UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
LOS ANGELES TIME, 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)
TENTATIVE ORDER GRANTING
PLAINTIFFS' MOTION FOR
PARTIAL SUMMARY JUDGMENT
AND DENYING DEFENDANTS'
MOTION FOR SUMMARY
JUDGMENT
Plaintiffs Los Angeles Times and The Washington Post 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
news articles; among these are verbatim copies of news articles from the Los
Angeles Times and Washington Post websites. Plaintiffs' complaint alleges that
the unauthorized copying and posting of news articles on the Free Republic site
constitutes copyright infringement. Defendants have now moved for summary
judgment, asserting that the copying of news articles onto their website is [begin
page 2] 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 a 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 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, however, tips towards 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, asserting that absent wholesale copying,
Free Republic visitors would be unable to express their criticisms 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' free speech rights.
I. FACTUAL BACKGROUND[1]
Plaintiffs publish the Los Angeles Times and The Washington Past in print and
online at "http://www.latimes.com" and "http://www.washingtonpost.com."[2]
Plaintiffs' websites also include [begin page 3] archived articles that users must
pay to view.[3] 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 the day.[4] The
websites also produce advertising and licensing revenue for the papers.[5]
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.[6] 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.[7]
Defendant Jim Robinson is an owner and the operator of the two remaining
defendants, [begin page 4] Electronic Orchard and Free Republic.[8] Electronic
Orchard is a for-profit limited liability company that, although no longer actively
engaged in business, offers "Internet programming and design services."[9]
Free Republic is a limited liability corporation that operates
freerepublic.com.[10] This website, which has been operational since 1996,
allows registered visitors to "post" news articles and comments concerning them
on the site."[11] Registered members may then post additional comments.[12]
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
views each month.[13]
Plaintiffs contend that "perfect copies" of news articles appearing in their
publications and on their websites are posted on the Free Republic website,
while defendants maintain that any article posted is merely a "purported copy"
of the original. Defendants assert an interested party would have to verify that
a posting is an exact copy of an article by visiting plaintiffs' websites.[14] They
appear to concede, however, that some of the postings are verbatim copies of
original articles.[15]
[begin page 5]
The parties dispute whether Free Republic is a for-profit or not-for-profit
entity.[16] Despite this purported disagreement, it appears undisputed that Free
Republic is presently a for-profit limited liability company. Corporate counsel
for defendant Free Republic is currently preparing documents to obtain
tax-exempt status for the Free Republic Institute, a company incorporated on
September 27, 1999.[17] Nothing has yet been submitted to the IRS, however,
and tax-exempt status has not been granted.[18]
Defendants contend that Robinson was not paid to create the website, that he
receives no salary from Free Republic, and that he receives almost no
compensation for posting banners or links on the site.[19] Plaintiffs counter
that Free Republic earns revenue through commercial advertising, merchandise
sales, saleable consumer data, donations, "voluntary" subscriptions, and
membership dues.[20] They also assert that Free Republic is used to advertise
Electronic Orchards's services.[21]
[begin page 6]
These matters are contested by defendants, who contend 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 were in some instances posted on. the site by
third-party users.[22] Defendants similarly 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 on the site solely as a courtesy.[23] Defendants maintain that Free
Republic does not collect consumer data, and has not sold any information
regarding its registered users to any other entity.[24] Additionally, they contend
they have no connection with membership organizations of Free Republic
supporters, and that the dues revenue generated by these groups in no way
benefits them.[25] They 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
souvenir items in exchange for donations.[26]
The parties also dispute whether Free Republic's use of plaintiffs' news articles
causes an increase or decrease in traffic on the Times and Post websites,
whether it diminishes the available market for sale of their 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,[27] while plaintiffs maintain they
lose traffic when [begin page 7] Internet users read an article posted on
freerepublic.com rather than visiting the Times or Post websites. They also
assert that their ability to sell copies of the articles from archives and their ability
to license the works is diminished by having copies made freely available on
Free Republic's site.[28]
II. DISCUSSION
A. Legal Standard Governing Motions For Summary
Judgment
A 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 [begin page 8] 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 (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 parry
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 (1956);
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 insufficient 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. 1995); 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 (1985). It is nonetheless appropriate to
resolve the issue at the summary judgment stage where the historical facts are
undisputed and the only question is the proper legal conclusion to be drawn
from those facts. Los Angeles New Serv. v. Tullo, 973 F.2d 791, 796 (9th Cir.
1992) ("Where the district court has found facts sufficient to evaluate each of
the statutory factors considered in determining fair use, we may determine as a
matter of law whether the challenged use is a fair one"); 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, [begin page 9] 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)
(issue was properly resolved on summary judgment because "[n]o material
historical facts [were] at issue in this case [and t]he parties dispute only the
ultimate conclusions to be drawn from the admitted facts").
B. Elements Of Copyright Infringement
"Copyright law protects an author's expression; facts and ideas within a work
are not protected." Shaw v. Lindheim, 919 F.2d 1353,1356 (9th Cir. 1990).
