and that's all true after this case read it so it's been a more substantial undertaking than than ordinary so you have more time available to you  for that reason don't treat the red light as aspirational we've given you plenty of time of course if you're still answering questions from us feel free to to answer that question before you finish and you'll case and this appeal really operates as a safety valve for occasional and i emphasize that word occasional borrowing of potentially socially productive expression where importantly that taking doesn't impair the marketability of the original work it's the exception to the copyright rule which is that copyright owners as a rule are entitled to control their expression including the copying of that expression it's a flexible statutory driven balancing test and as you understand and appreciate it's applied on a fact specific basis the district court twice now has misconstrued the essence of that doctrine the remand decision by the prior panel  instructed of the court to treat the statutory factors the four factors flexibly it wasn't arithmetic and mechanical while a judge evans abandon the twenty five percent twenty five percent twenty five percent as you've read she adopted other we would say arbitrary weightings worse than arbitrary i would suggest because as i will get to the effect of her weightings was to perpetuate the second consequential error that the prior panel identified which was giving undue almost per se weight to the pedagogical purpose of the use here and as is clear the preamble to section one zero seven this court has said it  c and campbell court said in the supreme court is only a guide it's a factor to be weighed as a prior panel decided but when you look at the weights assigned by judge evans to factors one which was automatically given because of the educational use at twenty five percent which by the way was unchanged in that sense inflexibly unchanged from the twenty five percent originally interesting lee and thirty percent awarded to factor three simple math tells you that fifty five percent you don't even need to look at third error identified most importantly by the prior panel which is undue in appropriately little weight given to the single most dispositive issue involved in this case repeatedly identified by the prior panel which is what's the threat of market substitution given that it was conceded conceded i have a find that the district court's analysis under the fourth factor was correct and that district court properly took license availability and do a count and determining whether the fourth factor waited defendants uses non transformative and fulfills educational purposes that plaintiffs at least in part market their works for but the threat of market substitution here is great and thus the fourth factor looms large the overall fair use analysis that the panel said because to fit we find that the district court did not end its application of the fourth factor however because defendants copying was non transform it says again with regard to the fourth factor the effect of defendants used on the market for the original the district court did not or however because defendants on paid copying was non transformative and they use plaintiff's work for one of the purposes for which they are marketed the threat of market substitution is severe i thought on rating that that that what the district court had to haven't failed to do that in several consequential ways but i want can i ask you a question about that though please here here's my concern what judge evans or did originally on the ones where it was three to one when she weighed them all equally was she look through the first two parts of the test if you will one was is there licensing availability and if there is licensing availability then how much would you all have been entitled to so for example on craft of inquiry fourteen dollars ninety nine cents and then she said well if everybody did it would that be a substantial would that have a substantial effect and the answer is yes of course it is and so the problem is that and then she stopped she just stopped there she didn't go any further the problem is and i think the panel points out and actually uses the term circular that if that is the be all and end all of the market test then just by making licenses available that factor will always necessarily strongly favor in for a finding of infringement and the reason that that's the case is because even if it's only one cent right if everybody did it it's always going to be a substantial amount so i  feel like that can't possibly be the be all and end all of the test i guess i'd like you to address that and to see first of all whether you agree that that is the be all and end all the test and second if not what else should be considered there's a lot packed into both of your honor's questions let me guess please take them one at a time let me let me try to systematically less it's less we might start where should the district court and you can consider it in the light of what in part the judge just said that the district court committed no error in concluding that we are licenses were available for thirty one of the works in two thousand and nine factor for quote strongly favored plaintiffs and of period end of sentence it said it found no error with that analysis in the context of this case but can you answer my question which is in those cases in the ones where the where the district court found three to one and the one was the fourth factor on the initial analysis the first time around all the district court did was look to see whether there was licensing availability and if so then it found that there was you know substantial infringement basically or you know that it favored infringing and so you would never have to look at anything else i mean you are in agreement that that's all the district court did in those cases first of all and second of all it is that is there something wrong with that i mean it seems to me like it cannot possibly be the case that that's always going to favor strongly a finding of infringement just by virtue of the fact that there is licensing available no and that's why there's a very full trial record here and your honor which the prior panel acknowledged we have the let's be clear about the context in which this has occurred this was not a situation the plaintiffs the publishers did not bring this case because of all want to off taking a chapter by a single professor for a single course for a single term let alone a paragraph taking which is sort of a caricature of our case by the other side quite distinctly this case was brought because of a multi year pattern of significant chapter long and longer takings which is the fact record and i don't mean to suggest otherwise that you know this isn't a serious problem or anything of that nature but i am concerned about what we say about the fourth factor and how it applies and so far i haven't heard you address whether there is something more to the test then there is a licensing availability and since there's a licensing availability and you all would be entitled to some kind of money on that then necessarily it strongly favors infringing i just don't see how that can possibly be the answer well and so that's what i'm asking you if they please your honor we have extraordinarily importantly a conclusion on factor one conceded no transformative use so we have by definition here the significant threat of transformative the threat of market substitution is severe precisely so in that circumstance your honor where there is a readily functioning permissions market like c c c as the texaco case concluded as the princeton case concluded you don't have the circularity problem where it is due where there is a definable existing let alone likely reasonably likely to be developed market you don't have a theoretical right to license  haven't established permissions market stipulated fact if i may around have stipulated facts in the record that the c c c permissions market is well established in my functioning that the plaintiffs rely on permissions income actually for the viability of specific work for their profitability so you have actual actual prospect of market harm which takes us well beyond the governing standard of harper which is some reasonable likelihood of future harm of some prospect of future harm of any part of a normal market in the words of the heart as a part of the problem here is i understand it when you're looking at this market substitution  is that you're having to consider you're having to speculate about a future market right and you can't about are you eight that in toto by what has happened in the past and your honor if i may emphasize that and judge rosemary i don't mean to run from you by any means i'm trying to be responsive to a series of questions but this is this is critically important to this case and the context which is if i may take a simple analogy i spend a lot of my life litigating in the music field as well and if somebody were to say to the record companies back a decade ago at the time people were still buying c d s oh don't worry about streaming of musical works there's no market for that it's a nascent market show me today how you're being harmed in your cd sales under a totally different the creative quality involved with