Introduction
It’s been a while since I posted on any LEGAL matter, and I must say it’s good to finally get around to the legal posts again. Anyway, I’m not vouching for the LEGAL correctness of any of this… but I though I’d post the text of my final Copyright Exam just in case you were interested in Copyright as a general matter. The exam was intended to be the analysis portion of a legal opinion discussing Google’s “book search” and the Copyright issues raised with Google’s scanning and indexing activities.
Let me know what you think? I’d be interested to hear from law students and novices alike. (Do I deserve and A? 
Update: It turns out I DID get an ‘A’. niiice.
OVERVIEW
Google, an online search giant, is undertaking a project to catalogue and digitally index the contents of books in libraries across the country. To accomplish this project, each book added to the Google database must be scanned and the text converted into a digital format. Google then stores a graphical copy of the book as well as an indexed database of all words and phrases that is then searchable by the end user. For works in the public domain, Google allows users to access the work in its entirety. In the case of Copyrighted material, Google selects individual pages to be displayed in order for the user to preview the book before having the option to purchase or obtain the book by alternate means.
As a result of these activities, Publishers have sued Google for “massive” copyright infringement. They claim that the act of copying and indexing a Copyrighted work is itself an infringing activity and further assert that the opt-out policy is evidence of indifference to the rights of authors and publishers. Google asserts that the opt-out program removes them from Copyright liability and even if not, they are protected by the “fair use” doctrine.
FINDING OF LAW Before the Court is a motion for Summary Judgment on the issue of Google’s copyright infringement of thousands of literary works. In order to successfully pass Summary Judgment on a claim of Copyright infringement, a plaintiff must a) own a valid copyright and b) Defendant must have violated one of his §106 exclusive rights. The Court first analyses the “ownership” requirement.
§102 of the Copyright act provides protection to “original works of authorship… fixed in any tangible medium… from which they can be perceived… either directly or with the aid of a machine or device“. “Original” in this context requires a de-minimus level of creativity (Feist, p. 75). According to Feist, “Original[ity], as the term is used in copyright, means only that the work was independently created by the author… and that it possesses at least some minimal degree of creativity.” (p. 75). If a work meets the fixation and creative requirements, it immediatly becomes a work protected by state common-law copyright. In order for there to be federal copyright, an author must register their work with the U.S. Copyright Office.
What kinds of creative work does Copyright protect? §102 protects literary, musical, dramatic, pictoral, and graphic works (among others). Of relevance to the question before the court is the Act’s protection for literary works. Under §101, “literary works” are defined as works “expressed in words, numbers… symbols… regardless of the nature of the material objects such as books…disks… in which they are embodied.” It is assumed for purposes of this opinion the Plaintiff’s do represent a large number of valid federal copyrights. To verify the validity of each would be burdensome for both the parties and the court. Given this assumption, the Court addresses the second prong of an infringement suit: the violation of 106 rights.
Per §106, Copyright owners have the exclusive rights to do and authorize any of the following:
- to reproduce the Copyrighted work in copies
- prepare derivative works based upon the Copyrighted work
- to distribute copies to the public by sale, rental, lease or lending
- to perform the work publicly
- to display the Copyrighted work publicly
In order for there to be infringement, there must be a violation of one of the above rights. The Court finds Google is infringing at least one of the exclusive rights in §106. First, by scanning the book and creating a digital copy of the book, Google is reproducing copies of the work works under sub (1). “Copies”, under §101, are “material objects…in which a work is fixed by any method now known or later developed, and from which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.” The material object from which the work can be perceived is from the computers on Google’s servers. Just as in Phillips v. Kidsoft where defendant’s unauthorized scanning of pages from a children’s magazine onto a computer storage device constituted the making of a copy, so here the Court finds that Google’s scanning of books in their entirety also constitutes a copy (p 508).
Google is also violating the exclusive right to “display” the work publicly. To display a work publicly is “to transmit or otherwise communicate a performance or display of the work to [a place open to the public]… by means of any device or process” (§101). We assume that at least a small percentage of users are in public areas — either at a library, a cafe over their wireless network, etc. It follows then that Google is in fact contributing to the public “display” of copyrighted work per §106.
