LOS ANGELES TIMES, and THE WASHINGTON POST COMPANY and
its wholly owned subsidiary, WASHINGTONPOST.NEWSWEEK INTERACTIVE COMPANY,
Plaintiffs, vs. FREE REPUBLIC, ELECTRONIC ORCHARD, JIM
ROBINSON, and DOES 1 THROUGH 10, inclusive, Defendants.
CASE NO. CV 98-7840 MMM (AJWx)
UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF
CALIFORNIA
2000 U.S. Dist. LEXIS 5669; 54 U.S.P.Q.2D (BNA) 1453; Copy.
L. Rep. (CCH) P28,075; 28 Media L. Rep. 1705
March 31, 2000, Decided
April 4, 2000, Filed; April 5, 2000, EnteredDISPOSITION: [*1] Plaintiffs' motion for summary
adjudication with respect to fair use granted and defendants' motion for summary
judgment denied.
COUNSEL: For LOS ANGELES TIMES,
WASHINGTON NEWSWEEK INTERACTIVE COMPANY, plaintiffs: Rex S Heinke, Greines
Martin Stein & Richland, Beverly Hills, CA.
For WASHINGTON POST COMPANY, plaintiff: Rex S Heinke, Heather L
Wayland, Greines Martin Stein & Richland, Beverly Hills, CA.
For JIM ROBINSON, FREE REPUBLIC, ELECTRONIC ORCHARD,
defendants: Brian L Buckley, Brian L Buckley Law Offices, Los Angeles, CA.
JUDGES: MARGARET M. MORROW, UNITED STATES DISTRICT
JUDGE.
OPINIONBY: MARGARET M. MORROW
OPINION: ORDER GRANTING PLAINTIFFS' MOTION FOR
PARTIAL SUMMARY JUDGMENT AND DENYING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT
Plaintiffs Los Angeles Times and The Washington Post
Company publish newspapers in print and online versions. Defendant Free Republic
is a "bulletin board" website whose members use the site to post news articles
to which they add remarks or commentary. Other visitors to the site then read
the articles and add their comments. For the most part, Free Republic members
post the entire text of articles in which they are interested; among these are
verbatim copies [*2] of articles from the Los Angeles Times and
Washington Post websites. Plaintiffs' complaint alleges that the unauthorized
copying and posting of the articles on the Free Republic site constitutes
copyright infringement.
Defendants have now moved for
summary judgment. They assert that the copying of news articles onto their
website is protected by the fair use doctrine. Plaintiffs have filed a
cross-motion for partial summary judgment, arguing that defendants may not
invoke fair use as a defense.
The fair use doctrine,
codified at 17 U.S.C. § 107, permits the reproduction of copyrighted works for
certain purposes. Section 107 sets forth four nonexclusive factors to be
considered in determining whether a defendant's copying is fair use: "(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." 17 U.S.C. § 107.
Based on the evidence [*3] submitted by the parties, the court
concludes that the first, third and fourth factors militate against a finding of
fair use in this case. The second factor weighs in defendants' favor. The
balance of all factors tips toward plaintiffs, and the court thus finds that
defendants are not entitled to assert a fair use defense to the claims of
copyright infringement alleged in the complaint.
Defendants also allege that the First Amendment protects the posting of
plaintiffs' news articles to their website. They contend that, absent wholesale
copying, Free Republic visitors will be unable to express their criticism and
comments. There are other methods in which the visitors' rights of free
expression can be protected, however, and the court cannot conclude that
enforcing plaintiffs' rights under the copyright law impermissibly restricts
defendants' right to free speech.
I. FACTUAL
BACKGROUND n1
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n1 All
parties have filed evidentiary objections to the declarations submitted in
support of or opposition to the cross-motions. To the extent the court has
considered evidence contained in the declarations, it has ruled on the
objections to that evidence and noted its rulings in this order. To the extent
evidence contained in the declarations is not mentioned in this order, it has
not been considered by the court, and no ruling on the objections is
required.
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End Footnotes- - - - - - - - - - - - - - [*4]
A. The PartiesPlaintiffs publish the
Los Angeles Times and The Washington Post in print and online at
"http://www.latimes.com" and "http://www.washingtonpost.com." n2 Their
respective websites contain the current edition of the newspaper, which can be
viewed free of charge, and archived articles that users must pay to view. n3 The
Times charges $ 1.50 to view an archived article, while the Post charges from $
1.50 to $ 2.95 depending on the time of day. n4 In addition to income generated
in this fashion, the websites also produce advertising and licensing revenue for
the papers. n5 Because advertising is sold "CPM" (cost per thousand), the
revenue generated from this source depends on the volume of traffic the sites
experience during a given period. n6 The parties dispute the extent to which
being able to access archived articles at a different site for free affects
plaintiffs' ability to advertise, license, and sell the archived articles. n7
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n2 Declaration of Carol Perruso
("Perruso Decl."), P 2; Declaration of Eric Koefoot ("Koefoot Decl."), PP
2-3.
n3 Perruso Decl., P 4; Koefoot Decl.,
P 4 [*5]
n4
Plaintiffs' Statement of Uncontroverted Facts and Conclusions of Law ("Pls.'
Facts"), P 50; Defendants' Response to Plaintiffs' Separate Statement of
Uncontroverted Facts ("Defs.' Genuine Issues"), P 50. The price per view figures
cited in the text are set forth in the Perruso (Los Angeles Times) and Koefoot
(Washington Post) declarations. While defendants have objected to the paragraphs
of the declarations in which this information is found, their objection appears
to relate to the declarants' assertion that it is not "impractical" to view the
full text of an archived article on plaintiffs' websites rather than the Free
Republic's site. (See Perruso Decl., P 8; Koefoot Decl., P 8; Defendants'
Evidentiary Objections to Declarations of Carol Perruso, Eric Koefoot and
Chappell Aldridge ("Defs.' Objections") at 2:7-10, 4:21-24.) The statements
concerning the amounts charged for viewing articles on the Times and Post
websites are not irrelevant, do not lack foundation, and are not ambiguous,
speculative or conclusory. Consequently, to the extent defendants object to this
aspect of the declarations, their objections are overruled.
n5 Perruso Decl., PP 10-12; Koefoot Decl., PP 10-12.
Defendants object to paragraphs 10 and 12 of the Perruso and Koefoot
declarations on the basis that they lack foundation, and are ambiguous,
conclusory and speculative. (See Defs.' Objections at 2:12-15, 2:17-22, 4:26-28,
5:3-8.) Perruso and Koefoot are executive officers of their respective
companies, and have personal knowledge of company operations and Internet
business generally. Each is aware of the sources of revenue generated by their
company's website, and of the factors that cause such revenue to increase or
decrease. The testimony, which is general in nature and not directed
specifically to the impact of the Free Republic site, is not speculative,
ambiguous or conclusory. Consequently, defendants' objections to these portions
of the Perruso and Koefoot declarations are overruled. [*6]
n6 Pls.' Facts, PP 33, 48;
Defs.' Genuine Issues, PP 33, 48.
n7 See
Pls.' Facts, PP 49, 51, 52; Defs.' Genuine Issues, PP 49, 51, 52.
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Defendant Jim Robinson is the
owner and operator of defendants Electronic Orchard and Free Republic. n8
Although no longer actively engaged in business, Electronic Orchard is a
for-profit limited liability company that offers "Internet programming and
design services." n9 Free Republic is a limited liability corporation that
operates freerepublic.com. n10 The website, which has been operational since
1996, allows registered visitors to "post" news articles and comments concerning
them on the site. n11 Registered members may then post additional comments. n12
Free Republic has approximately 20,000 registered participants. The website
receives as many as 100,000 hits per day, and between 25 and 50 million page
view each month. n13
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Footnotes - - - - - - - - - - - - - - -
n8
Defendants' Exhibits - Vol. 4, Ex. 1009 [Deposition of James Curtis Robinson
("Robinson Depo.")] at 25:6-26:10, 19:16-19. Robinson's son, John, and Amy
DeFendis are co-owners of the two companies. (
Id. at
25:24-26:10.) [*7]
n9
Id. at 20:2-12; Pls.' Facts, P 24; Defs.' Genuine Issues, P
24.
n10 Robinson Depo. at 26:16-20.
n11 Pls.' Facts, PP 1, 24, 25; Defs.' Genuine
Issues, PP 1, 24, 25; Declaration of James Robinson ("Robinson Decl."), P35;
Memorandum of Points and Authorities in Support of Defendants' Motion for
Summary Judgment ("Defs.' Mot.") at 7:17-24; Declaration of Heather L. Wayland
("Wayland Decl."), Ex. B (D000441, D000445).
n12 See, e.g., Wayland Decl., Ex. D.
n13 Pl.'s Facts, PP 18, 38; Defs.' Genuine Issues, PP 18, 38.
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Plaintiffs contend that
"perfect copies" of news articles appearing in their publications and on their
websites are posted to the Free Republic site. Defendants maintain that the
posted articles are merely "purported copies" of the original, and assert that
one can verify that a posting is an exact copy only by visiting plaintiffs'
websites. n14 Defendants nonetheless apparently concede that
some of the
postings are verbatim copies of original articles. n15
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n14 See, e.g., Pls.' Facts, PP 45, 47; Defs.'
Genuine Issues, PP 45, 47, 49, 51, 52. [*8]
n15 Defs.' Genuine Issues, PP 45, 47, 49, 51,
52 (". . . With the exception of a very few articles, there is no evidence in
the record to establish that the articles are 'perfect copies' as Plaintiffs
allege").
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End Footnotes- - - - - - - - - - - - - -
B.
Defendants' Profit Or Non-Profit StatusThe parties
dispute whether Free Republic is a for-profit or not-for-profit entity. n16
Despite this purported disagreement, it appears uncontroverted that Free
Republic is presently a for-profit limited liability company. Free Republic's
corporate counsel is currently preparing documents seeking tax-exempt status for
the Free Republic Institute, a company incorporated on September 27, 1999. n17
Nothing has yet been submitted to the IRS, however, and tax-exempt status has
not been granted. n18
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Footnotes - - - - - - - - - - - - - - -
n16 See Pls.' Facts, P 23; Defs.' Genuine Issues, P 23; Defendants'
Separate Statement of Uncontroverted Facts ("Defs.' Facts"), P 6; Plaintiffs'
Response to Defendants' Separate Statement of Uncontroverted Facts ("Pls.'
Genuine Issues"), P 6.
n17 Free Republic
Institute will apparently assume responsibility for operation of the website,
freerepublic.com. (See Robinson Depo. at 98:15-21.) [*9]
n18 See Declaration of
Harold Szabo ("Szabo Decl."), PP 3-6. Plaintiffs object to the Szabo Declaration
on the basis that it is irrelevant, vague and ambiguous, without foundation,
conclusory, and speculative, and that it offers improper opinion testimony to
the extent it suggests tax-exempt status will be granted. (See Plaintiffs'
Evidentiary Objections to Declarations of Richard L. Stout and Howard K. Szabo
("Pls.' Objections") at 11:21-15:19.) These objections are overruled as Szabo
has personal knowledge of his retention, the work he was asked to perform, and
the tasks he has completed to date. Thus, the statements he offers concerning
the incorporation of Free Republic Institute and the status of his work on the
tax-exempt application are neither vague, ambiguous, speculative or conclusory.