See also Sid & Marty Kroft 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 original elements of the protected work. Feist Publications v. Rural
Telephone Service Co., 499 U.S. 340, 361 (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 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 [begin page 10] copying of their
articles.[29]
C. The Fair Use Defense
The 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(l). 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 educations purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to
the copyrighted [begin page 11] work as a whole; and
(4) the effect of the use upon the potential market for or value of the
copyrighted work.
The fact 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 the fair use doctrine 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)
("[b]ecause fair use is an affirmative defense, Defendants bear the burden of
proof an 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 Use
The 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, 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 (1995) (quoting Folsom v. Marsh, 9 F.Cas.
342, 348 (D. Mass. 1841)). ". . . [T]he 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, surpa, 510 U.S. at 579.
Inquiry into 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. This 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 commercial use,
not every commercial use of a copyrighted [begin page 12] work is
presumptively unfair. Campbell, supra, 510 U.S. 579.
a. Extent To Which Free Republic's Work
Is Transformative
There is no dispute that at least some of the articles posted on the Free Republic
website are exact copies of plaintiffs' articles. While defendants assert there is
"no evidence" before the court that the thousands of Times and Post news
articles that have been posted are verbatim copies, they have presented no
evidence that they are not.[30] Defendants bear the burden of proof on the
issue of fair use. To the extent they wish to rely on the fact that something
other than exact copies of news articles are posted, therefore, they must come
forward with evidence demonstrating that this is so. Since they have not, the
court will assume for purposes of assessing the first fair use factor that verbatim
copies of complete articles or portions of articles are used.[31]
There is nothing transformative about copying the entirety or portions of a work
verbatim. See Nihon Keizai Shimbun, 166 F.3d at 72 (where the infringing
news abstracts were "for the most part direct translations of Nikkei articles," the
court found that the first factor "weigh[ed] strongly against fair use"); Los
Angeles News Service v. Reuters Television Int'l, 149 F.3d 987, 993 (9th Cir.
1998) (unauthorized copying of news footage "was not very transformative"
because the defendant did "not explain the footage, edit the content of the
footage, or include editorial comment"); Infinity [begin page 13] Broadcast
Corp. v. Kirkwood, 150 F.3d 104, 108 (2d Cir. 1998) (finding that "[t]here is
no transformation" where the defendant retransmitted original broadcasts over
the telephone); Religious Technology Center v. Netcom On-Line
Communication Services, Inc., 923 F.Supp. 1231, 1243 (N.D.Cal. 1995)
("Netcom On-Line II") (defendant's posting of some 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").
Defendants argue that the posting of plaintiffs' articles on the Free Republic
website is transformative because registered visitors add comments and criticism
following each article. They distinguish Nihon Keizai Shimbun on this basis,
concluding that the additions make the posting significantly more transformative
than a translated abstract. Adding commentary to its verbatim copy of a
copyrighted work or portions thereof does not transform the work, especially
where the first posting of the article by a Free Republic user often contains little
or no commentary. See Twin Peaks Productions, Inc. v. Publications
International, Ltd., 996 F.2d 1366, 1375-76 (9th Cir. 1993) (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
"abridgments[s] of a copyrighted work [are] . . . likely to be found to be prima
facie infringing," and defendant's "abridgment . . . elaborated[d] 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
(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 in favor of the 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").
In Netcom On-Line II, supra, defendant posted verbatim copies of works
copyrighted by the Church of Scientology on an Internet website "with little or
no added comment or criticism." Id. at 1243. The court found that the works
were only "minimally transformative" because "unlike the typical critic,
[defendant] add[ed] little new expression to the Church's works." Id. The
court specifically rejected defendant's argument that his copying was fair use
within the meaning of 17 [begin page 14] U.S.C. § 107(1) because subsequent
visitors added further comments, concluding 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.[32]
Similarly, in Religious Technology Center v. Lerma, 19076 WL 633131
(E.D.Va. 1996), defendant copied portions of works copyrighted by the Church
of Scientology by downloading or scanning them into his computer and posting
segments on the Internet. Id. at * 4. He 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 his
argument, noting that it did "not justify the wholesale copying and republication
of copyrighted material," and that "[t]he degree of copying by [defendant]
combined with the absence of commentary on most of his Internet postings, is
inconsistent with the scholarship exception." Id.[33]
[begin page 15]
The court similarly rejected defendant's assertion that "saving . . . postings
[from Internet newsgroups] for later review is indistinguishable from the
temporary storage [of a television program] on a VCR tape that was upheld by
the Supreme Court in Sony Corp. Of America v. Universal Studios, Inc., 464
U.S. 417 (1984)." Id. at * 6. Unlike the defendant in Sony, the court stated,
defendant was "not licensed to view or copy the Works" copyrighted by the
Church. Id. Given this fact, it observed, the more appropriate analogy was to a
situation in which "the Sony defendant obtained an unauthorized copy of a
television movie from a premium cable channel and them re-broadcast [it] on a
public access channel." This, the court noted, "Would be clearly
prohibited."[33] Id.[34]
[begin page 16]
Defendants argue that, whether or not their copying is transformative, the first
factor nonetheless should weigh in their favor because their general purpose is
criticism -- a purpose different than that served by posting the articles on the
Times and Post websites. Defendants contend that posting articles on the
Times and Post websites permits visitors to read current news and research
archived articles published in the two newspapers. They contrast this with the
purpose of posting articles to the Free Republic site, i.e.. to enable visitors to
comment upon and criticize media coverage of current events. Defendants
assert 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.[35] Additionally,
they contend that the imprecision of searches would make it difficult to locate
archived articles on their site. Plaintiffs dispute these claims, noting that the
Free Republic's search engine provides immediate search capability.[36] More
fundamentally, they assert, even if the general purpose of posting the articles is
to foster comment and criticism, ultimately the purpose is the same 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) (court found 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).
