On May 11, 2012, we learned what it sounds like when all the college professors and university librarians in the country breathe a collective sigh of relief. Judge Orinda Evans of the Federal District Court for Northern Georgia issued a whopping 350-page opinion which, for the most part, vindicated Georgia State University’s fair use defense in the closely-watched copyright infringement case brought by a coalition of publishers (Oxford University Press, Cambridge University Press and Sage Publications) with the financial backing of the Copyright Clearance Center and the Association of American Publishers.

But was that collective sigh premature? The Court’s opinion is in fact a mixed bag, and in that mix are so many controversial holdings on juicy legal issues that, even in the event that the plaintiffs here do not appeal, there is no chance that we’ve heard the last word on the subject.

Background

Georgia State University (“GSU”) allows professors to select excerpts from academic texts and have the school library upload those selections to an “electronic reserves” system, known as ERES, where they are available for free to students in that professor’s class. A significant portion of these uploaded excerpts are full chapters from academic textbooks. For example, one of the excerpts in question was Chapter 17 from Sage Publication’s Handbook of Social Theory, entitled “Symbolic Interactionism at the End of the Century.” The copyright notice page for that book indicates that each chapter was written as a standalone work by a separate author:

In 2008, the publishers brought suit against GSU, alleging that the ERES system was an illegal substitute for legitimate copies (i.e., the purchase of textbooks or the inclusion of authorized excerpts in course packets) and thus a vehicle for massive copyright infringement. The plaintiffs sought injunctive and declaratory relief, specifically, a change in GSU’s electronic reserves policies and practices.

In 2009, while still in the midst of the lawsuit, GSU changed its policy, instituting the use of a “Fair Use Checklist” based on a similar policy at Columbia University. The new policy required that each professor use the checklist to determine for herself or himself whether uploading any particular chapter was fair use, with only limited oversight by the library. The plaintiffs claimed that this new policy was as problematic as the old one, alleging that it distorted the fair use analysis, and that the professors did not receive sufficient training or oversight in their use of the checklist.

In 2010, the Court granted partial summary judgment for the defendants, leaving alive only counts for contributory infringement. In essence, the key issues remaining in the case were whether approximately 74 alleged instances of copyright infringement occurred and, if so, whether the new GSU policy caused (i.e., materially contributed to) that infringement. The parties conducted a 15-day bench trial in May 2011. Then they waited.

The Opinion

After approximately a year, Judge Evans finally issued her 350-page opinion, which includes 74 separate mini-opinions, one for each allegedly infringed work. Specifically, the Court held that:

• 16 of the claims failed because the plaintiffs were unable to prove ownership of copyright in the specific chapters copied and thus could not make a prima facie case;
• 10 of the claims failed because the copying was de minimis, for example because it was a supplemental reading assignment that no student actually downloaded;
• 43 of the claims failed because the copying was fair use; and
• 5 of the claims succeeded because the copying was not fair use. The Court further held the GSU policy caused this infringement because GSU failed to place any limit on the amount copied or provide sufficient guidance to the professors.

Controversial Fair Use Issues

The majority of the Court’s opinion focused on the doctrine of fair use, 17 U.S.C. § 107 (http://www.law.cornell.edu/uscode/text/17/1070), which provides that:

". . . the fair use of a copyrighted work, including . . . 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."

Judge Evan’s application of this doctrine was in some ways unusual and controversial. Many of these issues are likely be revisited by other courts down the road. We discuss a few of them below.

Fair Use Factor One: The Purpose and Character of the Use

The Court held that the first fair use factor weighed “strongly” in favor of the defendants in each and every case, for the simple reason that the copying was done for students in a class at a “nonprofit educational institution for the nonprofit, educational purposes of teaching and scholarship.” The Court’s approach suggests a virtually automatic victory for defendants on the first factor, provided they work in non-profit academia.

In examining the first factor, courts usually determine whether the use of the copyrighted work was “transformative,” i.e. that the use added something new or different. The parties agreed that GSU’s straight copying was not transformative, but Judge Evans found this fact irrelevant in the academic context. In support of this position, she turned to a footnote by Justice Souter in Campbell v. Acuff Rose Music, 510 U.S. 569 (1994). Justice Souter, referring in dicta to the preamble of the fair use statute, noted that “the obvious statutory exception to [the fair use analysis’] focus on transformative uses in the straight reproduction of multiple copies for classroom distribution.”

