Harry Potter Decision Provides Guidance on Fair Use

Presumably, anyone reading this article is aware of the enormously popular Harry Potter series of books, which have sold more than 400 million copies and been translated into 67 languages. If you are a fan of the series, you may also be familiar with “The Harry Potter Lexicon,” a Web site devoted to all things Harry Potter. Since 2000, the Web site has developed a cult following of devoted Harry Potter fans. Even J.K Rowling, the author of the Harry Potter series, has praised the Web site.

It is against this backdrop that the recent decision from Judge Robert P. Patterson in the Southern District of New York received so much attention. The case, Warner Bros. Entertainment Inc. v. RDR Books, involved claims asserted by J.K. Rowling (“Rowling”) and the owner of the film rights in the Harry Potter series, Warner Bros. Entertainment Inc. (“Warner Bros.”), for copyright infringement. The allegedly infringing work was a reference guide authored by the creator of the “Harry Potter Lexicon” Web site, Steven Vander Ark (“Vander Ark”). The primary issue in the case was whether the reference guide constituted a fair use.

Background

Rowling wrote and published, and owns copyrights in all seven of the novels in the Harry Potter series. Moreover, Rowling has written and published two companion books to the series: Quidditch Through the Ages, which recounts the history of the imaginary sport featured in the Harry Potter series, and Fantastic Beasts & Where to Find Them, an A-to-Z encyclopedia for imaginary beasts in the Harry Potter series. Among other things, Rowling has also penned several related products including “Famous Wizard Cards” and “The Daily Prophet,” a fictional newsletter.

Vander Ark is the author of the Web site titled “The Harry Potter Lexicon.” The Web site collects and organizes information from the Harry Potter books for fans to use as a reference source. The Web site has developed a substantial following and received praise by both Rowling and her publishers. In 2007, RDR Books approached Vander Ark regarding the idea of publishing a print version of “The Harry Potter Lexicon.” Although initially reluctant, Vander Ark eventually agreed to author the print version (the “Lexicon”).

The Lexicon consisted of “an A-to-Z guide to creatures, characters, objects, events, and places that exist in the world of Harry Potter,” and contained 2,437 entries over more than 400 pages. These entries synthesized information contained throughout the novels, companion books, and various other Harry Potter-related sources of information. Upon learning of RDR Books' intention to publish the Lexicon, Rowling immediately objected and, after RDR Books refused to cease with its plans, Rowling and Warner Bros. filed suit seeking injunctive relief and damages. The hearing on the motion for preliminary injunction was consolidated into a bench trial on the merits. Thus, the court's opinion constituted its findings of fact and conclusions of law.

Fair Use Factors

Section 107 of the Copyright Act requires that courts consider the following four factors in evaluating fair use:

(1) the purpose and character of the use;

(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.

These factors are weighed and evaluated in light of the purposes of copyright. According to the court, “At stake in this case are the incentive to create original works which copyright protection fosters and the freedom to produce secondary works which monopoly protection of copyright stifles ' both interests benefit the public.”

Purpose and Character of the Use

As noted by the court, the central inquiry under this factor “is 'whether and to what extent the new work is 'transformative.”” The court found that the Lexicon's use of copyrighted content from the Harry Potter series was for a different purpose and, thus, transformative:

Presumably, Rowling created the Harry Potter series for the expressive purpose of telling an entertaining and thought provoking story centered on the character Harry Potter and set in a magical world. The Lexicon, on the other hand, uses material from the series for the practical purpose of making information about the intricate world of Harry Potter readily accessible to readers in a reference guide. ' Because it serves these reference purposes, rather than the entertainment or aesthetic purpose of the original works, the Lexicon's use is transformative and does not supplant the objects of the Harry Potter works.

On the other hand, the companion books already served an informational purpose, and therefore, use of these works was transformative, but “to a much lesser extent.” Notably, the court held that the Lexicon was transformative despite not adding significant analysis or commentary to the material copied from the Harry Potter works.

Courts also consider the commercial nature of the use under this factor. According to the court, “To the extent that [RDR Books] seeks to provide a useful reference guide to the Harry Potter novels that benefits the public, the use is fair, and its commercial nature only weighs slightly against a finding of fair use.”

