It appears that Righthaven continues to lose big
in its questionable mass lawsuit business model strategy. The latest ruling (embedded below) in one of the cases reinforces two key issues on which Righthaven has already lost in previous rulings, and once again suggests that the entire basis for Righthaven's existence may be a castle made of sand that has long since washed away.
First up, we have the question of standing -- which was what last week's big ruling was about
. In that case, Judge Roger Hunt took apart Righthaven and Stephens Media's bogus claim that Righthaven ever actually owned one of the key rights granted by copyright law. As we've explained a few times, in order to be able to sue over copyright, you have to actually hold one of the specific rights listed in Section 106 of the copyright law. What's not allowed is the transferring of the "bare" right to sue. If you hold one of the enumerated rights, you can also take with it the right to sue over any infringement of that right. But without the rights, you're in trouble. This is the second judge that has found Righthaven in serious trouble over this issue.
As in the Hunt ruling, this ruling, by Judge Philip Pro, finds that it's quite clear from the nature of the agreement between Stephens and Righthaven, that the entire point of those agreements was to try to get around what the law says, and provide Righthaven with just the right to sue, and that's not allowed:
Here, the rights in the copyrighted Work retained by Stephens Media deprive Righthaven of everything except the right to pursue alleged infringers, a right that is still subject to Stephens Media’s oversight. Accordingly, Righthaven does not possess an exclusive right in the Work and therefore does not have standing to bring a suit for infringement.
It seems pretty straightforward: if you don't have any of the specific rights under section 106, you don't have a right to sue. Done deal.
Separately, Judge Pro, like Judge Hunt, indicates that Righthaven and Stephens Media's attempt at the beginning of May to "clarify" their agreement fails to fix this basic problem. Righthaven has been insisting that the "Clarification" solved any questions of standing, but both of the judges seem to indicate otherwise.
Judge Pro then goes on to point out that even if
Righthaven had the copyright and had standing, it would still lose, because of fair use. This is the second
such case to find that, and once again highlights how for all the complaints about Righthaven, it's aggressive attempt to stretch copyright law has served to help create a wonderful body of case law that will be quite useful in the future. We've regularly seen people claim -- incorrectly -- that if you use the full work, there is no fair use. Yet, there are plenty of cases that prove this to be untrue, and now we've got another one, with the explanation clearly laid out. Judge Pro walks neatly through the four factors test:
- The Purpose and Character of the Use: Here, the judge finds the fact that Hoehn was using the article in order to create a discussion, and was doing so in a way entirely differently than the rightsholder, to lean towards a ruling of fair use:
It is undisputed that Hoehn did not and could not profit from posting the Work. Under Sony, noncommercial/nonprofit use is presumptively fair. Additionally, this factor focuses on the purpose or character of the new work. Here, Hoehn posted the Work as part of an online discussion. Hoehn avers he posted the Work to foster discussion in a specific interactive website forum regarding the recent budget shortfalls facing state governments. This purpose is consistent with comment, for which 17 U.S.C. § 107 provides fair use protection. There is no genuine issue of material fact that Hoehn’s noncommercial use of the Work for comment favors a finding that the use was fair.
This is a great ruling for people who post works of others for the purpose of discussion.
- The Nature of the Copyrighted Work: This is a surprising, but welcome statement from Judge Pro. He notes that much of the article in question may not actually deserve any real copyright protection at all, as it just provides factual data, and such is not intended to be protected by copyright law.
The Work is an editorial originally published in the LVRJ. The Work is a combination of an informational piece with some creative elements. Roughly eight of the nineteen paragraphs of the Work provide purely factual data, about five are purely creative opinions of the author, and the rest are a mix of factual and creative elements. While the Work does have some creative or editorial elements, these elements are not enough to consider the Work a purely “creative work” in the realm of fictional stories, song lyrics, or Barbie dolls. Accordingly, the Work is not within “the core of intended copyright protection.”
This part of the ruling could certainly be useful in future cases, in noting that just because someone writes an article or creates some form of content, it shouldn't automatically get copyright on the entirety of the work, if not all of it reaches the level of creative input necessary to qualify for copyright. This is a point that is often lost in discussions of copyright.
- The Amount Used: This is the big question. This is why many people, falsely, assume that any time "all" of a work is being used, it cannot be fair use. However, as we've pointed out time and time again, that's simply not true, and this case reinforces that point. Here, Judge Pro notes that there's no dispute that all of the work was being used, but points out that this is just one factor in the four factor test, and that "wholesale copying does not preclude a finding of fair use." If the other sections weigh heavily towards fair use, that'll outweigh this point -- which is what happened in this case.
- The Effect Upon the Potential Market for the Work: In the end, for all the discussions of the four factors, it's this factor that quite frequently is the make-or-break factor in determining fair use, which intuitively makes sense. If the use hurts a market, people are generally wary of saying it's fair. If it doesn't hurt the market, it's much easier to claim it's fair. In this case, the court notes that there's no real impact on the market:
It is undisputed that Hoehn’s use of the Work is noncommercial. Challenges to noncommercial use require a showing that the particular use is harmful or negatively impacts the potential market for the copyrighted work. Id. Righthaven has not presented evidence raising a genuine issue of material fact that Hoehn’s use is harmful. Rather, Righthaven contends that because Hoehn replicated the entirety of the Work “[s]uch circumstances warrant the conclusion that [Hoehn’s] infringement has likely caused a substantial impairment on the potential market for the Work and that [Hoehn’s] infringing copy of the Work fulfilled the demand for the original.” (Resp. (Doc. #13) at 12-13.) Additionally, Righthaven argues that the market for the Work was impacted negatively because potential readers are able to read the Work on the Website and would have no reason to view the Work at its original source of publication. However, Righthaven has not presented any evidence of harm or negative impact from Hoehn’s use of the Work on the Website between November 29, 2010 and January 6, 2011. Merely arguing that because Hoehn replicated the entirety of the Work the market for the Work was diminished is not sufficient to show harm. Therefore, Righthaven has not presented evidence raising a genuine issue of material fact that the fourth factor favors a finding of fair use.
I have to admit that I think this section could be much stronger against Righthaven, and am a bit disappointed that the judge didn't take the next step. It's important to note that this factor is supposed to be about the impact on the market for the copyright holder, and if we assume (as the court is doing in this case) that Righthaven is, in fact, the copyright holder, the argument on this factor looks even worse for Righthaven. That's because, based on Righthaven's situation and the limited rights it has, the only "market" it has control over is the market to sue. That's it's sole source of revenue for what bits of this copyright it might own (but probably doesn't). So, if we look at that, we see no impact whatsoever, because it's not as if the guy here (Hoehn) is going to compete with Righthaven in suing over the work.
Either way, it's yet another good ruling for sanity, and another nail in the coffin for Righthaven on both counts -- while at the same time adding some more case law to the pile. Of course, these are only district court rulings, and this could get interesting depending on what an appeals court says (if it gets ahold of one these cases). In the meantime though, it seems like Righthaven is giving us some nice case law to build on.