Additionally, Szabo offers no opinions concerning the ultimate outcome of the
application for tax-exempt status. Finally, while plaintiffs dispute the
relevance of the information set forth in Szabo's declaration, this objection is
not an attack on the admissibility of the evidence. Rather, it is argument
concerning the legal import of the information Szabo provides. Consequently,
there is no basis for striking the declaration.
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- - - [*10]
Defendants contend that Robinson
was not paid to create the Free Republic website, that he receives no salary
from the entity, and that he receives almost no compensation for posting banners
or links on the site. n19 Plaintiffs counter that Free Republic earns revenue
through commercial advertising, merchandise sales, saleable consumer data,
donations, "voluntary" subscriptions, and membership dues. n20 They also assert
that Robinson uses the Free Republic site to advertise Electronic Orchard's
services. n21
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n19 Robinson
Depo. at 24:1-8, 27:18-28:23, 38:4-40:12.
n20 Pls.' Facts, PP 27, 28, 29, 30, 31, 32, 34, 35.
n21 Pls.' Facts, PP 27, 28. Plaintiffs additionally note
that the Free Republic website uses a ".com" domain name of the type generally
employed by commercial entities. (Pls.' Facts, P 26.) Defendants dispute the
relevance of this fact, noting that use of a ".com" domain name does not
indicate whether their business is for-profit or not-for-profit. (Defs.' Genuine
Issues, P 26; Supplemental Declaration of Richard Stout ("Supp. Stout Decl."),
PP 35-38.)
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End Footnotes- - - - - - - - - - - - - - [*11]
Defendants dispute these claims, contending that they have received no
advertising revenue, commissions or donations for permitting various individuals
and entities to place links on the freerepublic.com site. They assert, in fact,
that the links have in some instances been posted on the site by third-party
users. n22 Defendants also contend that Electronic Orchard has received no
business or financial benefit from any links appearing on the Free Republic
website, and that Robinson has placed links for Electronic Orchard customers
there solely as a courtesy. n23 Defendants maintain that Free Republic does not
collect consumer data, and that it has not sold any information regarding its
registered users to any other entity. n24 Additionally, they contend they have
no connection with membership organizations of Free Republic supporters, and
receive no benefit from dues revenue generated by these groups. n25 Defendants
concede, however, that Free Republic has facilitated links to web pages run by
third-party supporters where donations to Free Republic and/or Robinson are
solicited. They also acknowledge that the website carries links to third-party
web pages that offer Free Republic-related [*12] souvenir items in
exchange for donations. n26
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Footnotes - - - - - - - - - - - - - - -
n22 Defs.' Genuine Issues, PP 32, 34.
n23 See Defs.' Genuine Issues, PP 27, 28,
n24 Defs.' Genuine Issues, P 35.
n25 Defs.' Genuine Issues, P 31.
n26 See Defs.' Genuine Issues, PP 29, 30.
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C. The Impact Of The Free Republic Site On
Traffic At Plaintiffs' WebsitesThe parties also
dispute whether the posting of plaintiffs' news articles to the Free Republic
site causes an increase or decrease in traffic at the Times and Post websites,
whether it diminishes the available market for sale of plaintiffs' news
articles, and whether it has a negative impact on plaintiffs' ability to license
the works. Defendants assert that plaintiffs' websites actually gain viewers
because people go to them after visiting the Free Republic site. n27 Plaintiffs
maintain they lose traffic when Internet users read an article posted on
freerepublic.com rather than visiting the Times or Post websites. They further
assert that their ability to sell copies of the archived [*13]
articles and their ability to license the works is diminished by having copies
made freely available on the Free Republic site. n28
-
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n27 Defs.' Genuine Issues, PP 49, 51, 52. As
support, defendants rely, in part, on the Declaration of Rick Stout. Plaintiffs
have filed objections to portions of this declaration, only certain of which are
pertinent here. (See Pls.' Objections at 3:8-11:19.) Specifically, plaintiffs
object to paragraphs 46, 50 and 51 on the basis that they lack foundation and
are irrelevant, conclusory, speculative, vague and ambiguous. Plaintiffs'
objections to paragraph 46 are overruled, as Stout has demonstrated that he is
qualified to offer an opinion concerning the traffic moving from the Free
Republic site to the Times site, and has offered a detailed explanation of his
methodology in the preceding paragraphs of the declaration. As respects
paragraphs 50 and 51, it is true that the opinions set forth therein are
general. Stout's qualifications and his specific expertise in analyzing Internet
traffic permits him to offer an opinion concerning the relative impact of
freerepublic.com on plaintiffs' websites, however, and the generalized nature of
the conclusions found in these paragraphs goes to their weight rather than their
admissibility. [*14]
n28 Pls.' Facts, PP 49, 51, 52. Plaintiffs support these contentions
with citations to the Perruso, Koefoot and Aldridge Declarations. Defendants
object to the relevant portions of these declarations on the basis that they
lack foundation, are speculative, conclusory, and ambiguous, and assume facts
not in evidence. The relevant statements are found at paragraph 21 of the
Perruso, and Koefoot Declarations, and paragraphs 3-6 of the Aldridge
Declaration. In his declaration, Chappell Aldridge details a search he made for
an article on the Post website and his retrieval of the full text of the article
on the Free Republic site. The testimony is based on personal knowledge, and is
not speculative, conclusory or ambiguous. Consequently, the court overrules
defendants' objections to the Aldridge declaration, with the exception that the
court has not considered the argumentative statement that this method of
accessing articles is "a dodge . . . available to anyone." As respects the
Perruso and Koefoot Declarations, each is an executive officer of his or her
respective company, and each thus has personal knowledge of company operations
and Internet business generally. This knowledge provides a sufficient foundation
for the expression of the opinions set forth in the declarations concerning the
impact of freerepublic.com on traffic at the Times and Post sites. The
generalized nature of the opinions offered goes to their weight rather than
their admissibility. Consequently, defendants' objections to these portions of
the Perruso, Koefoot and Aldridge declarations are overruled.
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II.
DISCUSSIONA. Legal Standard Governing Motions
For Summary JudgmentA motion for summary judgment
must be granted when "the pleadings, depositions, answers to interrogatories,
and admissions on file, together with the affidavits, if any, show that there is
no genuine issue as to any material fact and that the moving party is entitled
to a judgment as a matter of law." Fed.R.Civ.P. 56(c). A party seeking summary
judgment bears the initial burden of informing the court of the basis for its
motion and of identifying those portions of the pleadings and discovery
responses which demonstrate the absence of a genuine issue of material fact. See
Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct.
2548 (1986). Where the moving party will have the burden of proof on an issue at
trial, the movant must affirmatively demonstrate that no reasonable trier of
fact could find other than for the moving party. On an issue as to which the
nonmoving party will have the burden of proof at trial, however, the movant can
prevail merely by pointing out that there is an absence of evidence to support
the nonmoving party's case. See
id. If the moving [*16] party
meets its initial burden, the nonmoving party must then set forth, by affidavit
or as otherwise provided in Rule 56, "specific facts showing that there is a
genuine issue for trial."
Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
250, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986); Fed.R.Civ.P. 56(e).
In judging evidence at the summary judgment stage, the
court does not make credibility determinations or weigh conflicting evidence.
Rather, it draws all inferences in the light most favorable to the nonmoving
party. See
T.W. Electric Service, Inc. v. Pacific Electric Contractors
Ass'n, 809 F.2d 626, 630-31 (9th Cir.1987). The evidence presented by the
parties must be admissible. Fed.R.Civ.P. 56(e). Conclusory, speculative
testimony in affidavits and moving papers is not sufficient to raise genuine
issues of fact and defeat summary judgment. See
Falls Riverway Realty, Inc.
v. Niagara Falls, 754 F.2d 49, 56 (2d Cir.1985);
Thornhill Pub. Co., Inc.
v. GTE Corp., 594 F.2d 730, 738 (9th Cir.1979).
Fair use is a mixed question of law and fact.
Harper & Row,
Publishers, Inc. v. Nation Enter., 471 U.S. 539, 560, 85 L. Ed. 2d 588, 105
S. Ct. 2218 (1985). [*17] It is nonetheless proper to decide the
issue at the summary judgment stage if the historical facts are undisputed and
the only question is the proper legal conclusion to be drawn from those facts.
Narell v. Freeman, 872 F.2d 907, 910 (9th Cir. 1989) ("Fair use is a
mixed question of law and fact that may be resolved on summary judgment if a
reasonable trier of fact could reach only one conclusion");
Hustler Magazine,
Inc. v. Moral Majority, Inc., 796 F.2d 1148, 1151 (9th Cir. 1986) ("If there
are no genuine issues of material fact, or if, even after resolving all issues
in favor of the opposing party, a reasonable trier of fact can reach only one
conclusion, a court may conclude as a matter of law whether the challenged use
qualifies as a fair use of the copyrighted work");
Fisher v. Dees, 794
F.2d 432, 436 (9th Cir. 1986) (fair use issue was properly resolved on summary
judgment because "no material historical facts [were] at issue in this case [and
t]he parties disputed only the ultimate conclusions to be drawn from the
admitted facts").
B. Elements Of Copyright
Infringement"Copyright law protects an author's
expression; [*18] facts and ideas within a work are not protected."
Shaw v. Lindheim, 919 F.2d 1353, 1356 (9th Cir. 1990). See also
Sid
& Marty Krofft Television Productions v. McDonald's Corp., 562 F.2d
1157, 1163 (9th Cir. 1977) ("It is an axiom of copyright law that the protection
granted to a copyrighted work extends only to the particular expression of the
idea and never to the idea itself. Copyright infringement is established by
demonstrating (1) ownership of a valid copyright and (2) copying of the original
elements of the protected work.
Feist Publications v. Rural Telephone Service
Co., 499 U.S. 340, 361, 113 L. Ed. 2d 358, 111 S. Ct. 1282 (1991);
Kouf
v. Walt Disney Pictures & Television, 16 F.3d 1042, 1043, n. 2 (9th Cir.
1994). To prove copying, plaintiffs must show that defendants had access to the
copyrighted work and that there is a substantial similarity between the
copyrighted work and defendants' work.
Brown Bag Software v. Symantec
Corp., 960 F.2d 1465, 1472 (9th Cir.1992);
Chase-Riboud v. Dreamworks,
Inc., 987 F. Supp. 1222, 1224 (C.D.Cal. 1997).
Before proceeding to the substance [*19] of the parties'
motions, it is important to state what issues are not before the court at this
time. Because the parties address the availability of a
defense to
copyright infringement, their motions assume for present purposes that such a
claim can be proved. The court expresses no opinion as to whether this is so,
given that the "copying" of news articles at issue in this case is to a large
extent copying by third-party users of the Free Republic site. The court also
makes no determination as to whether plaintiffs have in any manner consented to
the copying of their articles. n29
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n29 Defendants Robinson and Free Republic admit that they have
personally posted certain of plaintiffs' articles on the Free Republic site.
(See Defs.' Genuine Issues, P 9.) Because several thousand articles have been
posted to the site, however, defendants assert that much of the posting has been
done by registered third-party users. (See Pls.' Facts, PP 10, 41; Defs.'
