Category: Intellectual Property

Court in Richard Prince Case Affirms that “Transformative” Has Boundaries

The big battle over application of the fair use defense has been focused on the highly subjective, often confusing, doctrine of “transformativeness,” which is addressed under factor one of the four-factor test. Factor one considers the purpose of the use, including whether the purpose is commercial; and over the past decade or so, several high-profile defendants have sought to broaden the concept of a “transformative” purpose to encompass any use of a work that results in any new development, from fine art to technology.

The courts have largely rejected this over-broad approach because it would render fair use a boundaryless and, therefore, meaningless aspect of copyright law. And in an opinion delivered last week, we see why it is essential to draw contours around the “transformativeness” doctrine because the “purpose” inquiry so often controls the rest of the fair use analysis.

In a case that I frankly did not realize was still active, the S.D.N.Y. affirmed the significance of a meaningful “transformativeness” consideration when it denied the fair-use-based motion for summary judgment (MSJ) to famed appropriation artist Richard Prince and co-defendant Gagosian Gallery. At issue are photographs taken by Donald Graham and Eric McNatt, which Prince reproduced, displayed, and offered for sale as part of his “New Portraits” series in 2015. The story went viral when Prince created (and sold for six-figure prices) the series of canvasses made from enlarged screen grabs of Instagram posts. Because the main expression in each of the canvasses is someone else’s visual work, which Prince used without permission, photographers and other artists responded with mixed, but generally negative, feelings about the exhibit.

Although I discussed the idea that the “New Portrait” series itself was an artistic and engaging statement about social media, I also noted, regarding the Graham complaint, that finding creative significance in the exhibit itself does not mean that any of the works copied were fairly used. According to the opinion released last week, the years since the MSJ was filed have entailed a lengthy discovery process during which Prince apparently changed his “purpose” statement from a nondescript intent “to make art” to a more assertive claim that the “New Portraits” series is a comment about social media and its role in contemporary culture.

Inconsistency in testimony notwithstanding, the court found Prince’s elaborated statement of intended social message no more persuasive that his use was “transformative” than his originally stated intent to just “make art.” Citing substantial circuit precedent, the district court reiterated the opinion that the user of a protected work must in some way comment upon the work used, not merely use a work to make a statement about something else.

…where a secondary work does not obviously comment on or relate back to the original or use the original for a purpose other than that for which it was created, the bare assertion of a ‘higher or different artistic use’ … is insufficient to render a work transformative.[1] 

The court found that Prince’s latter testimony about the intent of the series only reinforced the fact that he could have selected any of the millions of images posted to Instagram and that he in no way commented upon or added new expression to the photographs made by Graham and McNatt. Combine the finding that the appropriator could have selected any work for his purpose with the fact that the works used happen to convey the heart of the follow-on expression, and then find the purpose to be commercial, and factor one is likely fatal to the defendant’s claim of fair use. In fact, this opinion, while not articulating anything new, is a good example of how the “transformative” question affects other dispositive aspects of the fair use inquiry.

As usual, the court addressed factor two (nature of the work used) as a simple, binary question finding the photographs in suit to be expressive in nature and, so, favors the plaintiffs with scant discussion on the matter. The factor three analysis (amount of the work used) restates that while it is possible to make fair use of a whole work, this inquiry is dependent upon factor one. “Because Prince’s use is not transformative, his use of nearly the entirety of plaintiffs’ photographs cannot be deemed ‘reasonable,’” the opinion states. [2] The court found that the fourth factor (potential market harm to the work used), “weighs slightly in favor of fair use” based on evidence indicating that Prince’s use does not threaten the market for the Graham and McNatt photographs, but…

…Prince has failed to show that other artists would not be emboldened by his success in declining to compensate plaintiffs for his non-transformative use, which negatively affects the value of the original works.

So, with three factors favoring the plaintiffs and the fourth maybe “partially” supporting the defendants, Prince and Gagosian lose on the MSJ. The consistency of this opinion with Second Circuit caselaw could mean that this litigation is about to settle. On the other hand, the Supreme Court has yet to drop its later-than-expected opinion in Andy Warhol Foundation v. Lynn Goldsmith—another Second Circuit case presenting a similar question on the meaning of “transformativeness.”

