There is one other slightly troubling part in the ruling, which is that the court seems to suggest that fair use is "an implied license."
In a sense, the grant to an author of copyright in a work is predicated upon a reciprocal grant to the public by the work’s author of an implied license for fair use of the work.
But that's just wrong. The law itself says "the fair use of a copyrighted work... is not an infringement of copyright." That doesn't mean that it's an implied license. It means that no license is needed. The idea that it's an implied license, unfortunately, takes us back to this idea that every use "must be licensed" which is simply wrong. Still, that's not a huge part of the ruling, but a little pet peeve.

Given all that, the case has been sent back to the lower court to reconsider and to correct these errors. As noted, it was good that so much was considered fair use in the original ruling, but a bit troubling on the reasons. Given these new instructions, it seems like the lower court now has a chance to come to the right answer for the right reasons and that's always going to be a better result.

There is a "concurring" opinion by Judge Vinson, which is a bit on the wacky side, insisting that, despite the fact that fair use has been a part of the actual statute since the Copyright Act of 1976, it doesn't matter because it was originally common law and thus "fair use analysis does not require conventional statutory interpretation." Then he suggests the court "step back a little" and look at the use and determine if it's fair use or not -- and he's pretty damn sure it's not. Eh, whatever. Let's see what the lower court has to say, and then the inevitable return on appeal.

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  • identicon
    PRMan, 17 Oct 2014 @ 5:29pm

    This is GREAT!

    So does this mean that downloading copies of textbooks is not copyright infringement?

    I mean, it's CLEARLY for educational use.

    reply to this | link to this | view in chronology ]

    • identicon
      Josh Taylor, 18 Oct 2014 @ 2:35pm

      Re: This is GREAT!

      Read the title. Tt means we lost, Copyright Maximalists Won.

      reply to this | link to this | view in chronology ]

      • icon
        Eldakka (profile), 19 Oct 2014 @ 7:26pm

        Re: Re: This is GREAT!

        err no.

        The appeals court overturned some of the reasoning used by the district court judge. It made no decision on whether or not the materials (or any specific material) was or was not in breach of copyright. It merely overturned the district court judges ruling and told them to try again. It did not say the district court judge couldn't reach the same conclusion again, just that they had to use different reasoning.

        reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 17 Oct 2014 @ 6:12pm

    I'm still waiting for Congress to address the issue of fair use, and put the issue to rest once and for all. On second thought, letting the courts decide what constitutes fair use, case by case, might be a less corruption-prone method.

    reply to this | link to this | view in chronology ]

  • identicon
    Fakey McFakename, 17 Oct 2014 @ 9:33pm

    The "implied license" language, on my reading, isn't denying that it's literally an implied license. It's saying that the balance Congress struck is analogous to that.

    reply to this | link to this | view in chronology ]

  • icon
    antidirt (profile), 18 Oct 2014 @ 7:39am

    There is one other slightly troubling part in the ruling, which is that the court seems to suggest that fair use is "an implied license."
    In a sense, the grant to an author of copyright in a work is predicated upon a reciprocal grant to the public by the work’s author of an implied license for fair use of the work.
    But that's just wrong. The law itself says "the fair use of a copyrighted work... is not an infringement of copyright." That doesn't mean that it's an implied license. It means that no license is needed. The idea that it's an implied license, unfortunately, takes us back to this idea that every use "must be licensed" which is simply wrong. Still, that's not a huge part of the ruling, but a little pet peeve.


    I think you're right and you're wrong. The Eleventh Circuit does cite that passage from Harper & Row about fair use being an implied license:
    In a sense , the grant to an author of copyright in a work is predicated upon a reciprocal grant to the public by the work’s author of an implied license for fair use of the work. See Harper & Row , 471 U.S. at 549, 105 S. Ct. at 2225 (“[T]he author’s consent to a reasonable use of his copyrighted works ha[d] always been implied by the courts as a necessary incident of the constitutional policy of promoting the progress of science . . . since a prohibition of such use would inhibit subsequent writers from attempting to improve upon prior works and thus . . . frustrate the very ends sought to be attained.” (quoting H. Ball, Law of Copyright and Literary Property 260 (1944) )). Thus , in order to promote the creation of new works, our laws contemplate that some secondary users — those implied licensees making fair use of copyrighted works — will be allowed to make use of original authors ’ works. At the same time, a secondary user who takes overmuch in the name of fair use operates outside the bounds of his or her implied-by-law license.
    The Eleventh Circuit and Supreme Court are saying an author implies a license for others to make fair use of a work. I agree that that's the wrong way to look at it. Licenses are based on consent, either implied or manifest. But even if an author expressly says there is no consent whatsoever to use the work--thus defeating any claim of implied consent--the fair use defense is still available. It's available because it's not based on consent. Moreover, Harper & Row was about fair use of a pre-publication work, back when federal statutory copyright did not kick in until publication. The Court was talking about consent once the work is published, and this was part of the quid pro quo view of copyright where certain customary uses were implied in exchange for the protection. That view makes less sense today with automatic copyright upon fixation.

