The Supreme Court Decision on Fair Use: What It Means for Our Clients

September 19, 2023  |  Carole Clark Isakson

The landscape of copyright law is in transition after a recent Supreme Court decision that could redefine how we approach fair use. The Andy Warhol Foundation v. Goldsmith case has significant implications for our clients, particularly those who regularly use or create copyrighted materials. Here’s our breakdown of this landmark Supreme Court decision on fair use and what it might mean for you.

Protecting Original Work

At the heart of copyright law is the protection of original work. When you create something unique, you automatically receive the exclusive right to use and distribute that creation. The purpose of this right is to stimulate innovation and creativity, assuring creators that they will benefit from their work.

The Fair Use Doctrine and Permitting Unlicensed Use

Often considered a life-saving exception for content creators, educators, journalists, and others, the fair use doctrine is a crucial component of copyright law. It’s essentially a legal doctrine that promotes freedom of expression by permitting the unlicensed use of copyright-protected works in certain circumstances.

Specific Circumstances Under the Fair Use Doctrine

The fair use doctrine does not offer a free pass to use copyright-protected works indiscriminately, but instead provides a framework where certain types of usage are considered legally permissible. It’s worth noting that there are no rigid rules about what constitutes fair use. Instead, courts generally evaluate the following four factors on a case-by-case basis, outlined in Section 107 of the Copyright Act:

  1. Purpose and Character of the Use: This is often discussed in terms of whether the use of the copyrighted work is transformative, i.e., does it add something new, with a further purpose or different character, altering the first with new expression, meaning, or message? For example, using a snippet of a novel in a book review would likely be considered transformative.
  2. Nature of the Copyrighted Work: This refers to the characteristics of the work being used. For example, using a purely factual work is more likely to be considered fair use than using a highly creative work. These materials are deemed less likely to infringe upon the unique creative expression and economic rights of the copyright owner.
  3. Amount and Substantiality of the Portion Used: This considers both the quantity and quality of the copyrighted material that was used. If the use includes a large portion of the copyrighted work, fair use is less likely to be found; if the use employs only a small amount of copyrighted material, fair use is more likely. However, even a small amount may infringe if it constitutes the “heart” of the work.
  4. Effect on the Market: This examines whether the unlicensed use harms the existing or future market for the copyright owner’s original work. In other words, would this use replace the original work in the marketplace?

Why Fair Use is Crucial

The fair use doctrine aims to achieve a balance between the rights of creators, ensuring they receive appropriate compensation and recognition for their work, and the broader public interest, which benefits from the free flow of ideas and information.

Without the doctrine of fair use, the strict enforcement of copyright could potentially limit creativity, innovation, and the free exchange of ideas. For instance, critics couldn’t quote from the works they’re critiquing, and teachers couldn’t photocopy limited sections of books for their students. It’s this principle that allows society to draw from, comment on, and build upon existing work. Without it, cultural and technological advancement could encounter serious obstacles.

While the fair use doctrine serves as a safeguard against stringent copyright restrictions, it’s important to note that the doctrine is not a free pass to use copyrighted works without permission. As illustrated by the Supreme Court’s recent decision in the Warhol case, the application of the fair use doctrine can be complex and often depends on the specific circumstances of each case.

Dispelling Common Misconceptions about Fair Use

The fair use doctrine can often be misunderstood, leading to several common misconceptions. It’s crucial to remember that not all educational or non-commercial uses automatically qualify as fair use, as court rulings depend on an analysis of all four fair use factors together. Similarly, there is no “safe” percentage of a work that one can use without infringing copyright; infringement can occur even with less extensive usage if the other fair use factors weigh against you.

The notion of transformative use is also often misconstrued, as not all alterations make a use transformative. Additionally, some people believe that giving credit or citation to the copyright owner automatically clears the path for fair use. However, while attributing the source is good scholarly practice and often legally required, it doesn’t change the fair use analysis. Lastly, the idea that fair use only applies to print materials is an outdated notion. The principle of fair use extends to all forms of media, be it digital content, music, film, or beyond. Understanding these intricacies is key to effectively navigating copyright law.

A Turning Point: The Andy Warhol Foundation v. Goldsmith Case

The Supreme Court’s recent ruling in the Andy Warhol Foundation v. Goldsmith case has prompted a critical re-evaluation of fair use. Previously, the central question in fair use cases was whether the derivative work brought something new to the original — a new expression, meaning, or message.

However, in this case, the Supreme Court emphasized the “purpose and character of use” over whether the work was transformative. The court concluded that Warhol’s Orange Prince, despite having an aesthetic difference, did not qualify as fair use since it was used commercially, similar to the original photograph by Goldsmith. This ruling suggests that a derivative work doesn’t automatically qualify for fair use, even if it brings new meaning or message, especially when the two works compete for the same commercial benefit.

The Fair Use Impact on You and Your Business

This shift in the interpretation of fair use could potentially narrow the fair use doctrine, especially where original and derivative works are in direct commercial competition. The court’s focus on “purpose and character of use” over the transformative nature of the work could make it more challenging to invoke the fair use defense in copyright infringement claims.

What does this mean for you? If your business operates in a space where copyrighted material is used, it is crucial to familiarize yourself with this decision and its potential implications. We recommend revisiting your use of copyrighted content and ensuring that it doesn’t infringe upon any copyright protections.

Navigating the Evolving Landscape of Copyright Law Together

At Barna, Guzy & Steffen, Ltd., we remain committed to staying at the forefront of evolving legal landscapes. This recent Supreme Court decision on fair use marks a profound change in copyright law, but rest assured, we’re here to assist you in understanding its implications. If you have any concerns about how this decision might affect you personally or professionally, we encourage you to reach out. Please contact BGS attorneys Carole Clark Isakson or Pedro Herrera for assistance.

By Joshua Ojile, Law Clerk at Barna, Guzy & Steffen, Ltd.
J.D. Candidate May 2024, Mitchell Hamline Law School