Genuine Issues, PP 10, 41). Plaintiffs contend that defendants provide
instructions and tools that permit third-party copying, that they have the
ability to control what is posted on their website, and that they have removed
certain postings from time to time. (Pls.' Facts, PP 11, 12, 13.) Defendants
agree that they have the technical ability to remove material from the site, but
argue that it is not feasible to monitor the large quantity of daily postings
the site receives. (Defs.' Genuine Issues, PP 12, 13.) They do not respond
directly to the assertion that they provide tools and instructions that permit
third parties to copy plaintiffs' articles; rather, they acknowledge that "the
Free Republic web site provides a virtual 'bulletin board' forum which enables
and allows registered users to post whatever content they wish." (Defs.' Genuine
Issues, P 11.) Whether defendants' operation of the Free Republic website, and
the posting by third parties of verbatim copies of plaintiffs' copyrighted news
articles renders defendants liable for copyright infringement is not an issue
decided in this order. Similarly, the court does not address defendants'
assertion that plaintiffs' posting of the articles on their websites constitutes
implied consent for others to copy the works. (See Defs.' Genuine Issues, PP 6,
7, 9, 10, 11.)
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- End Footnotes- - - - - - - - - - - - - - [*20]
C. The Fair Use DefenseThe fair use
defense is a limitation on the exclusive right of a copyright owner "to
reproduce the copyrighted work in copies." 17 U.S.C. § 106(1). It is codified at
17 U.S.C. § 107, which provides:
"Notwithstanding the provisions of sections 106 and 106A, the fair
use of a copyrighted work, including such use by reproduction in copies or
phonorecords or by any other means specified by 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 [*21] 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."
Because fair use is an
affirmative defense to a claim of infringement, defendants carry the burden of
proof on the issue.
American Geophysical Union v. Texaco Inc., 60 F.3d
913, 918 (2d Cir. 1995);
Columbia Pictures v. Miramax Films Corp., 11 F.
Supp. 2d 1179, 1187 (C.D.Cal. 1998) ("because fair use is an affirmative
defense, Defendants bear the burden of proof on all of its factors"). See also
Dr. Seuss Enterprises, L.P. v. Penguin Books USA, Inc., 109 F.3d 1394,
1403 (9th Cir.), cert. dismissed, 521 U.S. 1146 (1997).
1. The Purpose And Character Of The UseThe first factor listed in § 107 is "the purpose and character of the
use, including whether such use is of a commercial nature or is for nonprofit
educational purposes." 17 U.S.C. § 107. This factor assesses whether "the new
work 'merely supersedes the objects' of the original creation, or instead adds
something new, with a further purpose or different character, altering the first
with new expression, [*22] meaning, or message; it asks, in other
words, whether and to what extent the new work is 'transformative.'"
Campbell
v. Acuff-Rose Music, Inc., 510 U.S. 569, 579, 127 L. Ed. 2d 500, 114 S. Ct.
1164 (1995) (quoting
Folsom v. Marsh, 9 F. Cas. 342, 348 (D.Mass. 1841)).
". . .The more transformative the new work, the less will be the significance of
other factors, like commercialism, that may weigh against a finding of fair
use."
Campbell, supra, 510 U.S. at 579.
Inquiry
concerning the character and purpose of a challenged use should be guided by the
examples provided in the statute -- i.e., whether the use was for purposes of
"criticism, comment, news reporting, teaching . . ., scholarship, or research."
17 U.S.C. § 107;
Campbell, supra. The list, however, is not intended to
be exhaustive or to single out any particular use as presumptively fair.
Harper & Row, supra, 471 U.S. at 561. Indeed, the fact that a use
falls within one of these categories "is simply one factor in [the] fair use
analysis."
Id. Similarly, while the statute draws a distinction between
non-profit and [*23] commercial use, not every commercial use of a
copyrighted work is presumptively unfair.
Campbell, supra, 510 U.S. at
579.
a. The Purpose Of Free Republic's Use And The
Extent To Which Its Work Is TransformativeThere is
no dispute that at least some of the items posted on the Free Republic website
are exact copies of plaintiffs' articles. n30 While defendants assert there is
"no evidence" that
all of the Times and Post articles that have been
posted are verbatim copies, n31 the evidence they have presented reveals that,
generally, exact copies of whole or substantial portions of articles n32 are
posted. n33
- - - - - - - - - - - - - - Footnotes - - -
- - - - - - - - - - - -
n30 See
Defendants' Exhibits - Vol. 4, Ex. 1009 at 53:8-54:3.
n31 See Defs.' Genuine Issues, PP 45, 46, 47 ("with the
exception of a very few articles, there is no evidence in the record to
establish that the articles are 'perfect copies' as Plaintiffs allege").
n32 Copying excerpts from the articles would
satisfy the "copying" element of plaintiffs' copyright claim. See
Nihon
Keizai Shimbun, Inc. v. Comline Business Data, Inc., 166 F.3d 65, 70-71 (2d
Cir. 1999) (holding that there was substantial similarity between defendants'
abstracts and plaintiffs' news stories because the "abstracts appeared to be
direct, if not word-for-word, translations of the Nikkei articles, edited only
for clarity," to "use[ ] about two-thirds of the protectable material in the
corresponding Nikkei article," to "track the information in the articles
sentence by sentence, in sequence," occasionally "combining two Nikkei
sentences, dividing a sentence, or rearranging the facts among different
sentences," and to "adopt[ ], by and large, the exact same structure and
organization of the facts reported by Nikkei"). See also
Wainwright Sec. Inc.
v. Wall St. Transcript Corp., 558 F.2d 91, 93-94 and n. 1 (2d Cir. 1977)
(the court held that defendant had infringed plaintiff's copyrights by
summarizing its analytical financial reports because it "appropriated almost
verbatim the most creative and original aspects of the reports, the financial
analyses and predictions, which represent a substantial investment of time,
money and labor"), cert. denied, 434 U.S. 1014, 54 L. Ed. 2d 759, 98 S. Ct. 730
(1978). [*24]
n33 See Defendants' Exhibits - Vol. 2, Exs. 1006; Vol. 3, 1007; Vol. 4,
Ex. 1009 at 55:14-18 (Robinson's testimony that "[most people do not summarize"
but post full text articles). Defendants contend that the only way to determine
if the items posted to the Free Republic site are verbatim copies is to conduct
a side-by-side comparison of the posting and the original article. Defendants
bear the burden of proof on the issue of fair use. To the extent they wish to
argue that something other than whole articles or substantial portions of
articles are posted, they must adduce evidence that this is so. As noted, their
evidence supports a contrary conclusion.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
There is little transformative about copying the entirety
or large portions of a work verbatim. See
Nihon Keizai Shimbun, supra,
166 F.3d at 72 (where the infringing news abstracts were "for the most part
direct translations of Nikkei articles," the court held that the first factor
"weighed strongly against fair use");
Infinity Broadcast Corp. v.
Kirkwood, 150 F.3d 104, 108 (2d Cir. 1998) (holding that
"there [*25] [was] no transformation" where defendant retransmitted
original broadcasts over the telephone);
Los Angeles News Service v. Reuters
Television Int'l, 149 F.3d 987, 993 (9th Cir. 1998) (defendant's
unauthorized copying of news footage "was not very transformative" because it
did "not explain the footage, edit the content of the footage, or include
editorial comment");
Sundeman v. The Seajay Society, Inc., 142 F.3d 194,
205-06 (4th Cir. 1998) (while it does not preclude a finding of fair use,
"copying an entire work weighs against [such a] finding");
Princeton
University Press v. Michigan Document Service, 99 F.3d 1381, 1389 (6th Cir.
1996) ("If you make verbatim copies of 95 pages of a 316-page book, you have not
transformed the 95 pages very much -- even if you juxtapose them to excerpts
from other works and package everything conveniently. This kind of mechanical
'transformation' bears little resemblance to the creative metamorphosis
accomplished by the parodists in the
Campbell case"), cert. denied, 520
U.S. 1156, 117 S. Ct. 1336, 137 L. Ed. 2d 495 (1997);
Religious Technology
Center v. Netcom On-Line Communication Services, Inc., 923 F. Supp. 1231,
1243 (N.D.Cal. 1995) [*26] (
"Netcom On-Line II") (defendant's
posting of plaintiffs' copyrighted material on the Internet was "only minimally
transformative since, unlike the typical critic, [defendant] adds little new
expression to the Church's works"). As the Supreme Court said in
Campbell,
supra:
"Whether 'a substantial portion of the infringing
work was copied verbatim' from the copyrighted work is a relevant question, .
. . for it may reveal a dearth of transformative character or purpose under
the first factor, or a greater likelihood of market harm under the fourth; a
work composed primarily of an original, particularly its heart, with little
added or changed, is more likely to be a merely superseding use, fulfilling
demand for the original." Campbell, supra, 510 U.S. at
587-88.
See also 3 M. and D. Nimmer,
NIMMER ON COPYRIGHT, § 13.05[D][1] ("whatever the intent of the copier, a
verbatim reproduction will of necessity serve the function of the plaintiff's
work").
Defendants proffer two reasons why their full
text copying of plaintiffs' articles is nonetheless transformative. First, they
assert that the copies of the articles found on the Free [*27]
Republic site do not in reality substitute for the originals found on
plaintiffs' web pages. Second, they contend they copy no more than necessary to
fulfill their purpose of criticizing the manner in which the media covers
current events and politics. Each of these contentions will be examined in
turn.
Defendants' first argument -- that the copies of
plaintiffs' articles found on the Free Republic site do not substitute for those
on plaintiffs' sites -- focuses on readers' ability to access and review
specific articles in which they are interested. Defendants contend that using
the Free Republic site to read current articles would be impractical since there
is a delay between the time information is posted to the site and the time it is
indexed by third-party search engines. Additionally, they assert that the
imprecision of search language makes it difficult to locate archived articles at
the site. n34 These arguments overlook the fact that the Free Republic site has
its own search engine that apparently has immediate search capability. n35
- - - - - - - - - - - - - - Footnotes - - - - - - - - - -
- - - - -
n34 See Defs.' Mot. at
11:14-12:3. See also Supp. Stout Decl., PP 4-25. [*28]
n35 See Defendants'
Exhibits - Vol. 4, Exs. 1002, 1003; Aldridge Decl., P 5.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - -
- - -
Even were this not true, the articles posted on
the Free Republic site ultimately serve the same purpose as "that [for which]
one would normally seek to obtain the original -- to have it available . . . for
ready reference if and when [website visitors adding comments] need[] to look at
it."
American Geophysical Union v. Texaco, Inc., 60 F.3d 913, 918 (2d
Cir. 1995) (the court held that the first fair use factor weighed against a
defendant that encouraged its employees to make unauthorized photocopies of
articles in scientific and medical journals and keep them in their offices for
ready reference).
Defendants' web page acknowledges
this. It states,
inter alia, that the Free Republic site is a place where
visitors "can often find breaking news and up to the minute updates." n36
Indeed, it is clear from the content of the representative pages submitted by
defendants that visitors can read copies of plaintiffs' current and archived
articles at the Free Republic site. For those who visit the [*29]
site regularly, therefore, the articles posted there serve as substitutes for
the originals found on plaintiffs' websites or in their newspapers.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - -
- - - - -
n36 Wayland Decl., Ex. C
(D000448).
