Source: https://casetext.com/case/pacific-and-southern-co-inc-v-duncan-4
Timestamp: 2019-10-16 07:22:08
Document Index: 427732417

Matched Legal Cases: ['§ 107', '§ 102', '§ 101', '§ 107', '§ 108', '§ 109', '§ 107', '§ 106', '§ 408', '§ 101', '§ 502', '§ 13', '§ 502', '§ 411', '§ 408']

Pacific and Southern Co., Inc. v. Duncan, 744 F.2d 1490 | Casetext
744 F.2d 1490 (11th Cir. 1984)
ReadReadAttorney AnalysesAnalyses0Citing BriefsBriefs14Citing CasesCiting Cases114
Pacific and Southern Co., Inc.v.Duncan
United States Court of Appeals, Eleventh CircuitDec 7, 1984
Georgia TV v. TV News Clips of Atlanta
The fact that WSB-TV's future news broadcasts are not presently created does not preclude injunctive relief…
"Fair use" describes "limited and useful forms of copying and distribution that are tolerated as exceptions…
finding harm to the potential market for plaintiff's news broadcasts where a defendant videotaped the broadcasts and sold tapes to the subjects of the news reports because “[c]opyrights protect owners who immediately market a work no more stringently than owners who delay before entering the market” and so “[t]he fact that [the plaintiff] does not actively market copies of the news programs does not matter, for Section 107 looks to the ‘potential market’ in analyzing the effects of an alleged infringement”
reviewing for abuse of discretion the district court's decision not to permanently enjoin a seller of videotapes containing material that the court had held infringed copyrights
discussing generally a refusal to revisit fair-use arguments under the guise of the First Amendment
Summary of this case from Cable/Home Communication Corp. v. Network Productions, Inc.
October 26, 1984. Rehearing and Rehearing En Banc Denied December 7, 1984.
WXIA does not currently market videotape copies of its news stories. Nevertheless, some people ask the station for a chance to view a tape at the station or to purchase a copy for personal use. WXIA has always honored requests to view tapes and usually allows persons to buy the tapes they want. The revenue from tape sales is a small portion of WXIA's total profits.
The tapes cost one hundred dollars. WXIA will not sell tapes to political candidates because the sale could appear to be an endorsement or other show of support for the candidate. Out of a similar concern over favoritism, the station asks for a subpoena before selling a tape that will be used in litigation.
Carol Duncan operates a business known as TV News Clips, a commercial enterprise belonging to a nationwide association of news clipping organizations. TV News Clips videotapes television news programs, identifies the persons and organizations covered by the news reports, and tries to sell them copies of the relevant portion of the newscast. It does not seek the permission of WXIA or any other broadcaster before selling the tapes, nor does it place a notice of copyright on the tapes. A label on each tape does say, however, that it is "for personal use only not for rebroadcast." TV News Clips erases all tapes after one month.
TV News Clips belongs to the International Association of Broadcast Monitors, an organization of 20 to 30 members. Ms. Duncan is a past president of the association.
The customers pay $65 for an initial purchase and $25 for subsequent purchases.
This case began when TV News Clips sold a copy of a news feature to Floyd Junior College, the subject of a story aired by WXIA on March 11, 1981. WXIA obtained the tape purchased by Floyd Junior College, registered its copyright, and brought this action to obtain damages for the infringement of its copyright and an injunction preventing unauthorized copying and sales of its news program. The district court, 572 F. Supp. 1186, found that the news feature was protected by the copyright laws and that TV News Clips had not made "fair use" of the material. It rejected the fair use defense without reaching the four factors listed in 17 U.S.C.A. § 107 (1977), because TV News Clips had not met its threshold burden of showing that its activity served a purpose such as "criticism, comment, news reporting, teaching . . . scholarship, or research," categories listed in the preamble to Section 107. Yet despite finding that TV News Clips had clearly violated WXIA's copyright, the district court denied the request for an injunction for three reasons. First, the sales did not seriously threaten WXIA's creativity, so an injunction would not significantly further the main objective of the copyright laws, fostering creativity. Second, the court feared that an injunction would threaten First Amendment values served by the increased public availability of the news made possible by TV News Clips. Finally, the court found that WXIA had abandoned its copyright on several portions of the newscasts; it declined to formulate a decree that would distinguish between the abandoned and unabandoned portions.
WXIA does not normally register the copyright for its news programs.
The news feature broadcast by WXIA undoubtedly falls within the protection of the copyright laws. The editorial judgment used to present effectively the events covered by the broadcast made it an "original" work of authorship, Wainwright Securities, Inc. v. Wall Street Transcript Corp., 558 F.2d 91, 95 (2d Cir. 1977), cert. denied, 434 U.S. 1014, 98 S.Ct. 730, 54 L.Ed.2d 759 (1978), and the feature became "fixed" in a tangible medium when it was recorded at the time of transmission. Thus, it met the requirements of 17 U.S.C.A. § 102 (1977). The fact that the infringing tape is the only exact copy of the transmission still in existence does not nullify the copyright. The statute requires only that the original work be "fixed" for a period of "more than transitory duration," not for the entire term of the copyright. 17 U.S.C.A. §§ 101, 102 (1977).