    I think you miss with your point that the "law itself says 'the fair use of a copyrighted work... is not an infringement of copyright.'" That's not why fair use is not an implied license. Using a work consistent with an implied license is "not an infringement of copyright" either. The reason fair use and implied license are not infringements is because they excuse activity that would otherwise be infringing. They're affirmative defenses. You say: "The idea that it's an implied license, unfortunately, takes us back to this idea that every use 'must be licensed' which is simply wrong." I agree that it needn't be licensed, but assuming there's more than de mininis use, there needs to be some defense, such as fair use or implied license, or else it's infringing. So it's not that the uses need to be licensed, but they still do need to be excused--whether by license or something else, like fair use.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 19 Oct 2014 @ 7:53am

    I recently seen the message 'piracy is not a victimless crime' before the start of a movie. Hah!!! Like the IP defenders responsible for putting up these messages care about the law or morality (with their undemocratic law buying activities).

    How about this one for them. Law buying is not a victimless crime.

    reply to this | link to this | view in chronology ]

  • icon
    LAB (profile), 19 Oct 2014 @ 3:17pm

    I agree with much of the authors analysis. What I found most disturbing about the original ruling was percentage analysis used by the judge to come to a fair use determination. A percentage to determination is not in the copyright statute and I felt was judicial activism in the extreme.

    reply to this | link to this | view in chronology ]

    • icon
      John Fenderson (profile), 19 Oct 2014 @ 4:50pm

      Re:

      I agree (perhaps less emphatically), but I can see how they got there. A few times in the past, courts have used a percentage as part of their determination of fair use. I think that also factors into why there are so many people who wrongly believe that using a small enough percentage (or short enough clip) of something automatically counts as fair use.

      reply to this | link to this | view in chronology ]

      • icon
        Eldakka (profile), 19 Oct 2014 @ 7:33pm

        Re: Re:

        I agree.

        But I also think some of it may be due to the oft-promoted confusion vis'a'vis plagiarism and copyright.

        In my university days it was often cited that if you copied more than 10% of a work into an assignment then it was plagiarism.

        This then became twisted to mean that any copying of more than 10% was ALSO copyright infringement, and ANY copying less than 10% WASN'T copyright infringement.

        The confusion still frequently persists today. Therefore the judge may not even have been aware of why they chose the arbitrary 10%, but it probably 'felt' right to them and their subconscious because that's the benchmark for plagiarism.

        reply to this | link to this | view in chronology ]

        • icon
          John Fenderson (profile), 20 Oct 2014 @ 10:13am

          Re: Re: Re:

          "it was often cited that if you copied more than 10% of a work into an assignment then it was plagiarism."

          Really? That's a very strange position for a school to take, since it completely dodges the definition of plagiarism: to claim another's work as you own. If I copy a single sentence written by another and don't credit it, that's plagiarism. If copy an entire work but credit it, that's not plagiarism.

          Plagiarism and copyright violation are entirely different things.

          reply to this | link to this | view in chronology ]

        • icon
          antidirt (profile), 20 Oct 2014 @ 10:36am

          Re: Re: Re:

          The confusion still frequently persists today. Therefore the judge may not even have been aware of why they chose the arbitrary 10%, but it probably 'felt' right to them and their subconscious because that's the benchmark for plagiarism.

          If you read the opinion, the 10% thing comes from certain classroom best practices that are repeated in the legislative history but that do not carry the force of law. I actually think bright line rules would be a good thing when it comes to fair use, but that's not the way it works.

          reply to this | link to this | view in chronology ]

  • identicon
    Tucker Taylor, 21 Oct 2014 @ 8:54am

    Question

    In the 11th paragraph, did you mean to say "not" transformative?

    In the end, the court found that the District Court was correct in its initial analysis of the state of licenses, but failed to take into account the fact that the use was transformative in judging the fourth factor.

    reply to this | link to this | view in chronology ]


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