Tag Archive for: Seventh Circuit

Google Books’ Dubious Distinction Between Transformative Use and Derivative Works

Given its prior ruling in last year’s substantially similar HathiTrust case, the Second Circuit’s October 16 decision in The Author’s Guild v. Google, Inc. was as inevitable as the Cubs failing to win the World Series. Still those in the content creating community feel it’s fundamentally unfair that Google gets to scan millions of copyrighted books in their entirety without paying a dime for the privilege under the banner of fair use. The opinion, written by Judge Pierre N. Leval (Mr. Transformative Use, himself), not surprisingly held that Google’s usage was a transformative, and therefore fair, use under the Supreme Court’s 1994 decision in Campbell v. Acuff-Rose Music, which had relied upon Judge Leval’s own Harvard Law Review article advocating a transformative use analysis.

The facts are briefly as follows: Google digitally scanned more than 20 million of books that were submitted by participating university libraries – but without the consent of the rights holders – to create a searchable database for these materials. In return, the submitting library gets a digital copy of each work it submitted, providing that the library agrees to use the digital copy only in compliance with copyright laws. The database, which can be searched online by the public for free, provides a list of works containing the key terms searched as well as snippets from each book containing the search terms in context. Google has built in safeguards that limit the number of snippets and the amount of text displayed so that a searcher cannot obtain a copy of the book, or a substantial portion of it, simply by doing repeated searches.

I’ll leave it to others to critique the Court’s analysis of the finding of fair use under the four factors of Section 107 of the Copyright Act. My focus is on the opinion’s distinction between “transformative” fair uses of copyrighted works, for which no permission is needed, and the creation of “derivative works” as defined in Section 101 and for which authorization from the copyright owner is required pursuant to Section 106(2).

Judge Leval, in pages 17 through 19 of his opinion, including a lengthy footnote 18, appears to address the Seventh Circuit’s issues with the transformative test, particularly as voiced in Judge Easterbrook’s opinion in last year’s Kienitz case, which I’ve previously written about. Kienitz concerned alterations to a copyrighted photograph of the mayor of Madison, Wisconsin. The District Court found that the usage was fair, relying on a “transformative use” analysis.

Although the Seventh Circuit affirmed the result, it rejected the transformative use approach as articulated in the Second Circuit’s much-criticized Cariou decision, finding a conflict with protected derivative works:

Fair use is a statutory defense to infringement. The Copyright Act sets out four non-exclusive factors for a court to consider. The district court and the parties have debated whether the t-shirts are a “transformative use” of the photo – and , if so, just how “transformative” the use must be. That’s not one of the statutory factors, though the Supreme Court mentioned it in Campbell v. Acuff-Rose Music, Inc. The Second Circuit has run with the suggestion and concluded that “transformative use” is enough to bring a modified copy within the scope of §107. Cariou applied this to an example of “appropriation art,” in which some of the supposed value comes from the very fact that the work was created by someone else. We’re skeptical of Cariou’s approach, because asking exclusively whether something is “transformative” not only replaces the list in §107 but could also 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). (Citations omitted)

While agreeing with Judge Easterbrook that the fourth factor is the most important, Judge Leval also noted that the Supreme Court stressed the importance of the first factor, the “purpose and character of the use,” in making a determination of fair use. Citing Campbell (but coyly omitting the Supreme Court’s approving citation – more than Judge Easterbrook’s mere mention – of his own seminal article promulgating the concept of transformative use), Judge Leval wrote: “The more the appropriator is using the copied material for new, transformative purposes, the more it serves copyright’s goal of enriching public knowledge and the less likely it is that the appropriation will serve as a substitute for the original or its plausible derivatives, shrinking the protected market opportunities of the copyrighted work.”

Judge Leval further elaborated: “In other words, transformative uses tend to favor a fair use finding because a transformative use is one that communicates something new and different from the original or expands its utility, thus serving copyright’s overall objective of contributing to public knowledge.” But, as the Court’s opinion cautions: “The word ‘transformative’ cannot be taken too literally as a sufficient key to understanding the elements of fair use. It is rather a suggestive symbol for a complex thought, and does not mean that any and all changes made to an author’s original text will support a finding of fair use.“ Fair enough, but how is this dictum helpful in practice?