The feature in this case was prerecorded, but the final product broadcast by WXIA included a live introduction by the anchor person and graphics (stating the reporter's name and location) superimposed over the pretaped version.
A copyright grants to the owner several exclusive rights, including the right to reproduce the copyrighted work and to distribute copies to the public. The courts have, however, developed over the years the concept of "fair use" to describe some limited and useful forms of copying and distribution that are tolerated as exceptions to copyright protection. The 1976 Copyright Act codified this judicial doctrine at 17 U.S.C.A. § 107 (1977) without significantly altering it. The statute divides into a "preamble" and a list of factors to consider during the search for fair use:
TV News Clips analogizes itself to a newspaper clipping service or an archive, both of which qualify for an exemption apart from the fair use doctrine. The statute defines an archive with some precision, and TV News Clips does not match the description. 17 U.S.C.A. § 108 (1977). Likewise, it cannot be considered a newspaper clipping service because it does not purchase the copy that it sells to its clients. 17 U.S.C.A. § 109 (1977).
17 U.S.C.A. § 107 (1977).
We agree with TV News Clips that the district court should have considered the four factors set out in the statute. The statute uses mandatory language to the effect that in a fair use determination, the "factors to be considered shall include" (emphasis added) the four listed. The preamble merely illustrates the sorts of uses likely to qualify as fair uses under the four listed factors.
As a result, the House Committee on the Judiciary may have overstated its intention to leave the doctrine of fair use unchanged, because the statute clearly offers new guidance for courts considering fair use defenses. It establishes a minimum number of inquiries that a court must carry out, even if it leaves to the courts how to assign relative weights to each factor and how to supplement the first four factors. See House Report No. 94-1476, U.S.Code-Cong. Ad. News 1976, p. 5659.
The approach taken by the district court impedes the ability of the fair use doctrine to function as a "rule of reason." Fair use allows a court to resolve tensions between the ends of copyright law, public enjoyment of creative works, and the means chosen under copyright law, the conferral of economic benefits upon creators of original works. Where strict enforcement of the rights of a copyright holder under 17 U.S.C.A. § 106 (1977) would conflict with the purpose of copyright law or with some other important societal value, courts should be free to fashion an appropriate fair use exemption. The district court fashioned a per se rule that a use must be inherently productive or creative before it can be a fair use, but a doctrine meant to resolve unforeseen conflicts of values should not turn on such a narrow inquiry. The Supreme Court, in its recent fair use decision in Sony Corp. v. Universal City Studios, ___ U.S. ___, 104 S.Ct. 774, 78 L.Ed.2d 574 (1984), did not conduct any preliminary tests before analyzing the four statutory factors. It expressly refused to look to productivity alone in determining what constituted a fair use. Id. at n. 40. Hence, the Supreme Court's recent application of the doctrine, as well as the traditional purpose of fair use, points out the error of the district court's reasoning.
Despite the district court's erroneous interpretation of the law, we need not remand this case for further fact finding. The district court resolved all the issues of fact necessary for us to conclude as a matter of law that TV News Clips' activities do not qualify as a fair use of the copyrighted work. See Triangle Publications, Inc. v. Knight-Ridder Newspapers, Inc., 626 F.2d 1171, 1175 (5th Cir. 1980) (analyzing usage under the four statutory factors where district court had made findings under an erroneous view of controlling legal principles).
Fair use is probably best characterized as a mixed question of law and fact that can be decided by an appellate court if the trial court has found facts sufficient to evaluate each of the four statutory factors. Cf. Meeropol v. Nizer, 560 F.2d 1061, 1070 (2d Cir. 1977) (trial court erroneously determined fair use as a matter of law before allowing case to go to jury because there were no factual findings regarding first or fourth statutory factors).
This commercial nature of the use militates quite strongly against a finding of fair use, for the Supreme Court emphasized in Sony, supra, that a commercial purpose makes copying onto a videotape cassette "presumptively unfair." 104 S.Ct. at 792. Even before the Supreme Court's decision, many federal courts had found the commercial nature of a use especially significant, if not determinative. See MCA, Inc. v. Wilson, 677 F.2d 180 (2d Cir. 1981); Triangle Publications, Inc. v. Knight-Ridder Newspapers, Inc., supra, at 1175-76; Association of American Medical Colleges v. Mikaelian, 571 F. Supp. 144, 153 (E.D.Pa. 1983) (Commercial purpose is not determinative, but "a court should not strain to apply the fair use defense when it is being invoked by a profit-making defendant").