- - - - - - - - - - - -
End Footnotes- - - - - - - - - - - - - -
Defendants
next argue that their use of plaintiffs' works is transformative because
registered Free Republic users add comments and criticism concerning the
articles following a posting. Copying portions of a copyrighted work for the
purpose of criticism or commentary is often considered fair use. See
Twin
Peaks Productions, Inc. v. Publications Int'l, Ltd., 996 F.2d 1366, 1375
(9th Cir. 1993) ("Inevitably, some identification of the subject matter of a
writing must occur before any useful comment may be made about it, and it is not
uncommon for works serving a fair use purpose to give at least a brief
indication of the plot. Works of criticism, teaching, and news reporting
customarily do so"). The fact that criticism is involved, however, does end the
inquiry. See
Harper & Row, supra, 471 U.S. at 561 [*30]
(list contained in § 107 is not intended to be exhaustive or to single out any
particular use as presumptively fair);
Sony Corp., supra, 464 U.S. 417 at
452 ("even copying for noncommercial purposes may impair the copyright holder's
ability to obtain the rewards that Congress intended him to have"). Rather, it
must be considered in combination with other circumstances to determine if the
first factor favors defendants. See
Twin Peaks, supra, 996 F.2d at
1375-76 ("'Purpose' in fair use analysis is not an all-or-nothing matter. The
issue is not simply whether a challenged work serves one of the non-exclusive
purposes identified in section 107, such as comment or criticism, but whether it
does so to an insignificant or a substantial extent. The weight ascribed to the
'purpose' factor involves a more refined assessment than the initial, fairly
easy decision that a work serves a purpose illustrated by the categories listed
in section 107").
Since the first posting of an article
to the Free Republic site often contains little or no commentary, it does not
significantly transform plaintiffs' work. In
Netcom On-Line II, supra,
defendant posted [*31] verbatim copies of works copyrighted by the
Church of Scientology to an Internet website "with little or no added comment or
criticism." 923 F. Supp. at 1243. The court found that the works were only
"minimally transformative" because "unlike the typical critic, [defendant] added
little new expression to the Church's works."
Id. The court specifically
rejected defendant's argument that his copying was fair use because subsequent
visitors added further comments. It concluded that while the copying of "works
that were previously posted by their authors on the basis of an implied license
or fair use argument" might be justified, such a defense would not be available
"where the first posting made an unauthorized copy of a copyrighted work."
Id. at 1247, n.18. n37
- - - - - - - - - - - - -
- Footnotes - - - - - - - - - - - - - - -
n37 While the court made this observation in analyzing the third fair
use factor, it is equally relevant in evaluating the extent to which a
particular work is transformative.
-
- - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Similarly, in
Religious Technology Center v. [*32]
Lerma, 1996 U.S. Dist. LEXIS 15454, 1996 WL 633131 (E.D.Va. 1996), n38
defendant downloaded or scanned into his computer portions of works copyrighted
by the Church of Scientology. He then posted segments of the works on the
Internet.
Id. at *4. Defendant argued that his use was transformative,
because he was a "dedicated researcher delving into the theory and scholarship
of Scientology," and was "providing materials which 'add new value to public
knowledge and understanding, thereby advancing the goals of copyright as set
forth in the Constitution.'"
Id. at *5. The court rejected this argument,
noting that it did "not justify the wholesale copying and republication of
copyrighted material," and concluding that "the degree of copying by [defendant]
combined with the absence of commentary on most of his Internet postings, is
inconsistent with the scholarship exception."
Id. n39
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n38 The court believes that
Netcom On-Line
II and
Lerma are more pertinent to analysis of defendants' fair use
defense than the decision in
Religious Technology Center v. Netcom On-Line
Communication Services, Inc., 907 F. Supp. 1361 (N.D.Cal. 1995) ("
Netcom
On-Line I"). In
Netcom On-Line I, the court considered the fair use
defense of Internet access provider Netcom On-Line. In doing so, it
distinguished Netcom's involvement in the posting of copyrighted works from that
of the individual who actually posted copies of the works to a Usenet newsgroup.
The poster gained access to the web through a bulletin board service that was
not directly linked to the Internet, but that connected through the facilities
of Netcom On-Line. See
id. at 1365-66. The court stated: "The proper
focus here is on whether Netcom's actions qualify as fair use, not on whether
Erlich himself engaged in fair use; the court has already found that Erlich was
not likely entitled to his own fair use defense, as his postings contained large
portions of plaintiffs' published and unpublished works quoted verbatim with
little added commentary."
Id. at 1378. Despite the commercial nature of
Netcom's function as an Internet access provider, the court found that the first
fair use factor weighed in its favor,
inter alia, because (1) "its
financial incentive [was] unrelated to the infringing activity and [it] received
no direct financial benefit from the acts of infringement"; (2) "there [was] no
easy way for a defendant like Netcom to secure a license for carrying every
possible type of copyrighted work onto the Internet," and thus it "should not be
seen as 'profiting from the exploitation of the copyrighted work without paying
the customary prices'"; (3) Netcom did not "directly gain anything from the
content of the information available to its subscribers on the Internet"; and
(4) it did not "provide the files or solicit infringing works."
Id. at
1379. Here, defendants admit that they themselves post copies of plaintiffs' new
articles to the Free Republic site. Additionally, their relationship to the
site, and to the material posted, is significantly more direct than that of
Netcom, a company that maintains a software system that automatically forwards
messages received from subscribers onto the Usenet, and temporarily stores
copies of the messages on its system in the process. See
id. at
1368. [*33]
n39 The decision in
Religious Technology Center v. F.A.C.T.NET,
Inc., 901 F. Supp. 1519 (D.Colo. 1995) is not to the contrary. There,
because the matter before it was a motion for preliminary injunction, the court
did not make final legal rulings, but merely assessed the likelihood that
plaintiff would prevail on the merits. Defendant in the case, F.A.C.T.NET, was a
nonprofit corporation that maintained a library of materials concerning the
Church of Scientology. Certain of its materials were posted on an Internet
bulletin board by Arnaldo Lerma (the defendant in the case cited in text).
Id. at 1521-22. Focusing heavily on the fact that it had copied the works
for inclusion in its private library, the court found that F.A.C.T.NET was
likely to prevail on its fair use defense. See
id. at 1524. As respects
its possible involvement in supplying materials to Lerma for Internet posting
(an involvement F.A.C.T.NET denied), the court noted evidence that the postings
"were made in the context of ongoing dialogue in [a] particular newsgroup," and
that they "formed part of the topical debate concerning whether the Works are of
substance or are perpetuated as part of systemic mind control."
Id. at
1526. Because plaintiff had adduced no evidence "showing a likelihood that a
follower of the Church would consider the postings by Lerma as a market
substitute for the Works," nor any demonstrating that the postings "were of a
commercial nature or had any effect on the potential market for the works," the
court held they might "well be considered as having been made for the purposes
of criticism, comment or research falling within the fair use doctrine."
Id. Given the limited nature of the evidence before it, the
F.A.C.T.NET court's "preliminary" findings are substantially less
persuasive than, and cannot be said to contradict, the
Lerma court's
direct and detailed analysis of Lerma's posting activities.
- - - - - - - - - - - - End Footnotes-
- - - - - - - - - - - - - [*34]
Additionally, even where copying serves the "criticism, comment and
news reporting" purposes highlighted in § 107, its extent cannot exceed what is
necessary to the purpose. See
Twin Peaks, supra, 996 F.2d at 1375-76 (the
fact that defendant "detailed . . . the plots [of episodes of a television
series]. . . far beyond merely identifying their basic outline for the
transformative purposes of comment or criticism" weighed against a finding of
fair use because the "abridgment . . . elaborated in detail far beyond what is
required to serve any legitimate [transformative] purpose");
Toho Co., Ltd.
v. William Morrow and Co., Inc., 33 F. Supp. 2d 1206, 1217 (C.D.Cal. 1998)
(relying,
inter alia, on the fact that the infringing work contained
detailed plot summaries of the Godzilla movies to find that the first fair use
factor weighed heavily in favor of a copyright plaintiff, despite the fact that
the work also contained "numerous biographies [and] analyses of the movies,
including commentary, trivia and other bits of information"). Thus, an
individualized assessment of the purpose for which defendants are copying the
works and a comparison of [*35] that purpose to the amount copied is
required. See
Campbell, supra, 510 U.S. at 586-87 ("we recognize that the
extent of permissible copying varies with the purpose and character of the
use");
Sundeman, supra, 142 F.3d at 205-05 (same). See also
Sony Corp.
of America v. Universal City Studios, Inc., 464 U.S. 417, 449-50, 78 L. Ed.
2d 574, 104 S. Ct. 774 (1984) (reproduction of an entire television program did
"not have its ordinary effect of militating against a finding of fair use" where
programs were videotaped for home viewing);
Harper & Row, supra, 471
U.S. at 564 ("Even substantial quotations might qualify as fair use in a review
of a published work or a news account of a speech").
Here, it seems clear that the primary purpose of the postings to the
Free Republic site is to facilitate discussion, criticism and comment by
registered visitors. Defendants contend that copying all or parts of articles
verbatim is necessary to facilitate this purpose. n40 They argue that full text
posting is required because links expire after a week or two, and because
unsophisticated Internet users will have difficulty [*36] accessing a
linked site. n41 Defendants' assertion that links expire after a period of time
is presumably a reference to the fact that articles are available on plaintiffs'
websites free of charge only for a certain number of days. Thereafter, there is
a charge for viewing and/or printing them. That this is so does not make linking
plaintiffs' websites to the Free Republic site "impractical." It merely requires
that Free Republic visitors pay a fee for viewing plaintiffs' articles just as
other members of the public do. Similarly, defendants' suggestion that articles
are posted to the Free Republic site long after they are published is not
supported by the representative postings they have submitted. n42 These reflect
that the vast majority of comments are posted the same day the articles appear
or within one to three days afterwards. n43 Finally, defendants' assertion that
unsophisticated Internet users would be confused by links is unpersuasive.
Linking is familiar to most Internet users, even those who are new to the
web.
- - - - - - - - - - - - - - Footnotes - - - - - -
- - - - - - - - -
n40 See Defs.' Mot. at
17:21-23. See also
id. at 12:20-23; 13:20-21; Defs.' Genuine Issues, P
42; Defendants' Exhibits - Vol. 4, Ex. 1009 at 75:12-76:20. [*37]
n41 Defs.' Genuine Issues,
P 42.
n42 See
id., P 42.
n43 See Defendants' Exhibits - Vol. 2, Ex.
1006; Vol. 3, Ex. 1007.
- - - - - -
- - - - - - End Footnotes- - - - - - - - - - - - - -
As
evidence that verbatim copying is in fact not necessary to defendants' purpose,
plaintiffs cite the fact that defendants provided a hypertext link to
Jewish
World Review's website at its request, and requested that registered Free
Republic visitors no longer copy the publication's articles verbatim. n44 That
defendants accommodated
Jewish World Review belies their current
contention that only verbatim posting of articles will serve the criticism and
comment purposes of the Free Republic site. Indeed, they acknowledge that
honoring
Jewish World Review's request "did not significantly detract
from the purpose of the
freerepublic.com website." n45
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n44 See Wayland Decl., Ex. Q.
n45 Defs. Genuine Issues, P 43. While defendants dispute
the proposition that "widespread use of such 'links' would not significantly
detract from the purpose of the
freerepublic.com site, . . . and contend
that there is controverting evidence," none of the evidence they cite in support
addresses the subject.