that is completely different from a lot of the works that are at issue here where although there obviously it involves additional work but besides just putting facts in the creative quality is not to the extreme that you have in completely original works that you would have in the record industry but my point that's one of the factors my point  except i would have no way whatsoever the way you've described it all because the mere fact that it's a non transformative use and that you have licensing availability would necessarily mean that there's a finding of infringement and i just don't i  think you also have to consider and the court said in the next section that there were a couple other factors that the district court had broken out that had to be considered in the context of the other factors  those are that limited unpaid copying of excerpts will not deter academic authors from creating new academic works and that the slight limitation of permissions income caused by the fair use authorized by this order will not appreciably diminish the plaintiff's ability to publish scholarly works and will promote the spread of knowledge i'm not necessarily saying which way it should come out i'm just concerned that if all we look at is non transformative use is suggesting now and the fact that there's licensing availability that is a problem that cannot possibly be the answer either because then it completely devalues the other two factors or are what we're saying is it's the district court's job in any given case and your honour's job with respect to take the cases on the fact records if you find them this is a case of systematic use of multiple takings of stringing together these excerpts of demonstrated stipulated stipulated market harm with respect to those takings in a market which is now frozen in zero nine but where the president of oxford university press even then testified that use rather than sales was the new marketplace emerging that oxford and cambridge and say we're creating new products to meet that new market demand to to establish a test which is a snapshot of current harm putting blinders on to the evolution which was the only reason i was using the music analogy or on a not for creativity relatively would be in essence to say it's a complete disincentive for content owners to move into those new markets the horse is out of the barn under judge evans conception of market harm before you can stop it because you can't measure by definition that's somewhat speculative potential market but where you have in place established license mechanisms in house and through c c c where you have these very appellants using those permissions processes receiving millions of dollars today to license their works where you have a market that is stipulated has moved from paper course packs where georgia state made the permissions payments to electronic copying simply and expressed the to save money that was found as a fact by judge evans that was found by judge vincent to be a dispositive fact in his reading of the record at least and you had mr palmer the chief administrator of course passage e s u say as much here is the administration saying to students you can save money don't make permissions payments by buying course packs download them print them bring them to class same difference all of that your honor with respect is the record context in which we argue that at a minimum whereas to those thirty one works where digital license availability was present and we think that was a too narrow reading of the law as it is at a bare minimum in that situation where the threat of market substitution looms so heavy the balance should be tipped consequentially in favor of factor for over the non dispositive educational use what's worse and i think your honor just prior you were getting to this in the beginning if you analyze work by work notwithstanding that it pages ninety nine and one hundred  hundred three of the prior panel opinion the ninth circuit said you got it right and factor for your honor she changed her analysis and the bottom line in no fewer than twenty five cases in twenty five of the thirty one cases where in her prior opinion she found factor for strongly favoring plaintiffs based on this balance sheet type analysis the judge and gauged in looking microscopically at what the earnings were per work in the current market calibrating those against sales she said favors fair use she flipped twenty five times even though the prior panel said you've got it exactly right you didn't give it enough weight so instead of giving it enough weight i mean six cases did she end up in the entire record finding  four or five launch of findings on factor for on the first go around strongly and frenching works one through what eighteen seventeen all of which then on fact the paragraph that says we find the district courts now says under the fourth factor is correct and the district court properly took license availability into account in determining whether the fourth factor waited for or against fair use comes in this opinion right after the court addresses the fact that you all were were concerned that the district court in cases where there was no licensing availability found that there was no market and that that factor weighed in favor of fair use and so the very first paragraph the very first sentence the topic sentence of the paragraph that i just read you the last line of says in its individual analysis under the fourth factor of each of the forty works for which it found plaintiffs had made a prime official case of infringement the district court performed a sufficiently nuanced review of the evidence regarding license availability in other words when the district court found that if there is no market at all if there is no licensing availability at all then there is no market it was correct in that respect and that its handling of the licensing availability aspect of the fourth factor was correct but as i read this it's not saying that it was limited to considering the licensing availability in the fourth factor because if it were the rest of this whole six page discussion about the fourth factor would have no relevance i mean it would make no sense well your honor we always hesitate to interpret what three other people you know meant in their writings and i understand your point of view i do believe that that that section of the opinion ninety nine through one or three in particular is reasonably straightforward while in our briefing and throughout our position we disagreed with the first prong of that which is that you we must have shown digital license availability this both a fact dispute because as you know we believe in j x five and the testimony it could not have been clearer but that was ruled against us that was seventeen of the works for the moment i'm focusing at a minimum though on the remaining thirty one where i believe it's pretty plain from two sections of the opinion as i interpret it anyway that the court said you got it right judge evans as to that circumstance and where we have no circularity because c c c is well established functions well where it's got licensed programs that operate where judge evans herself said in a matter of minutes g s you could have installed the necessary software click the button as it were and gotten these permissions so it's all lubricated it's all there and avail and which works are we talking about talking about now the except thirty one works at the moment your honor ok thirty one where there is license availability i at least construe in your obvious that would be one just to finish the thought we certainly construe it as saying you got it right as to those that the court did go on in one sentence page one hundred i think saying in close cases the district court also did not err in looking further but if you look at the record of the first district court opinion that was seven cases where the court found a quote by a two to two tie in her mind so in those limited quote close cases she went further and have it but the problem is then the court then we told her you know go go back and and do all these things and so when she did that the original time everything was worth one she didn't go into any further detail on the fourth factor when it was three to one because it made no difference there was no reason for her to go into it to go past the licensing aspect of it the licensing availability because even if it weighed heavily in favor of finding an infringement it wouldn't have made any difference because the way she originally did it which was wrong there were three of equal weight that weighed the other way so there was no reason for her to expend her time and go into that but when it came out two to two there was well when it went back and the weights were different then there became a necessity to go through and do the complete analysis on each of them that's how i construe what they do you're on to the problem with that is the problem and i respect your reading of it obviously in your intitled to your reading and we we would read it differently but the the larger problem with that candidly is that if that were the correct interpretation it would fall outside of all settled jurisprudence there is no other copyright precedent of which we are aware and certainly not at the circuit level and certainly not at the supreme