Finally, it appears as though the process of creating a searchable database amounts to the creation of a “derivative work”. A derivative work per §101 is “a work based upon one or more preexisting works… consisting of editorial revisions, annotations, elaborations, or other modifications which, as a whole, represent an original work of authorship.” A searchable database requires a series of revisions, annotations, and “other modifications” in order to work. For this reason, the Court finds an infringement.
Google argues (a general assumption based on the facts) that an “opt-out” policy serves as either a “waiver” or as implicit authorization to scan and catalog the books in question. In other words, Google argues that it can acquire Copyright interests by simply asserting them. This Court finds that Google cannot claim a Copyright interest under this theory. As with any piece of personal property, ownership cannot simply be asserted to vest unless the owner “opts-out”. §201 specifically addresses how one may obtain ownership rights. In part, it states that “The ownership of a copyright may be transferred in whole or in part by any means of conveyance or by operation of law… Any of the exclusive rights comprised in a copyright, including any subdivision of any of the rights specified by section 106 [17 USC 106], may be transferred as provided by clause (1) and owned separately.” Furthermore, §204 specifically outlines the means by which ownership interests can be transferred. “A transfer of copyright ownership, other than by operation of law, is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner’s duly authorized agent.” Unless Google can assert a pre-existing copyright interest, it cannot acquire one through acquiescence or waiver. Therefore, Google’s “opt-out” policy is not compatible with Copyright law.
Given these facts, the Court’s inquiry now turns to the doctrine of fair use and whether Google’s activities constituted a fair use per §107.
FAIR USE
Google maintains that even if it’s activities are found to be infringing, its activities are protected by the §107 “fair use” doctrine. The legislative intent of §107 was to codify the existing common-law doctrine of fair use and is to be read and applied in light of the purposes of Copyright law (p. 719-20). The language is “illustrative and not limitative” and should be flexible enough to apply on a case-by-case basis. (p. 718) Pursuant to §107 of the Copyright Act, the following four factors must be considered, but not one factor should be considered to be controlling.
- the purpose and character of the use, including whether such use is of a commercial nature ore is for nonprofit educational purposes;
- the nature of the Copyrighted work;
- the amount and substantiality of the portion used in relation to the Copyrighted work as a whole; and
- the effect of the use upon the potential market for or value of the Copyrighted work.
In applying the first factor, the Court should look at the nature of the infringing activity–including it’s transformative qualities, its message, and its use in light of Copyright’s purpose–the promotion of science and the useful arts (p. 4). According to the record, Google’s purpose is to provide its consumers relevant results to search queries. By converting the text of a page into a digital database, Google makes it possible for users to accomplish in seconds what would otherwise take years. It has exponentially increased the book’s usability — and to a greater extent the useability of a library’s search system — by giving users the most relevant results to text queries on demand. The re-organization of the words and sentences into a database is indeed transformative. The new format makes possible the search system and changes the original to such an extent that the Court would classify the database as a “new species” of work. This finding tends to weigh in favor of fair use.
However, in approaching the first factor, this Court must also consider the financial incentive driving Google’s activities. In Roy Export Co. Establishment v. Columbia Broadcasting System, the Court explained that, “The crux of the profit/nonprofit distinction 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.”
(emphasis added p. 753). In the case at bar, it is clear that Google is a profit-oriented business and stands to make a fair amount of profit from the sale of adds and other services associated with this book including referrals or any other “commission” arrangements it may have with its preferred sellers. However, the question of what the “customary price” is for scanning, indexing, organization, etc. is not clear from the record. The Court simply notes that Google has been indexing the Copyrightable contents of websites, images, and other online media, without charge, for almost a decade. This fact does not necessarily weigh in favor of Google’s fair use, but it is germane to the issue of the customary price.
