Source: http://williampatry.blogspot.com/2008/04/fair-use-three-step-test-and-european.html
Timestamp: 2019-04-24 20:53:50+00:00

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There is a counter-reformation movement afoot in the world of copyright. The purpose of the movement is to chill the willingness of countries to enact fair use or liberal fair dealing provisions designed to genuinely further innovation and creativity, rather than, as is currently the case, merely to give lip service to those concepts as the scope of copyright is expanded to were-rabbit size.
In addition to Director General Arpad Bogsch who was the lead witness in the very first congressional hearing (before the Senate on May 16, 1985), the following foreign experts participated in the round table: Mr. Shahid Alikhan, Mr. Gyorgy Boytha, Mr. Jean-Louis Comte, Mrs. Mialgros De Corral, Professor Dr. Dittrich, Mr. Mayer Gabay, Mr. Roland Grossbacher, Professor Gunnar Karnell, Mr. Jukka Liedes, Mrs. Margaret Moller, Dr. Werner Rumphorst, Mr. Victor Tarnofksy, Professor Dr. Dirk W.F. Verkade, and Mr. Jean-Alexis Ziegler. If any of these illustrious experts had any thoughts on fair use, they were not expressed publicly.
The only real difference -- and that has nothing to do with the level of protection -- that makes the U.S. law incompatible with the Berne Convention consists in the notice and registration requirements. One can solve that in two ways: make compliance with those two requirements voluntary rather than mandatory -- for any work, or make compliance with those requirements voluntary only for foreign works that would have to be protected under the Berne Convention.
May 16, 1985 hearing, page 10).
When Dr. Bogsch was asked about the compatibility of U.S. limitations and exceptions, the only one he thought might be a problem was the Section 116 jukebox license, and even here, he testified, "I would say it could be regarded as a matter of not sufficient importance from an economic viewpoint, so that nobody would be very excited about it, even if you don't change your law." (page 14). Nor can one say Dr. Bogsch was simply unfamiliar with U.S. law. Although he was a native of Hungary, he had worked in the U.S. Copyright Office, obtained an American law degree, and became a U.S. citizen. (See an obituary of him here).
So why now, 23 years after Dr. Bogsch's testimony, is the issue of fair use compatibility being raised with national ministries? If there really was a problem, why wasn't the issue taken to a WTO panel rather than the pathetically minor amendment to Section 110(5) that was taken to a WTO panel ? Why wasn't the obvious lack of moral rights in the U.S. objected to? Why wasn't the U.S. failure to provide retroactive protection to foreign works as required by the Berne Convention complained about, a failure that existed from 1988 to 1995? Why single out fair use 23 years after Dr. Bogsch testified that the only incompatibilty issues were notice and registration? The answer is obvious.
The three-step itself is under attack too, and is being cast as a rigid limitation on limitations, rather than as a recognition that copyright rights only go so far. There is an excellent book on the three-step test, Martin Seftleben's "Copyright, Limitations, and the Three-Step Test: Analysis of the Three-Step Test in International and EC Copyright Law," published by Kluwer Law International in 2004 and available here. Mr. Senftleben was a student of the great Dutch copyright scholar Bernt Hugenholtz who just co-authored a major piece on the issue, available here. In addition to the counter-reformation revisionism about the compatibility of Section 107, there is counter-reformation revisionism about the three-step test.
The three steps are (1) certain special cases which (2) do not conflict with a normal exploitation of the work, and (3) do not unreasonably prejudice the legitimate interests of the author. Counter-reformation forces act as if Article 9(2) is a centerpiece of the Convention, something essential to the goals of ensuring that authors' rights aren't eroded by those thieves and pirates who insist on using the author's work without permission. Not true: the three-step test is a very recent addition to the Berne Convention, which was founded in 1888. The provision was proposed in the 1967 Stockholm protocol and then included in the 1971 Paris text, only 14 years before WIPO General Bogsch testified before Congress on U.S. adherence to the Convention. As Mr. Senftleben points out in his insightful chapter 3 ("The Contextual Background to the Three-Step Test"), the introduction of the three-step test was part of a deal, the deal being providing formal recognition to the reproduction right: "The feasibility of the plan to attain the formal recognition of a general right of reproduction, however, depended on whether or not the Conference would succeed in finding a satisfactory formulation for possible limitations." (page 47).
