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Copyright Troll Loses on Fair Use Claim

Posted in Copyright Law

By Jeffrey Pietsch

Last month, the United States District Court in Nevada found that a non-profit that reposted in its entirety an article originally published by the Las Vegas Review-Journal did not infringe on the owner’s copyright under fair use grounds.  The court’s decision was likely influenced by the copyright holder’s business as a serial litigator in copyright infringement cases.  This article will discuss the fair use exception to copyright infringement specifically in light of the copyright holder’s business model.

The copyright holder of the article in question is Righthaven, LLC. Righthaven searches for unauthorized republications of newspaper articles, acquires ownership to such articles (by assignment from the original owner of the copyright) and then sues the unauthorized user, without any notice, for copyright infringement. After filing a complaint, Righthaven seeks to settle with the defendants. Often times, the unauthorized user who lacks the funds to fight a court battle will settle the suit with Righthaven. According to the website righthavenlawsuits.com, Righthaven has filed 275 lawsuits for copyright infringement and has settled 138 cases for approximately $483,000. Based on the outcome of this case, Righthaven may no longer be able to achieve similar results in the future.

In this case, Righthaven sued the Center for Intercultural Organizing (“CIO”), a non-profit dedicated to helping immigrants become aware of immigration related issues in the United States, for reposting a newspaper article on the targeting of minorities by the Las Vegas Police Department. Righthaven acquired the copyright from the Las Vegas Review-Journal after discovering that CIO posted the article on its website. 

The Court’s decision in this case was based on the fair use exception as defined in Section 107 of the Copyright Act which states that the fair use of a copyrighted work for purposes such ascriticism, comment, news reporting, teaching, scholarship, or research is not an infringement of copyright.  In determining whether the use was a fair use, the court considers: (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 first factor in determining whether one’s use of another’s copyrighted material constitutes fair use is the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes.  As the U.S. Supreme Court has stated, “[t]he central purpose of this investigation is to see . . . 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, 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 (1994). 

The Nevada District Court found that CIO’s use of the article was transformative. The court focused on the current copyright owners’s use and not the use by the original copyright holder, the Las Vegas Review-Journal. In this case, the court found that Righthaven’s use of the copyright was solely for litigation purposes. Since CIO’s use of the article was to educate the public, the court found the use as transformative since it did not supplant Righthaven’s use. In addition, the court found that the purpose of publishing the article by CIO was non-commercial.  In fact, Righthaven, in its complaint, characterized CIO as a non-profit with an educational mission. Accordingly, the first factor under the fair use test favors a finding of fair use.

The second factor is the nature of the copyrighted work. The second factor “calls for recognition 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, 510 U.S. at 586. Generally, works that are creative in nature receive greater copyright protection than factual works. In this case, the court concluded that article is an informational work and deserves less protection than a creative work. Again, this factor weighs in favor of a finding of fair use.  

The third fair use factor is “the amount and substantiality of the portion used in relation to the copyrighted work as a whole.” This factor “calls for thought not only about the quantity of the materials used, but about their quality and importance, too.” Campbell, 510 U.S. at 587. In this case, the court found that even though CIO published the article in its entirety, the amount copied was reasonable considering the nature of the discussion. Additionally, it would have been difficult if not impossible for CIO to pare down the article. The court explicitly states that wholesale copying does not preclude against a finding of fair use. The court found that this factor did not favor either party.

The fourth and final factor is the effect of the use upon the potential market for or value of the copyrighted work. This factor is generally the single most important element of fair use.  To negate fair use, the copyright owner need only show that if the challenged use should become widespread, it would adversely affect the potential market for the copyrighted work. This factor must take account not only the harm to the original but also the harm to the market for derivative works. Unfortunately for Righthaven, they failed to allege that a market exists for its copyright. Also, Righthaven cannot claim the original copyright holder’s market as its own. Since Righthaven is not operating as a newspaper it failed to show that was any harm to the value of the copyright. Accordingly, the court found that this factor supported a finding of fair use.

Based on the above analysis, the court found that CIO’s use of the copyright constitutes fair use as a matter of law even though the plaintiff copied the entire article. The court criticized the fact that the copyright owner was using the copyright exclusively to file infringement lawsuits. The court stressed that such use had “a chilling effect on potential fair uses of articles owned by Righthaven which diminishes public access to such articles and does nothing to advance the Copyright Act’s purpose of promoting artistic creation.”