court level that has said you were engaged in this kind of microscopic examination taking a present day snapshot of actual market harm and hypothesize from that experience alone what the future prospects of potential harm might be an industry wide basis the record here makes clear even the a meek guy american library association brief makes clear that g s used practice being tested here is national a whole bunch of universities are disregarding permissions in this sphere so that it talk about circularity if i may it's circular to say old only fourteen dollars and thirty eight cents was generated in permissions fees from digital permissions when nobody is respecting in our view the copyright boundaries nationally let alone the fact that this whole practice is evolving people aren't consuming in print form any longer it was already beginning to be true in zero nine and i think you know from your daily experience it's accelerating greatly none of that was factored in by the district court there is no opinion respectfully that you will find certainly at any appellate court level that validates an approach saying unless you can prove that you couldn't stay in business today that you wouldn't keep publishing the work today that there for you fail on market for harm is completely antithetical to the governing standard the governing standard if if that practice impairs any normal reasonable expected market and i would submit that in this galloping digital evolution of an economy there's never a better example where you've got to give latitude to the stipulated facts saying we are being heard to the testimony of our witnesses saying this is where the business is going to the fact that in course packs g s you respected the law and made the payments and suddenly because the format of copying is different they don't and say no no no unless you can prove today that there's a meaningful disposition of your ability to continue publishing the very works let alone the impact for the future we respectfully submit i don't think the panel went that way certainly not asked who works for which that the thirty one works for which there was a showing of digital availability they affirmed that she was right the first time in saying this strongly favors the plaintiffs mistry when he made that the four rule instead applied to all thirty one works and flipped twenty five of mr rich you're thomas but i'm going given the number of questions you were asked and the length of them i'm going to give you some more time and i suspect my colleagues to my right who hasn't even had an opportunity to ask questions might have to what they said and i think there are different ways to read that so is i understand your view and judge priors you is in the the first trial she has signed a twenty five percent value to the fourth factor and in most cases found strongly infringing also although by her waiting it didn't matter where i so we know that  she had to give it a different way when it went on a rant remained she did that but in your view as i understand it she had to take the strongly infringing finding and just expand it from twenty five percent to something you're not even happy with the forty percent again i'm simplifying everybody he but  without redoing the mix that resulted in the strongly infringing finding ok i i can see how you would read judge opinion to say oh yeah by the way you do have to redo the mix which could explain how she went from strongly infringing to fair use and you seem to acknowledge that she had to redo the mix rather than just slide from twenty five to forty percent fair use whatever it might be so for example in your argument about why she was wrong not to reopen the record i believe one of the things you say is was she had to redo the mix some factor for anyway so i 'm just trying to it which which was did she have to reevaluate the evidence and factor for or use this sliding i'm sorry and it's understandable why in this record there could be a lot of confusion or perhaps a you but the answer is no as to the thirty one we certainly didn't suggest she had to re evaluate her conclusion as to the works for which there was a valuable availability that strongly favored the plaintiffs that was one of the few areas where i think she got it legally correct what we said to her was you've got to give far more weight according to all the passages judge prior right from the prior point she did factor now she did mathematically move it from twenty five percent only after making a finding that what was broke before strongly infringing is now fair yet she took it away and then gave fair or use more way she took it away your honor it seems to us impossible to square the most important take away from the prior opinion which is that this is directly substitutional this goes right to the heart of the market for which our clients market their works the educational market it's not transformative directly substitutional it's impossible to square the repeat instruction from the prior panel which is give that the weight it's due to severe risk give it relatively great weight those are the words of the panel it's impossible to square that with a conclusion on factor for by the district judge that it favored the plaintiffs thirty one times the first time and six times the second time it seems impossible to square those outcomes forgetting how you then balance the entire mix and with respect to the entire mix if i may yes there are four factors but i think we all acknowledge the second factor which i could talk about but i don't think is likely to drive the result here one way or the other if it's neutral or favors the plaintiffs although we certainly think that these are classic works of scholarship that if any factual works deserve to be treated as you know evaluat creative in all of these putting those to one side i really feel that the balance of this case is how do you weigh the educational purpose of the use against the risk of market substitution when you read what the district what partly the prior panel had to say about factor three in a sense it said factor three is just a proxy for that they call that a hero risk pick for the fourth factor i don't necessarily disagree with what you've just said yeah ok my concern is about how evaluate the meaning a factor for you know that that's all yes that's my concern and there i think your honor i would ask you to really study carefully the sections of our briefing that lay out what we think is the completely settled jurisprudential test it's a test of presumptive harm once it's been established that there is a an existing marketplace that functions well which is in fact accessed allowed to re evaluate the facts in arriving at the her answer on factor for for some more but she could but she had to for others i mean we were what we were urging was that clearly clearly we thought her bottom line conclusion as to the work for which there was found to be digital availability in two thousand and nine and my clients keep reminding me not to concede that there wasn't but that were found to be we didn't ask you to re evaluate even want to be able to reopen the record you wanted to reopen and you're asking us to say that he should have been able to reopen the record to the ones that were against you but he should have been able to rea open the record as to the ones that were for you and i look at this and i look at the prior panel opinion and i don't see where there's anything to suggest that there should have been a reopening of anything with respect to any  turk reevaluation of the facts are full on the others and your honor if you would pose that as a question to me this morning which is what if we were to hypothetically my answer to you was would be content with that ruling because the purpose of this case was never to determine how many works infringed this was a policy issue policy that the district court herself found encouraged or certainly didn't pre term this kind of infringing conduct where this court to determine the thirty one works that the district court erred in flipping and in overall balancing and not concluding that there was infringement as to those works then it seems to me you're in a position to make that ruling on the current record no fact finding needed and b to remand to the district court for what we've always sought is not damages sovereign immunity it's all about the future conduct regulation through an appropriately framed injunction we will have accomplished our clients reopen the records the district court did not abuse its discretion on that ok but in return but in essentially reopening the record not to take new evidence but to revisit the findings about factor for that that was contrary to what the panel opinion contemplated if that were if that was legal air and that the district court a revisit only the weight it gives factor for not what the findings were from the original trial what what would we tell the district court or should we tell if anything the district court about what an injunction would look like that snot a fall of the law and junction you know that's not going to be a  antithetical to the rule of law i know i have to ease one here but that's what it is you're going to take a question in two parts if i may if i understood you you said that contemplating the possibility that this panel might r to rebalance