Finally, under the first factor, the degree of exploitation by the infringing party also weighs on the ultimate finding on the fair use issue. In Kelly v. Arriba Soft Corporation, the Court found that the use of low-resolution copies of digital images was a “fair use” in part because the financial gain from the use of such images was only incidental, and therefore not “highly exploitative”. (p. 818). However, other courts have come to different conclusions. In the case of Perfect 10, the Court found that Google’s Ad-sense advertising system amounted to a use “far more commercial than Arriba’s use in Kelly” (p. 822). Although Google does indeed make money off of advertising, this Court does not find the Perfect 10 reasoning particularly convincing. If this Court were to use the Perfect 10 analysis, the affect would be to categorically disadvantage an entire segment of internet websites simply because their revenue model is based around adds instead of goods or services. This revenue source has no direct relationship to any particular book or scan; it is a byproduct of user interaction with their website, and therefore bears only an incidental relationship to the function of the web service. Given these conclusions, we find the transformative nature of Google’s activities clearly weigh in favor of Google’s fair use defense.
The Court’s next inquiry is into the nature of the Copyrighted work(s). At issue are millions of books from the collections of libraries and universities across the country–all of which are subject to a wide array of unique copyright restrictions. This factor’s relevance is limited in that it weighs against the argument made earlier for treating books the same as webpages. In the web context, Google is indexing the contents of information a) already in a digital format and b) freely given away. The same cannot be said for content in the print medium–very little of which is freely distributed–including a vast majority of the books in question. This weighs against Google’s position, but is not itself binding.
The third factor in the fair use analysis is “[whether] the amount and substantiality of the portion used in relation to the Copyright work as a whole are reasonable in relation to the purpose of copying“. Google argues that it provides only small snippets of the work to users to provide the context for their search query. This is slightly misleading because although Google may not share in any contributory liability for the acts of end users, it must copy the work in its entirety in order to provide this service. The “de-minimus” standard is often applied to the third prong of the fair use analysis, making it hard but not impossible for substantial copying to be considered fair use. In Campbell, the Supreme court, in addressing the question of substantiality found that, “[the] extent of permissible copying varies with the purpose and character of the use” (p. 744). In UMG Recordings, Inc. v. MP3.Com, Inc. , the Southern District of New York found that even when a work was copied in its entirety (from a CD to a MP3 format), the resulting copy did constitute a “fair use”. (p. 814). In analyzing Google’s use, this Court finds that the purpose of the copying is to allow users to run a full-text search against all books in the google database which match their query. In other words, Google is not primarily using the protected expression for expressive purposes or for the value of the expression itself, but is instead scouring the pages for the facts contained therein: the word “Washington” appears on page 211, the words “Revoluonary War” appear on another (and so on). When the expressive nature is used to give a user context, it is done so in limited, short segments that the Court considers de-minimus. Therefore, the Court finds that the portion of use in relation to the work as a whole is reasonable and therefore favorable to Google’s fair use defense.
Finally, the Court address the fourth and most important factor, the effect on the potential market (p. 789 middle). In measuring the potential affect, the Court should weigh the copyright owner’s expectation of gain against the public benefit shown to justify the use. (p. 745). The Second Circuit in Dr. Suess stated that “[t]he less adverse effect that an alleged infringing use has on the copyright owner’s expectation of gain, the less public benefit need be shown to justify the use” (id). The Court finds there to be no detrimental impact on the market for books. In fact, it would seem that the Google search system serves as perhaps the most effective selling tool available to the publishing industry. The system can drive sales because it establishes a book’s relevance (and therefore, its value) to users looking for relevant content. Google’s search will most likely have the effect of increasing sales when users are assured the book’s contents contain the valuable information.
Given the overwhelmingly positive effect Google’s search system has on the market for books, the Court need only find a reasonable public benefit to find in favor of fair use. The Court finds that this bar has been surpassed by wide margins. The public gain an incredible advantage when the wealth of knowledge of an entire library is at their fingertips.
CONCLUSION
We can think of nothing that would further promote the progress useful arts then tools and systems that allow the public to find the materials that interest them through legal means. Granted, Google must walk a fine line; uses of this information that have adverse affects on authors and publishers will undoubtedly come under the most serious scrutiny. Nevertheless, the system as it currently operates seems to benefit both the authors and consumers equally with no apparent adverse side effects.
The Court hereby grants summary judgment to Google on all counts. Attorney’s fees are not awarded to either party.