We also note that TV News Clips' use is neither productive nor creative in any way. It does not analyze the broadcast or improve it at all. Indeed, WXIA expressed concern over the technical inferiority of the tapes. TV News Clips only copies and sells. As the uses listed in the preamble to Section 107 indicate, fair uses are those that contribute in some way to the public welfare. Until recently a few courts had automatically considered unproductive or uncreative uses to be unfair. Universal City Studios, Inc. v. Sony Corp. of America, 659 F.2d 963 (9th Cir. 1981), rev'd, ___ U.S. ___, 104 S.Ct. 774, 78 L.Ed.2d 574 (1984); Rubin v. Boston Magazine Co., 645 F.2d 80 (1st Cir. 1981); Dow Jones Co., Inc. v. Board of Trade, 546 F. Supp. 113 (S.D.N.Y. 1982). Although the Supreme Court has rejected "productive use" as an absolute prerequisite to a defense of fair use, it has recognized that the distinction between productive and unproductive uses could be "helpful in calibrating the balance." Sony, 104 S.Ct. 795, n. 40. The unproductive nature of TV News Clips' use affects the balance in this case.
The third factor directs our attention to the amount and substantiality of the portion used in relation to the copyrighted work as a whole. The Floyd Junior College story stands alone as a coherent narrative, and WXIA saves it as a distinct unit for future reference apart from the rest of the March 11 broadcast. The Register of Copyrights issued a certificate of copyright for the Floyd Junior College segment and for the entire broadcast. Moreover, the district court found that WXIA had properly registered the story and the whole broadcast. We agree with the district court that the feature stands alone as a copyrighted work in this case. Hence, TV News Clips copied an entire work. And even if the story could not stand independent of the entire newscast, we could not ignore the fact that TV News Clips tapes virtually all of the broadcast on a daily basis. By bringing a suit for injunctive relief as well as damages, WXIA is challenging the entire practice of copying and selling news stories, not just the sale of the Floyd Junior College story. Because TV News Clips uses virtually all of a copyrighted work, the fair use defense drifts even further out of its reach. See Marcus v. Rowley, 695 F.2d 1171 (9th Cir. 1983).
TV News Clips contends that the district court erred in its finding that WXIA had properly registered the Floyd Junior College story because WXIA had deposited, pursuant to 17 U.S.C.A. § 408(b) (1977), the copy made by News Clips. This invalidated the registration, it argues, because the copy was not fixed "under authority of the author." It is true that a work must be fixed under authority of the author in order for the protections of copyright to take effect. 17 U.S.C.A. § 101 (1977). But the tape that "fixes" a broadcast need not be the same tape that is deposited for registration.
This case differs from Triangle Publications, Inc. v. Knight-Ridder Newspapers, Inc., supra, where the court held that the cover of a magazine was not a copyrighted work apart from the whole magazine. There was no evidence in that case that the cover had been registered apart from the magazine or that they were stored or used separately.
In addition, we mention that a small portion of a work may be especially significant. The single story involving a particular subject is by far the most significant portion of the newscast for that potential customer.
Finally, the second factor calls on us to analyze the nature of the copyrighted work. This is the only factor that arguably works in favor of TV News Clips. The importance to society of the news could affect the definition of a fair use for a number of reasons. But the courts should also take care not to discourage authors from addressing important topics for fear of losing their copyright protections. The necessarily limited impact of this second factor, along with the commercial and unproductive purpose of the use, the injury to the potential market, and the substantial amount of copying, leads us to conclude that TV News Clips has not made fair use of the protected work.
The Supreme Court has mentioned that use of a news program may give rise to a fair use defense more easily than use of a full-length motion picture. Sony, supra, 104 S.Ct. at 795, n. 40. The Court does not fully explain this distinction, but the context suggests that the large secondary market for motion picture copies makes fair use less appropriate in that context. As discussion of the fourth factor revealed, significant commercial harm is present in this case. Another court found that the great public interest in the contents of a book (the memoirs of Gerald Ford) called for application of the fair use doctrine. Harper Row, Publishers, Inc. v. National Enterprises, 723 F.2d 195 (2d Cir. 1983). But the Harper Row court also relied on other factors, particularly the fact that the alleged infringer used material from the book that was for the most part not copyrightable at all. Furthermore, the public interest in the average news story is far less than the interest in presidential memoirs.