or reweigh in light of giving more weight or fixing fact before i would suggest you don't need to remand for that purpose you have all the facts i know you've got let's say you know the list say i don't want to do that if you  framed an injunction early on with enormous input from our clients trying to be thoughtful and again i want to bring back to the context in which this is occurring these works were stitched together with as many as thirty or more other unlicensed works to create electronic course back so there's two components to what we believe an injunction should provide in informing future fair use decisions by faculty one is there should be some some limit at least with general reference to for example the classroom copying guidelines about just physically how much material can be taken from a plaintiff's work without permission are we hide bound to a thousand words or ten percent whichever is less which is the guidelines of course not but the record shows here takings anywhere from five to one hundred times those guidelines which was exactly the kind of warning signal that set off lights in the princeton university case saying wait a minute that just can't be what congress in vision about this balance between educational copying and others has to be some quantitative limit and we suggested and would maintain there should be a cumulative test by which i mean not more than x takings put together in any one course in any one term our clients also believe that there's extra harm to their markets when the same material is used term after term after term by the same professors in the same courses once perhaps a little more leeway multiple times really significant market incursion third and last year honor the record shows a haphazard implementation of the existing policy most faculty were given a fair use checklist which was a disaster candidly given no training they were offered training but the record shows a majority either didn't take it or didn't know about it they had not a clue how to fill it out there needs to be communication there needs to be education coupled with some level of administrative overview more than the so called red flag review which the dean of libraries miss siemens conceded was only if somebody literally wanted to copy the whole work that's so you're going to have extra time as well as you need it will go ahead and give you an extra fourteen minutes  thank you miss arbor may please the court my name is steve shots and we represent the police if i may judge private like to start with your question about revisit and i would start by reading this language from the prior panel opinion which is found in my copy of page twelve eighty three where do you have you don't have the slip up and do you i'm sorry i did not but this is you have a second the section which says section on capital e in some work by work analysis and it carries on however the district court did or by giving each of the four fair use factors equal weight and by treating the four factors mechanistically here is the language i would refer to the district court should have undertaken a holistic analysis which carefully balanced the four factors in the manner we have explained that was the direction to judge evans i and then and then let's keep telling me i'm happy you got a paragraph that talks about the first factor then it and the second factor then a fact a paragraph that doubts about the third factor and then it says  with regard to the fourth factor the effect of defendant seize on the market for the original the district court did not her however because defendants on paid copying was no transformative and they use plaintiffs works for one of the purposes for which they are marketed the threat of market substitution is servier therefore the district court should have afforded the fourth factor use factor or more significant weight in its overall fair use analysis i don't see where the district court was ever told anywhere in this opinion to revisit on a work by work basis the determinations that it had made on the fourth factor the only thing i see is a we have a strain of findings on the fourth factor and the first go around where the district court said that was strong and frenching what did what the defendants were doing we say no are where did the panel tell it to do that can you show me that i thought i believe that i have shown over let me try to explain our position ok and our response to that would be because the prior panel told her that she had to give it more weight the question becomes how much more weight the appellant say oh we could jump straight to forty percent that's not what judge evans did she explains at her slip opinion very clearly at paragraph or on pages thirteen and fourteen that she did this in two stages she first looked at the individual factors and she did say that yes i'm using she called them estimated approximate initial weights but then consistent with the language on which we rely she did the second stage of the analysis which i understand to be judge martin's question the mix she did the entire mix again because she had to do the holistic waiting of the for each work of it to your disdain if you will your honor for balancing tests unfortunately in the fair use environment as mr rich said when he opened his argument this is a flexible factual inquiry yes and what you do and where the district court did not or on the fourth factor we said did not where do we say oh by the way you didn't are on the us go back and not to determine how much more to weigh the fourth factor in for a given work the district court appropriately went back to the evidence for that work to say here is how much more weight i'm going to give it in the final mix i have to first decide how much more weight is it going to be given in herd language she says there may be certain factors or certain features from one work to another that i h strongly and frenching on fourth factor how is it that giving that more away leads now to a finding on the fourth factor alone  there's no air about it because it leads to that determination because on the evidence considered by judge evans for all the fourth factor evidence on that work it's on pages twenty three and twenty four of the district court's opinion feminist research or take handbook of social theory all of these are our words where the district court had founded the initial go around that factor for the factor for determination was strongly infringing and we said no aaron whereby work announces no air but he didn't give it enough weight and the threat of market substitution here is severe how is it that when you won't go back on remand the district court when it's told that factor for for that those those three works was which had been strongly infringing is now fair use and we're going to give it more weight as fair use so how did the panel tell that in your honor we submit that the the answer to that question is that the district court had a difficult task it had to determine how much more weight whether it's craft of inquiry or any other works how much more weight to give forth back in order to make that determination the prior panel said for example as was read in close cases it's appropriate in the fourth factor to look at licensing revenues as part of the evidence it is therefore also appropriate and their head and there has been some that were that were on the first go around that the district court had event in a fight as close cases but not those on the fourth factor but it still in order to make the determination for craft of inquiry focused on that work how much more weight to give it it was appropriate for the district court to go back and look at all of the evidence on the fourth factor and so for example in two thousand and six the total amount of revenues received an electronic course content service permissions from c c c for craft of inquiry was twelve dollars and thirty six cents so it might seem unusual to suggest that the fourteen dollars ninety nine cents that your client for would have had to have paid would have made a substantial impact if everybody was doing it because in reality there is only twelve dollars and thirty six cents when you look at what the total amount of revenues was for that years that is that what she did i believe that that's what she did yes i believe that that's what the district court did and that's what she did why isn't that error because it seems to me that the premise of the panel opinion is that if you look at it just that way and that kind of microscopic way you're losing sight of the harm to the future the threat of what if everybody does it and suddenly a different world where what was fourteen or twelve dollars before if everybody's doing it it because the threat of market substitution is severe but why you should be giving it additional way now what happened before is never going to be the way it's done it and the future everybody's going to do what georgia state does and they've lost it all i respectfully disagree your honor because what judge evans did w to answer what the prior panel identified for her as the central question of fair use and that was first it was an evidentiary factor and second the central question was described to her as whether or not there was georgia state use if widespread it caused significant are substantial economic harm such a