Tag Archives: fair use

FAIR USE OR INFRINGEMENT?

Industry experts have been scratching their heads after a U.S. judge ruled an image, taken from the website of a professional photographer and used by a film festival online, was fair use. The case, is Brammer v. Violent Hues Productions LLC, and it began when Russell Brammer found one of his pictures, a long exposure shot of Adams Morgan, Washington D.C., had been used on a website promoting the Northern Virginia Film Festival.

Read a complete analysis of the case here

Fair Use or Infringement?-Court finds use of image to illustrate a geographic area on website fair use.

by Nancy Wolff, DMLA Counsel

Fair use is often described as one of the most difficult to understand doctrines of copyright law by the courts. This could not be more obvious than in a recent Northern District of Virginia decision, which found in favor of fair use where an image was used to illustrate a website. Many in the industry thought the use at issue in the case was an obvious infringement as it was one that is typically licensed. In Brammer v. Violent Hues Productions, LLC, the photographer Russell Brammer sued Violent Hues for infringing his copyright of a time-lapse depiction of the Adams Morgan neighborhood of Washington, D.C., at night. Violent Hues used a cropped version of Brammer’s photograph on its website, which was intended to be used as a reference guide providing about an annual film festival in Northern Virginia. The court granted Violent Hues’ motion for summary judgment on its defense of fair use, finding all four of the statutory factors favored a finding of fair use.

As to the first factor – the purpose and character of the use – the court looked to “whether the new work is transformative” and “the extent to which the use serves a commercial purpose.” The court found that Violent Hues’ use of the photograph was transformative in function and purpose. While Brammer’s purpose in capturing and publishing the photograph was promotional and expressive, the court noted that Violent Hues’ purpose in using it was informational because it used the photograph to provide information regarding the local area. Its use was also found to be non-commercial as the photo was not used to advertise a product or to generate revenue. Additionally, the court found that Violent Hues’ use was in good faith because Violent Hues’ owner attested that he believed the photo was publicly available because he found the photo online and saw no indication that it was copyrighted. In further support of good faith was the fact that Violent Hues removed the photo as soon as it learned the photo might be copyrighted.

The second factor – the nature of the copyrighted work – was also held to favor fair use. While the court noted that the photograph contained creative elements, it was a factual depiction of a real-world location and Violent Hues used the photograph purely for its factual content: to depict the neighborhood. The photograph had also previously been published on several websites and “at least one of these publications did not include any indication that it was copyrighted.”

On the third factor – the amount and substantiality of the portion used in relation to the copyrighted whole – the court noted that Violent Hues cropped half of the original photo. The court found this to be no more than necessary to convey the photo’s factual content. Thus, the third factor weighed in favor of fair use as well.

Finally, regarding the fourth factor – the effect of the use upon the potential market for or value of the copyrighted work – the court found no evidence that Violent Hues’ use had any effect on the potential market for Brammer’s photo. The court noted that Brammer still made sales of the photograph (at least two) after Violent Hues’ alleged infringement began, and Brammer testified that he made no effort to market the photo. Additionally, the court found the cropping of the photo and its non-commercial use to undercut a finding of adverse effect on the photo’s market.

In all, the court found that each of the four factors favored Violent Hues and thus held that Violent Hues’ use was a fair use and that there was no copyright infringement.

This decision has been roundly criticized by the industry and it has been noted that it is not often that a court gets every fair use factor wrong. The plaintiff is appealing the decision and many associations in the visual arts industry, including DMLA, are planning to file either separate or joint amicus briefs. Specifically of concern is the distinction between using an image for informational purpose and using and image for aesthetic purpose. By its nature, every image conveys some information, and to be successful, should be aesthetically appealing. Further, one of the touchstones of stock imagery licensing is that one image or clip can be reproduced for many different purposes. In addition, the fact that an image is displayed without a copyright notice should not mean that the work is free to use without consent, absent a legitimate exception, as copyright notice has not been a requirement under US copyright law since 1989. Lastly, when looking at harm to the market the court should look at the potential harm to the market if the type of unauthorized use is widespread. As the licensing of images to websites to enhance the look of the site or to provide visual information regarding a geographic area is common, widespread unauthorized use of this nature could have a significant impact on the licensing of visual content.