It appears clear that the primary purpose of posting articles to the Free Republic
site is to facilitate the discussion, criticism and comment of the registered users
that follows. The mere fact that criticism is involved, however, does not
warrant an automatic finding that the first factor favors defendants. See Harper
& Row, supra, 471 U.S. at 561 (list contained in § 107 is not intended to be
exhaustive or to single out any particular use as presumptively fair). Rather, this
fact must be weighed together with other considerations in assessing whether
the first fair use factor favors [begin page 17] defendants. See Twin Peaks,
supra, 996 F.2d at 1375-76 ("'Purpose' 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").
b. Commercial Nature Of The Free
Republic Website
The parties vigorously dispute whether defendants' operation of the Free
Republic website is for commercial or non-profit purposes, as those terms are
used in § 107. Their argument focuses on the for-profit or not-for-profit 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.[37] 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 free Republic-related souvenir items
are offered to donors.[38] Additionally, the Free Republic page advertises the
website design services available through Electronic Orchard, and contains links
to Electronic Orchard clients.[39] Defendants maintain that [begin page 18]
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, if nothing else, from operation of the Free Republic
site. Consequently, the court concludes that defendants stand to profit from
operation of the website in a variety of ways.[40]
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.[41] 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. This in turn enhances defendants' ability to solicit donations
and generate goodwill for their operation and Robinson's other business.
The decision of the court in Marobie-FL, Inc. v. National Assoc. of Fire
Equipment Distributors, 983 F.Supp. 1167 (N.D.Ill. 1997), is instructive in this
regard. There, defendant was a non-profit organization that placed copyrighted
clip art on its website without paying the copyright [begin page 19] owners. Id.
at 1175. Despite defendant's non-profit status, the court found that "its conduct
[could] still be considered commercial." Id. It reasoned that defendant had
obtained copies of the clip art for free, although they would ordinarily have cost
money, and then 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. For this reason, the court concluded that defendant's use of the clip art
"enhanced the Web Page and furthered . . . commercial purposes." Id. See also
Television Digest Inc. v. United States Telephone Assoc., 841 F.Supp. 5, 9-10
(D.D.C. 1993) (court concluded that non-profit national trade association's
duplication and distribution of a copyrighted newsletter was not a
non-commercial use because the trade association saved money by
photocopying one subscription issue rather than ordering the number of
subscriptions it required per reader).
Like the organization in Marobie-FL, defendants benefit from having copies of
plaintiffs' articles available free of charge to viewers visiting their website. The
fact that the articles are posted on the web page allows visitors to review
archived material without paying the fee they would be charged if they visited
plaintiffs' websites. It also enhances the Free Republic page and promotes
support for the operation. Consequently, the court concludes that the use is
commercial as that term is used in § 107, regardless of Free Republic's profit or
non-profit status or motives.
c. Conclusion Regarding First Fair Use
Factor
Balancing all aspects of the character and purpose inquiry, the court concludes
that the first fair use factor favors plaintiffs. In Sony, the Supreme Court
emphasized the need for a "sensitive balancing of interests," and eschewed a "a
rigid, bright-line approach," Sony, supra, 464 U.S. at 455, n. 40. Here, the
factors to be considered are the verbatim nature of the copying, the minimally
transformative nature of the use, the fact that the copying is designed to
facilitate comment and criticism, the fact that defendants' web page is enhanced
by use of the articles, and that fact that the copying assists in generating
support, both financial and non-financial, for their operation. Balancing all of
these considerations, the court finds that the first factor weighs against a finding
of fair use in this case. See Rogers v. Koons, 960 F.2d 301, 309 (2nd Cir.
1992) ("[T]hough it is a [begin page 20] significant factor, whether the profit
element of the fair use calculus affects the ultimate determination of whether
there is fair use depends on the totality of the factors considered; it is not itself
controlling"); Marcus v. Rowley, 695 F.2d 1171, 1176 (9th Cir. 1983)
("[W]holesale copying of copyrighted material precludes application of the fair
use doctrine");[42] Netcom On-Line II, supra, 923 F.Supp. at 1243 ("despite
Erlich's purported critical purpose, the actual character of his use does not
weigh heavily in his favor because it has only a slight transformative nature");
Lerma, supra, 1996 WL 633131 at * 5 ("The degree of copying by Lerma,
combined with the absence of commentary on most of his Internet postings, is
inconsistent with the scholarship exception"); Marobie-FL, supra, 983 F.Supp.
at 1175 (use of copyrighted clip art was commercial, inter alia, since it assisted
the non-profit defendant's "promoti[on of its] association").