substantial economic harm that it would impair the publisher's incentive to publish the work that comes directly from the panel opinion and those are the questions that she was required to answer and in order to address those question it's a question can't be that they would not have published the work at all clearly they've already published the work the question is cite and that's why the thing the sense of is it speculative or do we have to really look forward you know if you have money in this contest he have markets that the courts have recognized separate markets for trailers as and movies you know the trailer is full it is created from the movie but the courts have said that's a separate market writing and we don't we're not going to just allow you to start copying the the for the work itself the original collected book right and and if you allowed georgia state to didn't assess i guess i understood what the for the first panel was saying was the threat of market substitution force exarchs going forward where where there are already licenses available is severe you didn't get that enough wait but i don't see where in in that it the district court could come back and say oh but i understand your honour's position to question whether or not it would be appropriate under these circumstances for the district court to go back and look at the evidence in order to come to the determination required by the prior panel of what the appropriate weight would be be it for the fourth factor the third factor or the second wait yes but but whether it's an infringing or fair use is is for under that factor is not weight well but the opposite finding about that factor that we had said no was no air and then gives it more weight because when the district court looked at the evidence before it it found that there was no substantial economic harm looking a future looking then it's not just a static thing about what happened in the past is it but the threat of looking forward is contemplated in that standard your honor that language from this from the prior panel from this court was  we said that it was severe the threat severe agreed and also said that the question the central question is whether the defendants use taking into account the damage that might occur if everybody did it that's the looking forward part y cause substantial economic harm such that allowing it would frustrate the purposes of copyright by materially impairing defendants incentive to publish the work in order to answer that central question  to license electronic licenses are available right i'm sorry we have works all these works where there had been previous determinations of strongly infringing where license electronic licenses were available right i don't know that they're  to be strongly for but there are licenses available for certain works now so i go through every one of them where they were the district court settled for a first go around it strongly in french ok to take to you know except my word on that time and the fact that georgia state did something different in an existing market where there were licenses available and and they were being purchased electronic licenses that georgia state does something different and and now going for it because what georgia state did didn't cause substantial economic harm no problem here no problem here what's that going to do for the market for everyone back then who wasn't doing it the way georgia state was doing it who's got what are they going to do tomorrow is an everybody a market going forward in the betamax case the sony vs universal case many of the same arguments were made that if we allow people to time shift to watch television programs at a later date because they can put the tape in the machine and tape it that's going to destroy the market instead it grew markets it grew new markets in blockbusters it's now the streaming markets that mr rich mentions we can licenses anymore when they can do with the georgia state where well but the georgia state where your honor is first and foremost a nonprofit educational institution which is very different and these are works that are created for educational purposes well but there are going to be infringements and that the publishers have to be paid under certain circumstances that has to be the case but the mere fact that licensing is available it seems to me anyway shouldn't dictate whether or not there is an infringement which is essentially what i understand the position to be of the other side and so i'm not necessarily saying that you know that your client is without any kind of infringement fault but i do i guess i wonder what you make this out to be from the panel's opinion the first time around it says we note that it is not determ determinative that programs exist through which universities may license excerpts of plaintiff's works in other words the fact that plaintiffs have made paying easier does not automatically dictator right to payment a copyright holder can always assert some degree of adverse effect on its potential licensing revenues as a consequence of the secondary use an issue simply because the copyright holder has not been paid a fee to permit that particular use the goal of copyright is to stimulate the creation of new works not to furnish copyright holders with control over all markets accordingly the ability to license does not demand a finding against fair use what do you make of that how does that factor into the fourth factor when it's discussed by the panel under the fourth factor in response to that question and your earlier question children we do believe that something more has to be proven other than just saying we offer a license so therefore we prevail on the fourth factor and the fourth factor is as mr rich said d positive and that's the end of the fair use inquiry because if there isn't something more then people in the position of using the work as georgia state is have no right to make a fair use determinations and that is our statutory right second of all what i what we make of the language that you read and the earlier language to which you refer is that what the something more needs to be gets back to the language of have they demonstrated that there will be in fact an impairment to their incentive to publish what evidence have they come forward with that says there will be some sort of any merit probably has to be more than that right i mean there probably has to be more than that but but when you look at the market if if literally the entirety of royalties the entirety of licensing fees in the world for her work is twelve dollars and eighty nine cents perhaps that should figure into whether there is truly a market for that particular excerpt it is that we understand this to mean that's what we understand judge evans to have that part of the calculus that she went through first in order to weight the fourth factor appropriately and then to provide or to to complete the holistic analysis that she was required to do because in that situation it would seem that it would not have a substantial effect on the market is that basically what we would have to look at yes we believe that again as that language states would g s use use if widespread looking forward would cause substantial economic harm such that allowing it would frustrate the purposes of copyright by materially impairing defendant's incentive to publish the work and to address those fact findings our position is that it was appropriate for judge evans to go back through all of the evidence including permissions evidence including if it is saturday and then the district court should have reopened the record and allowed them to submit information about license availability that they had presented before well we respectfully disagree with that because that is within the court's discussion in terms of how it's going to conduct the conduct of discretion not to allow them to date that going to be will be looking at all of it anyway because they are the ones who raised the licensing as a potential harm came forward with evidence of licensing and now so now the district court wants to say wants to say that oh you got a paltry amount of revenue for that kind of licensing and they can't even show the other licensing availability that they have for other works you more and this emerging market no no i don't want to hear about that well but they're asking to show it after they had the opportunity to produce it at trial it's not that we haven't had the trial it's not that we haven't had one appeal already they're asking to do it having evidently electricity and so i went tails you lose quality to this proceeding i mean it's surprising to me that after reading the panel opinion and the way the panel opinion a den of errors of the district court that we could possibly on remand end up with a finding of fair use as to all the same war as before discretion about whether to open the open the record reopen the record or not that i mean so i mean i think it has a a bad result but i think that's how it happened she doesn't have any choice in what rule of law she applies as the she does have a choice about the record and i mean she has a lot of discretion about about that and i mean i'm not sure i wouldn't i mean i think i might have done it differently i think i probably would have been the wrecker but i don't i don't know what