 

DMLA’s Amicus Brief Supports Argument as Oracle defeats Google Fair Use Argument over Java Code Packets

Last week the U.S. Court of Appeals for the Federal Circuit reversed the U.S. District Court for the Northern District of California’s ruling of fair use in Oracle America, Inc. v. Google LLC, and held that a verbatim and non-transformative taking in the presence of an actual or potential licensing market fatally undermined the defense.

Even in industries unrelated to computers, mobile devices, software, and source code, the court’s broad pronouncement that “[t]here is nothing fair about taking a copyrighted work verbatim and using it for the same purpose and function as the original in a competing platform” is both powerful and beneficial to creators and licensors of copyrighted content. DMLA’s amicus brief with the support of the coalition of Visual Artists– and one of many amicus briefs in this hotly contested case– helped explain to the court of appeals the importance of licensing markets in fair use cases in general. Ultimately DMLA supported the winning argument and contributed to the creation of appellate-level precedent that will help image licensors everywhere in responding to many infringement claims, as it turns on harm to the licensing market.

Read the entire article here

Oracle defeats Google Fair Use Argument over Java Code Packets

(ORACLE AM., INC. V. GOOGLE LLC
No. 2017-1118, 2017-1202, 2018 WL 1473875 (Fed. Cir. Mar. 27, 2018)

by Nancy Wolff, DMLA Counsel

Last week the U.S. Court of Appeals for the Federal Circuit reversed the U.S. District Court for the Northern District of California’s ruling of fair use in Oracle America, Inc. v. Google LLC, and held that a verbatim and non-transformative taking in the presence of an actual or potential licensing market fatally undermined the defense. Oracle had sued Google for copyright infringement, alleging that Google had unlawfully used 37 packages of Oracle’s Java application programming interface – “pre-written Java source code programs” that serve as shortcuts for various computer functions to save programming time – in its Android-powered devices. Google copied verbatim 11,500 lines of Oracle’s copyrighted computer code as well as the structure, sequence, and organizing of the packages. After a second jury trial on fair use, Google prevailed on its fair use defense, and Oracle appealed after the district court rejected its post-trial motion for judgment as a matter of law.

The Federal Circuit disagreed with the district court’s assessment, and analyzed each of the four fair use factors in 17 U.S.C. 107. In particular, under the first factor (nature and purpose of the use), the court held that Google’s use of Oracle’s code was both commercial and not “transformative” because the purpose of the software packages in Google’s Android operating system was the same as the purpose of the package in Oracle’s Java platform; Google did not change the expressive content or message of the code; and use of the code in smartphones as opposed to other computer hardware did not constitute “new context.” As many courts do, the Federal Circuit did not pay much heed to the second factor (nature of the copyrighted work), but emphasized under the third factor (amount of the work used), that the taking at issue here was more than was defensible. For instance, there was no dispute that only 170 lines of code were needed to write in Java programming language, but Google copied 11,500 lines.

The court spent considerable time discussing the fourth factor (effect on the potential market), focusing on harm to actual markets for the copyrighted work, as well as the market for potential and derivative uses. The court noted that the record clearly showed actual market harm in that Oracle’s copyrighted works had already been used in mobile devices, that Google directly competed with Oracle using Oracle’s own code, and that the existence of the free Android operating system caused significant damage to Oracle’s negotiating position with third parties like Amazon. The district court also had failed to consider potential market harm, including licensing Java “for smartphones with increased processing capabilities”; importantly, the court observed that just because Oracle had never built its own smartphone device was irrelevant “because potential markets include licensing others to develop derivative works.” Because factors one and four weighed heavily against fair use (factor two weighed in favor, and factor three was likely against), the Federal Circuit reversed and remanded for a trial on damages.

