Opinion ID: 111062
Heading Depth: 1
Heading Rank: 4

Heading: Fair Use

Text: The doctrine of fair use has been called, with some justification, the most troublesome in the whole law of copyright. Dellar v. Samuel Goldwyn, Inc., 104 F. 2d 661, 662 (CA2 1939); see Triangle Publications, Inc. v. Knight-Ridder Newspapers, Inc., 626 F. 2d 1171, 1174 (CA5 1980); Meeropol v. Nizer, 560 F. 2d 1061, 1068 (CA2 1977), cert. denied, 434 U. S. 1013 (1978). Although courts have constructed lists of factors to be considered in determining whether a particular use is fair, [27] no fixed criteria have emerged by which that determination can be made. This Court thus far has provided no guidance; although fair use issues have come here twice, on each occasion the Court was equally divided and no opinion was forthcoming. Williams & Wilkins Co. v. United States, 203 Ct. Cl. 74, 487 F. 2d 1345 (1973), aff'd, 420 U. S. 376 (1975); Benny v. Loew's Inc., 239 F. 2d 532 (CA9 1956), aff'd sub nom. Columbia Broadcasting System, Inc. v. Loew's Inc., 356 U. S. 43 (1958). Nor did Congress provide definitive rules when it codified the fair use doctrine in the 1976 Act; it simply incorporated a list of factors to be considered: the purpose and character of the use, the nature of the copyrighted work, the amount and substantiality of the portion used, and, perhaps the most important, the effect of the use upon the potential market for or value of the copyrighted work (emphasis supplied). § 107. No particular weight, however, was assigned to any of these, and the list was not intended to be exclusive. The House and Senate Reports explain that § 107 does no more than give statutory recognition to the fair use doctrine; it was intended to restate the present judicial doctrine of fair use, not to change, narrow, or enlarge it in any way. 1976 House Report 66. See 1975 Senate Report 62; S. Rep. No. 93-983, p. 116 (1974); H. R. Rep. No. 83, 90th Cong., 1st Sess., 32 (1967); H. R. Rep. No. 2237, 89th Cong., 2d Sess., 61 (1966).
Despite this absence of clear standards, the fair use doctrine plays a crucial role in the law of copyright. The purpose of copyright protection, in the words of the Constitution, is to promote the Progress of Science and useful Arts. Copyright is based on the belief that by granting authors the exclusive rights to reproduce their works, they are given an incentive to create, and that encouragement of individual effort by personal gain is the best way to advance public welfare through the talents of authors and inventors in `Science and the useful Arts.'  Mazer v. Stein, 347 U. S. 201, 219 (1954). The monopoly created by copyright thus rewards the individual author in order to benefit the public. Twentieth Century Music Corp. v. Aiken, 422 U. S., at 156; Fox Film Corp. v. Doyal, 286 U. S. 123, 127-128 (1932); see H. R. Rep. No. 2222, 60th Cong., 2d Sess., 7 (1909). There are situations, nevertheless, in which strict enforcement of this monopoly would inhibit the very Progress of Science and useful Arts that copyright is intended to promote. An obvious example is the researcher or scholar whose own work depends on the ability to refer to and to quote the work of prior scholars. Obviously, no author could create a new work if he were first required to repeat the research of every author who had gone before him. [28] The scholar, like the ordinary user, of course could be left to bargain with each copyright owner for permission to quote from or refer to prior works. But there is a crucial difference between the scholar and the ordinary user. When the ordinary user decides that the owner's price is too high, and forgoes use of the work, only the individual is the loser. When the scholar forgoes the use of a prior work, not only does his own work suffer, but the public is deprived of his contribution to knowledge. The scholar's work, in other words, produces external benefits from which everyone profits. In such a case, the fair use doctrine acts as a form of subsidy  albeit at the first author's expense  to permit the second author to make limited use of the first author's work for the public good. See Latman Fair Use Study 31; Gordon, Fair Use as Market Failure: A Structural