The Golden Age of Fair Use

MARK KUIVILA—2015 has brought major developments to the world of copyright law. For example, the copyright for the “Happy Birthday” song was invalidated, saving the public from having to endure yet another rendition of the off-brand Applebee’s or TGI Friday’s version. One of the most important developments in the field has been an apparent expansion of the fair use doctrine.

Fair use has always been an abstract doctrine of copyright law with its broad, overlapping factors outlined in § 107 of the Copyright Act. Formerly reserved for educators, researchers, critics, and editorialists, fair use has become a useful tool in promoting innovation in the commercial sector. As older copyright-centric business models become obsolete, fair use is a valuable defense for new companies working to transform protected works and develop new functionalities. The Second Circuit’s decision in Author’s Guild v. Google is a recent example of how the fair use defense can be used to protect disruptive industries.

In Author’s Guild, the Second Circuit found that Google’s use of copyrighted literary works for its “Google Books” project was protected by fair use.  As part of the project, Google contacted libraries and—with their permissions—copied the full text of tens of millions of literary works in those catalogues. Google Books allows users to search for terms within the catalogue and shows the frequency of the term’s use in any given work with three or four examples of the term’s use within that work.

The plaintiffs (Author’s Guild) claimed this “snippet” function essentially provided users with a substitute for the underlying copyright works. Google however had taken steps to prevent exactly that by blacklisting one snippet per page and one full page per ten from public view. The court found that these safe guards effectively transformed the works and prevented substitution.

The plaintiffs also claimed that because other searchable literary databases like Amazon had acquired licenses at a fee from the authors, Google’s free use would unduly harm existing license markets for those works. The court again disagreed, finding that evidence of an existing market—for an activity already considered fair use—does not preclude allowance of that activity under the fair use doctrine. In other words, the commercial viability of licensing for a particular use is not dispositive to a finding that the use is permissible without a license.

The decision in Author’s Guild shows how courts have become more willing to offer fair use protection to commercial activities. Even though the commercial nature of the activity is only one factor in a fair use analysis, it can militate heavily against a defendant. But when carefully implemented, business models based on transformative use of protected works may be permissible even if they undermine existing market norms.

This broader acceptance of the fair use defense may prove to be a valuable tool for companies developing new disruptive technologies, particularly in the era of sharing and remix cultures. As the classical structure of copyright becomes culturally antiquated, parties with stakes in those rights will, at least to some degree, retaliate against new systems damaging to their interests. If litigation is used to challenge an innovative but disruptive technology, fair use seems to have become a stronger defense for the innovator than it once was.

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