Even in industries unrelated to computers, mobile devices, software, and source code, the court’s broad pronouncement that “[t]here is nothing fair about taking a copyrighted work verbatim and using it for the same purpose and function as the original in a competing platform” is both powerful and beneficial to creators and licensors of copyrighted content. DMLA’s amicus brief with the support of the coalition of Visual Artists– and one of many amicus briefs in this hotly contested case– helped explain to the court of appeals the importance of licensing markets in fair use cases in general. Ultimately DMLA supported the winning argument and contributed to the creation of appellate-level precedent that will help image licensors everywhere in responding to many infringement claims, as it turns on harm to the licensing market.

Fox News Network, LLC v. TVEyes, Inc.: Second Circuit Rejects Fair Use Defense for Mass Archiving and Re-Distribution of Copyrighted TV Content

By: Scott J. Sholder

A panel of the U.S. Court of Appeals for the Second Circuit today issued its much-anticipated opinion in the TVEyes appeal, reversing the decision of the U.S. District Court for the Southern District of New York, and holding that TVEyes’ copying, storage, and re-distribution for viewing, downloading, and sharing, of massive amounts of copyrighted TV content was not fair use.

Read the entire story here.

Fox News Network, LLC v. TVEyes, Inc.: Second Circuit Rejects Fair Use Defense

By: Scott J. Sholder

A panel of the U.S. Court of Appeals for the Second Circuit today issued its much-anticipated opinion in the TVEyes appeal, reversing the decision of the U.S. District Court for the Southern District of New York, and holding that TVEyes’ copying, storage, and re-distribution for viewing, downloading, and sharing, of massive amounts of copyrighted TV content was not fair use.

TVEyes is a for-profit media company offering a service that allows its clients to “sort through vast quantities of television content in order to find clips that discuss items of interest to them.” TVEyes records 1,400 channels’ worth of TV broadcasts, 24 hours a day, and makes the copied content searchable by also copying the closed-captioned text that accompanies the videos. Clients can search for videos based on keywords and play unlimited video clips, each up to ten minutes in duration, and may archive, download, and share clips by e-mail. Clients pay $500 per month for these services.

The District Court held that the searching, archiving, and watching functions offered by TVEyes constituted fair use, but that the downloading and e-mailing functions did not. Fox only challenged the “watch” function (and its ancillary functions like downloading, archiving, and sharing), but not the search function.

At the outset of its opinion, the Court of Appeals noted the similarities between this case and Authors Guild v. Google, Inc., in which the court held that mass copying of books for purposes of limited text searching was fair use, but it explained that Authors Guild “test[ed] the boundaries of fair use,” and that TVEyes “has exceeded those bounds.” In sum, the court held that TVEyes’ re-distribution of copyrighted content was only modestly transformative under the first fair use factor, but that other fair use factors outweighed any transformative purpose. Despite myriad recent case law holding that transformative use is the most important fair use factor, the TVEyes court seemed to hearken back to a slightly earlier era of fair use and reiterated that the fourth factor – market harm – is “the single most important element.”

The court held that TVEyes’ copying could be considered transformative in that “it enables TVEyes’s clients to isolate from the vast corpus of Fox’s content the material that is responsive to their interests, and to access that material in a convenient manner.” Similar to the Sony “Betamax” case, the court noted that TVEyes’ watch function was also akin to time- and place-shifting, and “certainly qualifies as technology that achieves the transformative purpose of enhancing efficiency,” and so was “at least somewhat transformative.” However, the transformative character of the use was not enough to outweigh the commercial nature of the services offered because TVEyes “essentially republishes that content unaltered from its original form, with no ‘new expression, meaning or message.’”