Warhol is more complicated than the “New Portraits” case for several reasons, including the fact that it highlights the tension between “transformative” for an unauthorized fair use, and “transformative” for an authorized derivative work. But AWF’s argument is similar to Richard Prince’s—namely that Warhol’s use is “transformative” because it expresses a “new meaning or message.” Thus, the Supreme Court may also find that this is too broad a definition for a prong of the inquiry that so often carries the day. As argued in an older post on Warhol, requiring that some comment on the work used must be present in the follow-on work would be consistent with the purpose of the fair use exception, and it would inject some long-needed clarity into a doctrine that has caused much confusion for all parties.

[1] Warhol v. Goldsmith citing Rodgers v. Koons (2nd Cir.)

[2] Citing Cariou v. Prince (2nd Cir).

Controlled Digital Lending is a Dubious Proposal in Every Sense

On March 24, the court in Hachette et al. v. Internet Archive wholly rejected IA’s fair use defense constructed on the theory called Controlled Digital Lending (CDL). Prior to and since that ruling, various parties have tried to characterize this case as an attack by the publishers against the core function of libraries, alleging that libraries either already depend, or will come to depend, on CDL to meet the needs of communities in the digital age.

It is easy to promote a message that says Library good. Publisher bad. And I get why various people, including policymakers and librarians, might respond to the slogan. But the populist message obscures what a convoluted, if not insidious, proposal CDL truly is. While it may be true that select libraries engage in limited activities, long exempted by statute, which certain vested interests now describe as akin to CDL, it is erroneous to suggest that CDL, as envisioned by its proponents, is inherent to library operations. On the contrary, it is a complicated and expensive proposal—even if it were legal.

The CDL theory, based on ideas first proposed by Professor Michelle Wu (Georgetown University), is fleshed out and advocated in a 2018 white paper written by Kyle Courtney (Library Futures Chair) and David R. Hansen (Authors Alliance Executive Director). According to their reading of the fair use doctrine in conjunction with first sale doctrine,[1] Courtney and Hansen argue that libraries are legally permitted to erect their own ebook lending models by digitizing and then loaning digital books based on the number of legally obtained physical copies in the collection.

On its face, the concept sounds fair-minded and progressive—hypothetically adding new digital access while allowing the library to bypass (i.e., not pay for) current ebook licensing/lending regimes like OverDrive. And according to the theory, CDL will not disrupt the authors’ interests because it purports to maintain, rather than alter, longstanding copyright doctrine. Who wouldn’t endorse that from the sound of it? Candidly, someone who is not well-versed in copyright law or contemplating the practical implications of the CDL model.

Sparing readers a detailed breakdown of the legal constructs in the 42-page white paper, suffice to say, the keystone argument—a fair use defense riding on the first sale doctrine—was unequivocally rejected by the court in Hachette last month because the central points had already been made and rejected by this same circuit in contemporary cases.[2] In fact, CDL proponents may not be thrilled that Internet Archive was the first (and perhaps the last) institution to represent their theory in court because, even with millions in revenue, IA failed to implement the “controlled” part of the model.[3]

This begs an important question for libraries: if IA is their Galahad in the quest for CDL, why does it fail operationally to implement the model? That the underlying legal theory would fail was hardly in doubt, and this alone should doom CDL as a consideration for any library. But it is further notable that, even if CDL were legal in some form, implementing it would likely be more costly than the current ebook lending regime the library would be circumventing.

CDL Would Not be Free or Liability Free

Launching a CDL model, as set forth in the white paper, implies considerable expense, requiring either a library-developed system or paying to use a system developed by a third party. Presumably, the CDL folks imagined that Internet Archive would be that third party, but as that organization failed to adhere to the controls in the model, this should prompt librarians to consider what it would cost to adopt “real” CDL, and for what purpose.