- - - - - - -
- - - - - End Footnotes- - - - - - - - - - - - - - [*38]
The fact that linking the text of an article as it appears
on plaintiffs' websites to the Free Republic site, or summarizing the article's
text, is not as easy or convenient for Free Republic users as full text posting
does not render the practice a fair use. Rather, the focus of the inquiry must
be whether verbatim copying is necessary to defendants' critical purpose. See
Campbell, supra, 510 U.S. at 586-87;
Castle Rock Entertainment, Inc.
v. Carol Publishing Group, Inc., 150 F.3d 132, 144 (2d Cir. 1998) ("The
inquiry must focus upon whether 'the extent of . . . copying' is consistent with
or more than necessary to further 'the purpose and character of the use'");
Rogers v. Koons, 960 F.2d 301, 311 (2d Cir. 1992) ("It is not fair use
when more of the original is copied than necessary");
Walt Disney Prods. v.
Air Pirates, 581 F.2d 751, 758 (9th Cir. 1978) ("while other factors in the
fair use calculus may not be sufficient by themselves to preclude the fair use
defense, . . . excessive copying precludes fair use").
Defendants have not met their burden of demonstrating that verbatim
copying of all or a substantial [*39] portion of plaintiffs' articles
is necessary to achieve their critical purpose. They argue that the purpose of
full text posting is to enable Free Republic users to criticize the manner in
which the media covers current events. n46 The statement or purpose found on the
website, however, is somewhat different. There, defendants state that visitors
to the Free Republic site "are encouraged to comment on the news of the day . .
. and . . . to contribute whatever information they may have to help others
better understand a particular story." n47 In fact, a review of the
representative articles submitted by defendants reveals that visitors'
commentary focuses much more on the news of the day than it does on the manner
in which the media reports that news. n48 This is significant, since the extent
of copying that might be necessary to comment on the nature of the media's
coverage of a news event is arguably greater than the amount needed to
facilitate comment on the event itself. Commentary on news events requires only
recitation of the underlying facts, not verbatim repetition of another's
creative expression of those facts in a news article. So too, the fact that a
particular [*40] media outlet published a given story, or approached
that story from a particular angle can be communicated to a large degree without
posting a full text copy of the report. n49 For this reason, the court concludes
that verbatim posting of plaintiffs' articles is "more than is necessary" to
further defendants' critical purpose. See
Castle Rock Entertainment,
supra, 150 F.3d at 144. See also
Hustler Magazine, Inc. v. Moral
Majority, Inc., 796 F.2d 1148, 1153 (9th Cir. 1986) (examining whether
defendant copied "more than was necessary" in responding to a parody).
- - - - - - - - - - - - - - Footnotes - - - - - - - - - -
- - - - -
n46 Defs. Mot. at 12:20-22;
17:21-23.
n47 Wayland Decl., Ex. C
(D000448).
n48 See Defendants' Exhibits -
Vol. 2, Ex. 1006; Vol. 3, Ex. 1007.
n49
Indeed, a few Free Republic visitors summarize the content of news articles
rather than post verbatim copies of the text with little apparent impact on the
quantity and quality of the commentary their postings attract. (See, e.g.,
Defendants' Exhibits - Vol. 2, Ex. 1006 at 24-25.)
- - - - - - - - - - - - End Footnotes- - - - - - - - - - -
- - - [*41]
For all these reasons, the court
concludes that defendants' use of plaintiffs' articles is minimally, if at all,
transformative.
b. Commercial Nature Of The Free
Republic WebsiteIn addition to examining
defendants' purpose in copying plaintiffs' articles, the first fair use factor
also directs that the court evaluate the "character" of the use. The mere fact
that a use is commercial does not "give rise to a presumption of unfairness."
Sony Computer Entertainment, Inc. v. Connectix Corp., 203 F.3d 596, 606
(9th Cir. 2000). See also
Campbell, supra, 510 U.S. at 584-85 (noting
that the Court's earlier decision in
Sony, supra, 464 U.S. at 451,
"called for no hard evidentiary presumption"). Rather, a defendant's commercial
purpose is only "a separate factor that tends to weigh against a finding of fair
use."
Campbell, supra, 510 U.S. at 585. Thus, a court evaluating the
first fair use factor "must weigh the extent of any transformation . . . against
the significance of other factors, including commercialism, that militate
against fair use."
Sony Computer, supra, 203 F.3d at
607. [*42]
The parties vigorously dispute
whether defendants' operation of the Free Republic website is a profit or
non-profit venture as those terms are used in § 107. Their disagreement focuses
on the corporate status of Free Republic, and on the extent to which defendants'
operation of the website generates revenue, donations, and commissions.
Defendants argue that Free Republic is a non-profit
organization and that they make no money from operating the website. The
undisputed evidence reveals that Free Republic is currently a for-profit
company. It also demonstrates that Free Republic solicits donations from
visitors to the website who wish to support its mission and operations. n50 In
addition to these direct solicitations, defendants concede that they have
facilitated links to third-party web pages where donations to Free Republic
and/or Robinson are requested, and where donors receive Free Republic-related
souvenir items in exchange for a contribution. n51
- -
- - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n50 See Wayland Decl., Ex. M (TM092) ("FreeRepublic is
supported by donations. We are a NON commercial and NOT for profit public forum
and discussion group. If you would like to sponsor FreeRepublic and/or place an
ad or banner linking your website, contact Jim. If you would like to support
FreeRepublic, donations may be sent to: [P] Jim Robinson[,] c/o Electronic
Orchard[,] P.O. Box 9771[,] Fresno, CA 93794-9771. [P] Or click here to donate
by secure credit card transaction"). See also
id., Ex. P (TM001,
TM084). [*43]
n51 See Defs.' Genuine Issues, PP 29, 30.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - -
- - -
There is also evidence that the Free Republic web
page advertises the website design services of Electronic Grenard, and contains
links to Electronic Orchard clients. n52 Defendants maintain that these links
have been included as a courtesy to Electronic Orchard customers, and that they
receive no revenue from them. Accepting this as true, the fact that Electronic
Orchard's services are advertised and that Robinson is able to provide free
links for his clients' businesses demonstrates that he and Electronic Orchard
derive goodwill from the Free Republic site.
- - - - -
- - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n52 Wayland Decl., Ex. M (TM092) ("Jim also operates
Electronic Orchard[,] an Internet web design and software development company
located in Fresno, California. Please visit www.e-orchard.com and our clients'
websites. We can also create and/or host your website. For effective Internet
software that gets results, contact Jim Robinson"). See also
id., Ex. P
(TM001, TM084).
- - - - - - - - - -
- - End Footnotes- - - - - - - - - - - - - - [*44]
Nonetheless, defendants' operation possesses many characteristics of a
non-profit entity. It does not market or sell a product, and does not generate
revenue in the traditional sense. "The commercial nature of a use is a matter of
degree, not an absolute. . . ."
Maxtone-Graham v. Burtchaell, 803 F.2d
1253, 1262 (2d Cir. 1986). See also
Sega Enterprises Ltd. v. Accolade,
Inc., 977 F.2d 1510, 1522 (9th Cir. 1993) (same). Here, while the Free
Republic operation has commercial aspects, its overall character is more
properly viewed as non-commercial.
Additionally, the
Free Republic site provides a public service by fostering debate and discussion
regarding the issues of the day. This too is a factor that should be taken into
account in assessing the character of defendants' use of plaintiffs' copyrighted
material. See
Sega Enterprises, supra, 977 F.2d at 1523 ("Public benefit
need not be direct or tangible, but may arise because the challenged use serves
a public interest");
Hustler, supra, 796 F.2d at 1153 ("When the use has
both commercial and non-profit characteristics, the court may consider 'whether
the alleged infringing [*45] use was primarily for public benefit or
for private commercial gain'").
Section 107(1) does not
mandate "a clear-cut choice between two polar characterizations, 'commercial'
and 'non-profit.'"
Maxtone-Graham, supra, 803 F.2d at 1262. Here,
choosing one of these two extremes does not properly reflect the nature of the
Free Republic site, or defendants' activities in operating it. Rather,
attempting the "sensitive balancing of interests" required for application of
the fair use doctrine (
Campbell, supra, 510 U.S. at 584;
Sony,
supra, 464 U.S. at 455, n. 40), the court finds that the operation of the
Free Republic site is only minimally commercial.
The
relevant inquiry, however, "is not whether the sole motive of the use is
monetary gain but whether the user stands to profit from exploitation of the
copyrighted material without paying the customary price."
Harper & Row,
supra, 471 U.S. at 562. See
Campbell, supra, 510 U.S. at 584 ("the
mere fact that a use is educational and not for profit does not insulate it from
a finding of infringement, any more than the commercial
character [*46] of a use bars a finding of fairness");
Infinity
Broadcasting, supra, 150 F.3d at 110 ("societal benefit does not guarantee a
finding of fair use");
Marcus v. Rowley, 695 F.2d 1171, 1175 (9th Cir.
1983) ("a finding of a nonprofit educational purpose does not automatically
compel a finding of fair use"). n53 Here, defendants and registered third-party
visitors to the Free Republic site copy and post plaintiffs' news articles,
which are then available to others visiting the site free of charge. Since the
general purpose of the site is to provide a forum where individuals can discuss
current events and media coverage of them, posting copies of plaintiffs'
articles assists in attracting viewers to the site.
- -
- - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n53 In
American Geophysical, the court stated that
the proper focus of the commercial/non-commercial inquiry is "on the use of the
copyrighted material," not on the profit or not-for-profit status of the user.
American Geophysical, supra, 60 F.3d at 921-22. Nonetheless, it noted
that the profit or non-profit status of the user was not "irrelevant' and "need
not [be] ignored."
Id. at 921, 922.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - -
- [*47]
In
Marobie-FL, Inc. v. National
Assoc. of Fire Equipment Distributors, 983 F. Supp. 1167 (N.D.Ill. 1997),
the court examined an analogous situation in which a non-profit organization
placed copyrighted clip art on its website without paying the copyright owners.
Id. at 1175. Despite defendant's non-profit status, the court found that
"its conduct [could] still be considered commercial."
Id. The court
reasoned that defendant had obtained the clip art for free, although it would
ordinarily have cost money, and then had made the files available on its website
to members and other Internet users without charge.
Id. This was
beneficial to it, since the organization used the website "for the commercial
purposes of promoting the association (whose members pay dues) and generating
advertising revenue."
Id. Consequently, the court concluded that
defendant's use of the clip art "enhanced the Web Page and furthered . . .
commercial purposes."
Id. See also
Marcus, supra, 695 F.2d at
1175-76 (the court held that a defendant who replicated a substantial portion of
plaintiff's copyrighted work could not assert a [*48] fair use
defense despite the fact that her copying was for a nonprofit educational
purpose, since both she and plaintiff used the material for the same purpose,
i.e., to teach cake decorating);
Television Digest, Inc. v. United States
Telephone Assoc., 841 F. Supp. 5, 9-10 (D.D.C. 1993) (the court concluded
that a non-profit trade association's duplication and distribution of a
copyrighted newsletter was not a non-commercial use because it saved money by
photocopying one subscription issue rather than ordering the number of
subscriptions it required per reader);
Encyclopaedia Britannica Educational
Corp. v. Crooks, 447 F. Supp. 243, 252 (W.D.N.Y. 1978) (a non-profit
educational services corporation that videotaped copyrighted films, made copies,
and distributed them to public schools was not making fair use of the films
since it was reproducing large numbers of the videotapes in a "highly organized
and systematic" way).