Article 9(2) BC was distilled from typical features of the described extensive list of limitations that existed in 1967. The 1965 Committee of Governmental experts unequivocally took the view that in the course of the preparatory work for the Stockholm conference that 'the main difficulty was to find a formula which would allow of exceptions, bearing in mind the exceptions already in many domestic laws.
What were those exceptions? A study group found 14 common limitations: republication of public speeches; quotations; copying of school books and chresomathies; copying of newspaper articles; reporting current events; ephemeral recordings; copying for private use; reproduction by copying in libraries; reproduction on special characters for the use of the blind; copying of sound recordings of literary works for the use of the blind; copying of the text of songs; taking pictures of sculptures on permanent display in public places; use of artistic works used as background in films and TV programs; and reproductions in the interests of public safety. (Senftleben p. 48).
Current efforts to use the three-step test as a sword rather than a shield might well deny some of these uses as qualifying under the three-step test. The phenomenon of the three-step as a sword should be understood as part of a larger picture, in which copyright has become an absolute property right, what Blackstone (an advocate of copyright as a natural right) hyperbolically called an individual's "sole and despotic dominion ... over the external things in the world, in total exclusion of the right of any individual in the universe." This very recent phenomenon has led to what Professor Neil Netanel has rightly described as “spawn[ing] a vicious cycle. It reinforces the view that copyright owners are intrinsically entitled to control and reap the full value of each and every use of copyright-protected expression, thus smoothing the way to still further expansion.” Copyright's Paradox p. 55.
The attacks on fair use and the transmogrification of the three-step test are an essential part of this cycle: it is not enough to have vast rights: corporate content owners see a need to eliminate any limitations on those rights too, and one must hand it to them for their Karl Rove strategy of going after your opponent's strong points, rather than his weak ones. But unlike John Kerry, we need not and should stand by and let limitations and exceptions be swift-boated. Mr. Sentfleben points out that the origins of the three-step lie not only in the necessity of preserving existing limitations as a quid pro quo for the formal recognition of the reproduction right, but that the formulation chosen for the three-step was not an enumerated list of such existing uses, but rather abstract criteria. As Mr. Senftleben points out: "A comparison of the various observations made by the members countries elicits the specific quality of the abstract formula...: due to its openness, it gains the capacity to encompass a wide range of exceptions and forms a proper basis for the reconciliation of contrary opinions." (page 51). That sounds a lot like fair use.
Openness and toleration of diverse approaches have been an important hallmark of the Berne Convention, given its desire to include both civil law and common law countries, as well as developed countries and lesser developed countries. That same openness and toleration of diverse approaches -- so under attack today in the new TRIPS trade world of IP -- is what led Dr. Bogsch to approve of U.S. adherence to the Berne Convention, adherence where fair use was so obviously compatible with the letter, spirit, and history of the three-test step that not a single WIPO official or foreign copyright expert ever mentioned it in the four years U.S. adherence was being debated and eagerly sought. In a response to a question from Senator Mathias about the attitude of other Berne members, Dr. Bogsch replied, "They ardently desire it. They would welcome it without qualification." (May 16, 1985 p. 12). Without question they desired adherence in compliance with Berne's requirements, but the U.S., like any country, was entitled to rely on the opinion of the Director General of the organization administering the treaty as to what steps were necessary to comply. And Dr. Bogsch gave his opinion, an opinion in which the only limitation mentioned was the jukebox compulsory license, a limitation Dr. Bogsch though was of no moment. There was no mention of fair use, because no one thought fair use was incompatible with the three-step test.