Analysis of the Betamax Case and its Predecessors, 82 Colum. L. Rev. 1600, 1630 (1982). A similar subsidy may be appropriate in a range of areas other than pure scholarship. The situations in which fair use is most commonly recognized are listed in § 107 itself; fair use may be found when a work is used for purposes such as criticism, comment, news reporting, teaching, . . . scholarship, or research. The House and Senate Reports expand on this list somewhat, [29] and other examples may be found in the case law. [30] Each of these uses, however, reflects a common theme: each is a productive use, resulting in some added benefit to the public beyond that produced by the first author's work. [31] The fair use doctrine, in other words, permits works to be used for socially laudable purposes. See Copyright Office, Briefing Papers on Current Issues, reprinted in 1975 House Hearings 2051, 2055. I am aware of no case in which the reproduction of a copyrighted work for the sole benefit of the user has been held to be fair use. [32] I do not suggest, of course, that every productive use is a fair use. A finding of fair use still must depend on the facts of the individual case, and on whether, under the circumstances, it is reasonable to expect the user to bargain with the copyright owner for use of the work. The fair use doctrine must strike a balance between the dual risks created by the copyright system: on the one hand, that depriving authors of their monopoly will reduce their incentive to create, and, on the other, that granting authors a complete monopoly will reduce the creative ability of others. [33] The inquiry is necessarily a flexible one, and the endless variety of situations that may arise precludes the formulation of exact rules. But when a user reproduces an entire work and uses it for its original purpose, with no added benefit to the public, the doctrine of fair use usually does not apply. There is then no need whatsoever to provide the ordinary user with a fair use subsidy at the author's expense. The making of a videotape recording for home viewing is an ordinary rather than a productive use of the Studios' copyrighted works. The District Court found that Betamax owners use the copy for the same purpose as the original. They add nothing of their own. 480 F. Supp., at 453. Although applying the fair use doctrine to home VTR recording, as Sony argues, may increase public access to material broadcast free over the public airwaves, I think Sony's argument misconceives the nature of copyright. Copyright gives the author a right to limit or even to cut off access to his work. Fox Film Corp. v. Doyal, 286 U. S., at 127. A VTR recording creates no public benefit sufficient to justify limiting this right. Nor is this right extinguished by the copyright owner's choice to make the work available over the airwaves. Section 106 of the 1976 Act grants the copyright owner the exclusive right to control the performance and the reproduction of his work, and the fact that he has licensed a single television performance is really irrelevant to the existence of his right to control its reproduction. Although a television broadcast may be free to the viewer, this fact is equally irrelevant; a book borrowed from the public library may not be copied any more freely than a book that is purchased. It may be tempting, as, in my view, the Court today is tempted, to stretch the doctrine of fair use so as to permit unfettered use of this new technology in order to increase access to television programming. But such an extension risks eroding the very basis of copyright law, by depriving authors of control over their works and consequently of their incentive to create. [34] Even in the context of highly productive educational uses, Congress has avoided this temptation; in passing the 1976 Act, Congress made it clear that off-the-air videotaping was to be permitted only in very limited situations. See 1976 House Report 71; 1975 Senate Report 64. And, the Senate Report adds, [t]he committee does not intend to suggest . . . that off-the-air recording for convenience would under any circumstances, be considered `fair use.'  Id., at 66. I cannot disregard these admonitions.