Cases decided since
Marobie-FL have utilized a more nuanced approach in evaluating the
commercial/non-commercial aspect of the first fair use factor. Recent Ninth
Circuit decisions, for example, assess whether a defendant's
copying [*49] led directly to the generation of revenue and profit,
or whether it merely had an indirect relation to commercial gain. See
Sony
Computer, supra, 203 F.3d at 607 (because defendant copied video game for
purpose of reverse engineering it and producing software that would be
compatible with it, its "commercial use of the copyrighted material was an
intermediate one, and thus was only 'indirect or derivative'");
Sega
Enterprises, supra, 977 F.2d at 1522 (although defendant's ultimate purpose
was the commercial one of developing Genesis-compatible games for sale, "its
direct purpose in copying Sega's code, and thus its direct use of the
copyrighted material, was simply to study the functional requirements for
Genesis compatibility so that it could modify existing games and make them
usable with the Genesis console").
Citing
Sega,
the Second Circuit has described the proper analysis as "differentiating between
a direct commercial use and [a] more indirect relation to . . . commercial
activity."
American Geophysical, supra, 60 F.3d at 921. In
American
Geophysical, the court stated that the heart of "the commercial/nonprofit
dichotomy [*50] concerns the unfairness that arises when a secondary
user makes unauthorized use of copyrighted material to capture significant
revenues as a direct consequence of copying the original work."
Id. at
922. Since, in the case before it, Texaco did not derive direct or immediate
revenue or profits from photocopying articles in scientific and medical journals
for members of its research staff, the court held that its use was
"intermediate," and that the link between the copying and Texaco's commercial
gain was "somewhat attenuated."
Id. at 921, 922. Nonetheless, it
concluded that Texaco "reaped at least some indirect benefit from its
photocopying," and that this in turn had some impact on its ability to develop
marketable products.
Id. at 922. Accordingly, the court stated, "it is
not obvious why it is fair for Texaco to avoid having to pay at least some price
to copyright holders for the right to photocopy the original articles."
Id.Here, the analysis is much the same.
Defendants do not generate revenue or profits from posting plaintiffs' articles
on the Free Republic website. At most, they derive indirect economic benefit by
enhancing [*51] the website's cachet, increasing registrations, and
hence increasing donations and other forms of support. Coupled with the fact
that Free Republic has many of the attributes of a non-profit organization, this
indirect benefit argues against a finding that the use is strictly commercial.
Rather, it is more appropriate to conclude that, while defendants do not
necessarily "exploit" the articles for commercial gain, their posting to the
Free Republic site allows defendants and other visitors to avoid paying the
"customary price" charged for the works. See
Harper & Row, supra, 471
U.S. at 562.
c. Conclusion Regarding First Fair Use
FactorFollowing
Campbell, it is clear that
the court must balance and weigh the various elements of the first fair use
factor in deciding whether it favors plaintiffs or defendants. See
Campbell,
supra, 510 U.S. at 584 (emphasizing the need for a "sensitive balancing of
interests," and noting that Congress has "eschewed a rigid, bright-line approach
to fair use," quoting
Sony, supra, 464 U.S. 455, n. 40). See also
Sony
Computer, supra, 203 F.3d at 607 ("we must weigh the extent [*52]
of any transformation . . . against the significance of other factors, including
commercialism, that militate against fair use"). In the process, it must bear in
mind that "the concept of a 'transformative use' is central to a proper analysis
under the first factor."
American Geophysical, supra, 60 F.3d at 923. For
this reason, "the more critical inquiry under the first factor and in fair use
analysis generally is . . . whether and to what extent the new work is
transformative," not whether the use is commercial.
Castle Rock, supra,
150 F.3d at 142 (internal quotations omitted).
Here,
the court has found that defendants' copying of plaintiffs' articles is
minimally, if at all, transformative. The comments of the individual who posts
an article generally add little by way of comment or criticism to its substance.
The extent of the copying is more than is necessary to foster the critical
purpose it is designed to serve. Because the copying is verbatim, encompasses
large numbers of articles, and occurs on an almost daily basis, the evidence
supports a finding that defendants (and visitors to the Free Republic page)
engage in extensive, systematic copying [*53] of plaintiffs'
works.
Weighed against the essentially
non-transformative nature of defendants' use is the fact that they do not
directly derive revenue or profit from the posting of plaintiffs' articles, and
the fact that their operation of the Free Republic website has many
characteristics of a non-profit venture. So too, their use of plaintiffs'
articles appears to be intended more for public benefit than for private
commercial gain.
Since the "central purpose" of the
inquiry on the first fair use factor is to determine "whether the new work
merely 'supersede[s] the objects' of the original creation, . . . or instead
adds something new" (
Campbell, supra, 510 U.S. at 579), the court finds
that the non-transformative character of the copying in this case tips the scale
in plaintiffs' favor, and outweighs the non-profit/public benefit nature of the
purpose for which the copying is performed. This is particularly true since the
posting of plaintiffs' articles to the Free Republic site amounts to "systematic
. . . multiplying [of] the available number of copies" of the articles, "thereby
serving the same purpose" for which licenses are sold or archive charges
imposed. [*54] See
American Geophysical, supra, 60 F.3d at
924. The first fair use factor thus favors plaintiffs.
2. The Nature Of The Copyrighted WorkThe second factor identified in § 107 recognizes "that some works are
closer to the core of intended copyright protection than others, with the
consequence that fair use is more difficult to establish when the former works
are copied."
Campbell, Supra, 510 U.S. at 586. Thus, "the more creative a
work, the more protection it should be accorded from copying; correlatively, the
more informational or functional the plaintiff's work, the broader should be the
scope of the fair use defense." NIMMER,
supra, § 13.05[A][2][a].
Newspaper articles to a large extent gather and report facts. Nonetheless, a
news reporter must determine which facts are significant and recount them in an
interesting and appealing manner. See
Harper & Row, supra, 471 U.S.
at 547 ("creation of a nonfiction work, even a compilation of pure fact, entails
originality").
A number of cases that have analyzed
alleged copying of news articles or videotapes of news events have concluded
that the second fair [*55] use factor weighs in the defendant's
favor. See
Reuters Television, supra, 149 F.3d at 994 (the court held
that the second factor weighed in favor of defendants that copied news footage);
Los Angeles News Service v. KCAL-TV Channel 9, 108 F.3d 1119, 1122 (9th
Cir. 1997) (the second factor weighed in favor of a finding of fair use where
defendants copied news footage);
Los Angeles News Service v. Tullo, 973
F.2d 791, 792, 798 (9th Cir. 1992) (the second factor favored a video news
clipping service that used portions of copyrighted videotapes of newsworthy
events). See also
American Geophysical, supra, 60 F.3d at 925 (given the
"manifestly factual character of the . . . articles" from scientific and medical
journals copied by defendant, the court held that the second factor weighed in
favor of fair use);
Television Digest, supra, 841 F. Supp. at 10 (the
court found that the second factor weighed in favor of a defendant that copied a
newsletter containing original news stories). Compare
Nihon Keizai Shimbun,
supra, 166 F.3d at 72-73 (in a suit by a newspaper publisher against a
defendant [*56] that gathered news articles from various sources and
sold "abstracts" of them to its customers, the court recognized that newspaper
articles are predominantly factual in nature and that expressive elements do not
dominate, but nonetheless concluded that the second "factor is at most neutral
on the question of fair use").
While plaintiffs' news
articles certainly contain expressive elements, they are predominantly factual.
Consequently, defendants' fair use claim is stronger than it would be had the
works been purely fictional. See
Sony, supra, 464 U.S. at 455, n. 40
("Copying a news broadcast may have a stronger claim to fair use than copying a
motion picture"). The court concludes that the second factor weighs in favor of
a finding a fair use of the news articles by defendants in this case.
3. The Amount And Substantiality Of The Portion Used In
Relation To The Copyrighted Work As A WholeDefendants concede that they have copied and posted entire articles
published in plaintiffs' newspapers, although they dispute that all of
plaintiffs' articles posted to the Free Republic site are verbatim copies. As
noted earlier, defendants' evidence does [*57] not support their
contention in this regard. In his deposition, defendant Robinson conceded that
verbatim copying of entire articles or substantial portions thereof is the norm,
and the exhibits submitted by defendants bear this out. n54
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n54 See Defendants' Exhibits - Vol. 2, Ex.
1006; Vol. 3, Ex. 1007; Vol. 4, Ex. 1009 at 55:14-18.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - -
- - -
The fact that exact copies of plaintiffs' article
are posted to the Free Republic site weighs strongly against a finding of fair
use in this case. See
American Geophysical, supra, 60 F.3d at 926
(defendant's copying of entire copyrighted articles militated against a finding
of fair use and led the court to conclude that the third factor weighed in
plaintiffs' favor);
Hustler, supra, 796 F.2d at 1155 ("although wholesale
copying does not preclude fair use
per se," reproducing an entire parody
was the type of wholesale copying that "militated against a finding of fair
use");
Supermarket of Homes, Inc. v. San Fernando Valley Board of
Realtors, 786 F.2d 1400, 1409 (9th Cir. 1986) [*58] ("generally,
no more of a work may be taken than is necessary to make the accompanying
comment understandable");
Television Digest, supra, 841 F. Supp. at 10
(because an entire copyrighted work was used, the court concluded that the third
factor weighed against a finding of fair use); NIMMER,
supra, §
13.05[A][3] ("whatever the use, generally, it may not constitute a fair use if
the entire work is reproduced").
Citing the fact that
plaintiffs' copyright registration covers their newspapers as a whole,
defendants contend that the papers are plaintiffs' "works," and not the
individual articles that appear in them. Thus, they contend, the copying of a
single article constitutes reproduction of only a small portion of the work.
This proposition is not supported by the case law. See
American Geophysical,
supra, 60 F.3d at 925-26 (despite the fact that plaintiffs' copyright
registration covered their journals as a whole, the court held that copying an
entire article was equivalent to copying the entire work);
Hustler,
supra, 796 F.2d at 1155 (stating that "[a] creative work does not deserve
less copyright protection [*59] just because it is part of a
composite work" and holding that the copying of a one-page parody from a
154-page magazine constituted reproduction of the entire work);
Netcom
On-Line II, supra, 923 F. Supp. at 1247 ("although many of Hubbard's
lectures, policy statements, and course packets are collected into larger
volumes, and registered as a whole, they may still constitute separate works for
the purposes of this factor");
Lerma, supra, 1996 WL 633131 at *9 ("we
find that the Works at issue in this case are combined in 'collections' and that
each subpart must be considered a 'single work' for the purposes of fair use
analysis").
Defendants also contend that copying all or
a substantial portion of the articles is essential to the critical purpose of
the Free Republic website. See
Campbell, supra, 510 U.S. at 586 (the
applicable test to use in assessing the third fair use factor is whether the
amount copied was "reasonable in relation to the purpose of the copying"). In
assessing such an argument,
Campbell instructs that the court focus on
"the persuasiveness of a [copier's] justification for the particular copying
done," and [*60] noted that "the enquiry will harken back to the
first of the statutory factors, for . . . the extent of the permissible copying
varies with the purpose and character of the use."