The current counter-reformation movement should therefore be seen as the ahistorical effort it is. National governments are free to craft laws that serve their own needs and policies, including liberal limitations and exceptions.
The great Israeli scholar Orit Fischman kindly pointed out to me that in 1996, a number of countries, as part of the TRIPs process, asked each other questions about their laws. The United States was asked many questions on a wide variety of topics, but only three dealt with fair use, and even then the questions were about specific applications. The EU asked about parody, Australia asked about a case on speed-up kits and a case about photocopying, and New Zealand asked about commercial research and scholarly uses. Here is the link to the entire document. It is worth pointing out that no country has filed an objection since the U.S. gave its answers. Here are the questions and the answers, with the answers in italics.
1. Under 17 U.S.C. § 107, the United States permits "fair use" of a copyrighted work. Please explain how the fair use doctrine, as it has been broadly applied and interpreted by US courts, particularly in connection with a "parody" that diminishes the value of a work, is consistent with TRIPS Article 13, given the obligation to "confine limitations or exceptions to exclusive rights to certain special cases which do not conflict with a normal exploitation of the work and do not unreasonably prejudice the legitimate interests of the right holder".
The fair use doctrine of US copyright law embodies essentially the same goals as Article 13 of TRIPS, and is applied and interpreted in a way entirely congruent with the standards set forth in that Article. Fair use was his to rically developed as a safety valve to the exclusive rights granted by copyright, permitting limited and reasonable uses without permission or payment - precisely those types of uses which do not interfere with the copyright owner's normal exploitation of the work or unreasonably prejudice his or her rights. The classic example of fair use is the quotation in a book review of portions of the book being reviewed. The copyright owner ordinarily does not prepare reviews of his own work, and the impact on his interests will ordinarily be minimal. If, on the other hand, so much material is quoted that the review will substitute for purchases of the book in the marketplace, the use will not be considered fair.
The articulation of this concept that was developed by the courts over the years and codified in the Copyright Act in 1976 (17 U.S.C. § 107) identifies four fac to rs that courts must examine in determining whether a use is fair: (1) the purpose and character of the use, including whether such use is of commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work. The balancing of the four fac to rs represents a means of evaluating whether in fact the use in question conflicts with a normal exploitation of the work and unreasonably prejudices the copyright owner's interests. The Supreme Court has stated that the fourth fac to r, which specifically focuses on the impact on potential market exploitation of the work, is the most important. See Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 566 (1985). Other factors may be considered as well, allowing a flexible and sensitive calibration of the impact of the particular use under the circumstances.
In applying the fair use doctrine, the courts have consistently refused to excuse uses that go to o far and interfere with the copyright owner's normal markets for the work. See, e.g., Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539 (1985); American Geophysical Union v. Texaco, Inc., 37 F.3d 881 (2d Cir. 1994); Pacific & Southern Co. v. Duncan, 744 F.2d 1490 (11th Cir. 1984); Basic Books, Inc. v. Kinko's Graphic Corp., 758 F. Supp. 1522 (S.D.N.Y. 1991). Those uses that have been permitted have generally involved productive and non-commercial uses of limited amounts of material from the copyrighted work. See, e.g., Arica Institute, Inc. v. Palmer, 970 F.2d 1067 (2d Cir. 1992); Wright v. Warner Books, Inc., 953 F.2d 731 (2d Cir. 1991); Triangle Pub., Inc. v. Knight-Ridder Newspapers, Inc., 626 F.2d 1171 (5th Cir. 1980).