One might reasonably ask, however, whether this language was intended to cover electronic reserves. It is far from certain that Justice Souter and the Copyright Act meant the term “classroom distribution” to apply to all academic and scholarly use, no matter how systematic. Indeed, the Copyright Office’s educational guidelines limit even classroom distribution so as to preclude the systematic replacement of purchased educational materials.

Fair Use Factor Two: The Nature of the Copyrighted Work

Typically, factor two works on sliding scale, with purely informational works on one end and purely creative works on the other, the latter deserving more protection. It is not unusual for defendants to prevail on the second factor when scholarly articles are at issue, because they are at least somewhat informational in nature. See, e.g., American Geophysical Union v. Texaco Inc., 60 F.3d 913 (2d Cir. 1994).

However, Judge Evans went about it in an unusual way. She acknowledged that there was a good argument that at least some of texts in question, which consisted principally of criticism and comment, had creative elements. But then she turned back to the preamble of the fair use statute, and held that because “criticism and comment” were listed as among works that deserved more exposure, not less, this factor weighed in favor of a finding of fair use. Based on this reading of the statute, Judge Evans found that factor two weighed in favor of defendants for every single work at issue. Of course, the potential problem with this analysis, and perhaps a possible point of appeal, is that the fair use preamble is referring “criticism and comment” when it is the infringing work, not the infringed work.

Fair Use Factor Three: The Amount and Substantiality of the Portion Used

While rejecting the Copyright Office’s guidelines for classroom distribution as a basis for analysis, the Court came up with its own rules of thumb. Judge Evans held that if a book contained fewer than 10 chapters, it was permissible to copy no more than 10% of the entire work (in which she included indexes and tables of contents - another controversial point). If the book contained more than 10 chapters, it was permissible to copy up to one full chapter.

Some might argue that this misses the point. Because the chapters in question are mostly standalone works by different authors, in at least some sense each chapter was the whole work. The Court rejected this argument on the grounds that the plaintiffs had sued on copyrights in the books as a whole, not in the individual chapters, and therefore they had waived the right to argue that each chapter was a separate work.

But while refusing to treat the chapters as standalone works in one context, the Judge found that their standalone nature worked in favor of fair use in another context. In addition to the quantitative analysis describe above, the third factor also includes a qualitative element, specifically, was it the “heart of the book” that was copied? Here, because the chapters tended to be standalone works on subtopics within the broader topic of each book (such as the chapter on Symbolic Interactionism within a book on Social Theory), the chapters did not work together to “develop sequentially, leading toward a conclusion.” Therefore, with one or two exceptions, the Court essentially held that there was no “heart” to these works, and the qualitative analysis under factor three also favored the defendants.

Fair Use Factor Four: The Effect on the Potential Market

In determining the effect on the market, one issue to which courts often look is whether a license to the copyrighted materials could have been purchased by the defendant through some readily-available market. For example, in American Geophysical Union v. Texaco Inc., where Texaco had photocopied scientific articles for archival purposes, the Second Circuit held that the fourth factor weighed against fair use in part because the defendant could have acquired a photocopying license from the Copyright Clearance Center.

Here, Judge Evans placed great emphasis on license availability, nearly to the exclusion of other elements of the market analysis. The plaintiffs argued that, as in American Geophysical Union v. Texaco Inc., photocopy licenses for course packets were in fact available for many of these works. But the judge refused to acknowledge the photocopy license market and held that only digital excerpt licenses were relevant, because “[e]ducational users today want digital materials.” In other words, because GSU chose to distribute these materials electronically instead of in course packets, the course packet license market doesn’t count. This ruling arguably leaves open the danger that defendants, by choosing an alternative medium in which to make unauthorized copies, can manipulate the fair use analysis in their favor.

So What Happens Now?

Although it’s hard not to see an overwhelming victory for the defendants in the legal holdings of the case, in fact the plaintiffs may have attained their goals. After all, despite the hurdles thrown up by the Court, the plaintiffs now have a declaration that the GSU policy contributed to at least some copyright infringement. Additionally, the Court has ordered that the parties file proposed orders on the injunctive and declaratory relief to be granted by the end of the month, so the final order may yet include the policy changes that the publishers were looking for. So far, the publishers have claimed to be somewhat “pleased” with the Court’s recognition that the policy was flawed and required revision.

But who is kidding whom? We’ll see how “pleased” they really are when the matter gets appealed. And in the unlikely event the plaintiffs don’t appeal, the cluster of issues addressed by this controversial decision are no doubt only at the beginning of their journey through the federal courts.