2. The Nature Of The Copyrighted Work
The second factor set forth 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." M. Nimmer & D. Nimmer, NIMMER ON COPYRIGHT, §
13.05[A][2][a] (Mathew Bender 1999). Newspaper articles to a large extent
gather and report facts. Nonetheless, a news reporter must determine which
facts are significant and mount those facts in an interesting and appealing
manner. See Harper & Row, supra, 471 U.S. at 547 ("[c]reation of a
nonfiction work, even a compilation of pure fact, entails originality").
A number of cases that have analyzed the second fair use factor in the context
of alleged [begin page 21] copying of news stories or videotapes of news events
have concluded that it weighs in defendant's favor. See Reuters Television,
supra, 149 F.3d at 994 (the court hold 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) (second factor
weighed in favor of fair use where defendants copied news footage); Tullo,
supra, 973 F.2d at 792, 798 (second factor favored video news clipping service
that copied portions of copyrighted videotapes of newsworthy events). See also
Texaco, supra, 60 F.3d at 925 (because of 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 defendants that had 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 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 of 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
Whole
Defendants concede that they have copied and posted entire articles published
plaintiffs' newspapers, although they dispute that all postings of plaintiffs'
articles to the Free Republic site are verbatim copies. As noted earlier,
defendants bear the burden of proof on the fair use defense, and they must thus
come forward with evidence supporting this contention if it is to be considered
by the court. They have not done so, and the undisputed evidence presently
before the court is that exact copies are used. Indeed, in his deposition,
defendant Robinson in effect conceded that this is [begin page 22] the general
practice of those posting articles to the Free Republic site.[43]
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 Texaco, supra,
60 F.3d at 926 (defendant's copying of entire works militated against a finding
of fair use and led the court to find that the third factor weighed in favor of
plaintiffs); Hustler Magazine, Inc. v. Moral Majority, Inc., 796 F.2d 1148,
1155 (9th Cir. 1986) ("although wholesale copying does not preclude fair use
per se," reproducing an entire parody was the type of wholesale copying that
"militate[d] against a finding of fair use"); Supermarket of Homes, Inc. v. San
Fernando Valley Board of Realtors, 786 F.2d 1440, 1409 (9th Cir. 1986)
("[g]enerally, 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 (where 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").
Defendants contend that plaintiffs' "work" is the entire daily newspaper because
their copyright registration covers the paper as a whole rather than any
particular article. Thus, they assert, copying an individual article constitutes
reproduction of only a small portion of the entire work. This proposition is not
supported by the case law. See Texaco, supra, 60 F.3d at 925-26 (copying an
entire article from a journal where the copyright registration covered the journal
as a whole constituted a copying of the entire work); Hustler Magazine, supra,
796 F.2d at 1155 (finding that "[a] creative work does not deserve less
copyright protection 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 a
copying 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
[begin page 23] in 'collections' and that each subpart must be considered a
'single work' for the purposes of fair use analysis").
Defendants also contend that copying entire news articles is essential to the
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"). As
the Court in Campbell instructed, in assessing such an argument, the focus must
be on "the persuasiveness of a [copier's] justification for the particular copying
done, and 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.
Here, defendants assert it would be difficult for visitors to comment upon and
criticize an article without having the full text displayed above the comments.
Plaintiffs counter that defendants could post a link to the Times and Post
websites so that Free Republic visitors wishing to view an article being critiqued
could access it.[44] They assert that a hypertext link would permit a viewer to
access an article on the Times or Post website by "clicking" on the link and then
"clicking" back to the Free Republic site to post comments. Defendants
maintain that such a solution is impractical, since the links would expire
approximately two weeks after the article was initially published. They also
assert that such an approach would disadvantage unsophisticated Internet
users.[45]
Another alternative to full text copying, of course, would be to have visitors post
summaries of the news articles and attach commentary to them. Robinson, in
his depositions acknowledged that registered users were entitled to do this.[46]
The court, however, need not resolve the parties' dispute regarding the efficacy
of hypertext links, nor evaluate other alternatives such as summaries. Rather, it
it need only weigh the persuasiveness of defendants' argument regarding the
need for full-text [begin page 24] copying against the purpose and the character
of the use. See Campbell, supra, 510 U.S. at 586-87.