In response to the specific question about parody, it is important to understand that not all parodies qualify as fair use under US law. Rather, each parody is dealt with on a case-by-case basis, applying the factors set out in Section 107 in a manner that takes in to account the nature of parody. Thus, the US Supreme Court has held that the purpose and character of parody involves both criticism and humour, giving it social and cultural value, and that a parody, in order to be effective, must necessarily take enough of the copyrighted work to make the object of the parody recognizable. Campbell v. Acuff-Rose Music, Inc., 114 S.Ct. 1164 (1994). Not all humorous works that draw on pre-existing works will enjoy the benefit of this more lenient application of the fair use factors, however; the defendant's work must qualify as a true parody, targeting and commenting on the copyrighted work rather than simply using it as a vehicle for unrelated comment. Id. at 1172.
In examining the fourth fair use factor, the effect on the actual and potential market for or value of the copyrighted work, the Supreme Court held that any negative impact caused solely by the critical aspect of a parody could not be considered. Id. at 1178. This analysis is consistent with TRIPS Article 13, since any such lessening of public interest in the copyrighted work does not constitute "unreasonable prejudice" to "legitimate interests" of the copyright owner - rather, it is equivalent to the lessening of public interest that may result from a scathing review. This type of harm should not be actionable by a copyright owner; otherwise only flattering commentary or benign parody is likely to be permissible. In contrast, harm to the market for other adaptations of the copyrighted work will clearly weigh against a finding of fair use. Id.
The US answer equates the likely effect of a critical parody of a work with that of a scathing review. The answer also suggests that a much greater part of the copyright work will be reproduced in the parody than in the review. Unlike a review, therefore, exploitation of the parody could apparently replace any desire to exploit the copyright work.
How does the US justify this possibility given the requirement in TRIPS Article 13 that limitations and exceptions to exclusive rights should not conflict with a normal exploitation of the work?
If exploitation of a parody is of a nature that it replaces any desire to exploit the copyright work, the fourth fair use factor applied by the courts will weigh strongly against the defendant, and the use will not be considered fair. As noted in our original answer to this question, the Supreme Court of the United States has specifically directed the lower courts to consider the effect of the parody on the market for other adaptations of the work, in applying the fair use factors. As a result, the right holder's ability to control the exploitation of copies or adaptations of the work is protected.
1. Please explain, having regard to the decisions in Sega Enterprises v Accolade, Inc. and Prince to n University Press v Michigan Document Services Inc. and any similar cases whether and how the US law of fair use complies with Article 9(2) of the Berne Convention and Article 13 of TRIPS.
The decision in the other case, Princeton Univ. Press v. Michigan Document Servs., 74 F.3d 1512 (6th Cir. 1996), has been vacated. Princeton Univ. Press v. Michigan Document Servs., reh'g en banc granted, vacated, stay granted 74 F.3d 1528 (6th Cir. 1996).
1. In respect to the reply to the European Communities and their Member States on fair use (their question 1), please clarify how practice, especially case law, has affected the use of works in respect to teaching, research, and scholarship. In particular, how open ended is the multiple copying right for teaching, does research encompass any commercial research, and what is encompassed by scholarship?
It is important to understand that the purposes listed in the first sentence of Section 107, which include teaching, scholarship, or research, do not automatically qualify a use as a fair use, but are simply examples of the types of purposes that are likely to qualify as fair. See Twin Peaks Prods., Inc. v. Publications Int'l, Ltd., 996 F.2d 1366, 1374 (2d Cir. 1993). Each use must still be examined in light of the four statutory factors found in Section 107. Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 127 L. Ed. 2d 500, 514-515 (1994).
Accordingly, extensive multiple copying for the purposes of teaching has been held to fall outside the scope of the fair use doctrine and to constitute an infringement of copyright in the works copied. See Basic Books, Inc. v. Kinko's Graphic Corp., 758 F. Supp. 1522 (S.D.N.Y. 1991), noted in our original answer to the question from the European Communities. Guidelines as to the permissible amount and timing of such copying, negotiated by the educational and publishing sectors, are set out in the legislative history to the Copyright Act. H.R. Rep. No. 94-1476, 94th Cong., 2d Sess. 68-70 (1976).