we can do to or about th if i may your honor i'd like to address your judge progress question about the perception that somehow we're getting something now for free that we paid for in the past first the prior panel also heard that argument from the publishers and discounted at footnote four in the prior panels discussion this court said that it wouldn't discount that because there could be many reasons for why georgia state did not pay for course packs so we believe that that issue's been addressed and wasn't talked about that i'm sorry i wasn't talking about course backs i mean look i'm sorry then help i don't know how it back to footnote for response to anything i'm not understanding the point you're making about about foot four in response to what we've been discussing perhaps understood misunderstood your honour's point what i understood you to say we were doing differently was that it was in response to mr rich's argument that we paid fees for course packs but when we make fair use of electronic materials that we're not paying fees in that we're somehow getting something for free that we were willing to pay for is not all of that was good and it went into that determination i thought a factor for where the district court on the first go round it said that there were strongly and frenching determination to work bar work for what how many ever it was thirty some odd works and it was not just a matter of course packs it's also license availability it's a lot of things that the district court was considering for which we said no err that's right it just didn't give it enough  way and then it went on remand the district court gives it more weight but reverses all those those all that evidence that was previously available and now arrives at the complete opposite conclusion about it and says and now i'm going to give all that i don't understand how to how you get that outcome from what the panel opinion said and your honor again i don't mean to repeat myself but in order to determine how much more weight to give it our position is that the district court appropriately looked at the evidence before it to make that determination on factor for in terms of the course packs versus digital fair use the point that we would like to make to the court is to it that we view the publisher's efforts here as being one that they want to try and expand the scope of their copyright that they in effect want to begin to generate a windfall there is a difference in how course packs were treated and how electronic materials were treated course paks as a student i might go and buy one and then i have the physical item my classmate however may not buy one the money that i pay for one generates a fee for the publishers the publishers get no revenue from my classmate because my classmate didn't purchase one evening that there are students who don't read the material that fester so in fact the evidence in this case is that there are so many of them that that that's one reason the court found the minutes missed the minimalist infringement several instances asked of those students who do not buy the course pack the same can be thought to happen in a digital environment some students may access the work they get the link and go and read it other students will not do so but in terms of the publisher's remedy for that what they propose  for example that they would get three dollars and seventy five cents a student if there are one hundred students in the class they get roughly four dollars for each student and they make the point well what's what's the harm to georgia state we we pay one hundred dollars activity fee for a football game responsible for the difference there is that they've now found a way to expand their copyright so that instead of being concerned about use of the material and obtaining a fee from the person who actually bought the courts back or even used  material electronically well isn't that how they get three dollars and seventy five cents from a person who does not ever access the material and we have so they answer to that would be that what georgia stand out to do is  because first something their students aren't going to read but it doesn't mean that that that that the threat of of making it available digitally isn't a threat of severe harm it's not it's not that it's not infringing it's just that market reality is that this wiser decision for you is because only five percent of your state is read the materials just make it available in digital course backs but there is no digital course is to identify proper fair uses because under the law a proper fair use it's properly not generating a fee to anyone and the purpose of fair use is to facilitate teaching and that is what georgia state is in the business of doing they're trying to fulfill that teaching mission in fact the ferry statute says notwithstanding the provisions of sections one a six and one the fair use of a copyrighted work including said she use by reproduction in copies or phone records or by any other means specified by that section for purposes such as teaching including multiple copies for classroom use is not an infringement of copyright that's what it says right would you agree that that anticipates that at least in some situations there are uses by educational institutions of these materials even where there is licensing available for these materials that does not constitute a copyright infringement yes of course so that being the case it cannot possibly be that whether or not a copyright is infringed by a fair use or by a proposed fair use depends on whether or not there's licensing availability would you agree yes the mere fact that a license is available of course doesn't survive doesn't dictate the outcome but if you copy tar chapters and substantial portions of works that were created for an academic market for a teaching market that is that the bit where the threat of market substitution is severe then we have a different problem right i do not believe that that is a different problem your honor two points first of all on the panel opinion said that it was well i believe the panel opinion for example in reference to what is done in the marketplace referenced the c c c guidelines and those guidelines stated something to the effect of experts in the field recommend copying no more than one chapter for educational use that's what happens in the real marketplace that's the use that is traditionally made that does not create an act of infringement that is a fair use but a tick on to what judge pryor said i mean i think judge pryor raises a fair point which is you know if you're talking about more than a substantial amount if you're talking a substantial amount of the work that's being copied or you're talking about you know the use of the heart of the matter those are factors that go into the analysis as well and they may affect the total weighing if also licensing is available and that licensing availability shows that there is a substantial market by virtue of the fact that there have been prior licensing fees paid that are substantial i mean you would agree that in those circumstances you would have to figure all of that in and probably there would be an infringement i would certainly agree that you would have to figure all of that in as you say your honor whether or not there would be an infringement would require the holistic way of all the factors for example they want to disregard factor to the prior panel said well it's not entitled to a lot of weight but it isn't titled to some way is it a purely factual work is it something that is not creative or does it have evaluative considerations from the author in that you have to perform the entire for factor analysis and that would be required so i can't agree that it would probably be an infringement as you say but i can certainly agree that those types of things would be considered and that at some point in time if you used too much of the work yes that no longer is a fair use and the publisher deserves to be compensated but as the prior panel said factor three can serve as a heuristic in that regard if you take too much you're going to potentially impact the panels or impact the market for the works professors are unique position here publish or perish is a line frequently used for professors to survive in the academic environment environment environment excuse me they understand that once they publish and in fact they hope that their work will be used by others to advance their particular field that's how they are if you will compensate it it's not necessarily financial that's how they advance their careers perish is built on an expectation that there are going to be publishers vailable to publish your work and that that's the problem here right the publishers who publish the scholar's work are saying how work we're not going to be able to survive and do that are this going to be substantial harm to us going forward if this is the way it's going to work where  digital use for which there's no feast paid is the future what evidence was there before judge evans of that fact there was no expert evidence that said this is going to destroy the market for our work there was no testimony where for whether it's awakening minds or any other work that said as a result of georgia state use here are other schools that have started to use it or hear other