Here, defendants have not met their burden of demonstrating that full-text
copying is essential to their use of plaintiffs' articles. They merely assert, in
conclusory fashion, that it is so. See Netcom On-Line II, supra, 923 F.Supp. at
1247, n. 17 ("Erlich never adequately explains why it was essential for him to
copy verbatim the amount of the works that he copied, merely asserting in a
conclusory fashion that it was 'reasonable in relation to the purpose the
copying'").[47] Belmore, supra, 880 F.Supp. at 679 ("The Court declines . . .
to further involve itself in myriad possible methods of excerpting 'Tale of Two
Islands,' and the extend to which these methods affect the purported purpose of
'Hooligan's Island.' Such an inquiry is neither necessary nor appropriate for
resolution of this case"). When contrasted against the minimally transformative
nature of the use and the commercial aspects of the venture (see supra at
12-20), the wholesale copying of plaintiffs' articles weighs against a finding of
fair use. See Ty, Inc. v. West Highland Publ'g, Inc., 1998 WL 698922, * 15
(N.D. Ill. 1998) (concluding that defendant's "Beanie Baby Handbook," which
included color photographs of plaintiff 's copyrighted images, was not a fair use,
the court reasoned that "West could have provided editorial or commentary
without copying Ty's protected expressions" by referring to each plush toy's
distinct name and item number.)
4. The Effect Of The Use On The Potential Market
For Or Value Of The Copyrighted Work
The 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). "Fair use, when
properly applied, is limited to copying by others which does not materially
impair the marketability of the work which is copied." NIMMER, supra, §
1.10[D]. "If the intended use is for commercial gain, th[e] likelihood [of future
harm] may be presumed." Sony, supra, 464 U.S. at 451. The inquiry
encompasses not only the effect the alleged infringer's use will have, but also
"'whether unrestricted and widespread conduct [begin page 25] of the sort
engaged in by the defendant . . . would result in a substantially adverse impact
on the potential market' for the original original." Campbell, supra (quoting
NIMMER, §13.05[A][4], p.13-102.61); Harper & Row, supra, 471 U.S. at 568.
In Reuters, supra, 1149 F.3d at 994, defendants copied plaintiffs' news footage
without permission. Plaintiff's could not prove that they had lost sales of the
copyrighted news footage and thus could not prove that the copying had an
actual adverse effect on the market for the footage. Id. The court nonetheless
concluded that the fourth fair use factor weighed in plaintiffs' favor, reasoning
that "actions [of the type in which defendants had engaged] if permitted would
result in a substantially adverse impact on the potential market for the original
works." Id. Specifically, it held that allowing a customer to buy the footage
from defendants rather than plaintiffs lessened the market for plaintiffs'
footage. Id.
Here, the Free Republic website allows visitors to read archived news articles
from the Times and the Post without having to pay the fee they would
otherwise be charged for accessing the articles at the papers' websites. This has
the effect of lessening plaintiffs' market for the sale of archived articles.
Plaintiffs contend that they lose visitors to their websites because articles are
available at the Free Republic site, and that this results in a loss of advertising
revenue as well. They also assert that licensing revenue is lost, because others
follow Free Republic's lead in copying the works rather than securing a license
for them.
Defendants dispute these contentions, arguing that the posting of plaintiffs' news
articles on the Free Republic website has little, if any, negative effect on the
newspapers' web traffic or revenue. In fact, defendants assert, the Times and
the Post benefit from having the articles posted at the Free Republic site
because their sites receive "literally tens of thousands, if not hundreds of
thousands of hits per month"[48] as a result of the Free Republic site. This
claim overstates their expert's quantification of the number of referral hits, who
states that it is approximately 20,000 per month. The expert estimates that this
generates $1,000 in revenue for the [begin page 26] the papers per month.[49]
Even assuming this is true, "[t]he mere absence of measurable pecuniary
damage does not require a finding of fair use." Marcus, supra, 695 F.2d at
1177. If the copying "fulfill[s] 'the demand for the original' works and
'diminish[es] or prejudice[s]' their potential sale," this is sufficient to justify a
finding that the fourth fair use factor favors the copyright holder. See Hustler
Magazine, supra, 796 F.2d at 1155-56. Here, regardless of its impact on the
advertising revenue generated by visits to plaintiffs' websites, the availability of
the papers' news articles in full text on the Free Republic site fulfills at least to
some extent demand for the original works and diminishes plaintiffs' ability to
sell or license them. This is particularly true when one considers the impact that
widespread copying of this type would have on plaintiffs' ability to sell and
license their articles. Thus, an adverse effect on the potential market for the
articles has been demonstrated,[50] and the fourth factor weighs against a
finding of fair use. See Wainwright Securities, supra, 558 F.2d at 96
(defendant's abstracts filled the demand for plaintiff's financial reports). See
also Twin Peaks, supra, 996 F.2d 1377 ("it is a safe generalization that
copyright holders, as a class, wish to continue to sell the copyrighted work . .
.").
[begin page 27]
5. Balancing The Fair Use Factors
For the reasons discussed above, the court concludes that three of the four
factors weigh against a finding of fair use. The one factor that favors
defendants -- the nature of the copyrighted work -- does not strongly support
their assertion of a fair use defense, however, because defendants copied both
the factual and expressive elements of plaintiffs' news articles. Additionally, the
third factor -- amount and substantiality of the portion used -- militates against a
fair use finding, since defendants copied entire news articles verbatim. The
court therefore concludes that defendants' fair use defense to plaintiffs'
copyright infringement claim fails.