Here’s how the Second Circuit addressed the tension between transformative fair use and protected derivative works:

A further complication that can result from the oversimplified reliance on whether the copying involves transformation is that the word “transform” also plays a role in defining “derivative works,” over which the original rights holder retains exclusive control…..The statute defines derivative works largely by example, rather than explanation. The examples include “translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgement, condensation,” to which list the statute adds “any other form in which a work may be…transformed (emphasis added). As we noted in Author’s Guild v. HathiTrust, “[p]aradigmatic examples of derivative works include the translation of a novel into another language, the adaptation of a novel into a movie or play, or the recasting of a novel as an e-book or an audiobook.” While such changes can be described as transformations, they do not involve the kind of transformative purpose that favors a fair use finding. The statutory definitions suggest that derivative works generally involve transformations in the nature of changes of form. By contrast, copying from an original for the purpose of criticism or commentary on the original or provision of information about it, tends most clearly to satisfy Campbell’s notion of the “transformative” purpose involved in the analysis of Factor One.” (Citations omitted)

I’m doubtful the foregoing answers Judge Easterbrook because even this formulation of transformative use sounds like it could cover a lot of protected derivative works as translations and abridgements of texts and arrangements of musical works surely expand their utility and often communicate something new. For example, the Southern District of New York recently held that taking the characters, settings and entire scenes from the TV series, Three’s Company, and adapting them into a stage play (a mere “change of form” and presumably a derivative work under Judge Leval’s revised formulation), was a transformative fair use that parodied the original.

As I’ve previously written, the transformative use test remains amorphous and something akin to a restatement of Justice Stewart’s “I know it when I see it” standard where wholesale copying of large swaths or entire works can be found to be fair use if transformative. As the Court concluded in its epic footnote 18: “Attempts to find a circumspect shorthand for a complex concept are best understood as suggestive of a general direction, rather than as definitive descriptions.” Yeah, right.

Despite the not terribly helpful attempts to define the ineffable, the quoted portion of the Court’s opinion does posit two instances of transformative use that do not appear to conflict with the general understanding of what constitutes a derivative work: 1) where the use of the underlying work is to comment on or criticize it; and 2) where the use provides information about the work. The Second Circuit cited Campbell as an instance of the former and clearly views Google’s actions as an example of the latter:

Google’s making of a digital copy to provide a search function is a transformative use, which augments public knowledge by making available information about Plaintiffs’ books without providing the public with a substantial substitute for matter protected by the Plaintiffs’ copyright interests in the original works or derivatives of them.

However, in Campbell, the Supreme Court pointed out that the musical parody of Roy Orbison’s iconic “Oh, Pretty Woman,” used only as much as was needed to conjure and comment upon the original song. Here, the Second Circuit blesses the copying of millions of complete works in the name of transformative use. There’s no doubt that Google’s database is incredibly useful and can provide substantial benefits to the public. However, as with derivative works, there are lots of really useful and beneficial things for which licenses are routinely obtained.

Transformative use analysis can be a helpful tool in applying the first statutory factor but it shouldn’t override all four §107 factors as it seems to do under current Second Circuit jurisprudence. And however formulated, it doesn’t adequately distinguish between fair and derivative uses. There is, however, one other point on which the estimable judges Leval and Easterbrook agree: fair use is an affirmative defense, as pointed out in Campbell. However, this seems to conflict with the Ninth’s Circuit’s recent opinion in the “dancing baby case” where, in the context of DMCA takedown notices, it states that fair use is something that is substantively “authorized by law.” Perhaps it’s time once again for the Supreme Court to transform fair use jurisprudence by providing some clarity to the concept.

Back to the Future: Will the Seventh Circuit Transform Fair Use?

Last month, the Seventh Circuit in Kienitz v. Sconnie Nation signaled what may be a seismic shift in how “fair use” cases are judged. In order to see why, let’s briefly review the statutory and judicial framework.

First, fair use is not a “right” as some “copy-left “ advocates would argue, but is a defense to copyright infringement codified since 1978 in Section 107 of the Copyright Act. And contrary to popular belief, there are no bright line rules as to what is and is not a fair use. For example, there’s no magic number of bars of music you can borrow or any certain number of seconds of a clip you can post or, as we’ll see, a prescribed portion of a photographic portrait that one is automatically free to use.

