As loyal readers know, I had a nasty brush with copyright law and the ALM Media inhouse law department this past Monday. 

In a nutshell, after spending part of the weekend generating four pieces on the 2006 AmLaw 100 (released last Friday)—here, here, here, and here—first thing Monday I returned a phone call from an assistant general counsel at ALM Media who proceeded to tell me that everything I'd written violated their copyright in the AmLaw 100 and that I must take it all down forthwith.

I did not, and I did what any lawyer with himself for a client would advise:  Call in the experts.

The good news is I learned a lot about copyright and fair use thanks to the superb counsel and advice I was able to draw upon, ranging from nearly a dozen readers, many of whom I'd never heard from, who offered their thoughts in personal emails (which were without exception generous and supportive) to a few friends who happen to be IP lawyers, to another friend who's the heaviest hitter of all in this area, as General Counsel of a major publicly-traded media organization.  (You know who you are.)

Consider what follows, then, a small effort to repay the collective efforts of the blogosphere, and an attempt to memorialize what I learned in hopes it might be useful in future to someone finding themselves in a similar situation.

One motivation for doing this is the remark of an IP practitioner and friend who, unsolicited, volunteered the opinion that "There are entire in-house law departments devoted to sending out legally unjustified cease and desist letters." And the truly bad news is not that dismaying commentary on the paucity of ethics, but his additional observation that far more than half the time, threats work.

For starters, my law school alma mater has a much-more-than-decent guide to fair use online.

But to get to "primary sources," the leading cases hereabouts are Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340 (1991) and Harper & Row v. Nation Enterprises, 471 U.S. 539 (1985).

Feist was a dispute over whether Feist, a directory publishing service, could copy telephone-book white page listings from Rural Telephone's directories and reproduce them in its own directories.  As Justice O'Connor felicitously put it:

"This case concerns the interaction of two well-established propositions. The first is that facts are not copyrightable; the other, that compilations of facts generally are. Each of these propositions possesses an impeccable pedigree."

After observing that "the key to resolving the tension lies in understanding why facts are not copyrightable,"

she discussed the constitutional requirement of "originality" as a predicate to copyrightability. "Originality" means that an act of independent creation took place. By contrast:

"facts do not owe their origin to an act of authorship. The distinction is one between creation and discovery: the first person to find and report a particular fact has not created the fact; he or she has merely discovered its existence. [...] Census-takers, for example, do not "create" the population figures that emerge from their efforts; in a sense, they copy these figures from the world around them."

Compilations of facts, on the other hand, may possess originality, but since facts themselves do not become original through association together, "This inevitably means that the copyright in a factual compilation is thin."

The heart of the distinction is explained thus:

"No matter how much original authorship the work displays, the facts and ideas it exposes are free for the taking . . . . The very same facts and ideas may be divorced from the context imposed by the author, and restated or reshuffled by second comers, even if the author was the first to discover the facts or to propose the ideas.

"It may seem unfair that much of the fruit of the compiler's labor may be used by others without compensation. As Justice Brennan has correctly observed, however, this is not "some unforeseen byproduct of a statutory scheme." Harper & Row, 471 U.S., at 589 (dissenting opinion). It is, rather, "the essence of copyright," ibid., and a constitutional requirement. The primary objective of copyright is not to reward the labor of authors, but "to promote the Progress of Science and useful Arts." Art. I, § 8, cl. 8. Accord Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 156 (1975). To this end, copyright assures authors the right to their original expression, but encourages others to build freely upon the ideas and information conveyed by a work. Harper & Row, supra, at 556-557. This principle, known as the idea-expression or fact-expression dichotomy, applies to all works of authorship. As applied to a factual compilation, assuming the absence of original written expression, only the compiler's selection and arrangement may be protected; the raw facts may be copied at will. This result is neither unfair nor unfortunate. It is the means by which copyright advances the progress of science and art. "

Finally, the Feist court takes pains to dispose of the "sweat of the brow" doctrine, whereby lower courts had (consistently, the High Court implies) granted unjustified protection to factual compilations merely because they were laborious to assemble:

"Making matters worse, these courts developed a new theory to justify the protection of factual compilations. Known alternatively as “sweat of the brow” or “industrious collection,” the underlying notion was that copyright was a reward for the hard work that went into compiling facts. The classic formulation of the doctrine appeared in Jeweler's Circular Publishing Co., 281 F., at 88:

“The right to copyright a book upon which one has expended labor in its preparation does not depend upon whether the materials which he has collected consist or not of matters which are publici juris, or whether such materials show literary skill or originality, either in thought or in language, or anything more than industrious collection. The man who goes through the streets of a town and puts down the names of each of the inhabitants, with their occupations and their street number, acquires material of which he is the author” (emphasis added)."

"The “sweat of the brow” doctrine had numerous flaws, the most glaring being that it extended copyright protection in a compilation beyond selection and arrangement -- the compiler's original contributions -- to the facts themselves. Under the doctrine, the only defense to infringement was independent creation. A subsequent compiler was “not entitled to take one word of information previously published,” but rather had to “independently work out the matter for himself, so as to arrive at the same result from the same common sources of information.” Id., at 88-89 (internal quotations omitted). “Sweat of the brow” courts thereby eschewed the most fundamental axiom of copyright law -- that no one may copyright facts or ideas. See Miller v. Universal City Studios, Inc., 650 F. 2d, at 1372 (criticizing “sweat of the brow” courts because “ensuring that later writers obtain the facts independently . . . is precisely the scope of protection given . . . copyrighted matter, and the law is clear that facts are not entitled to such protection”)."