Without addressing the practical implications of a holistic, auditable CDL system, proponents appear to recommend that libraries invest substantial resources in a new, complex model to manage physical and digital book lending and then wait to see if it gets sued. Because, astoundingly, the white paper contains a whole section advising libraries as to how they might limit risk when implementing CDL. It must be nice to sit in an office at an elite law school, devise a hypothesis that some proscribed conduct is “legal,” and then suggest somebody else try it to find out. And all this fuss, cost, and opportunity cost is to circumvent existing models that make ebooks available for about a dollar or less per loan?

The Future of Libraries is Not About eBooks

Finally, it cannot be ignored that the sustainability of libraries does not lie in providing more access to digital books and other materials via websites. Libraries are physical spaces that play important and diverse roles in each community, and their future depends on maintaining relevance as physical spaces operated by professionals with certain skills and sensitivities to local needs. Whether that means story time for children or hosting career counselors for adults or a thousand other initiatives, digital book lending is not a community connecting activity any more than shopping on Amazon is a social experience.

If ebook loans become too prominent a feature of a library system, those physical spaces and professional librarians will no longer be needed (i.e., funded). And in case it isn’t obvious by now, digital platforms tend to swallow independent institutions. Much like internet consolidation has nearly exterminated the local and independent newspaper, a similar consolidation of reading material into a more centralized, globally accessible network (as envisioned by Internet Archive’s Brewster Kahle) would be fatal to the local library as a lending institution.

Libraries should spend their limited resources on building and maintaining personal relationships with communities rather than waste time with complicated and erroneous workarounds to copyright rights. Frankly, the well-funded academics and organizations peddling CDL would do more good for libraries if they just hosted a damn bake sale.

[1] Specifically, the paper argues that factor one of the fair use test favors CDL because its “purpose” is to fulfill the intent of the first sale doctrine—and then, they argue this is further bolstered because libraries are not commercial entities.

[2] e.g., ReDigi, TVEyes.

[3] For instance, the CDL paper does not envision an unaccountable system whereby physical books are stored in shipping containers as the basis for digital copy loans. Internet Archive does this.

Photo by: JackF

If the Campaign Targeting eBooks is Reasonable, Why Lie About Copyright Law?

With the court’s unequivocal decision in Hachette et al. v. Internet Archive, and the continued failure of ebook legislation in various states, it is time for policymakers and librarians to understand the reason why this two-pronged campaign against copyright rights in ebooks is losing—because the academics, organizations, and lobbyists behind the effort are lying. Yes, that’s a big accusation to make about anyone, let alone professors at Harvard, Berkeley, Georgetown, etc., but what does one call disinformation in the service of an agenda?  Alternative facts?

In a recent example of the kind of dissembling scholarship being used in this campaign, Professor Michelle Wu, whose early work was seminal to the theory called Controlled Digital Lending (CDL), wrote an editorial for The Nation criticizing the court’s March 24 decision in Hachette. The CDL theory was the foundation of IA’s fair use defense, which the court rejected on all points, just four days after oral arguments. But rather than address the case law or merits in the decision, Wu claims the court simply does not understand the nature of American copyright law itself …

While Judge John G. Koeltl’s opinion addressed many issues, all his reasoning was based on one assumption: that copyright primarily is about authors’ and publishers’ right to profit. Despite the pervasiveness of this belief, the history of copyright tells us something different. What persuaded early state and federal government actors to establish copyright was authors’ reluctance to release their books publicly without the ability to stop the then-rampant piracy by publishers. The lack of copyright, then, was seen as a barrier to information reaching the public, and lawmakers enacted copyright to remove that barrier. This societal purpose is reflected in the wording of the Copyright Clause of the Constitution, which makes the spread of knowledge its goal, with copyright merely being a means to achieve that end.

That is a C- answer on a copyright history test. Wu’s implication that copyright was adopted at America’s founding period without regard for the author’s pecuniary interest, and for the sole purpose of spreading information is as thoroughly belied by the historic record as IA’s fair use defense was emphatically rejected by the court. At the very least, the two considerations were given equal weight, as described by Professor Jane Ginsburg in her paper A Tale of Two Copyrights.