Id. at 586-87.
As detailed in the court's consideration of the first fair
use factor, defendants have not offered a persuasive argument that full-text
copying is essential to the critical purpose of the Free Republic site.
Contrasted with the purpose and character of the use, the wholesale copying of
plaintiffs' articles weighs against a finding of fair use. See
Castle Rock,
supra, 150 F.3d at 144 ("In
Campbell, . . . the Supreme Court
clarified that the third factor -- the amount and substantiality of the portion
of the copyrighted work used -- must be examined in context. The inquiry must
focus upon whether 'the extent of . . . copying' is consistent with or more than
necessary to further 'the purpose and character of the use'");
Infinity
Broadcasting, supra, 150 F.3d at 110 ("the question most relevant to th[e
third] factor [is] whether 'no more was taken than necessary'").
4. The Effect Of The Use On The Potential Market For Or Value Of
The [*61]
Copyrighted WorkThe
fourth factor examines "the effect of the use upon the potential market for or
value of the copyrighted work." 17 U.S.C. § 107(4). It requires evaluating not
only the extent of market harm caused by the alleged infringer's use, but also
"'whether unrestricted and widespread conduct of the sort engaged in by the
defendant . . . would result in a substantially adverse impact on the potential
market' for the original."
Campbell, supra (quoting NIMMER,
supra,
§ 13.05[A][4]);
Harper & Row, supra, 471 U.S. at 568. In this regard,
it is significant if widespread use of the type in which the defendant is
engaged would "diminish[] potential sales, interfer[e] with marketability, or
usurp[] the market" for the original.
Sega, supra, 977 F.2d at 1523
(noting that if copying had this effect, "all other considerations might be
irrelevant"). Markets for derivative works, i.e., those markets 'that creators
of original works would in general develop or license others to develop,' must
be considered in addition to the market for the original.
Campbell,
supra, 510 U.S. at 590, 592. [*62] See also
American
Geophysical, supra, 60 F.3d at 929-30;
Cable/Home Communication Corp. v.
Network Productions, Inc., 902 F.2d 829, 845 (11th Cir. 1990) ("'potential
market' means either an immediate or a delayed market, and includes harm to
derivative works").
In assessing the fourth factor,
courts frequently contrast a use that "suppresses" or "destroys" the market for
the original or derivative works with one that "usurps" or "substitutes" for
those markets. See, e.g.,
Castle Rock, supra, 150 F.3d at 145. See also
Campbell, supra, 510 U.S. at 593;
Sony Computer, supra, 203 F.3d
at 607;
Sundeman, supra, 142 F.3d at 207;
Sega, supra, 977 F.2d at
1523. "[A] work that merely supplants or supersedes another is likely to cause a
substantially adverse impact on the potential market of the original, [while] a
transformative work is less likely to do so."
Sony Computer, supra, 203
F.3d at 607. See also
Sega, supra, 977 F.2d at 1523 ("The
Harper &
Row Court found a use that effectively usurped the market for the
copyrighted work [*63] by supplanting that work to be
dispositive").
Applying these principles to the present
case, the undisputed evidence shows that the Free Republic website has
approximately 20,000 registered users, receives as many as 100,000 hits per day,
and attracts between 25 and 50 million page views each month. The evidence also
shows that visitors to the site are able to read full text copies of articles
from plaintiffs' newspapers and archives without purchasing the papers, visiting
plaintiffs' websites or paying the fee plaintiffs charge for retrieving an
article from their archives. While defendants argue that the Free Republic site
is a "poor substitute" for locating plaintiffs' articles on their websites, n55
the court has found that for those individuals who visit the site, the articles
posted to freerepublic.com do substitute for the original works. Given the
number of registered visitors, hits and page views Free Republic attracts, the
court cannot accept defendants' assertion that the site has only a
de
minimis effect on plaintiffs' ability to control the market for the
copyrighted works. n56
- - - - - - - - - - - - - -
Footnotes - - - - - - - - - - - - - - -
n55 Defs.' Opp. at 20:4-5. [*64]
n56 See
id. at 20:7-8; Stout Decl., PP
47-51. In his declaration, Richard Stout opines that the detrimental impact of
the Free Republic site on plaintiffs' websites is "trivial." (
Id., P 51.)
He bases this conclusion on the fact that the volume of traffic visiting the
Free Republic site is "trivial" in comparison with the number of visitors to
plaintiffs' sites, and that only a small percentage of the articles that appear
on the Free Republic site are from plaintiffs' publications. (
Id., PP 48,
49.) Thus, he concludes that the "general public" wishing to read articles from
plaintiffs' publications has "no reason to believe" that the Free Republic site
is a better place to view plaintiff's articles than the papers' own websites.
(
Id., P 50.) This overlooks the fact that those who visit the Free
Republic site
can read plaintiffs' articles without visiting their
websites. As to those individuals, the articles posted to the Free Republic site
clearly substitute for the originals, and make a visit to plaintiffs' websites
unnecessary.
- - - - - - - - - - - -
End Footnotes- - - - - - - - - - - - - -
Moreover, this
kind of
de minimis argument [*65] has been rejected by the
courts. In
Infinity Broadcasting, for example, the court considered the
fair use defense of an individual who operated a "dial-up" service that allowed
"subscribers (for a fee) to listen over the telephone to contemporaneous radio
broadcast in remote cities," including broadcasts by stations owned by the
plaintiff.
Infinity Broadcasting, supra, 150 F.3d at 106. Infinity
offered a similar service on a limited basis to certain clients, but
acknowledged that it had "no present interest" in developing the market further.
Id. at 107, 111. The defendant argued that its operation was likely to
have no material effect on the value of the copyrighted works because it was
"directed to a narrow and specialized audience" and generated "extremely modest"
revenues.
Id. at 111. The court rejected this. Noting that it could not
conclude defendant's use had only a negligible effect on Infinity's ability to
exploit the potential market, the court stated:
"Infinity, in the exercise of its business judgment, has decided
that its best current use of listen lines is to offer them at no additional
cost to certain 'valued [*66] customers.' Dial-Up disrupts this
practice by removing Infinity's control over who should have access to such
lines. Kirkwood is selling Infinity's copyrighted material in a market that
Infinity, as the copyright owner, is exclusively entitled to exploit. Kirkwood
does not suppress demand for Infinity's broadcasts in the manner of a
reviewer, but instead replaces Infinity as the supplier of those broadcasts to
meet the demand of his customers. This is precisely the kind of harm the
fourth factor aims to prevent." Id. n57
See also
Sega Enterprises Ltd. v. Maphia, 948
F. Supp. 923, 937 (N.D.Cal. 1996) (in finding that the fourth fair use factor
cut against a bulletin board service that allowed users to download plaintiff's
video games, the court rejected defendant's argument that any impact on
plaintiff's sales was de minimis, since only a limited number of users had
copiers that enabled them to play the games, the users probably played in their
own homes, and there was no evidence that they had further distributed the
downloaded video games; the court determined that "unrestricted and widespread
conduct of this sort would result in a substantial adverse [*67]
impact on the market for the Sega games");
Playboy Enterprises, Inc. v.
Frena, 839 F. Supp. 1552, 1559 (M.D.Fla. 1993) (rejecting defendant's
argument that his use was de minimis).
- - - - - - - -
- - - - - - Footnotes - - - - - - - - - - - - - - -
n57 While the Supreme Court's decision in
Sony suggests that
some potential markets should be considered "too insubstantial [or speculative]
to tilt the fourth fair use factor in favor of the copyright holder" (see
American Geophysical, supra, 60 F.3d at 930, n. 18), the market is
presently being exploited by plaintiffs via their websites, and thus cannot be
said to be of this type.
- - - - - -
- - - - - - End Footnotes- - - - - - - - - - - - - -
This is precisely defendants' argument here -- that the Free Republic
site is small in comparison to the sites operated by plaintiffs, is not known to
the general public, and thus could not divert a substantial amount of business
from plaintiffs. As the copyright holders, however, plaintiffs have the "right
to control" access to the articles, and defendants' activities affect a market
plaintiffs currently seek to [*68] exploit.
Plaintiffs assert they have lost and will lose revenue because visitors
to the Free Republic site can read plaintiffs' archived news articles without
paying the fee they would be charged for accessing the articles at plaintiffs'
sites. Similarly, plaintiffs contend that defendants' use affects their ability
to generate licensing revenue, since the fact that the articles are available
for free viewing on Free Republic's web page diminishes their value to
licensees. Finally, plaintiffs argue that defendants' copying reduces the number
of people visiting their sites, and thus causes them to lose advertising revenue
calculated on the number of hits they receive. n58
- -
- - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n58 At the hearing on the motions, defendants claimed they
had been "sandbagged" because, contrary to the declarations submitted in
connection with the motions for summary judgment, plaintiffs' designated Rule
30(b)(6) witnesses testified at their depositions that there was no evidence
that posting plaintiffs' articles to the Free Republic site diverted hits from
plaintiffs' websites. Specifically, defendants cited Koefoot's testimony, in
which he said there was no quantitative data that defendants' posting of
articles diverted traffic from the Washington Post website. (See Defendants'
Exhibits - Vol. 7, Ex. 1012 (Deposition of Eric Koefoot) at 56:15-57:24.)
Koefoot added, however, that "qualitative data" supported such a conclusion
since it is self-evident that a person who reads an article on the Free Republic
site will not go to the Washington Post site to read the same thing. (
Id.
at 57:25-58:8.) Defendants also cited Eric Schvimmer's deposition testimony, in
which he stated that he did not search for, and did not know of, any documents
showing an decrease or increase in the number of hits to the Washington Post's
website as a result of defendants' allegedly infringing acts. (Defendants'
Exhibits - Vol. 6, Ex. 1011 (Deposition of Eric Schvimmer) at 65:6-11, Ex. 5 at
6.) Plaintiffs did not submit a declaration from Schvimmer in connection with
the motions. They did submit Koefoot's declaration, however, which contains
generalized statements to the effect that the Washington Post website loses
potential "hits" when people can access Post articles at the Free Republic site.
(Koefoot Decl., PP 21-22.) Perruso makes an almost identical statement
respecting the Los Angeles Times' website in her declaration. (Perruso Decl., PP
20-21.) These statements do not contradict the deposition testimony. While
plaintiffs may have no "quantitative data" to support the claim, they have
consistently asserted that the Free Republic site reduces traffic on their web
pages.
- - - - - - - - - - - - End
Footnotes- - - - - - - - - - - - - - [*69]
Defendants respond that plaintiffs have not adduced evidence of lost
revenue resulting from operation of the Free Republic site. This, however, is
not determinative. See
Sony, supra, 464 U.S. at 451 ("Actual present harm
need not be shown"). In
Reuters, supra, 149 F.3d at 994, defendants
copied plaintiffs' news footage without permission. Plaintiffs could not prove
that they had lost sales of the footage or that they had suffered any actual
adverse market effect.
Id. The court noted that allowing a customer to
buy the footage from defendants rather than plaintiffs lessened the market for
plaintiffs' footage, and concluded that "such actions if permitted would result
in a substantially adverse impact on the potential market for the original
works."
