A 'Partial Win' for Publishers

While academic publishers on Friday notched a rare win in the ongoing legal debate about digital access to copyrighted works, proponents of fair use said the opinion in Cambridge v. Patton recognizes that colleges and universities can legally create digital reserves of books in their collections.

In a unanimous decision, a three-judge panel of the U.S. Court of Appeals for the 11th Circuit, which covers Alabama, Georgia and Florida, rejected a broad ruling on how to determine fair use. The decision guarantees the case has a long and litigious road ahead of it by reversing the district court’s opinion and sending the case back for further deliberations.

Rather than strike a decisive blow against fair use, the legal concept that places some limits on the rights of copyright holders, the appeals court instead issued a stern warning against quick-fix, one-size-fits-all solutions to legal disputes -- specifically, the idea that copying less than a chapter or 10 percent of a book automatically protects an institution from a lawsuit.

“To further the purpose of copyright, we must provide for some fair use taking of copyrighted material,” the opinion, authored by Judge Gerald Bard Tjoflat, reads. “But if we set this transaction cost too high by allowing too much taking, we run the risk of eliminating the economic incentive for the creation of original works that is at the core of copyright and -- by driving creators out of the market -- killing the proverbial goose that laid the golden egg.”

Yet the court also came away “persuaded” that the Copyright Act of 1976 contains specific protections for colleges and universities, noting that Congress “devoted extensive effort to ensure that fair use would allow for educational copying under the proper circumstances.”

“While it can be worrisome to see a fair use win sent back, in this case, it seems to be mostly for the right reasons,” Mike Masnick, founder of the technology blog Techdirt, wrote. “Given these new instructions, it seems like the lower court now has a chance to come to the right answer for the right reasons, and that’s always going to be a better result.”

Rejected on Process, Not Merits

The case concerns an initiative created by Georgia State University, which in 2004 began letting faculty members scan book and journal excerpts and host them in the university’s e-reserves. Instead of waiting in turn for their classmates to finish an assigned reading on hold in the library, students could read the digitized version online. Three publishers, Cambridge University Press, Oxford University Press and Sage Publications, said Georgia State’s actions, similar to those used at many other colleges, constituted copyright violations.

Judge Orinda D. Evans in May 2012 endorsed the university's practices, ruling in its favor on 94 of 99 instances of alleged copyright violation. As long as the university didn’t make too much of the copyrighted books or articles available -- up to 10 percent or one chapter, whichever is less -- the digitized copies were considered fair use of the works, she ruled.

The publishers criticized the court for what they said was a narrow opinion, and for relying on a “legally incorrect” fair use analysis. They appealed the case to the higher court that September.

The appeals court, which released its opinion late Friday afternoon, sided with the publishers -- at least on their criticism of Evans’s process.

“While that might sound like the publishers won, ... it becomes clear that the appeals court overruled Judge Evans not because she reached the wrong decision but because of how she reached it,” Nate Hoffelder, editor of the blog The Daily Reader, wrote in a post. The publishers lost in 2012, he wrote, “And on Friday the publishers lost again.”

Evans used a four-point test to determine if Georgia State’s e-reserves should be considered fair use, but found a tie. Two of the factors -- whether the works were copyrightable and used for nonprofit educational purposes -- favored the university, while the other two -- the amount of the works used and the effect on their value -- seemed to favor the publishers. Evans then tweaked her analysis, coming up with the 10-percent rule, and called it a three-to-one win in favor of Georgia State.

The appeals court called that piece of legal arithmetic “improper”; the four factors should not have been given equal weight, but rather used in a “holistic analysis,” the opinion reads.

Most importantly, the court dismissed the “blanket 10-percent-or-one-chapter benchmark.” Instead, the opinion reads, each excerpt should be considered on its own.

“If copyright’s utilitarian goal is to be met, we must be careful not to place overbroad restrictions on the use of copyrighted works, because to do so would prevent would-be authors from effectively building on the ideas of others,” the ruling reads. “Some unpaid use of copyrighted materials must be allowed in order to prevent copyright from functioning as a straightjacket that stifles the very creative activity it seeks to foster. If we allow too much unpaid copying, however, we risk extinguishing the economic incentive to create that copyright is intended to provide.”

