Copyright Principles in Action

A. Fair Use and the Court Decisions

"Course packs" (i.e. an assemblage of readings photocopied and provided or sold to the students for assigned or optional reading in a course) have been the subject of copyright litigation. Faculty preparing such packs have either had the simplistic notion that "nobody would care" or the more sophisticated belief that the fair use statute (Copyright Act, sec. 107) because of the explicit reference to "teaching (including mulitple copies for classroom use)" inoculated such use from liability. As explained above, this is not true and the four fair-use factors must be considered to determine if the use is likely to be fair.

Certainly the purpose of the use (assuming the copies are made at the University’s internal cost and does not include a profit for an outside copy service) would be educational and this would (especially in view of the preambular language) weigh positively for the University. A federal court has already held, in a case involving New York University and Kinkos, that the profit of a commercial copier will swing this factor to negative despite the end-use by the students. The nature of the copied work will usually be non-fiction prose, but could be – in an art history or English literature course for example – in the most protected category (fiction or works of art). However, even the non-fiction article will be given far more protection than something more mechanical (e.g. a table of mathematical values or a display of experimental raw data) making this factor likely to weigh against the University. The amount copied can range from a few lines to an entire chapter to 100% of the original (e.g. an image or an entire essay or an entire epic poem). As discussed above, the courts have treated this factor as positive when the amount is approximately 3% or less, and neutral (or weakly positive) in the 3% to 10% range. There have been exceptions in both directions, of course. An important exception involves taking the "gist" or the "heart" of the material even when it represents a modest proportion of the whole. When this has happened, the factor turns negative against the copier.

The fourth factor (impact on the copyright holder’s market) is obvious yet subtle and has been the subject of heated debate in the courts. In the context of course packs, the copied material is sometimes out-of-print or is only available in costly books. The instructor reasons that the students should have an exposure to multiple resources or viewpoints and that the students cannot feasibly or affordably get them all just for one course. The copyright holders (typically major publishers) argue that the older works may still be profitably published or licensed in anthology form and that they will lose the potential of collecting permission fees. And they argue they will have lost at least some sales of the newer (still in print) works. The instructors have argued that exposure to the work (or an excerpt therefrom) in a course pack will actually motivate some students (who would not otherwise have done so) to purchase the publisher’s book.

In a well-known case involving the University of Michigan, the trial court ruled in favor of the publishers, particularly emphasizing the "impact" factor because no permission fees were negotiated or paid. On appeal, the panel decision was for the defendant with the majority of the panel reasoning that the "permissions" argument was circular i.e. the publisher could only complain about the impact of lost permission fees if it were entitled to collect them and that depended on whether the copying would be infringing and that in turn depended on whether the use was "fair" … the very issue that the fourth factor was helping to decide. Nevertheless, the Fourth Circuit Court of Appeals, on rehearing en banc, reversed the panel and held for the publishers. Regrettably, the en banc opinion is not very clear as to how and why the court rejected the circularity argument. Thus, the fourth factor will probably weigh against the University. Of course, we are in the territory of the Ninth Circuit and a Fourth Circuit decision is not a strict precedent here. Nevertheless, this decision is the latest and most detailed consideration of this problem at an appellate level and it is likely to be fairly persuasive should the question ever be litigated in this Circuit. Another caveat might apply in a case where permission was sought (including a willingness to pay a reasonable fee) and the offer was rejected by the publisher. This might turn the fourth factor back to favor the University.

The notion that permission fees are a legitimate aspect of a copyright holder’s revenue expectations was reinforced in a case involving science journals copied by the in-house library staff at Texaco. Petrochemical scientists on Texaco’s staff requested and received copies of articles on topics of interest to them. In defense, Texaco asserted that the scientists needed the copies for "research" (recall that activity was also included in the preambular language in the fair use statute). The court rejected that argument saying that Texaco was clearly a for-profit enterprise. As for the "impact" factor, the court noted that Texaco could have bought each scientist a subscription and, more practically, that the National Copyright Clearance Center exists for the very purpose of extracting fees from others who wish to copy portions of commercial journals and Texaco’s avoidance of that regime had an economic impact on the journal publisher’s market.

B. "Safe Harbor" Guidelines

The Association of American Publishers (AAP) has formulated "Fair Use Guidelines" for course-related copying. Given the great many publishers who belong to the Association, following the Guidelines should assure the copier that the use will not be seen as infringing and will not lead to litigation. The Guidelines are fairly easy to understand and apply and they offer a conservative, "safe harbor" for high-volume course-pack production. Thus, many universities, including our own, use the Guidelines to make expedient decisions on whether or not to seek permission to include a work in a course packet. However, since the Guidelines were formulated by publishing interests, they are sometimes narrower than fair use determinations arrived at by balancing the statutory factors.

In summary form, the Guidelines permit course packs to include up to 250 words from a particular poem, a complete article of up to 2500 words and excerpts of longer works up to 1000 words or 10% of the total words whichever is less, and one diagram/chart/illustration per copyrighted work. A further requirement is that the "inspiration and decision to use the work and the moment of its use for maximum teaching effectiveness are so close in time that it would be unreasonable to expect a timely reply to a request for permission. Note that this last requirement has no basis in the fair use statute and, if taken literally, would probably only help the instructor in instances of fast-breaking developments part-way through the term. To see a frequently asked question (and the answer) on this issue, click on Q.5. Another limitation is the "cumulative effect" limitation that no more than two excerpts from the same author and no more than three pieces from the same collective work may be used in the same course packet. While the frequency of usage from the same source would certainly be relevant in weighing the "amount" factor, the precise limits enunciated in the Guidelines are not based on the fair use section of the Copyright Act. Finally, the Guidelines say that course packets are not supposed to contain more than nine copyrighted works and that no items may be included in the same packet "from term to term" (presumably meaning in successive offerings of the course). Neither of these requirements are found in the fair use statute and they are of dubious importance.

When it appears that the inclusion of a work would not be a fair use or that the APA Guidelines will be significantly violated, the UO Copyright Clearance Office is helpful and experienced in requesting and negotiating permissions. However, if the permission cannot be negotiated at no (or an acceptable) fee, the material should not be included as proposed. The UO Copyright Clearance Office will work in cooperation with the instructor and the reproducing facility (usually the UO Press) to make the fair use decision and to obtain any necessary permissions. It should be noted that a lead time of approximately six weeks is usually necessary so instructors must decide what they want to include well before the course pack is needed by the students. The UO Copyright Clearance Office can also refer novel or especially difficult questions to the UO Office of General Counsel.

... Continue to Part V