schools  refused to pay permissions what evidence was before her on that regard the only thing they come with is this commonsense notion that oh simply because we offer a license that's the evidence that's the end of the inquiry you know what that does is first it takes us into the circular nature of the licensing exercise that simply by creating a licensing opportunity they prevail on factor four and second of all it it fails to recognize that what does happen here is that as a result of being exposed to an excerpt perhaps a chapter judged prior that that student then says i'm interested in that subject matter i decide to take that on as my life calling when i work in it i now go and buy the book so that i can have it it's not a fair to say that when the panel said that that circularity problem with respect to factor for that was something that the panel ts saying in response to an argument from them from your adversaries that the district court had heard one factor for isn't that right and they said the panel is saying now you know right about that there's no error here and there's a circularity to your argument publishers doesn't want that isn't that what the prior panel opinion the saying i believe that is a part of what the prior panel is saying i believe it's not saying though that when you go back we want you to redo it again and part of we did it district court or circular has not saying that sit there in different parts of the opinion if that is your time what the what the court says your honor is that in addressing generally the fourth factor that the central question is whether or not georgia state use would cause substantial economic harm the central question in relation to the fourth factor the court then comes to the conclusion that it agrees with the district court that the small excerpts defendants used i believe the panels referring to all of the excerpts at issue there that the small excerpts defendants use do not substitute for the full books from which they were drawn so in terms of what the court was trying to address last time yes i believe it was being responsive to the defendants are going to start human i believe it was also saying a more general admonition that we can't allow them to head off a defense of fair acquainted the availability of a light of electronic license or digital license with a finding in favor of the plaintiffs on a factor for i don't see where the district court and any i mean where the panel in any way faulted how the district court had evaluated the fourth factor except the weight that it gave i think what the panel said was that weight was not appropriate that it needed to be way more improper and the reason is because the threat of market substitution is severe is that right that was one of the reasons yes or whatever reason was there because it was non factors yes and so in order to perform those three just to court properly as this court had previously said it was appropriate looked at licensing revenue but didn't the district court itself actually implicitly acknowledge that it had decided initially on the three one and the original version where it had found three factors in favor of fair use and one in favor of infringing that it had initially looked at only the licensing availability didn't implicitly say that in its second opinion where it went through on a case by case basis for each specific work and talked about first whether there was licensing availability second how much it cost in this case for the craft of inquiry how much it cost oxford that g s you didn't pay for that licensing availability and then if everybody had programs that of course who would be substantial damage and then it said viewed alone these considerations initially cost factor ford away in oxford's favor and then it goes on from there and says nonetheless defendants claim there was no substantial actual or potential damage to oxford stemming from widespread use blah blah blah and it goes into the other the other considerations so in other words didn't the district court affectively acknowledge that the first time around it considered as a proxy for the fourth factor at least in the three one cases whether there was licensing availability but i don't know that the district court ever considered licensing availability simply as a proxy for the fourth factor i guess i'm asking you if that's effectively what they did when they said when the district court said first we look to see whether licensing is available it is available in the case of craft inquiry therefore we look to see how much oxford would have made had yes you paid they would have made fourteen dollars and eighty nine cents and then we looked to see well if everybody did this would that have a substantial effect and of course it would because any time you multiply any number even if it's only one cent by everybody doing it there's going to be a substantial effect isn't that effectively saying is that effectively using the availability of licensing than as a proxy for the fourth factor it is using it as one of the elements to be considered under the fourth factor but the district court for example was also influenced by the fact that there was no evidence of any lost book sales that there was no a right that's what it looked at further though right that's what it looked at the second time around when that's why the and the things change from strongly infringing or friendly questions by the way if you're not  i mean do you disagree if you do then i don't like they're not just and i don't disagree what i'm trying to make certain is appear is that there were other factors involved in the fourth factor analysis and there's other evidence there and it's our position that the district court properly could go back and look at all of that evidence in the district court say you know i was in err on the fourth factor i mean isn't that the that you know i actually used a lot of the availability of digital licenses as a proxy and that is air after that after the panel had said there was no air on factor for so i mean judge prior is right over and over and over and over judge so flat's opinion says no error on the fourth factor over and over it says that but i think at the same time the opinion does tell judge evans that she's got to redo it i mean for example where it just talks about the show she considered two additional purportedly non statutory considerations and he says what those already says she should've included those in the four factors and so that required her to succumb to read redo it as well right i mean if that's what we've got to figure out you know does she did she error by looking back into the evidence on each one of these works for factor for mean that would be one reason why she might do that we would agree with that and given that she had to if you will redo the soup of fair use that she had to look back at all of the ingredients a little bit differently she was told to redo that analysis in a holistic fashion it's and what the publishers a and you know how to formulate a rule that works if for the ages which would indicate to me that the players position was reasonable and it serves a social purpose and the the supreme court has said when you're addressing attorneys fees you've got to think about those things and i don't think she did so i wanted to give you a chance to defend what she did i  think the order that we would first direct you to is found docket for forty one which she did address the various reasons why she found she has you to be the prevailing party for example she did say that in reference to the fair use determination and their argument that fair you should be near very narrowly construed that that position was objective really reasonable but at no time did the district court say that it was appropriate to  a party of thousands of violations then when it came down to identifying some for trial identify only ninety nine after a tortured process of trying to identify what was actually in dispute and then failed to go forward with any evidence whatsoever on a fourth of those allegations fail to make a promise foshee case on another fourth of those allegations and that that was all objectively reasonable the curtseying case which i believe is the case you're referring to the john wiley case does talk about looking to see if the losing party's position is objectively reasonable but it doesn't ignore or say you shouldn't look at the traditional folk of the factors to determine whether or not a party is the prevailing party so for example issues such as compensation and deterrence our position is that this plaintiff was overly aggressive in its identification of works that it was difficult for us to learn what works we were being accused of infringing and that they didn't narrow their image in a timely fashion that it was not fair to drop a quarter of your allegations during trial when we're trying to defend against all of them and that that type of conduct is worthy of deterrence those are the types of facts that judge evans looked at and again i believe the docket numbers docket for forty one where she looked in more detail at those issues before this panel or before that one circuit we told the prior panel that what the publishers feared is not that professors at georgia state will make incorrect fair use decisions what they fear is that they will make