Getting then to the heart of the dispute, the Court restates the question presented as follows:

"[D]id Feist, by taking 1,309 names, towns, and telephone numbers from Rural's white pages, copy anything that was “original” to Rural? Certainly, the raw data does not satisfy the originality requirement. Rural may have been the first to discover and report the names, towns, and telephone numbers of its subscribers, but this data does not “'owe its origin'” to Rural. Burrow-Giles, 111 U.S., at 58. Rather, these bits of information are uncopyrightable facts; they existed before Rural reported them and would have continued to exist if Rural had never published a telephone directory."

So the handwriting of the holding is on the wall, as it were:  Feist did not infringe Rural's copyright:  "copyright rewards originality, not effort."

The other case, Harper & Row v. Nation, has a much sexier set of facts.  But the real reason we're interested in it is that it's the primary authority on the parameters of "fair use."

Shortly after President Gerald Ford left office, he negotiated a book deal for his memoirs with  Harper & Row, which subsequently sold pre-publication rights of an excerpt dealing with Ford's pardon of Pres. Nixon to Time magazine for $25,000.   About ten days before the Time excerpt was to run, The Nation magazine (under the famous Victor Navasky) obtained a purloined draft of the Ford memoir and published a 2,500-word story on it, deliberately scooping Time and lifting 300-400 words verbatim, albeit of course with attribution, from the Ford memoir.  Time magazine promptly cancelled the story and refused to pay the second half of the $25,000, which was still owing.  Harper & Row then sued The Nation for copyright infringement.

The Southern District of New York (557 F. Supp. 1067 (SDNY 1983)) found for Harper & Row and rejected The Nation's defense of "fair use."

The Second Circuit reversed (723 F.2d 195 (2d Cir. 1983)), endorsing the defense of "fair use" and finding under the four tests enumerated in the Copyright Act (17 U.S.C. § 107), as follows:

• the purpose of the article was "news reporting,"
• the original work was essentially factual in nature,
• the 300 words appropriated were insubstantial in relation to the 2,250-word piece, and
• the impact on the market for the original was minimal.

The Supreme Court, in turn, reversed again, rejecting The Nation's "fair use" defense.  Its discussion of the four factors is the heart of the opinion.

• Purpose of the Use:  In general (there are no bright lines here—this is an "all the facts and circumstances" inquiry), nonprofit uses are favored over for-profit ones, news reporting and other "productive" uses are favored, and a "true scholar" is favored over "a chiseler."
  
• Nature of the Copyrighted Work:  The law "recognizes a greater need to disseminate factual works than works of fiction or fantasy," presumably on the theory that facts educate regardless of where they originated whereas fiction or fantasy is at its core the expression of the author.  Also critical in Harper & Row was that the Ford memoirs were unpublished when The Nation purloined them:

  "While even substantial quotations might qualify as fair use in a review of a published work or a news account of a speech that had been delivered to the public or disseminated to the press, see House Report at 65, the author's right to control the first public appearance of his expression weighs against such use of the work before its release. The right of first publication encompasses not only the choice whether to publish at all, but also the choices of when, where, and in what form first to publish a work."

• Amount and Substantiality of the Portion Used:  This is perhaps the single one of the four "tests" that most readily comes to mind when discussing fair use, but it needs to be stressed that the emphasis on the qualitative "substantiality," not the quantitative "amount:"  As the Supreme Court put it, "In absolute terms, the words actually quoted were an insubstantial portion of "A Time to Heal." The District Court, however, found that '[T]he Nation took what was essentially the heart of the book.' [...]  A Time editor described the chapters on the pardon as 'the most interesting and moving parts of the entire manuscript.'"
  
  The fact that the purloined 300-400 words were certainly less than 1% of the memoir manuscript, in other words, cuts no ice.
  
• Effect on the Market:  Finally we get to my favorite test, the economic impact of the alleged infringement, and the Supreme Court evidently is of the same view:  "This last factor is undoubtedly the single most important element of fair use."  Indeed, quoting the estimable Nimmer, they say "Fair use, when properly applied, is limited to copying by others which does not materially impair the marketability of the work which is copied."
  
  Since Time reneged on its agreement to pay the second installment of royalties to Harper & Row, the economic impact here was obvious. But the Court went further:

  "More important, to negate fair use, one need only show that, if the challenged use "should become widespread, it would adversely affect the potential market for the copyrighted work." Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. at 451 (emphasis added)"

  In other words, courts will consider not just the isolated alleged infringement, but how the world would look if they approved a pattern of same.

Held:

"The Court of Appeals erred in concluding that The Nation's use of the copyrighted material was excused by the public's interest in the subject matter. It erred, as well, in overlooking the unpublished nature of the work and the resulting impact on the potential market for first serial rights of permitting unauthorized prepublication excerpts under the rubric of fair use. Finally, in finding the taking "infinitesimal," the Court of Appeals accorded too little weight to the qualitative importance of the quoted passages of original expression. In sum, the traditional doctrine of fair use, as embodied in the Copyright Act, does not sanction the use made by The Nation of these copyrighted materials."

Here endeth our discussion of Harper & Row v. Nation.

Applied to what I did here on "Adam Smith, Esq." last weekend with the AmLaw 100 statistics, I concluded that my use of their non-copyrightable facts advanced knowledge and was newsworthy in its own small way, that I did not deprive them of any publication rights of their own, and that my analysis of their raw data increased, if anything, the economic value of their initial listing.

Again, I would like to humbly and graciously thank all those who contributed to my education on this topic.   My devout hope is that this piece will help, in some small way, a future target of a claim of copyright infringement to understand the pertinent law and to govern their behavior accordingly.