{"id":55,"date":"2014-02-25T14:22:10","date_gmt":"2014-02-25T14:22:10","guid":{"rendered":"http:\/\/blogs.law.harvard.edu\/copyrightosc\/?p=55"},"modified":"2014-02-25T14:22:34","modified_gmt":"2014-02-25T14:22:34","slug":"fair-use-week-day-two-with-guest-expert-kevin-smith","status":"publish","type":"post","link":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/2014\/02\/25\/fair-use-week-day-two-with-guest-expert-kevin-smith\/","title":{"rendered":"Fair Use Week: Day Two with guest expert Kevin Smith"},"content":{"rendered":"

For our second entry this week, we are excited to feature Kevin<\/em> Smith, Director of Copyright and Scholarly Communication in the Office of Copyright and Scholarly Communication at Duke University.<\/em><\/p>\n

<\/h3>\n

Fair Use, Fixation, and the Problem of Legal Fictions<\/strong><\/h3>\n

 <\/p>\n

The Second Circuit Court of Appeals handed down a decision at the end of January that is simultaneously important and bizarre.\u00a0 Bizarre because of the nature of the issue, which actually involved a debate over whether or not a work was \u201cfixed\u201d (a prerequisite for copyright protection).\u00a0 And important because of the stance the Second Circuit took on fair use and the implications of its position for the Georgia State appeal, a decision that is still pending as I write.\u00a0 Hat tip to attorney Zick Rubin for pointing the case out to me and suggesting its implications.<\/p>\n

The case is Swatch Group Management Services v. Bloomberg<\/em>, which the Second Circuit heard on cross appeals from a decision by the District Court in the Southern District of New York that found that Bloomberg had made a fair use of a recording of a telephone conference call that Swatch held with selected investors and analysts.\u00a0 Swatch appealed the decision in favor of Bloomberg, while Bloomberg apparently appealed because it did not like the grounds on which it had won.<\/p>\n

Briefly, someone working for Bloomberg managed to join the conference call and make a recording, which was then distributed to its list of \u201cBloomberg Professional\u201d subscribers.\u00a0 Swatch objected, registered a copyright in its own recording of the call, and sued Bloomberg for infringement.\u00a0 Bloomberg argued that it had not copied Swatch\u2019s recording but had made its own, lawful recording of a \u201clive news event.\u201d\u00a0 More about that argument later on, but first let\u2019s look at the fair use analysis.<\/p>\n

Both the District Court and the Second Circuit found that Bloomberg had made a fair use of the recording of this conference call, and the reasoning the latter court applied is very telling.\u00a0 They held that the use had not been transformative, but that that didn\u2019t matter.\u00a0 In fact, they suggest that the lack of transformation was a good thing.\u00a0 First, in this part of the discussion, the Court cites the remark from the Supreme Court in Campbell v. Accuff-Rose Music<\/em>, the case which really established the importance of the transformative analysis, that not all fair use must be transformative, citing the paradigmatic example of \u201cmultiple copies for classroom use.\u201d\u00a0 Then the Second Circuit goes on to say that the purpose of Bloomberg\u2019s recording of the Swatch conference call was \u201cto make important financial information\u2026 available to American investors\u201d and that that intent is \u201cclosely analogous\u201d to news reporting and therefore is a favored purpose in the fair use analysis.\u00a0 In light of this purpose, the Court reasons, the goal of the copying and distribution is accuracy of the information, so it is sensible that no transformation took place, and that lack does not undermine fair use.<\/p>\n

I see a couple of ways that this analysis of the purpose of Bloomberg\u2019s use of the recorded phone call can shed light on the arguments being reviewed by the Eleventh Circuit in the GSU copyright case.<\/p>\n

First, the Second Circuit held that Bloomberg\u2019s admittedly commercial purpose did not defeat the fair use argument.\u00a0 The public purpose, analogous to news reporting, remember, was enough to reduce the weight that a commercial purpose would normally have in countering a fair use claim.\u00a0 This was the case even though the use was held not to be transformative.\u00a0 All this reflects on the argument made by the GSU plaintiff publishers that without some transformation, GSU should not get the benefit, on the first fair use factor, of claiming that it has a non-profit educational purpose. \u00a0In the Swatch<\/em> case, the Second Circuit affirms that even a commercial, yet publicly beneficial, purpose can favor fair use in spite of not being transformative.\u00a0 This seems to completely undermine the argument being made in Atlanta; a non-profit, educational purpose is of great public benefit, and it can and should weigh in favor of fair use even if the Eleventh Circuit upholds the finding that there was no transformation.<\/p>\n

Second, in the Swatch<\/em> case the Second Circuit did not require that the material on the recording be subjected to criticism and comment in order for its \u201cre-use\u201d to be considered fair.\u00a0 They said that the need for precision in the delivery of information was enough.\u00a0 As Mr. Rubin pointed out when he alerted me to the case, there seems to be a clear analogy here to those electronic reserves at issue in the GSU case.\u00a0 In order for the non-profit educational purpose to be fulfilled, students need to become acquainted with small parts of the thinking of different scholars; this is best accomplished by reproducing accurately short excerpts from a variety of different works.\u00a0 Commentary is not required, at least as part of the reserves system \u2013 it is provided by the teacher in the classroom.\u00a0 What is vital is that these excerpts reflect precisely what the author said and thought.\u00a0 Really, this is just an added justification for the conclusion in the Swatch<\/em> case that transformation was not required.<\/p>\n