D. First Amendment Defense
Defendants contend the First Amendment protects their ability to post copies of
the plaintiffs' new articles on the Free Republic website. Without the ability to
post entire articles, defendants allege that visitors to the site will be prevented
from expressing their opinions on media coverage of current events and politics,
as well as their views concerning omissions and biases evident in the articles.
Some courts have treated First Amendment concerns as part of the fair use
analysis. See, e.g., Hustler Magazine, 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"). Defendants, however, raise this issue as a separate defense.
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 556-571 (citing Zacchini v.
Scripps-Howard Broadcasting Co., 433 U.S. 562, 575 (1977)). The Court
stressed that copyright fosters free expression because "[b]y establishing a
marketable right to the use of one's expression, copyright supplies the economic
incentive to create and disseminate ideas." Id. at 558. It also promotes the
countervailing First Amendment right to refrain from speech by protecting the
owner of copyrighted work from being [begin page 28] forced to publish it. Id.
at 559. For all of these reasons, the Court rejected defendant's First
Amendment argument that material could be copied because it was
"newsworthy," (id.) 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).
Nimmer argues that if the "copying of the expression is essential effectively to
convey the idea expressed," then copyrighted material may be copied under the
First Amendment. He cites the fact that the Court in Harper & Row implicitly
adopted this framework by acknowledging that some of the briefer quotes 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].
Assuming a standard such as this applies, defendants have failed to show that
copying entire news articles is essential to convery the opinions and criticisms of
visitors to their site. As discussed above in connection with the third fair use
factor, visitors' critiques could be attached to a summary of the article, or Free
Republic could provide a link to the Times and Post websites where the article
could be found. While defendants and users of freerepublic.com might find
these options less ideal than being able to copy entire news articles verbatim,
their speech is in no way restricted by denying them the ability to infringe on
plaintiffs' exclusive rights in the copyrighted news articles.
II. CONCLUSION
For the foregoing reasons, plaintiffs' motion for summary adjudication with
respect to fair use is granted and defendant's motion for summary judgment is
denied.
Copyright Tech Law Journal
DATED: November 8, 1999
______________________________
MARGARET M. MORROW
UNITED STATES DISTRICT JUDGE
Footnotes
[1] 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 those 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 there is thus no need to rule on the objections
presented.
[2] Declaration of Carol Perruso ("Perruso Decl."), ¶ 2; Declaration of Eric
Koefoot ("Koefoot Decl."), ¶¶ 2-3.
[3] Perruso Decl., ¶ 4; Koefoot Decl., ¶ 4.
[4] Plaintiffs' Statement of Uncontroverted Facts and Conclusions of Law
("Pls.' Facts"), ¶ 50; Defendants' Response to Plaintiffs' Separate Statement of
Uncontroverted Facts ("Defs.' Genuine Issues"), ¶ 50. The actual price per
view is established by the Perruso (Los Angeles Times) and Koefoot
(Washington Post) Declarations. While defendants have objected to the specific
paragraphs of the declarations where these dollar figures are set forth, it appears
that their objection relates to the declarants' assertion that it is not "impractical"
to view the full text of an archived article on plaintiffs' rather than Free
Republic's site. (See Purruso Decl., ¶ 8; Koefoot Decl., ¶ 8, Defendants'
Evidentiary Objections to Declarations of Carol Perruso, Eric Koefoot and
Chappell Aldridge (''Defs.' Objections") at 2:7-10, 4:121-24.) The statements
regarding the charge for viewing articles on the Times and Post websites is not
irrelevant, does not lack foundation, and is not ambiguous, speculative or
conclusory. Consequently, to the extent defendants object to this aspect of the
declarations, their objections are overruled.
[5] Perruso Decl., ¶¶ 10- 12; Koefoot Decl., ¶¶ 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, 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] Pls.' Facts, ¶¶ 33, 48; Defs.' Genuine Issues, ¶¶ 33, 48.
[7] See Pls.' Facts, ¶¶ 49, 51, 52, Defs.' Genuine Issues, ¶¶ 49, 51, 52.
[8] 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.)
[9] Id. at 20-2-12; Pls.' Facts, ¶ 24; Defs.' Genuine Issues, ¶ 24.
[10] Robinson Depo. at 26:16-20.
[11] Pls.' Facts, ¶¶ 1, 24, 25; Defs.' Genuine Issues, ¶¶ 1, 24, 25; Declaration
of James Robinson ("Robinson Decl."), ¶ 35; Memorandum of Points and
Authorities in Support of Defendants' Motion Summary Judgment ("Defs.'
Mot."), at 7:17-24; Declaration of Heather L. Wayland ("Wayland Decl."), Ex.
B (D000441, D000445).
[12] See, e.g., Wayland Decl., Ex. D.