The court found the second factor – the nature of the copyrighted works – inconsequential, but placed significant weight on the third factor, which analyses the amount of the copyrighted works made available to the public. This factor weighed in favor of Fox because, unlike in Authors Guild where Google Books made available only snippets, “TVEyes makes available virtually the entirety of the Fox programming that TVEyes users want to see and hear,” and given the brevity of most news reports, at very least copied and distributed “the entirety of the message conveyed by Fox to authorized viewers of the original” content.

Turning to the fourth factor, the Second Circuit agreed with Fox that “TVEyes undercuts Fox’s ability to profit from licensing searchable access to its copyrighted content to third parties.” Consumers were clearly willing to pay for such a service, and TVEyes therefore “deprives Fox of revenue that properly belongs to the copyright holder,” effectively usurping the market for Fox to offer similar aggregation, searching, and licensing services for its own content. This usurpation, combined with the amount of content offered and the modest transformativeness overshadowed by TVEyes’ commercial use of Fox’s content, defeated TVEyes’ fair use defense. The court remanded with instruction to the District Court to amend its permanent injunction accordingly.

Judge Kaplan of the Southern District of New York, sitting by designation, filed a separate concurring opinion to express his disagreement with the majority’s finding that TVEyes’ uses were at all transformative. He opined that the “somewhat transformative” designation was irrelevant given that the other fair use factors outweighed the transformative use, and that issuing such dicta would serve only to confuse the already complicated question of what constitutes transformative purpose. Nonetheless, Judge Kaplan expressed his own views on why TVEyes’ use of Fox’s content was not transformative, including that the mere “enhancing the efficiency with which copies of copyrighted material are delivered to secondary issuers” was not transformative because TVEyes simply repackaged and delivered the original content with no news aesthetics, insights, or understandings.

The Second Circuit’s decision is significant in that it further defines the outer boundaries of fair use by providing a concrete example of what falls outside the doctrine, which is helpful given the arguably expansive implications of the Authors Guild decision, and by distinguishing a facially similar service from the Google Books project it deemed fair use in that case. It also signals a potential shift in focus back to the “market harm” factor of fair use, and away from a strict focus on transformative purpose, but at the same time adds to the growing sense of confusion about what may be considered transformative, or in this case, “somewhat transformative.”

Cowan, DeBaets, Abrahams & Sheppard LLP drafted an amicus brief in this case on behalf of American Photographic Artists, American Society of Media Photographers, Digital Media Licensing Association, National Press Photographers Association, and Professional Photographers of America, in support of Fox News Network.

DMCA Takedown Notices Require Fair Use Considerations

Nancy Wolff and Josh Wolkoff, Cowan DeBaets Abrahams & Sheppard, LLP

Lenz v. Universal Music Corp., Case Nos. 13-16106 and 13-16107, in the United States Court of Appeals for the Ninth Circuit.

The Digital Millennium Copyright Act (DMCA) was enacted in 1998 to address in part issues created by the internet and the widespread posting of content by users. In reforming the Copyright Act in 1978, the drafters thought that this Act would serve well into the future as it was content neutral but they could not foresee the way the Internet dramatically altered the way users exchanged content online and how perfect copies of copyrighted content could be virally distributed in seconds. Internet service providers (ISPs) were concerned with strict liability and monetary damages based on content posted by users and hosted on their servers over which they could not monitor and control. Section 512 of the Copyright Act was enacted to balance the concerns of ISPs and copyright owners. Qualified ISP were granted immunity from liability if they received a proper notice of infringement and expeditiously removed the infringing content.

There has been much litigation over the years regarding various aspects of the DMCA, including whether a copyright owner is required to consider whether the use made of the uploaded content is considered a fair use and not an infringement before issuing a takedown notice. Because of the massive amount of content uploaded by users, and the difficulty to search the ever increasing number of sites, content owners, including the music industry, employ technology to crawl the internet to find unlicensed content in order to end the ISP the requisite takedown notice.