One other point from the Second Circuit is also worth a moment of our time.\u00a0 In Swatch v. Bloomberg<\/em>, the Court recognized that the entire phone call had been recorded and distributed.\u00a0 But they held, consistently with other Circuits, that using this much of the copyrighted work was necessary in light of the favored purpose (even though it was not transformative) and therefore that the third fair use factor was neutral \u2013 it did not either favor or weigh against fair use.\u00a0 In the GSU case, the Eleventh Circuit worried during oral arguments that the trial court had applied a numerical standard in its evaluation of the third factor and that the plaintiff publishers were asking the Appellate Court to apply a different, lesser standard, but a hard numerical line nonetheless.\u00a0 In light of what the Second Circuit has said, maybe the best course for the panel hearing the GSU appeal is to reject both numerical standards and ask if the length of each reading is appropriate to the favored non-profit educational purpose.\u00a0 The best judges of this, of course, are the instructors, who determine whether a short excerpt is appropriate or if students should, where possible, purchase the books.\u00a0 So within some reasonable and flexible limit, the Court should defer to the decision of the individual instructors as too how much of a work is necessary to fulfill their clearly favored purpose.<\/p>\n

In short, if the Eleventh Circuit panel upholds the trial court, or even creates more space for fair use in its ruling, they will be joining a growing consensus among the Circuit Courts of Appeal.\u00a0 If, on the other hand, they decided to deviate from this body of precedent, they will be inviting further review.<\/p>\n

The fact that the Swatch case was decided based on fair use had an additional, instructive effect, which we can take as a warning against using copyright law to prop up specific businesses or business models.\u00a0 Bloomberg\u2019s primary defense against the charge that they infringed copyright was that there was no copyright to infringe, since they made a recording from a live event.\u00a0 The problem they faced, however, was that part of the definition of \u201cfixed\u201d includes this line: \u201cA work consisting of sounds, images or both, that are being transmitted, is \u2018fixed\u2019 for purposes of this title if a fixation of the work is being made simultaneously with its transmission.\u201d\u00a0 As David Kluft explains in this blog post about the case<\/a>, this sentence appears to create a \u201clegal fiction\u201d that anyone recording the live event is actually copying the \u201cofficial\u201d recording that is being made simultaneously with the live event.\u00a0 This rule was inserted to protect professional sports leagues from recordings made from live broadcasts, but Swatch was apparently able to use it to defeat Bloomberg\u2019s claim that there was no copyright in the unfixed, live phone call from which they, Bloomberg, made their recording.\u00a0 I say apparently because the Court simply ruled in Bloomberg\u2019s favor based on fair use; that would appear to assume that a copyright did exist \u2013 based on this legal fiction \u2013 without actually telling us that the court was applying this provision from section 101 of the copyright law.<\/p>\n

The reason I bring this up is because I fear that this sentence intended to assist professional sports leagues might well encompass too much in the sweep of the fictional situation it creates.\u00a0 As attorney Kluft asks, does this mean that a parent who videotapes a live high school sporting event might infringe the copyright created by some official recording of the same event, made simultaneously, even though the parent made her video from live action?\u00a0 What if two different people make such recordings; do they infringe each other?\u00a0 The problem is that the sentence does not provide details, including whose recording creates this fiction, or if any\/all do.\u00a0 The line was inserted without sufficient thought to solve a putative problem raised, I would guess, by lobbyists for a single industry.\u00a0 But changing the law is much too blunt an instrument to protect one business or one business model; such changes will nearly always have unintended consequences that do more harm than the supposed good they were aimed at.\u00a0 Whenever lobbyists for a particular industry, including the publishing industry, offer to help \u201csolve\u201d a problem that they themselves have identified, Congress should take great care.\u00a0 In many cases, and the simultaneous fixation of a live broadcast may be one of them, those solutions prove more problematic than the situation they were supposed to address.\u00a0 This warning is especially important as Congress is talking about a revision of the copyright law, since such talk will bring out special interests in droves, and many will have such \u201cproblems\u201d that they want solved.<\/p>\n

Kevin Smith<\/a> is Director of the Office of Copyright and Scholarly Communications and is both a librarian and an attorney experienced in copyright and technology law. He also serves as a nationally recognized resource on local and national policy in order to help the Duke community stay informed and involved with the changing landscape of scholarly publication. You can read his regular blog here<\/a>.
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For our second entry this week, we are excited to feature Kevin Smith, Director of Copyright and Scholarly Communication in the Office of Copyright and Scholarly Communication at Duke University. Fair Use, Fixation, and the Problem of Legal Fictions   The Second Circuit Court of Appeals handed down a decision at the end of January […]<\/p>\n","protected":false},"author":6259,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[257,690],"tags":[],"class_list":["post-55","post","type-post","status-publish","format-standard","hentry","category-copyright","category-fair-use"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p7gxeS-T","_links":{"self":[{"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/posts\/55","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/users\/6259"}],"replies":[{"embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/comments?post=55"}],"version-history":[{"count":10,"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/posts\/55\/revisions"}],"predecessor-version":[{"id":65,"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/posts\/55\/revisions\/65"}],"wp:attachment":[{"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/media?parent=55"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/categories?post=55"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/archive.blogs.harvard.edu\/copyrightosc\/wp-json\/wp\/v2\/tags?post=55"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}