To be sure, the American framers saw patent and copyright law as generally beneficial to the new nation, and men like Joel Barlow (inaptly cited by Wu) wrote encomiums on the subject, noting authors’ fears of unscrupulous publishers as one rationale for legal protection. But the conviction that the author was naturally entitled to the fruits of his labor was alive in copyright history—in England, Europe, and America—by the time the Constitutional Convention dipped the first nib in an inkwell.

Subsequent to the doctrinal kerfuffle in England known as the “Battle of Booksellers,” which culminated in 1774,[1] American copyright history, from Noah Webster to the suffragettes to the congressional record and international agreements, is abundantly concerned with the author’s personal and financial interests in the work. In fact, the majority of those state copyright laws to which Wu alludes, prioritized the author’s natural rights as the rationale for legislation, and an early draft by Madison of language that would become the IP Clause provides for copyright as a stand-alone declaration without preamble. I could go on.

If Professor Wu can support her unilateral “spread of information” rationale with more than opinion, she is welcome to do so. Of course, it was necessary to preface her editorial with a false origin story of American copyright—and slag Judge Koeltl in the process—because Wu then asserts that copyright doctrine and practice shifted from what it never was to an unprecedented focus on certain technological changes and to encroach upon consumers’ interests:

Copyright owners did not interfere with the end user. This was the case despite many user activities—such as making mix tapes, converting LPs to MP3s, writing fan fiction, and playing pop music at a piano recital—all technically potential infringements of copyright. Making a mix tape violates the reproduction right (also the distribution right if the tape is given to another person), converting an LP to an MP3 violates the right to make derivative works, and the playing of music at a recital violates the public performance right. The public, Congress, and the courts all ignored these behaviors as normal incidental uses or as instances of “fair use”—the allowance for which was not inconsistent with an author’s rights.

Not quite. First, there is no such thing as a generalized agreement about myriad conduct falling under the fair use exception. More importantly, there is a world of difference between individual, potential infringements, like mix tapes, and the kind of enterprise-scale infringement committed by the Internet Archive. Making over a million books available via the internet has very different implications than the little white infringements committed by individuals, but Wu is intentionally tossing it all into one big stew pot to promote a concept of copyright that does not jibe with fact or law.

Next, Wu alludes to several cases in which rightsholders litigated against technological innovations (e.g., Sony Betamax), and she characterizes these as attempts to improperly extend the copyright owner’s profit interest (profit being a dirty word) at the expense of the consumer’s right to access. I’ll spare readers an examination of each case in context to Hachette and skip to the bottom line:  all those defendants had their day in court, and so did Internet Archive. And it lost on every point. Thus, rather than even mention the legal considerations in Hachette, Wu pivots to the false, general allegation that the court is fundamentally confused about the purpose of copyright. Finally, she claims …

Copyright protects a work—not a format—yet the justification used to stop CDL appears to be that the copyright owner has the right to profit repeatedly from the sale of the same content in a specific format to the same buyer, even if the buyer only ever needs one copy and already owns one copy.

It is almost a deft enough sleight of hand that a reader might miss the trick when Wu pockets the reproduction right, characterizing the manufacture of unlicensed ebooks—literal copying—as format shifting. The reproduction of books is the foundational activity in copyright law, and I am inclined to believe that Wu and her fellow CDL advocates at other fancy law schools know this. So why are they pushing revisionist history to promote a legal theory that may be DOA as of March 24?

Whatever their motives, the practical reality is that policymakers and libraries are having their time and resources wasted by a well-funded syndicate of ideologues and unscrupulous organizations[2] hawking bogus legal theories and doomed ebook legislation in the states. In follow-up posts, I’ll address the status of those ebook bills and discuss exactly what the CDL white paper of 2018 proposes and its implications for real libraries.

[1] In Donaldson v. Beckett (February 22, 1774).

[2] EFF, Fight for the Future, Library Futures, Authors Alliance.