A test case was brought in 2007 by Stephanie Lenz, a mother who sued Universal Music Group after YouTube removed a 29-second video of her toddler dancing to Prince’s “Let’s Go Crazy” in response to a DMCA takedown notice submitted by Universal Music Group, Prince’s music publisher. Not surprisingly, the Electronic Frontier Foundation, a pro user group supported Lenz in bringing this test case. Dubbed the “dancing baby case,” Lenz argued that her video was protected by the doctrine of fair use and that Universal’s takedown notice violated a section of the DMCA that provides liability for knowingly making material representations because it misrepresented that the video was infringing without considering fair use . Under the DMCA, a proper takedown notice must include a statement that the owner or its agent has a “good faith belief” that the use of the copyrighted work is not authorized under the law.

The case ultimately made its way to the Ninth Circuit Court of Appeals. An appeal the court was asked to examine whether fair use was a right under copyright and an authorized use, or a defense to infringement and unauthorized. In a significant ruling to content owners and ISP’s, the court issued a bright line rule that copyright holders must consider the fair use doctrine before issuing takedown notices to remove otherwise infringing content under the DMCA. The Court’s decision makes clear that a failure to do so can open the door to nominal monetary damages and attorneys’ fees for any material misrepresentations made (or improper procedures used) in the course of pulling content from service providers like YouTube. The court explained that fair use must be treated differently than other affirmative defenses because fair use is not merely an exception to an infringement – it is one that that is expressly “authorized by law” under Section 107 of the Copyright Act.

The Ninth Circuit took great pains, however, to qualify the thrust of its ruling, suggesting that it was “mindful of the pressing crush of voluminous infringing content that copyright holders face in a digital age.” In particular, a sender must only form a “subjective good faith belief” that the use is not a fair use or not authorized under the law. The inquiry “need not be searching or intensive” and, in fact, the Court recognized the role that computer algorithms and automated programs might play in making such fair use determinations and issuing proper takedown notices. The Ninth Circuit also confirmed that the question of liability for material misrepresentations does not hinge on whether or not the use is indeed a fair use: courts are “in no position to dispute the copyright holder’s belief even if [the court] would have reached the opposite conclusion.”

As a result content owners should review their notice and takedown procedures in order to ensure that their procedures give due consideration to potential fair uses. DMLA, in watching this case over the years, revised the declaration in its DMCA notice to include reference to a fair use review: I have a good faith belief that use of the material in the manner complained of herein is not authorized by COPYRIGHT HOLDER, its licensing representatives, or the law and is not a fair use.

Even if using recognition technology to find infringing uses, someone should review the use to determine if the use is a fair use or not. As fair use is determined on a case by case basis, and in not the easiest area of the law, the determination just needs to be made in good faith. As noted by the Ninth Circuit, it is not a material misrepresentation if a court might come out differently. Fair use is a judgment call after weighing the requisite four factors. DMLA has a webinar on fair use found here and the Copyright Office has published an index of fair use cases [http://copyright.gov/fair-use/]

 

 

DMCA Takedown Notices Require Fair Use Considerations

Lenz v. Universal Music Corp., Case Nos. 13-16106 and 13-16107, in the United States Court of Appeals for the Ninth Circuit.

 by Nancy Wolff and Josh Wolkoff, Cowan DeBaets Abrahams & Sheppard, LLP

The Digital Millennium Copyright Act (DMCA) was enacted in 1998 to address in part issues created by the internet and the widespread posting of content by users. In reforming the Copyright Act in 1978, the drafters thought that this Act would serve well into the future as it was content neutral but they could not foresee the way the Internet dramatically altered the way users exchanged content online and how perfect copies of copyrighted content could be virally distributed in seconds. Internet service providers (ISPs) were concerned with strict liability and monetary damages based on content posted by users and hosted on their servers over which they could not monitor and control. Section 512 of the Copyright Act was enacted to balance the concerns of ISPs and copyright owners. Qualified ISP were granted immunity from liability if they received a proper notice of infringement and expeditiously removed the infringing content.