[13] Pls.' Facts, ¶¶ 18, 38; Defs.' Genuine Issues ¶¶ 18, 38.
[14] See, e.g., Pls.' Facts, ¶¶ 45, 47; Defs.' Genuine Issues, ¶¶ 45, 47, 49, 51
52.
[15] Defs.' Genuine Issues, ¶¶ 45, 47, 49, 51, 52 (". . . [W]ith 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").
[16] See Pls.' Facts, ¶ 23, Defs.' Genuine Issues, ¶ 23; Defendants' Separate
Statement of Uncontroverted Facts ("Defs.' Facts"), ¶ 6; Plaintiffs' Response to
Defendants' Separate Statement of Uncontroverted Facts ("Pls.' Genuine
Issues"), ¶ 6.
[17] Free Republic Institute would apparently assume responsibility for
operation of the website, freerepublic.com. (See Robinson Depo. at 98:15-21.)
[18] See Declaration of Harold Szabo ("Szabo Decl."), ¶¶ 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. Szabo offers no
opinions concerning the ultimate outcome of the application tax-exempt status.
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. While plaintiffs dispute the relevance of
the information set forth in Szabo's declaration, this objection is part and parcel
of the legal arguments to be decided by this motion, and not a basis for striking
the declaration.
[19] Robinson Depo. at 24:1-8, 27:18-28:23, 38:4-40:12.
[20] Pls.' Facts, ¶¶ 27, 28, 29, 30, 31, 32, 34, 35.
[21] Pls.' Facts, ¶¶ 27, 29. Plaintiffs additionally note that the Free Republic
website uses a ".com" domain name of the type generally used by commercial
entities. (Pls.' Facts, ¶ 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, ¶ 26;
Supplemental Declaration of Richard Stout ("Supp. Stout Decl."), ¶¶ 35-38.)
[22] Defs.' Genuine Issues, ¶¶ 32, 34.
[23] See Defs.' Genuine Issues, ¶¶ 27, 28.
[24] Defs.' Genuine Issues, ¶ 35.
[25] Defs.' Genuine Issues, ¶ 31.
[26] See Defs.' Genuine Issues, ¶¶ 29, 30.
[27] Defs.' Genuine issues, ¶¶ 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 of
Stout's declaration on the basis that they are irrelevant, conclusory, speculative,
vague and ambiguous, and without foundation. The objections to paragraph 46
are overruled, as Stout has demonstrated his qualifications to offer an opinion
on the traffic from the Free Republic site to the Times' site, and explained his
methodology in detail in 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
freerepupblic.com on plaintiffs' websites, however, and the generalized nature
of the conclusions found in these paragraphs goes to their weight rather than
their admissibility.
[28] Pls.' Facts, ¶¶ 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, 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.
[29] Defendants Robinson and Free Republic admit that they have personally
posted certain of plaintiffs' articles on the Free Republic site. (See Defs.'
Genuine Issues, ¶ 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, ¶¶ 10, 41; Defs.' Genuine Issues,
¶¶ 10, 41). Plaintiffs contend that defendants provide instructions and tools that
permit third-party copying, and 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, ¶¶ 11, 12, 13.) Defendants agree that they have the
technical ability to remove material from the site, but argue that it is not possible
for them to monitor the large quantity of daily postings that the site receives.
(Defs.' Genuine Issues, ¶¶ 12, 13.) They do not respond directly to the
assertion that they provide tools and instructions that permit third-party copying
of plaintiffs' articles, acknowledging only 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, ¶ 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, ¶¶ 6, 7, 9, 10, 11.)
[30] See Defs.' Genuine Issues, ¶¶ 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").
[31] Even if only excerpts were copied, this would still appear to 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 appear[ed] to be direct, if not
word-for-word, translations of the Nikkei articles, edited only for clarity," to
"use[] about two-thirds of the protectible material in the corresponding Nikkei
article," to "track the information in the articles sentence by sentence, in
sequence," occasionally "combin[ing] two Nikkei sentences, divid[ing] a
sentence, or rearrang[ing] the facts among different sentences," and to "adopt[],
by and large, the exact same structure and organization of the facts reported by
Nikkei"). Sec also Wainwright Sec. Inc. v. Wall St. Transcript Corp., 558 F.2d
91, 93-94 and n. 1 (2d Cir. 1977) (court held that defendant 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 (1978).
[32] 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
tranformative.
[33] 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 "form[ed] 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," or 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" finding that the Church "ha[d] not shown a
substantial likelihood of success on the merits of its copyright claim" (id.) is
substantially less persuasive than, and cannot be said to contradict, the Lerma
court's direct and detailed analysis of his posting activities.
[34] The court believes that the cases cited in text are more pertinent to
analysis of defendants' fair use defense in this case than other decisions, such as
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 and in so doing, specifically distinguished Netcom's invocation
of the defense from that of the individual who had actually posted copies of the
copyrighted works to a Usenet newsgroup. This individual 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] receive[d] 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 'profit[ing] 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' news 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.