Finally, the label of "scholarship" in itself will not resolve the fair use issue, and there is no established definition of the term. If a particular use is designed to advance knowledge, this should be an aspect of the purpose and character of the use that weighs in favour of a fair use determination.
So why now, 23 years after Dr. Bogsch's testimony, is the issue of fair use compatibility being raised with national ministries?
Very interesting. But at least, to the extent fair use is required by the First Amendment, it couldn't be overridden by treaty, and I would think shouldn't be construed to have intended that result.
Professor Ricketson makes the important point that "By their nature, treaty provisions are usually expressed in more general and open-ended language than, say, provisions in national legislation, or conditions in a contract between parties." (page 5). In keeping with this, treaties are directed toward national governments and not courts or parties: treaty provisions are merely guides by which legislatures then implement the policies expressed in the treaty. We should not expect therefore that the three-step test represent a statutory provision against which national statutory provisions much less court decisions are measured. Accordingly, it should not be surprising that the three-step test itself was deliberately written in an open fashion, and not as a closed list of enumerated, permissible uses like national fair dealing laws.
It is against the nature of treaty drafting and the drafting of the three-step test itself to measure Section 107 of the Copyright Act against one's own interpretation of how the three-step test should be implemented. With the greatest respect, I fear Professor Ricketson comes close to doing this in his own brief discussion of fair use in his paper, contained on pages 67-69. He asks whether the enumerated purposes in the prologue to section 107 (and presumably the first factor) square with the "certain special cases" prong of the three-step test, and notes that those examples are illustrative not limitative, an indeterminacy he wonders about. Of course, the drafters of the three-step test rejected calls for an enumerated closed list, in favor of an open-ended approach, so there cannot be a requirement that there be an enumerated closed list. Nor did the drafters intended to freeze permissible uses to specified ones; first of all, which ones, in which laws, and applied how? The very impossibility of doing so was an important factor in rejecting the closed list approach.
But there is another aspect of Professor Ricketson's discussion I find unsatisfactory if I understand it, and it is a possible suggestion that because we may not know if any given court decision may conflict with the three-step test as (and here is the key) interpreted by ????, there may be a problem. That's not the way treaties work: one cannot say that any given national law is incompatible with a treaty obligation because some national court in a theoretical future case might go beyond vague boundaries.
Fair use is entirely compatible with the three-step test, and it is therefore not surprising that all the eminent scholars who studied the U.S. adherence at the time failed to mention it as even a potential problem.
An interesting post; I certainly agree with the general message of the article, yet I am not entirely convinced. Here is why: First, I do think that one should take into account that the international community was quite desperate to convince the US to become a Berne member state back then in the 1980s. I believe that therefore US copyright law was probably not subjected to as close a scrutiny as it should have been. In other words, I suggest that there was considerable fear that if too many demands were made as to necessary changes of US copyright law, the US might just not join “the club”. Secondly, I believe that one must also consider here that in the US a vast body of case law exists by now that, after all, significantly clarifies the scope of the doctrine. It is arguably for that reason that the US fair use doctrine actually does pass the first step of the three-step test which requires a confinement to "certain special cases". I am often approached by law and policymakers in Africa with the question of whether or not they should introduce a fair-use style copyright exception into their domestic laws. However, although I have been arguing for broader recognition of user interests in the realm of copyright law for quite some time, I usually advise against such a move. I am not only skeptical that a broad fair use provision without a clarifying body of case law can really be qualified as a limitation or exception that is confined to CERTAIN special cases; especially if one takes into account the interpretation of this step by a WTO dispute panel in 2000. Even more importantly, I don't think that such a broad provision is as user-friendly as often suggested. On the contrary, since nobody really knows initially what qualifies as fair use and what does not, such a clause would eventually necessitate numerous court battles, which are costly and whose outcome is highly uncertain. This situation is comparable to the situation in the US at the beginning of the 20th century when (the relatively new) fair use doctrine was, quite rightly, described as one of the most troublesome doctrines in (copyright) law. Should such a doctrine really be supported?