There has been much litigation over the years regarding various aspects of the DMCA, including whether a copyright owner is required to consider whether the use made of the uploaded content is considered a fair use and not an infringement before issuing a takedown notice. Because of the massive amount of content uploaded by users, and the difficulty to search the ever increasing number of sites, content owners, including the music industry, employ technology to crawl the internet to find unlicensed content in order to end the ISP the requisite takedown notice.

A test case was brought in 2007 by Stephanie Lenz, a mother who sued Universal Music Group after YouTube removed a 29-second video of her toddler dancing to Prince’s “Let’s Go Crazy” in response to a DMCA takedown notice submitted by Universal Music Group, Prince’s music publisher. Not surprisingly, the Electronic Frontier Foundation, a pro user group supported Lenz in bringing this test case. Dubbed the “dancing baby case,” Lenz argued that her video was protected by the doctrine of fair use and that Universal’s takedown notice violated a section of the DMCA that provides liability for knowingly making material representations because it misrepresented that the video was infringing without considering fair use . Under the DMCA, a proper takedown notice must include a statement that the owner or its agent has a “good faith belief” that the use of the copyrighted work is not authorized under the law.

The case ultimately made its way to the Ninth Circuit Court of Appeals. An appeal the court was asked to examine whether fair use was a right under copyright and an authorized use, or a defense to infringement and unauthorized. In a significant ruling to content owners and ISP’s, the court issued a bright line rule that copyright holders must consider the fair use doctrine before issuing takedown notices to remove otherwise infringing content under the DMCA. The Court’s decision makes clear that a failure to do so can open the door to nominal monetary damages and attorneys’ fees for any material misrepresentations made (or improper procedures used) in the course of pulling content from service providers like YouTube. The court explained that fair use must be treated differently than other affirmative defenses because fair use is not merely an exception to an infringement – it is one that that is expressly “authorized by law” under Section 107 of the Copyright Act.

The Ninth Circuit took great pains, however, to qualify the thrust of its ruling, suggesting that it was “mindful of the pressing crush of voluminous infringing content that copyright holders face in a digital age.” In particular, a sender must only form a “subjective good faith belief” that the use is not a fair use or not authorized under the law. The inquiry “need not be searching or intensive” and, in fact, the Court recognized the role that computer algorithms and automated programs might play in making such fair use determinations and issuing proper takedown notices. The Ninth Circuit also confirmed that the question of liability for material misrepresentations does not hinge on whether or not the use is indeed a fair use: courts are “in no position to dispute the copyright holder’s belief even if [the court] would have reached the opposite conclusion.”

As a result content owners should review their notice and takedown procedures in order to ensure that their procedures give due consideration to potential fair uses. DMLA, in watching this case over the years, revised the declaration in its DMCA notice to include reference to a fair use review: I have a good faith belief that use of the material in the manner complained of herein is not authorized by COPYRIGHT HOLDER, its licensing representatives, or the law and is not a fair use.

Even if using recognition technology to find infringing uses, someone should review the use to determine if the use is a fair use or not. As fair use is determined on a case by case basis, and in not the easiest area of the law, the determination just needs to be made in good faith. As noted by the Ninth Circuit, it is not a material misrepresentation if a court might come out differently. Fair use is a judgment call after weighing the requisite four factors. DMLA has a webinar on fair use found [here] and the Copyright Office has published an index of fair use cases [http://copyright.gov/fair-use/]

*** You can find the DMCA takedown notice on the DMLA Document Library

Stylized Derivative of Wisconsin Major Photo on T-Shirt Deemed Fair Use

by Nancy Wolff, PACA Counsel  

Michael Kienitz v. Sconnie Nation LLC and Underground Printing-Wisconsin LLC, No. 13-3004 (7th Cir., September 15, 2014)