[35] See Defs.' Mot. at 11:14-12:3.
[36] See Plaintiffs' Opposition to Defendants' Cross-Motion for Summary
Judgment on Fair Use ("Pls.' Opp.") at 5:28, 6:22-28; Aldridge Decl., ¶ 5;
Defendants' Exhibits - Vol. 1, Exs. 1002, 1003.
[37] 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 a[n]
ad or banner linking, your website, contact Jim. If you would like to support
FreeRepublic, donations may be sent to: [¶] Jim Robinson[,] c/o Electronic
Orchard[,] P.O. Box 9771[,] Fresno, CA 93794-9771. [¶] Or click here to
donate by secure credit card transaction"). See also id., Ex. P (TM001,
TM084).
[38] See Defs.' Genuine Issues, ¶¶ 29, 30.
[39] 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).
[40] Even were this not the case, it would not mandate a finding that the first
fair use factor favors defendants. In Marcus v. Rowley, 695 F.2d 1171 (9th Cir,
1983), defendant used a substantial part of plaintiff's copyrighted material in a
booklet she used to teach cake decorating. Id. at 1173. The court noted that
the teacher's use of the material was for a nonprofit educational purpose. Id. at
1175. It reasoned, however, that "a finding of a nonprofit educational purpose
does not automatically compel a finding of fair use." Id. Rather, because both
plaintiff and defendant used their publications to teach cake decorating, and
because defendant had never sought plaintiffs permission to copy the material, it
held that the first factor weighed against a finding of fair use. Id. at 1175-76.
[41] Were this not true, "the presumption would swallow nearly all of the
illustrative uses listed in the preamble paragraph of § 107, including news
reporting. . . ." See Campbell, supra, 510 U.S. at 584. See also
Maxtone-Graham v. Burichaell, 803 F.2d 1253, 1262 (2d Cir. 1986) (the
statute does not "requir[e] . . . a clear-cut choice between two polar
characterizations, 'commercial' and 'non-profit'[; w]ere that the case, fair use
would be virtually obliterated, for '[a]ll publications presumably are operated for
profit . . . '").
[42] While more recent Ninth Circuit cases have stated that the Supreme
Court's decision in Sony Corp. v. Universal Studios, Inc., 464 U.S. 417 (1984),
"casts doubt on [the circuit's] previous pronouncements concerning wholesale
copying as an absolute preclusion to fair use," (see, e.g., Hustler Magazine, Inc.
v. Moral Majority, Inc., 796 F.2d 1148, 1155 (9th Cir. 1986)), the court does
not find that defendants' use of exact copies of the articles absolutely precludes
their invocation of the fair use defense. Rather, it concludes that the wholesale
nature of the copying is a factor in evaluating the character and purpose of the
use.
[43] Robinson Depo. at 55:14-18 ("Q. Does Free Republic have any policy that
people should summarize rather than post full-text? A. They can summarize if
they'd like to. Q. But they almost never do? A. Most people do not
summarize.")
[44] See Plaintiffs' Motion for Partial Summary Judgment ("Pls.' Mot.") at
7:21-25. Plaintiffs note that Free Republic has provided links to articles in
another publication, Jewish World Review, as an alternative to having visitors
post them in their entirety. (Id., Robinson Depo. at 94:7-25, 95:12-18, 96:4-18;
Wayland Decl., Ex. Q; Pls.' Facts, ¶ 43; Defs.' Genuine Issues, ¶ 43.)
[45] See Defs.' Genuine Issues, ¶ 44.
[46] See Robinson Depo. at 55:14-18.
[47] Defendants cite Belmore v. City Pages, Inc., 850 F.Supp. 673, 679
(D.Minn. 1995) in support of their contention that full-text copying is essential
to their use of plaintiffs' articles. In Belmore, however, the court determined
that the third factor favored plaintiff. See id. at 680 ("The second and third
factors weigh in favor of Belmore").
[48] Defs.' Mot. at 14:16.
[49] See Stout Decl., ¶ 46. Stout's figures concern the Los Angeles Times site
only.
[50] In D.C. Comics Inc. v. Reel Fantasy, Inc., 698 F.2d 24 (2d Cir. 1982),
defendants argued, and the district court found, that the fourth fair use factor
favored defendants because their use of plaintiff's copyrighted comic strip
characters actually increased the market for plaintiff's goods. The Court of
Appeals, however, disagreed, stating: "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." Id. at 28. See also Harper & Row, supra, 471
U.S. at 569 ("Any copyright infringer may claim to benefit the public by
increasing public access to the copyrighted work. . . . But Congress has not
designed, and we see no warrant for judicially imposing, a 'compulsory license'
permitting unfettered access to the unpublished copyrighted expression of public
figures"); Ringgold v. Black Entertainment Television, Inc., 126 F.3d 70, 81,
n. 16 (2d Cir. 1997) ("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"); Storm Impact, Inc. v. Software of the Month
Club, 13 F.Supp.2d 782, 790 (N.D.Ill. 1998) ("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)).