correct fair decisions it's now apparent that that fear is so strong that what they want to preclude is preclude us from being able to make a fair use determination that by simply offering a license there will be a negative impact to a market albi it undefined that so impairs their incentive to publish that we have to pay that's not the law of fair use as the prior panel stated  copyright the right to control copying is not absolute it can be conceptually thought of as an implied license and implied license that we use in order to teach and we  teaching is a fundamental here that the section of the statute that you read teaching is the first step we teach students so then they can criticize common conduct scholar shacked fair use is not something fair use is what allows us to teach and what fulfills the constitution ok thank you you have your argument  ridge i'd like to start by addressing perhaps more concisely than i did my first time about the zone of fair use in a case like th which is troubling one or more of your honor's and troubled judge evans understandably i'd like to suggest that the record here supports all of the following propositions which in combination in combination compel a conclusion of infringement at the least as to thirty one of the works we've argued as in our briefing it should have gone beyond that thirty one would i think suffice to make a terribly important point here we're dealing this is all in the record much of it stipulated systematic takings of significant portions your honor just prior you substantial before they're interchangeable for this person of works created specifically for the educational market where takings are concededly non transformative and therefore pose a significant risk of market substitution where this where the volume of those takings exceed classroom copy guidelines which to address and bama come back to in a moment to one of your prior questions to mr shuttle by a factor of five to one hundred times where these takings were encouraged by a g s you policy that completely delegated unreviewed and unreviewable fair use discretion to untrained faculty where is it stipulated there was no budget provided to the faculty to secure permission so if you're a faculty member think about that you fill out a fair use checklist forgetting the biases of the checklist and you say well i've got two choices i guess either find these favor fair use or don't use these materials because there's no fund there's no student activity fee there's no fund for faculty there's no department money so in a circumstance which yes you budgeted nothing and where they stipulated they have no quote intent to budget anything in the future where the record demonstrates that the express purpose of encouraging eras use was to migrate works from paper course packs paid for by g s you through permissions fees to unpaid use quote to save students money unquote where these huge takings were used in conjunction with multiple other works we have takings of anywhere from five to thirty seven or so stitched together into elec tronic digital readings for two or three courses there were no purchases of any kind the entirety of the course reading was a reserve and where it has further been established your honour's that there exists a readily available efficient low priced judge evans herself in her first opinion said the defendants even concede that c c c has an efficient and reasonable set of practices in place to license these matters and by the way the record was not you don't pay three dollars and seventy five cents a student per course to be clear the record was three dollars and seventy five cents a student per academic year to have access to more than a million three of these works across all eras uses quite a bargain i would suggest and all of those together iran are comprised the basis on which we believe on this record and injunction is warranted we're not you don't see these plaintiffs suing isolated instances of uses you don't see them suing for a single isolated chapter taking out of this context you don't see them suing for taking so that that that that are that are not part of the takings any more than publishers sued to establish precedent in the paper course pack setting which was identical to the suggestion the suggestion incidentally that we ran from the record  that they were a quote only ninety nine and it was skinny down we brought this case your honor on fifteen sample works it was all about this collection of activity it was never about a tally of how many peculiar works viewed in isolation out of context might qualify for fair use we never brought the case with that in mind it was the cumulation of all of these that makes this case that on this record should make this case  easy decision i say that in quotes because i know it is not easy in some ways i'm not saying which is hard when erap but i mean don't we have to consider it on a work by work basis yes but but but but to say that you consider the no work by work basis doesn't mean with blinders your honor it means you can still take into account the setting in which these works were taken in which the determination of the prospect of severe market harm was established so for example a trial your honor literally took chunks took a chapter here took a chapter there made a whole course out of it she said we do this for a living at sage we actually will create for the professor councilman's of the world customized work textbooks i even brought one to the closing here it is look like a paper course back and the point is the harm is there under the prevailing test even on a work basis but it is transcendently larger when viewed in the context of the case what i'm suggesting is you can easily it seems to me craft an opinion that doesn't imply because we don't mean to imply that there is no zone of fair use ever for takings and that's why your honor to your question about a proposed injunction if these takings were far closer to the guidelines classroom guidelines we wouldn't be here if these takings were not part of and full logic takings we wouldn't be here if they were transformative uses we wouldn't be here but none of that is the case your honor asked the question about the preamble language in one of seven and that's critically important understand that that language says fair uses of for educational purposes  agree and i and and if i may just not i don't mean that up to him sorry and importantly because of the very kind of issue that we're dealing with in the electronic environment congress worried about this same balance and that's why congress encouraged what became the classroom guidelines not as a litmus test per se not as a measure of page by page or word by word of infringement but some measure to say you can't have educational use you'll have the kind of situation that yes you has done the guidelines therefore provided some guidance my question is not that you can't have uses that aren't fair of course you can  question is it seems to me that the mere fact that there is licensing availability cannot be determinative on this issue because if it is then you can't ever have fair uses that's what my question goes to and our point is taking your point that it's only we're only saying that it's determinative where you have already a finding of severe risk of market harm that's what the prior panel itself found a survey on this record  of market impairment they need not have determined that but on this record including important set of stipulated facts which included the centrale of of permissions income to these very publishers business the fact that this is this is stipulated fact seventeen and fifty two i believe the fact that the fact that without that that without permissions income certain works wouldn't be viable in terms of profitability there was a big record here that led the dish to lead the circuit court panel to conclude we're facing a severe risk of market harm here the problem with what judge evans did putting aside whether she felt she had latitude on the record or not judge martin to do more the problem is she very way off of established precedent here way out of bounds the test has never been to tell us today if this unlicensed use by this defendant will put you out of business in effect that's what she really said was the test there's no evidence that would put them out of business for this work because it was only fourteen dollars  thirty nine cents with respect it's not the test the sony case says it's only some likelihood of potential future harm not quantifiable today by definition half minute harper says normal market let me use my last half minute tourney fees if i may which is critical which is your honor we completely agree curtseying while it doesn't say that there is a unitary test for a for objective reasonable the main driver says the supreme court we invited judge evans to consider it she declined to consider it in her first opinion she acknowledged we acted in quote good faith in her first attorney fee opinion and in her second she acknowledged that we did act objectively reasonable and that we were pursuing legitimate copyright law objectives what better evidence that this case has been reversed and remanded once before that this is an objective lea reasonable case this is their asking three million dollars in attorney's fees no matter what seems