Michael Kienitz photographed the Wisconsin major, Paul Klogin, at his 2011 inauguration.  With Kienitz’s permission (but no fee), the major posted the portrait on the official city’s website.  An artist operating under Sconnie Nation LLC modified the photo and made t-shirts to be sold and worn at the 2012 Mifflin Street Block Party – an event that is designed to poke fun at authority.  The modified photo was colorized, posturized, and included multi colored type “Sorry For Partying.”   See the entire article here

Stylized Derivative of Wisconsin Major Photo on T-Shirt Deemed Fair Use

by Nancy Wolff, PACA Counsel  

Michael Kienitz v. Sconnie Nation LLC and Underground Printing-Wisconsin LLC, No. 13-3004 (7th Cir., September 15, 2014)

Michael Kienitz photographed the Wisconsin major, Paul Klogin, at his 2011 inauguration.  With Kienitz’s permission (but no fee), the major posted the portrait on the official city’s website.  An artist operating under Sconnie Nation LLC modified the photo and made t-shirts to be sold and worn at the 2012 Mifflin Street Block Party – an event that is designed to poke fun at authority.  The modified photo was colorized, posturized, and included multi colored type “Sorry For Partying.”    Apparently Soglin attended the very first annual block party as a student at the University of Wisconsin in 1969, but tried to stop the event when he took office.  The t-shirts were not a commercial success, only 54 t-shirts were sold. The photo and the t-shirt art are compared below.

Untitled

 

 

 

 

 

 

Kienitz, offended by the t-shirt design, brought a copyright infringement claim against Sconnie Nation and its distributor based on the derivative use of his image on the t-shirt. The court dismissed the action on a summary judgment motion, finding the use to be a fair use and not infringing. On appeal, the photographer did not fare any better as the 7th Circuit also found the use to be a fair use.

While the 7th Circuit analyzed fair use under the requisite four factor test proscribed in Section 107 of the Copyright Act, it took this opportunity to criticize the reasoning of the district court for relying on the Second Circuit’s approach in Cariou v. Prince, which focuses primarily on whether the’ use of the visual image is “transformative” in determining fair use. A work is considered transformative if it alters the original with new expression, meaning or message.  While the appellate court agreed that the modification of the photograph as depicted in the T-shirt was a fair use, it advocated for sticking to the factors identified in the statute rather than relying on a term that does not appear anywhere in the Copyright Act . The four the factors are (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit education 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.

This court focused more heavily on the fourth factor, and found that there was little to no effect of the use of the photograph on the market – the t-shirts were not a substitute for the original photograph, and Kienitz did not raise the possibility of licensing the photograph for apparel or any other use.  The third factor – the amount and substantiality of the use – was the only other fair use factor that had any “bite” in this case.  The court found that the only elements of the original photograph that remained after the modification was Soglin’s smile and the outline of his face, which cannot be copyrighted.  Turning to the two remaining statutory factors, the court acknowledged defendants’ small profits from the sales but stated that the design was political commentary.  Finally, in looking at the nature of the copyrighted work, the court stressed the absence of any argument that Sconnie Nation’s use reduced the value or demand of the original photograph.

The Court of Appeals noted that Sconnie Nation’s use of Kienitz’s photograph was not necessary in order to make the t-shirt and that Kienitz’s photography business may suffer in the long run – people may not want to hire Kienitz for fear the photos may be used against them, but these issues were not nearly enough to overcome the other fair use factors.

This case is most notable for its criticism of Cariou v. Prince.  In Cariou v. Prince, the Second Circuit expanded the meaning and importance of transformative use, holding that there is no requirement that a new work comment on or critically refer back to the original work or its author.  The court was explicitly “skeptical” of this approach, concerned that it may replace the list of factors and override protection of derivative works.