Thanks Tobias for your comments. I agree that Europeans didn't want to put too many demands on the U.S., but that begs the question: having accepted the U.S. law as compatible, should WIPO and others now be able to claim it isn't, either in the U.S. or elsewhere? I think not. I also think that fair use was deemed compatible; after all, it is not as if important issues of U.S. compatibility were politely ignored; they weren't, they were opnely discussed and then the WIPO and Europe blinked. But fair use, although occasionally and briefly discussed by Americans, was not discussed by WIPO or by Europeans (at least publicly), so I don't think one can say that fair use fell into the zone of things that we recognized as problems but swept under the rug.
Of course, saying that other countries may adopt a fair use provision doesn't mean they should. My point was that each country has the flexibility to adopt measures that meets its own social, cultural, and political objectives, including fair use and liberal fair dealing provisions. I do think that some sort of general safety valve is necessary because legislatures, no matter how careful, cannot anticipate all current, and no future uses. Courts should be given the flexibility to permit uses which satisfy objectives that the legislature demarcates, wholly aside from enumerated lists. In my view such lists, while essential in providing concrete guidance, have definite limits, and when those limits are reached, they can be circumvented, as in interpreting "research" very broadly. When this happens, even enumerated lists lack the ability of providing litigants with clear guidance. Clear guidance beforehand is, also I think, overrated and often in the eye of the beholder: more important is whether our copyright laws are performing as we them too.
William, what steps, if any, do you think could be taken to counter this campaign from big media and protect fair use?
I was wondering if you could elaborate on who is participating in this campaign? Are you aware of any certain companies that are involved in this practice?
Since the original posting, I have read a few stories about the posting on other blogs. I am happy to see the issue being raised by others, and hope that by raising the issue, we can ensure that the great freedom flexibility nations have to pursue their own cultural, social, and economic goals through copyright are exercised free of one-sided, partisan approaches to what are called limitations are exceptions; specifically, that the three-step not become a sword exercised as a limitation on limitations, cowering those governments who wish to pursue a balanced innovation agenda, and those countries who may wish to follow Israel's example, or variants of it.
Counter-reformations consist of diverse, independent groups of people, many of whom are believers, and who are not puppets being manipulated by others to further commercial interest, and in this respect the original post was misunderstood as being another salvo in the great U.S. copyright wars. Indeed, I think true believers are the most problematic since their zeal, appeal to authority, and certainty in their keeping the flame blinds. The Berne Convention is a big tent Convention; it permits diverse approaches to copyright, because it wants to include countries from diverse traditions, common law and civil law, countries that permit work for hire and those that don't, countries that have fair use and those that don't.
Counter-reformation folk, including a few academics in the U.S., ignore the big tent philosophy, and act as if copyright is a natural right, as if limitations and exceptions are derogations from a God-granted right, as if Article 9(2) is a straight-jacket designed to ensure that no one threatens the natural rights approach. This approach well serves corporate copyright interests too, where the philosophy is translated into a property rights view of copyright, but it is important to bear in mind that the alleged keepers of the copyright flame have their own agenda even while that agenda serves others' interests too.
The purpose of the post, then, was to point out that the keepers of the Berne flame, when the issue of limitations and exceptions was debated in 1967, and when U.S. adherence to Berne was being debated in 1985-1988, took a far more generous view of the issue than the counter-reformers do today.
Ahistorical views of limitations and exceptions should not be permitted to serve as false roadblocks to meaningful fair use or fair dealing laws, enacted as national governments see fit to further national goals. The Berne Convention was not intended to be an international copyright statute, but rather a way to ensure that there was national treatment for foreign authors and a minimum level of rights. The Berne Convention, like copyright itself, is intended to encourage creation and diversity, including in the laws that are enacted toward that objective.
You might find this piece interesting: http://ssrn.com/abstract=924174. It's more or less along the lines of your ideas.

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