Nature of the Copyrighted Work

The court noted “that creative and fictional works are generally more deserving of protection than factual works.” The highly creative nature of the Harry Potter works tilted this factor in favor of the plaintiffs, “particularly where the character of the secondary work is not entirely transformative.”

Amount and Substantiality of the Use

In evaluating the amount of material copied from Rowling's works, the court acknowledged “that 'room must be allowed for judgment, and judges must not police criticism,' or other transformative uses, 'with a heavy hand.'” Moreover, the court noted, “To fulfill its purpose as a reference guide to the Harry Potter works, it is reasonably necessary for the Lexicon to make considerable use of the original works.”

However, the court was concerned that the Lexicon went too far: “The Lexicon's verbatim copying of ' highly aesthetic expression raises a significant question as to whether it was reasonably necessary for the purpose of creating a useful and complete reference guide.” Perhaps most telling, the court criticized “Vander Ark's lack of restraint due to an enthusiastic admiration of Rowling's artistic expression, or perhaps haste and laziness as Rowling suggested, in composing the Lexicon entries.”

Market Harm

Under this factor, courts look “to 'not only the primary market for the copyrighted work, but the current and potential market for derivative works' as well.” The court determined that “the Lexicon does not present any potential harm to the markets for the original Harry Potter works,” but “[b]ecause the Lexicon's use of the companion books is only marginally transformative, the Lexicon is likely to supplant the market for the companion books.” This conclusion was buttressed by Vander Ark's own admission that “using the companion books without 'replac[ing] Ms. Rowling's encyclopedia content' presents 'quite a challenge.'”

The Court's Synthesis of the Factors

The court held that “[a]lthough the Lexicon has a transformative purpose, its actual use of the copyrighted works is not consistently transformative.” Most importantly, the court determined that the Lexicon used more than was reasonably necessary to accomplish its purpose, particularly with respect to the companion works. “In striking the balance between property rights of original authors and the freedom of expression of secondary authors, reference guides to works of literature should generally be encouraged by copyright law as they provide a benefit [to] readers and students; but to borrow from Rowling's overstated views, they should not be permitted to 'plunder' the works of original authors 'without paying the customary price' lest original authors lose incentive to create new works that will also benefit the public interest.”

A Road Map for Future Reference Guides

Rowling won this battle, but the real winners may be future authors aiming to create a reference guide to a fictional work. Despite finding against fair use, the court's opinion provides a surprising amount of guidance on what would constitute a fair use. The crux of the finding against fair use, as noted above, is that the Lexicon took too much copyrighted expression to fulfill its transformative purpose. The court reviewed a plethora of examples where Vander Ark had copied the Harry Potter works verbatim or closely paraphrased. Given the court's statement that “reference works that share the Lexicon's purpose of aiding readers of literature generally should be encouraged rather than stifled,” a reference guide that borrowed less heavily would likely have passed the court's test. Indeed, the court even acknowledged that the Lexicon itself is not beyond repair in noting only that the Lexicon “in its current state” is not a fair use of the Harry Potter works. Moreover, although the court found that the Lexicon had infringed the seven novels and the two companion books, it is not clear that the result would have been the same if the Lexicon had not significantly borrowed from the companion books. Clearly, the court was persuaded that the companion books served both an entertainment and informational purpose, thus making the use in the Lexicon only slightly transformative. For the same reason, the court determined that there was potential market harm for the companion books but not the novels.

In the end, while the court came down against fair use on these facts, it seems likely that this decision will serve to encourage others to follow the court's direction in creating reference guides that successfully balance the incentive to create and the freedom to produce secondary works.

W. Andrew Pequignot ([email protected]) is an associate in the Atlanta office of Kilpatrick Stockton LLP, where he practices in the areas of copyright, trademark, and entertainment law.

Presumably, anyone reading this article is aware of the enormously popular Harry Potter series of books, which have sold more than 400 million copies and been translated into 67 languages. If you are a fan of the series, you may also be familiar with “The Harry Potter Lexicon,” a Web site devoted to all things Harry Potter. Since 2000, the Web site has developed a cult following of devoted Harry Potter fans. Even J.K Rowling, the author of the Harry Potter series, has praised the Web site.