Neither did the appeals court find that Georgia State’s use of excerpts was “transformative” -- in other words, that it served a role different than the original work -- which likely would have given the university more legal protection. Yet after a long-winded analysis of whether or not Georgia State was using the excerpts for nonprofit educational purposes, the court agreed the first factor of the test favors the university.

The court’s reasoning, however, may come as an encouragement to organizations such as HathiTrust, which since 2011 has been embroiled in a copyright lawsuit of its own. The most recent ruling in that case also placed a heavy emphasis on “transformative uses,” which HathiTrust could claim thanks to its preservation and accessibility efforts. (In fact, the ruling against Georgia State specifically mentions HathiTrust as an example of transformative use.)

But since the e-reserves can’t be considered transformative, their impact on the market value of the books and journals “looms large,” and the appeals court found the lower court should have given more weight to that fourth factor.

The court’s focus on the market and publisher revenue concerned some university librarians. In an analysis of the opinion, Nancy Sims, copyright program librarian at the University of Minnesota Libraries, said that emphasis “creates some incredible barriers” for instructors.

“By placing additional weight on market harm -- a factor about which end users have almost no information -- the court is creating major difficulties for end users,” Sims wrote. “It would be hard, but not impossible, for many instructors to find out if a license is available.”

Barbara Fister, a librarian at Gustavus Adolphus College (and a blogger for Inside Higher Ed), in an email said she was concerned the “market harm” factor could be used to trump the other three. “[I]t also seems at times in conflict with the reason academics publish -- to share ideas,” she wrote. “I hope that libraries, academics, and publishers will be able to come up with financial models that sustain quality publishing without requiring pay per use, which can inhibit learning and research.”

On the second factor, which is sometimes the most straightforward, the court also disagreed with the prior ruling. Some of the excerpts didn’t just contain factual information, but also “evaluative, analytical or subjectively descriptive material.” The lower court, the opinion reads, should have called it a tie or even a point in favor of the publishers.

'A Partial Win'

“This case reveals the critical need to see the ‘big picture’ when attempting to determine what constitutes fair use of copyrighted work,” Judge Roger Vinson wrote in a concurring opinion. “It also highlights how the temptation to apply traditional statutory interpretation principles to a common law concept can lead to serious error.”

The district court awarded the university nearly $3 million in fees and costs, which the appeals court said should not have been awarded.

“[M]aking fair use determinations based on the four factors has never been a simple matter, and this decision doesn't change that,” Fister wrote. “I think we all must become comfortable with the responsibilities that come with exercising rights, including understanding fair use. We shouldn't ignore copyright holders' rights. We also should understand that some uses are fair without securing and paying for rights holders' permission.”

She added, “I see this as something of a partial win for the plaintiffs, though this decision does not uphold their entire argument by any means.”

Like the district court, the appeals court also dismissed using the 1976 Classroom Copying Guidelines to inform a decision on fair use. Those guidelines would in some cases have restricted copying to no more than 1,000 words.

Both Georgia State and the Association of American Publishers, which has supported the publishers, declined to comment until they had reviewed the ruling. In a brief statement, an AAP spokeswoman said the decision “will help to protect the intellectual property rights of authors and publishers who are providing students with high-quality educational materials.”

“It would've been nice to have a stronger affirmation of educational fair use,” Sims wrote. "It is difficult to predict what will happen next. This is not a slam-dunk case for the publishers, though it does favor them more than the first district court opinion.”

The publishers also refrained from claiming an outright victory. In a statement, Oxford University Press pledged to work with the scholarly community to clarify copyright policies.

"We have at no time sought damages or to extend copyright protections through this case, merely wanting to bring Georgia State's practices in line with those at other universities," the statement reads. "We look forward to a revised ruling from the lower court that we hope will draw this litigation to a close."

Update: Georgia State issued a response to the ruling Monday afternoon. 

"Georgia State will continue to defend the rights of universities in this complex digital environment and protect access to information for our students," Kerry L. Heyward, the university's attorney, said in a statement. "This decision, while not the outcome we had hoped for, supports the lower court's ruling on fair use."