Rather, as the Supreme Court reiterated in the 1994 case Campbell v. Acuff-Rose Music, fair use is determined by the courts on a case by case basis using the four factors of Section 107:

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.

In Campbell, the Supreme Court held that 2 Live Crew’s use of a portion of the Roy Orbison hit, Oh, Pretty Woman, in its similarly titled song, Pretty Woman, constituted a fair use parody of the Orbison song in that only so much of the original work as was necessary to comment on that original work was used in the 2 Live Crew recording. In its analysis of the first statutory factor, the Court cited with approval Judge Pierre N. Leval’s influential 1990 Harvard Law Review article, Toward a Fair Use Standard, as to whether the use of the Orbison in the 2 Live Crew work was “transformative,” in that “it adds something new, with a further purpose or different character, altering the first with new expression, meaning or message….” The Court, noted, however, that “transformative use is not absolutely necessary for a finding of fair use” but that “the goal of copyright, to promote science and the useful arts, is generally furthered by the creation of transformative works.”

Since Campbell, the Second Circuit, historically the nation’s second most important copyright court, took the “transformative use” ball and ran with it. Recent cases, such as the Google Books decision and Cariou v. Prince, held that copying of entire works constituted fair use on the basis that the use was “transformative.” Cariou, for example, involved Richard Prince’s alteration of entire photographs taken by Cariou. The Second Circuit held that the use was “transformative” and therefore a fair use, even though Prince’s works did not comment on Cariou’s, as was the case in Campbell. Any cursory Google search will yield a plethora of articles critical of Cariou.

This leads us to the Seventh Circuit and Kienitz. The case concerns a photo of the Mayor of Madison Wisconsin, Paul Soglin, taken by Kienitz. Soglin, with Kienitz’s approval, posted the portrait on the city’s website. The controversy arose because Soglin wanted to shut down an annual street party that he had once attended as a student many years before. Sensing some irony, defendant Sconnie Nation downloaded the headshot from the website, removed the background, changed the coloring and shading and added the slogan, “Sorry for Partying.” You can see the before and after pictures in the Court’s opinion. Sconnie Nation sold a total of 54 shirts, clearing a modest profit, and engendering the infringement action by Kienitz. Relying on Cariou, the parties argued whether or not defendant’s use of plaintiff’s photograph was “transformative”, with the District Court deciding that it was. Writing for the Seventh Circuit in his typically pithy manner, Judge Easterbook took a cynical view of this:

Fair use is a statutory defense to infringement. The Copyright Act sets out four non-exclusive factors for a court to consider. The district court and the parties have debated whether the t-shirts are a “transformative use” of the photo – and , if so, just how “transformative” the use must be. That’s not one of the statutory factors, though the Supreme Court mentioned it in Campbell v. Acuff-Rose Music, Inc. The Second Circuit has run with the suggestion and concluded that “transformative use” is enough to bring a modified copy within the scope of §107. Cariou applied this to an example of “appropriation art,” in which some of the supposed value comes from the very fact that the work was created by someone else.

We’re skeptical of Cariou’s approach, because asking exclusively whether something is “transformative” not only replaces the list in §107 but could also 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). [Citations omitted]

In the remainder of its 7-page opinion, the Court went through each of the four factors and affirmed the District Court’s finding of fair use, noting that while non-copyrightable elements, such as the Mayor’s face, were used in the Sconnie Nation shirts, the copyrightable expression in Kienitz’ photo was largely expunged: “Defendants removed so much of the original that, as with the Cheshire Cat, only the smile remains.”

Despite its rejection of the Second Circuit’s approach, the Seventh Circuit reached the same conclusion as under a transformative use analysis. It remains to be seen whether any other courts will adopt the Seventh Circuit’s retro approach in eschewing “transformativeness” as the touchstone of fair use. And if so, will they then find against fair use in cases, as in Author’s Guild v. HathiTrust and Cariou, where far more copyrightable expression was retained in the wholesale copying of works? In sum, adoption of this “new” approach may not necessarily signal a reversal of the trend to expand fair use.

Finally, it would be interesting to see what the Court would have done if Soglin, a public figure, had filed suit for violation of his right of publicity in the unauthorized commercial use of his likeness, albeit one with political overtones.