FAIR USE: FURTHER ISSUES

IVAN HOFFMAN, B.A., J.D.



        While it should by now be clear that copying other parties materials found on the Internet is an infringement of those parties rights, once in a while there is the vestige of some old ideas that must be clarified.  The case of The Los Angeles Times vs. Free Republic is one such reminder.

        The defendant Free Republic operated a bulletin board service and web site on which its members posted verbatim copies of articles that appeared in the plaintiff's newspapers, The Los Angeles Times and The Washington Post, ostensibly so that the defendant's members could post comments about the articles and their content.  It was conceded that often these copies constituted the entirety of the articles as they appeared in both the print and electronic copies of the paper.  The defense raised was that such reposting was fair use under the United States Copyright Law.

        The United States District Court analyzed the various factors involved in determining whether a particular use was a fair use under the statute.  You should read the articles entitled Fair Use and Napster and Fair Use on my site for a discussion of these factors in a general context.  The within article discusses these factors within the context of the facts of this case.

        Preliminarily but as a very interesting side note, because of the technical procedural posture of the case in the Court (it was on a motion for summary judgment in which the parties assume that the plaintiff's facts are correct), what was *not* covered in the case was the actual liability of the defendant's for the conduct of their third party users who posted these articles.  There was a peripheral discussion by the Court of whether or not such liability could be established on the part of the defendant itself but such discussion was not part of the main decision.

Fair Use Factors

        As in all cases dealing with this defense, it is determined on a case by case basis.

        In summary, these factors are:

            (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.

       The Court analyzed the evidence produced by the parties and among the more persuasive items was that the plaintiff newspapers charged fees of varying amounts to retrieve archived copies of the articles (although the current edition of the papers and the articles were free of charge) and that the plaintiff's sites generated significant amounts of advertising revenue measured by the amount of visitor  traffic.  There was evidence produced by both parties as to whether or not there was any proof that the defendant's conduct increased or decreased  traffic on the plaintiff's sites.  The plaintiff argued that whether or not such traffic change was measurable, the ability of the plaintiff's to sell archived copies was adversely impacted.

        During the pendency of the case, the defendants web site was realizing around 100,000 visitors per day and between 25 and 50 million page views a month.  The Court also noted that the defendant operated a for profit, limited liability company and found that this site was capable of generating revenue for the defendant in a number of different ways.

The Findings

        As to the factors above, the Court found:

        1. Given that the overwhelming majority of the repostings were of the entirety of the articles, there was no transformative use of the copyrighted material.  This means that part of being fair use is when a user takes otherwise protected materials and reuses it in such as way as to create some new work or enhance the meaning of the original materials by this new use.  It also means that such new use does not deprive the owner of a market for the underlying material because the new use is of a different nature than the original use.  The defendants argued that because the posting was for comment purposes, that thus the use was transformative but the Court decided that the original postings on the defendant's site were almost universally merely the article as a whole, without such commentary.  Further, the Court said that even if a posting was for the purpose of commentary, the posted amount of the original material cannot exceed that which is necessary and relevant to the portion about which the commentary is made and in this instance, the reposting of the entirety of the articles did in fact exceed this standard.  The evidence also was that the plaintiff's articles were posted on a regular basis. The Court found that the uses by the defendant were only minimally, if at all, transformative but not enough to satisfy this statutory requirement.

       While a commercial use is not conclusive in defeating a defense of fair use and a non-commercial use not conclusive that such defense is valid, the Court looked at the nature of defendant's business operation and concluded that, while that business was a mixed one, possessing some elements of both commercial and non-commercial operations, that there were substantial factors indicating that the use was commercial and in this context, did not serve to satisfy the fair use standards.  Even though the defendant argued that it received no money, for example, from links to a related entity on its site, the Court concluded that it derived benefit from the same in the form of good will.  The Court stated:

Here, the analysis is much the same. Defendants do not generate revenue or profits from posting plaintiffs' articles on the Free Republic website.  At most, they derive indirect economic benefit by enhancing the website's cachet, increasing registrations, and hence increasing donations and other forms of support.  Coupled with the fact that Free Republic has many of the attributes of a non-profit organization, this indirect benefit argues against a finding that the use is strictly commercial.  Rather, it is more appropriate to conclude that, while defendants do not necessarily exploit the articles for commercial gain, their posting to the Free Republic site allows defendants and other visitors to avoid paying thecustomary price charged for the works.
        Thus, as to this first factor, while they appeared to cut in opposite directions, the Court concluded that the defendant failed to satisfy the requirement of the fair use defense.

        2. Factual materials such as news articles are often accorded less protection than more creative works and the Court found that this factor weighed in the favor of the fair use defense.

       3. Given that the articles posted to defendant's site were almost verbatim copies of the originals,  the Court found against the defendant on this issue.  The Court said that the defendant failed to show that it was necessary for comment purposes to copy the entirety of the articles.

        4.  This analysis required the Court to decide whether the use by the defendant would supplant any uses, real or potential, of the copyrighted works by the plaintiff.  The Court found that given the large amount of site traffic on defendant's site and given that reading the articles on that site enabled users to avoid paying the plaintiff's archive fees, that such use was an infringement.  What is significant is that the Court rejected the argument on the part of the defendant that any such infringement was de minimus, meaning minimal.  The Court stated that whether or not the plaintiff's can show that they actually lost money from the infringement, the plaintiff is entitled, as the copyright owner, to control its protected material even if it elects to give it away.

First Amendment Claim

        Because this was commentary about newsworthy events, defendant claimed its rights were protected under the First Amendment.  The court, citing numerous cases, ruled that these type arguments are subsumed under the analysis of the fair use defense, meaning that a court considers this argument as part of the overall factors in that defense.  The Court decided that in order to prevail under a First Amendment claim, the defendant would have to show that copying the entirety of the protected articles was necessary to effect a valid commentary.  As indicated above, the Court found that that was not necessary.

        As discussed above in connection with analysis of defendant's fair use defense, visitors comments more often concern the underlying news event than they do the manner in which that event was covered by the media.

Conclusion

        Fair use is at best an "iffy" defense and there is virtually no way that anyone can say, in advance, whether the defense will be successful.  Thus, in any instance, the best and most advisable course of action is to license materials.  Read Screen Shot Liability for Computer Book Authors for an analysis of the benefits of licensing.

© 2001 Ivan Hoffman

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This article is not intended as a substitute for legal advice.  The specific facts that apply to your matter may make the outcome different than would be anticipated by you.  You should consult with an attorney familiar with the issues and the laws.
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No portion of this article may be copied, retransmitted, reposted, duplicated or otherwise used without the express written approval of the author.

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