Copyright news from the United States has not been good lately. Between the file-sharing lawsuits, the appointments of RIAA lawyers to key government positions and the continuation of failed policies on the international front, there's been little to celebrate. But a Federal Court in Pennsylvania issued a thoughtful decision last week upholding a claim of fair-use, based largely on the transformative nature of the work.
The controversy in Warren Publishing Co. v. Spurlock, centred on publication of the book, "Famous Monster Movie Art of Basil Gogos," which was a retrospective about Basil Gogos, the artist whose work appeared frequently on the covers of movie monster magazines in the 1950s and '60s.
According to an August 10th report by Shannon Duffy in the Legal Intelligencer, (Movie Monsters Help Set Intellectual Property Precedents):
In the movies, it seems that monsters are always up to no good -- making mayhem or setting fires.
But in a federal court in Philadelphia last week, a couple dozen movie monsters made some important new law and set a few significant precedents in the area of copyrights and trademarks that will help to define the doctrine of "fair use" for years to come.
Whether the case made any "new law" remains to be seen, but in any event, the decision should stand as an exemplar of the careful analysis of the fair-use factors that courts should be making.
The question of ownership of the actual artwork in question was not decided in the decision, which was on a summary judgment motion. While Warren claimed Gogos signed over all rights in the cover artwork to the publisher, contrary evidence was produced by the defendant, at least enough to defeat a motion for summary judgment. In any event, the ownership issue was mooted for purposes of the subject dispute by Spurlock's successful fair-use defense.
In his 78 page decision, Judge Michael Bayliss treated fair-use in some great depth. To summarize the court's findings on the four fair-use factors:
1) Nature and character of the use:
The most important consideration here was the highly transformative nature of Spurlock's work and the very different purposes it served compared with the plaintiff's magazines. This factor weighed heavily in favor of the defendant. That the defendant had unsuccessfully sought permission from the plaintiff to use the artwork did not vitiate this finding as urged by the plaintiff.
2) Nature of the copyrighted work
The court found that the second factor (nature of the copyrighted work) weighed slightly in favor of the plaintiff, due to the creative nature of the work. But this factor was given limited relevance because of the highly transformative nature of the allegedly infringing work.
3) Amount and substantiality of the portion used in relation to the copyrighted work as a whole
With respect to quantity, the defendant argued that the frame of reference should be the magazines in their entirety, in which case the percentage taken was very low. The plaintiff argued that each cover should be considered a separate work, in which case the entire work was taken. The court rejected plaintiff's argument that “the copyrighted work can be cut or spliced to maximize the percentage use” and pointed to the language of section 107(3) itself, the last clause of which specifies as a whole. Since the magazines ranged from 68 to 100 pages each, the court accepted defendant's argument that the portion taken as from 1%-1.5%, which is quite small.
With respect to quality, the plaintiff argued that the covers were qualitatively a significant portion of the magazines, were at “the heart” of the magazine’s content and that the covers were a “central and valuable part of Plaintiffs’ works.” The defendant countered that “the 'heart' of the magazines was not the covers, but was instead the content of the magazines that kept its readers up-to-date on movie monster gossip.” The court agreed with the defendant on this point, stating that the
“covers were not the qualitative “heart” of the magazines, but were instead used to catch the eye of potential readers at the newsstand and advertise the content of the magazine. The quality and importance of these covers as used in the original magazines are relatively minor” [p. 37].
4) The effect of the use upon the potential market for or value of the copyrighted work
Plaintiff's argument on this factor was based on the potential market for the derivative coffee-table book that Warren said he was going to publish. To counter defendant's point that no steps were taken to produce the work, Warren relied on Castle Rock Entertainment, Inc. v. Carol Publishing Group, Inc., 150 F.3d 132 (2d Cir. 1998). In Castle Rock, the 2d Circuit upheld the ruling by District Court Judge Sonia Sotomayor, (as she then was) which rejected the fair-use defense raised by the publisher of the Seinfeld Aptitude Test, stating “[i]t would . . . not serve the ends of the Copyright Act . . .if the artists were denied their monopoly over derivative versions of their creative works merely because they made the artistic decision not to saturate those markets with variations of their original.”
But the court distinguished the Castle Rock situation from Warren's failure to take steps to produce the coffee-table derivative:
Castle Rock concerned a plaintiff that had, and continued to, exploit its copyright over the Seinfeld television program and derivative markets. [citation omitted]. The only issue in that case was whether a decision to not exploit one particular derivative market should be respected. The underlying facts of the case at hand are substantially different. Warren not only failed to use his copyright to exploit a particular derivative market, but he has both failed to exploit any derivative market and failed to even exploit the copyrights in their entirety for the past several decades. This is not a case of a court’s need to respect the artistic decisions of the copyright owner who decides to exploit one derivative market but not another; instead, this is a case where the copyright owner has exhibited virtually no interest at all in utilizing his copyrights. It would defy logic for this Court to accept Warren’s argument that, where a copyright owner has failed to utilize his copyrights for several decades, a district court’s prohibition of a defendant’s productive and transformative use serves copyright’s purpose, ‘[t]o promote the Progress of Science and useful Arts . . . .’” [p. 39-40]
While both parties submitted evidence and made arguments on the fourth factor, the court stated
“Warren’s complete failure to exploit his copyrights for approximately 22 years substantially detracts from his argument on the fourth factor” [p. 43].
But there was still conflicting evidence on the record which created a triable issue of fact on the fourth factor. Taking everything into account, the Court found the fourth factor “slightly favors the plaintiff.”
On balance, the court found in favor of fair-use:
This Court concludes that the fair use factors, considered as a whole, weigh in favor of Spurlock. The strong weight of the first and third factors in favor of Spurlock, along with the limited relevance of the second factor, warrant a finding on fair use for the Defendant, despite the disputed facts on the fourth factor, which, when inferred in favor of Plaintiffs, slightly favors Plaintiffs. . . After weighing the factors together and considering the purposes of copyright, this Court determines that the fair use defense is appropriate here [p. 44].
Time will only tell if this decision will hold up on appeal. In a subsequent posting, I will discuss how the defendant's case might fare under a Canadian fair-dealing analysis as well its relevance to the current copyright consultations.