I recognize, nevertheless, that there are situations where permitting even an unproductive use would have no effect on the author's incentive to create, that is, where the use would not affect the value of, or the market for, the author's work. Photocopying an old newspaper clipping to send to a friend may be an example; pinning a quotation on one's bulletin board may be another. In each of these cases, the effect on the author is truly de minimis. Thus, even though these uses provide no benefit to the public at large, no purpose is served by preserving the author's monopoly, and the use may be regarded as fair. Courts should move with caution, however, in depriving authors of protection from unproductive ordinary uses. As has been noted above, even in the case of a productive use, § 107(4) requires consideration of the effect of the use upon the potential market for or value of the copyrighted work (emphasis added). [A] particular use which may seem to have little or no economic impact on the author's rights today can assume tremendous importance in times to come. Register's Supplementary Report 14. Although such a use may seem harmless when viewed in isolation, [i]solated instances of minor infringements, when multiplied many times, become in the aggregate a major inroad on copyright that must be prevented. 1975 Senate Report 65. I therefore conclude that, at least when the proposed use is an unproductive one, a copyright owner need prove only a potential for harm to the market for or the value of the copyrighted work. See 3 M. Nimmer, Copyright § 13.05[E][4][c], p. 13-84 (1983). Proof of actual harm, or even probable harm, may be impossible in an area where the effect of a new technology is speculative, and requiring such proof would present the real danger . . . of confining the scope of an author's rights on the basis of the present technology so that, as the years go by, his copyright loses much of its value because of unforeseen technical advances. Register's Supplementary Report 14. Infringement thus would be found if the copyright owner demonstrates a reasonable possibility that harm will result from the proposed use. When the use is one that creates no benefit to the public at large, copyright protection should not be denied on the basis that a new technology that may result in harm has not yet done so. The Studios have identified a number of ways in which VTR recording could damage their copyrights. VTR recording could reduce their ability to market their works in movie theaters and through the rental or sale of prerecorded videotapes or videodiscs; it also could reduce their rerun audience, and consequently the license fees available to them for repeated showings. Moreover, advertisers may be willing to pay for only live viewing audiences, if they believe VTR viewers will delete commercials or if rating services are unable to measure VTR use; if this is the case, VTR recording could reduce the license fees the Studios are able to charge even for first-run showings. Library-building may raise the potential for each of the types of harm identified by the Studios, and time-shifting may raise the potential for substantial harm as well. [35] Although the District Court found no likelihood of harm from VTR use, 480 F. Supp., at 468, I conclude that it applied an incorrect substantive standard and misallocated the burden of proof. The District Court reasoned that the Studios had failed to prove that library-building would occur to any significant extent, id., at 467; that the Studios' prerecorded videodiscs could compete with VTR recordings and were arguably . . . more desirable, ibid.; that it was not clear that movie audiences will decrease, id., at 468; and that the practice of deleting commercials may be too tedious for many viewers, ibid. To the extent any decrease in advertising revenues would occur, the court concluded that the Studios had marketing alternatives at hand to recoup some of that predicted loss. Id., at 452. Because the Studios' prediction of harm was based on so many assumptions and on a system of marketing which is rapidly changing, the court was hesitant to identify `probable effects' of home-use copying. Ibid. The District Court's reluctance to engage in prediction in this area is understandable, but, in my view, the court was mistaken in concluding that the Studios should bear the risk created by this uncertainty. The Studios have demonstrated a potential for harm, which has not been, and could not be, refuted at this early stage of technological development. The District Court's analysis of harm, moreover, failed to consider the effect of VTR recording on the potential market for or the value of the copyrighted work, as required by § 107(4). [36] The requirement that a putatively infringing use of a copyrighted work, to be fair, must not impair a potential market for the work has two implications. First, an infringer cannot prevail merely by demonstrating that the copyright holder suffered no net harm from the infringer's action. Indeed, even a showing that the infringement has resulted in a net benefit to the copyright holder will not suffice. Rather, the infringer must demonstrate that he had not impaired the copyright holder's ability to demand compensation from (or to deny access to) any group who would otherwise be willing to pay to see or hear the copyrighted work. Second, the fact that a given market for a copyrighted work would not be available to the copyright holder were it not for the infringer's activities does not permit the infringer to exploit that market without compensating the copyright holder. See Iowa State University Research Foundation, Inc. v. American Broadcasting Cos., 621 F. 2d 57 (CA2 1980). In this case, the Studios and their amici demonstrate that the advent of the VTR technology created a potential market for their copyrighted programs. That market consists of those persons who find it impossible or inconvenient to watch the programs at the time they are broadcast, and who wish to watch them at other times. These persons are willing to pay for the privilege of watching copyrighted work at their convenience, as is evidenced by the fact that they are willing to pay for VTR's and tapes; undoubtedly, most also would be willing to pay some kind of royalty to copyright holders. The Studios correctly argue that they have been deprived of the ability to exploit this sizable market. It is thus apparent from the record and from the findings of the District Court that time-shifting does have a substantial adverse effect upon the potential market for the Studios' copyrighted works. Accordingly, even under the formulation of the fair use doctrine advanced by Sony, time-shifting cannot be deemed a fair use.