TV News Clips urges us to consider a fifth factor in evaluating its claim of fair use. It points to WXIA's status as a governmental licensee, with a duty "to provide public access to newscasts," and argues that the fair use doctrine should be employed here to prevent WXIA from using the copyright laws to restrict public access in violation of its duties as a government licensee. WXIA is correct in contending that its duties as a public trustee do not go as far as TV News Clips claims. The cases cited by the appellant, Richmond Newspapers, Inc. v. Virginia, 448 U.S. 555, 100 S.Ct. 2814, 65 L.Ed.2d 973 (1980); Columbia Broadcasting System v. Democratic National Committee, 412 U.S. 94, 93 S.Ct. 2080, 36 L.Ed.2d 772 (1973); Red Lion Broadcasting Co. v. FCC, 395 U.S. 367, 89 S.Ct. 1794, 23 L.Ed.2d 371 (1969); and Muir v. Alabama Educational Television Commission, 656 F.2d 1012, 1017 (5th Cir. 1981), on rehearing, 688 F.2d 1033, cert. denied, 460 U.S. 1023, 103 S.Ct. 1274, 75 L.Ed.2d 495 (1983), indicate, if only by implication, that broadcast licensees and the press generally have a duty to provide public service. That duty finds at least partial expression in the fair use doctrine. But it is a long way from this proposition to TV News Clips' position that a licensee violates the public trust by enforcing its copyright against persons other than members of the press. WXIA has chosen to produce a news program and allows anyone interested to view the program after its broadcast. Certainly it has fulfilled its public obligations by doing this much. Therefore, WXIA's status as a public trustee does not change our evaluation of the fair use claim.
Finally, TV News Clips argues that every copyright must further the ends of the Copyright Clause of the Constitution. WXIA's copyright, TV News Clips says, does not further those ends and should not be enforced, because WXIA systematically destroys its broadcast videotapes and deprives the public of the benefits of its creative efforts. We agree that the Constitution allows Congress to create copyright laws only if they benefit society as a whole rather than authors alone. That is what the Congress has done. But this does not mean that every copyright holder must offer benefits to society, for the copyright is an incentive rather than a command. And, a fortiori, a copyright holder need not provide the most complete public access possible. WXIA provides complete access for seven days and permanent access to everything except the visual images broadcast live from within the studio. The public benefits from this creative work; therefore, enforcing the copyright statute in this case does not violate the Copyright Clause.
This alleged conflict between the ends of copyright law and its application in a particular case should be analyzed under the fair use rubric. We will, however, defer to TV News Clips' desire to treat this as a separate defense just as we did with regard to its First Amendment arguments, for our conclusion would be the same under either approach.
It has created a structure that encourages creativity and public enjoyment of that creativity by giving authors the exclusive rights to profit from their works in certain ways. Since authors most often profit by distributing their works to the public, society usually benefits. Dallas Cowboys Cheerleaders, Inc. v. Scoreboard Posters, Inc., 600 F.2d 1184 (5th Cir. 1979). Where the First Amendment removes obstacles to the free flow of ideas, copyright law adds positive incentives to encourage the flow.
WXIA has proven that TV News Clips infringed its copyright. The district court found that TV News Clips had regularly copied the newscast and sold the tapes, and would continue to do so. Unless it can obtain an injunction, WXIA can only enforce its copyrights against TV News Clips by finding out which stories have been copied and sold, registering those stories, and bringing many different infringement actions against TV News Clips. Each infringement action would yield a rather small damage recovery. This is a classic case, then, of a past infringement and a substantial likelihood of future infringements which would normally entitle the copyright holder to a permanent injunction against the infringer pursuant to 17 U.S.C.A. § 502(a) (1977). See Milene Music, Inc. v. Gotauco, 551 F. Supp. 1288 (D.R.I. 1982); 3 Nimmer on Copyright § 13.05[B] (1983). The question is whether the district court abused its discretion in refusing to issue the injunction. Because none of the three grounds relied upon by the court for denying injunctive relief are legally sufficient to support the decision, we hold that the court did abuse its discretion.
Indeed, the court considered future sales by TV News Clips to be a virtual certainty and a "modest social benefit." 572 F. Supp. at 1196.
The award in this case was $35.
TV News Clips insists that WXIA is not legally entitled to an injunction, because it seeks an injunction against the infringement of works that have not been created (future newscasts) rather than an injunction applicable only to the March 11 program. The statute itself does not impose such a requirement, for it empowers district courts to issue injunctions "on such terms as it may deem reasonable to prevent or restrain infringement of a copyright." 17 U.S.C.A. § 502(a) (1977). The appellant bases its argument on the requirement that an author register a work before instituting an infringement action. 17 U.S.C.A. § 411 (1977). An injunction against the use of unregistered works would bypass this requirement.
The district court in this case had the power to issue such an injunction because the statute provides for injunctions to prevent infringement of " a copyright" (emphasis added), not necessarily the registered copyright that gave rise to the infringement action. The opposite result would be especially unjust in a case such as this one in which the registered work and the future works are so closely related, part of a series of original works created with predictable regularity and similar format and function. To refuse injunctive relief under these conditions would render meaningless the fact that registration is "not a condition of copyright protection." 17 U.S.C.A. § 408(a) (1977).