Boston, Massachusetts
May 17-19, 1995
Kenneth D. Crews, Associate Professor of Law and of Library and Information Science and Director of the Copyright Management Center
Indiana University-Purdue University at Indianapolis
In many ways copyright is a paradoxical issue, because we need to consider and evaluate our source of information at the same time that we rely on experts. Even among a friendly group of library representatives, if you asked a copyright question you might get a different answer from each.
The uncertainty of copyright in an electronic environment is a major issue underlying developments with the National Information Infrastructure (NII). The Working Group on Intellectual Property Rights of the National Information Infrastructure Task Force has focused on this issue since the fall of 1993 and is expected to issue a “White Paper” soon with proposals for reform of the Copyright Act. The proposals in the “White Paper” are yet unknown but they may include at least two issues that are important to our community: restrictions on the first-sale doctrine, or the ability to lend or sell a work that you have lawfully acquired; and restrictions on transmissions of a work in electronic form. In addition, the “White Paper” is expected to address guidelines for fair use of copyrighted materials in an electronic environment that have been the subject of the Conference on Fair Use, a series of meetings being held in Washington, DC. The “White Paper” will not include the text of many guidelines, if any, simply because there is no way that the meetings, comprising many different people with many different perspectives, will come to any kind of agreement on guidelines in the time frame allowed. The issues are far too complex.
The issuance of the “White Paper” will also open the doors to other proposals for legislative reform of the Copyright Act. One section of the Copyright Act under scrutiny by several groups is Section 108 on library copying. From the point of view of libraries and library users, the expected proposals are good news and bad news. Some proposals may address preservation issues and open up more possibilities for digital preservation.
On the troublesome side is open talk, especially from publisher groups, about doing away with the interlibrary loan provision of Section 108, which clearly secures the right to share limited photocopies for purposes of interlibrary loans. In the view of some publishing officials, interlibrary loan should exist only in highly constrained forms, and the rule-of-five limitation that we have lived with for quite some years now could be eliminated. Some other proposals would limit interlibrary loan to low technologies. For example, mailing a photocopy may be acceptable, but do not dare elevate the technology beyond the photocopy machine — no faxes, no electronic transmittal, nothing else. These are some serious battles that we must be prepared to fight.
In addition to the activity of the Working Group and possible legislative reforms, we face another development that cannot be emphasized enough: the Texaco case. In 1985 a group of publishers sued Texaco Inc. for copyright infringement. At issue was whether a scientist at Texaco acted within fair use when he made isolated, single copies of journal articles for his own research needs. In May of this year the case was reported settled out of court, as Texaco was preparing the case for appeal to the U.S. Supreme Court. A settlement at this stage is the worst possible result, because it leaves on the record two adverse decisions, one from the District Court and one from the Second Circuit Court of Appeals, as the authority that will be leaned upon for guidance about what may be photocopied under certain circumstances. Both lower courts ruled that the copying in the Texaco case was not fair use. Worse than the actual decision is the reasoning that the courts used to reach that conclusion. Although the case does not apply to photocopying done in non-profit educational institutions for educational purposes, it does offer some significant insights for educational and research institutions. While we can distinguish the circumstances of this case from situations in library or in educational and research institutions, the courts’ reasoning is powerful and innovative.
In order to understand the courts reasoning, we must return to the four factors of analysis that Congress directed us to evaluate in any fair use decision: purpose, nature, amount, and effect.
Section 107 of the Copyright Act of 1976.
Limitations on exclusive rights: Fair use.
Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phono-records or by any other means specified in that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include —
(1) the purpose and character of the use, including whether such use is of a 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 fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.
In summary, the analysis of the courts in the Texaco decision was as follows:
Purpose: The purpose factor examines the purpose for which you are copying the protected work. The Texaco case tells us that, in the context of photocopying for research by the Texaco scientists, the purpose had several traits supporting the claims of infringement. The 1992 District Court decision held that although the copying was for research, which is generally a favored purpose, the purpose was commercial, because the research was ultimately to strengthen the company. On review, the Second Circuit Court of Appeals concurred that consideration of the first factor in the Texaco case supported the publishers’ claims, but for different reasons. The Appeals Court found that the for-profit character of the company, while relevant, had been over emphasized. Instead, the Appeals Court focused on the use of the copied articles rather that the user, and defined the purpose of the use as “archival.” The Texaco scientist, by taking the copies and putting them in a file for undetermined future research, was “archiving.” According to the court, he was in effect building a library in his file drawer that potentially competed with purchasing originals from the publisher.
In addition, both courts found that the photocopies were not “transformative” because copies that merely reproduce the originals do not “transform” them into a new work or one with a new utility. In 1994 the U.S. Supreme Court explored this “transformative” concept when it examined the fair use of a rap parody of Roy Orbison’s “Oh, Pretty Woman” song. The Campbell case offers many valuable insights into copyright that allow us to distinguish library and higher education activities from the Texaco case. The Campbell case rejected the presumption that commercial uses would not be a fair use, even though the Supreme Court had perpetrated that statement in the first place. The Supreme Court also made clear in a most important footnote in the Campbell case, and one that we should be heralding wherever possible, that the transformative concept may not be necessary in the educational setting. The Court pointed to the language of the fair use statute itself, which specifically allows multiple copies for teaching purposes: “the fair use of a copyrighted work . . . for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright” (emphasis added). This is powerful language from the Supreme Court, and it reveals that the Supreme Court might have been likely to isolate even further the commercial facts of the Texaco case from academic needs, if not reverse the lower courts entirely.
Nature: According to the Texaco rulings, this factor leans in favor of fair use, because the works used were factual in nature. Both courts distinguished factual, scientific articles from fiction; courts generally allow greater fair use of factual works.
Amount: This factor presents a challenge because the Texaco decisions defined the articles as independent works. According to the Texaco decisions, copying an article is copying the entire work, and not a portion of the longer journal issue. Seldom do courts find in favor of fair use when the entire work is reproduced.
Effect: The fourth factor explores the effect of the use on the market for the original work. This is perhaps the most nebulous factor, and under the Texaco decisions it is the single most troublesome fair use issue. The lower courts conceded that they found little evidence of lost subscriptions resulting from the photocopying by the Texaco scientist. However, the courts did conclude that the copying resulted in a loss of payment to the Copyright Clearance Center (CCC).
The CCC holds tremendous promise and can provide an enormously valuable service in securing permissions needed for copying that goes beyond fair use. However, the CCC has no business in this fair-use analysis. Not only is this analysis from the lower courts dangerous; it is flat out wrong. Our duty under the law is to analyze if a use of copyrighted material is a fair use. If it exceeds fair use, we may then choose to make the royalty payments to the CCC as a means for obtaining permission. In the Texaco decision, the courts reversed this process and examined the availability of the CCC first to determine what might be fair use.
In fact the Campbell case from the Supreme Court tells us that we need to be concerned only about the effect on those markets that the copyright owner is likely to exploit. We can at least identify those copyright owners and publishers that are actually using the CCC (or other means of collecting royalties) and distinguish them from those that do not.
This paper presents only brief summaries of the many copyright developments that could have profound consequences for libraries, higher education, and research. ARL and other library and academic organizations have become important participants, wherever possible, in attempting to shape the decisions of the courts, of Congress, and of other governmental agencies. These organizations also work to keep their constituencies informed about the developments. All three branches of the U.S. government are addressing the complex fair use issues. Faculty members, librarians, and scholarly publishers must unite to give fair use comparable attention and direction, because they are the key parties who must adjust their habits and conform to the outcomes.