Id. See also
Ringgold v. Black Entertainment Television,
126 F.3d 70, 81 (2d Cir. 1997) (artist who created a story quilt that was used
as set decoration for a television program was "not required to show a decline
in the number of licensing requests for" a poster depicting the quilt since the
program aired so long as she could demonstrate that there was "a 'traditional,
reasonable, [*70] or likely to be developed' market for licensing
[the] work as set decoration").
Here, plaintiffs have
shown that they are attempting to exploit the market for viewing their articles
online, for selling copies of archived articles, and for licensing others to
display or sell the articles. n59 Defendants' use "substitutes" for the
originals, and has the potential of lessening the frequency with which
individuals visit plaintiffs' websites, of diminishing the market for the sale
of archived articles, and decreasing the interest in licensing the articles. See
Hustler, supra, 796 F.2d at 1155-56 (if the copying "fulfill[s] 'the
demand for the original' works and 'diminish[es] or prejudice[s]' their
potential sale," this justifies a finding that the fourth fair use factor favors
the copyright holder);
Wainwright Securities, supra, 558 F.2d at 96
(defendant's abstracts filled the demand for plaintiff's financial reports).
- - - - - - - - - - - - - - Footnotes - - - - - - - - - -
- - - - -
n59 Koefoot Decl., PP 8, 10-13;
Perruso Decl., PP 8, 10-13.
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Defendants counter that there is no evidence that people
who view the articles on the Free Republic site would ever have visited
plaintiffs' websites. It is not necessary, however, to show with certainty that
future harm will result. See
Sony, supra, 464 U.S. at 451. Rather, "what
is necessary is a showing by a preponderance of the evidence that some
meaningful likelihood of future harm exists."
Id. That likelihood is
present when articles that would otherwise be available only at sites controlled
or licensed by plaintiffs are available at a different site as well. The
likelihood only increases when one considers the impact on the market if
defendants' practice of full text copying were to become widespread.
Defendants also contend that plaintiffs actually benefit
from having their articles posted verbatim on the Free Republic site. While they
argue that plaintiffs' sites receive "literally tens of thousands, if not
hundreds of thousands of hits per month" n60 as a result of referrals from the
Free Republic site, this overstates their expert's quantification of the number
of referral hits. In his declaration, Richard Stout states that the Los Angeles
Times' website [*72] receives approximately 20,000 hits per month
from users who visit the Free Republic site before accessing the Times' site.
Stout estimates that these referral hits generate approximately $ 1,000 in
revenue for the paper each month. n61 Defendants argue that this information
regarding referral hits demonstrates that plaintiffs' advertising revenue is not
diminished because of a reduction in the number of hits to their sites. Stout's
declaration, however, does not address how many hits are
diverted from
plaintiffs' websites as a consequence of the posting of articles to the Free
Republic site, and this is the pertinent inquiry in terms of potential market
harm.
- - - - - - - - - - - - - - Footnotes - - - - - -
- - - - - - - - -
n60 Defs.' Mot. at
14:16.
n61 See Stout Decl., P 46. Stout's
figures concern the Los Angeles Times site only.
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- - -
Defendants assert the evidence regarding referral
hits demonstrates that Free Republic is creating a demand for plaintiffs' works.
Even if this is the case, it does not mandate a conclusion that the fourth fair
use factor favors defendants. [*73] Courts have routinely rejected
the argument that a use is fair because it increases demand for the plaintiff's
copyrighted work. See
Campbell, supra, 510 U.S. at 591, n. 21 (even if a
"film producer's appropriation of a composer's previously unknown song . . .
turns the song into a commercial success[,] the boon to the song does not make
the film's . . . copying fair");
Ringgold, supra, 126 F.3d at 81, n. 16
("Even if the unauthorized use of plaintiff's work in the televised program
might increase poster sales, that would not preclude her entitlement to a
licensing fee");
D.C. Comics Inc. v. Reel Fantasy, Inc., 696 F.2d 24, 28
(2d Cir. 1982) ("Since one of the benefits of ownership of copyrighted material
is the right to license its use for a fee, even a speculated increase in DC's
comic book sales as a consequence of RFI's infringement would not call the fair
use defense into play as a matter of law. The owner of the copyright is in the
best position to balance the prospect of increased sales against revenue from a
license");
Storm Impact, Inc. v. Software of the Month Club, 13 F. Supp.
2d 782, 790 (N.D.Ill. 1998) [*74] ("This argument that increased
distribution of the author's work is a benefit to the author has been rejected
by the Supreme Court," citing
Harper & Row, supra, 471 U.S. at
569)).
In short, plaintiffs have demonstrated that they
are attempting to exploit the market for viewing their articles online, for
selling copies of archived articles, and for licensing others to display or sell
the articles. They have demonstrated that the availability of verbatim copies of
the articles at the Free Republic site has the potential to interfere with these
markets, particularly if it becomes a widespread practice. See
Sony,
supra, 464 U.S. at 451;
Tullo, supra, 973 F.2d at 798;
Hustler,
supra, 796 F.2d at 1155 (copyright owner may demonstrate that there is "some
meaningful likelihood of future harm" by showing that, "should the challenged
use become widespread, it would adversely affect the potential market for the
work"; this inquiry focuses on "whether the infringing use (1) 'tends to
diminish or prejudice the potential sale of [the] work,' or (2) tends to
interfere with the marketability of the work"). Defendants, who
bear [*75] the burden of proof on fair use, have not rebutted this
showing by proving "an absence of 'usurpation' harm to" plaintiffs.
Infinity
Broadcasting, supra, 150 F.3d at 111. Accordingly, the fourth factor weighs
against a finding of fair use in this case.
5.
Balancing The Fair Use FactorsIn sum, three of the
four fair use factors weigh in plaintiffs' favor. Moreover, the factor that
favors defendants -- the nature of the copyrighted work -- does not provide
strong support for a fair use finding, since defendants copied both the factual
and the expressive elements of plaintiffs' news articles. Conversely, the
amount and substantiality of the copying and the lack of any significant
transformation of the articles weigh heavily in favor of plaintiffs on this
issue. The court thus finds that defendants may not assert a fair use defense to
plaintiffs' copyright infringement claim. See
Reuters, supra, 149 F.3d at
994-95 ("the district court, having found that only one of the four statutory
factors weighed in favor of defendants, correctly concluded that the fair use
defense did not apply");
Tullo, supra, 973 F.2d at 799
(the [*76] only one of the four fair use factors -- the nature of the
copyrighted work -- supported a fair use finding, the court held that the
defense could not be invoked to shield defendant from liability for infringing
plaintiff's copyrights).
D. First Amendment
DefenseDefendants assert, as a separate defense,
the fact that the First Amendment protects their posting of copies of
plaintiffs' news articles to the Free Republic website. n62 Defendants contend
that visitors to the Free Republic site will be unable to express their views
concerning the manner in which the media covers current events since the
omissions and biases in the articles will be difficult to communicate to readers
without the full text of the article available. n63
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n62 Often, First Amendment concerns are considered as part
of the fair use analysis. See, e.g.,
Hustler, supra, 796 F.2d at 1151-52
("Courts balance [the fair use] factors to determine whether the public interest
in the free flow of information outweighs the copyright holder's interest in
exclusive control over the work").
n63
Defs.' Mot. at 17:21-23.
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In
Harper & Row, supra, Nation magazine
reprinted, without authorization, 300 words from the memoirs of President Gerald
Ford. 471 U.S. at 542-45. The Court noted that factual information concerning
current events contained in news articles is not protected by copyright. It
stated, however, that "copyright assures those who write and publish factual
narratives . . . that they may at least enjoy the right to market the original
expression contained therein as just compensation for their investment."
Id. at 556-57 (citing
Zacchini v. Scripps-Howard Broadcasting Co.,
433 U.S. 562, 575, 53 L. Ed. 2d 965, 97 S. Ct. 2849 (1977)). It stressed that
copyright fosters free expression because it "supplies the economic incentive to
create and disseminate ideas" by "establishing a marketable right to the use of
one's expression." 471 U.S. at 558. It noted that copyright also promotes the
countervailing First Amendment right to refrain from speech by protecting the
owner of a copyrighted work from being forced to publish it.
Id. at 559.
For all these reasons, the Court concluded that "that copyright's
idea/expression dichotomy 'strike[s] [*78] a definitional balance
between the First Amendment and the Copyright Act by permitting free
communication of facts while still protecting an author's expression.'"
Id. at 556. Accordingly, it rejected defendant's First Amendment argument
that material could be copied because it was "newsworthy," (
id. at 559)
and "limited its inquiry to 'the traditional equities of fair use,' unexpanded
by any free speech concerns." NIMMER,
supra, § 1.10[B][2] (quoting
Harper & Row, supra, 471 U.S. at 560). Courts have generally
interpreted this discussion in
Harper & Row to mean that First
Amendment considerations are subsumed within the fair use Analysis.
Nihon
Keizai Shimbun, supra, 166 F.3d at 74 ("We have repeatedly rejected First
Amendment challenges to injunctions from copyright infringement on the ground
that First Amendment concerns are protected by and coextensive with the fair use
doctrine");
Twin Peaks, supra, 996 F.2d at 1378 ("except perhaps in an
extraordinary case, 'the fair use doctrine encompasses all claims of first
amendment in the copyright field'");
Tullo, supra, 973 F.2d at 795
("Copyright [*79] law incorporates First Amendment goals by ensuring
that copyright protection extends only to the forms in which ideas and
information are expressed and not to the ideas and information themselves. . . .
First Amendment concerns are also addressed in the copyright field through the
'fair use' doctrine").
Nimmer argues that if the
"copying of the expression is essential effectively to convey the idea
expressed," then the First Amendment protects the copying regardless of
copyright. As the court in
Tullo noted, "no court has adopted Nimmer's
proposal."
Tullo, supra, 973 F.2d at 796, n. 5. Nimmer argues that the
Supreme Court in
Harper & Row implicitly adopted this framework when
it acknowledged that some of the briefer quotations from President Ford's
memoirs were "arguably necessary adequately to convey the facts; for example,
Mr. Ford's characterization of the White House tapes as the 'smoking gun' is
perhaps so integral to the idea expressed as to be inseparable from it."
Harper & Row, supra, 471 U.S. at 563; NIMMER,
supra, §
1.10[D].
Even assuming this is true, defendants have
failed to show that copying plaintiffs' news articles [*80] verbatim
is essential to communication of the opinions and criticisms visitors to the
website express. As discussed above in connection with analysis of defendants'
fair use defense, visitors' comments more often concern the underlying news
event than they do the manner in which that event was covered by the media. And,
even where media coverage is the subject of the critique, the gist of the
comments (which concern the fact that a particular media outlet published a
story or approached the story from a particular angle can generally be
communicated without full text copying of the article. The availability of
alternatives -- such as linking and summarizing -- further undercuts any claim
that First Amendment rights are implicated. While defendants and other users of
the Free Republic site may find these options less ideal than copying
plaintiffs' articles verbatim, this does not demonstrate that a First Amendment
violation will occur if full text posting is prohibited.
III. CONCLUSIONFor the foregoing
reasons, plaintiffs' motion for summary adjudication with respect to fair use is
granted, and defendants' motion is denied.
DATED:
March 31, 2000
MARGARET M. [*81] MORROW
UNITED STATES DISTRICT JUDGE