It is against this backdrop that the recent decision from Judge Robert P. Patterson in the Southern District of New York received so much attention. The case, Warner Bros. Entertainment Inc. v. RDR Books, involved claims asserted by J.K. Rowling (“Rowling”) and the owner of the film rights in the Harry Potter series, Warner Bros. Entertainment Inc. (“Warner Bros.”), for copyright infringement. The allegedly infringing work was a reference guide authored by the creator of the “Harry Potter Lexicon” Web site, Steven Vander Ark (“Vander Ark”). The primary issue in the case was whether the reference guide constituted a fair use.

Background

Rowling wrote and published, and owns copyrights in all seven of the novels in the Harry Potter series. Moreover, Rowling has written and published two companion books to the series: Quidditch Through the Ages, which recounts the history of the imaginary sport featured in the Harry Potter series, and Fantastic Beasts & Where to Find Them, an A-to-Z encyclopedia for imaginary beasts in the Harry Potter series. Among other things, Rowling has also penned several related products including “Famous Wizard Cards” and “The Daily Prophet,” a fictional newsletter.

Vander Ark is the author of the Web site titled “The Harry Potter Lexicon.” The Web site collects and organizes information from the Harry Potter books for fans to use as a reference source. The Web site has developed a substantial following and received praise by both Rowling and her publishers. In 2007, RDR Books approached Vander Ark regarding the idea of publishing a print version of “The Harry Potter Lexicon.” Although initially reluctant, Vander Ark eventually agreed to author the print version (the “Lexicon”).

The Lexicon consisted of “an A-to-Z guide to creatures, characters, objects, events, and places that exist in the world of Harry Potter,” and contained 2,437 entries over more than 400 pages. These entries synthesized information contained throughout the novels, companion books, and various other Harry Potter-related sources of information. Upon learning of RDR Books' intention to publish the Lexicon, Rowling immediately objected and, after RDR Books refused to cease with its plans, Rowling and Warner Bros. filed suit seeking injunctive relief and damages. The hearing on the motion for preliminary injunction was consolidated into a bench trial on the merits. Thus, the court's opinion constituted its findings of fact and conclusions of law.

Fair Use Factors

Section 107 of the Copyright Act requires that courts consider the following four factors in evaluating fair use:

(1) the purpose and character of the use;

(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.

These factors are weighed and evaluated in light of the purposes of copyright. According to the court, “At stake in this case are the incentive to create original works which copyright protection fosters and the freedom to produce secondary works which monopoly protection of copyright stifles ' both interests benefit the public.”

Purpose and Character of the Use

As noted by the court, the central inquiry under this factor “is 'whether and to what extent the new work is 'transformative.”” The court found that the Lexicon's use of copyrighted content from the Harry Potter series was for a different purpose and, thus, transformative:

Presumably, Rowling created the Harry Potter series for the expressive purpose of telling an entertaining and thought provoking story centered on the character Harry Potter and set in a magical world. The Lexicon, on the other hand, uses material from the series for the practical purpose of making information about the intricate world of Harry Potter readily accessible to readers in a reference guide. ' Because it serves these reference purposes, rather than the entertainment or aesthetic purpose of the original works, the Lexicon's use is transformative and does not supplant the objects of the Harry Potter works.

On the other hand, the companion books already served an informational purpose, and therefore, use of these works was transformative, but “to a much lesser extent.” Notably, the court held that the Lexicon was transformative despite not adding significant analysis or commentary to the material copied from the Harry Potter works.

Courts also consider the commercial nature of the use under this factor. According to the court, “To the extent that [RDR Books] seeks to provide a useful reference guide to the Harry Potter novels that benefits the public, the use is fair, and its commercial nature only weighs slightly against a finding of fair use.”

Nature of the Copyrighted Work

The court noted “that creative and fictional works are generally more deserving of protection than factual works.” The highly creative nature of the Harry Potter works tilted this factor in favor of the plaintiffs, “particularly where the character of the secondary work is not entirely transformative.”

Amount and Substantiality of the Use

In evaluating the amount of material copied from Rowling's works, the court acknowledged “that 'room must be allowed for judgment, and judges must not police criticism,' or other transformative uses, 'with a heavy hand.'” Moreover, the court noted, “To fulfill its purpose as a reference guide to the Harry Potter works, it is reasonably necessary for the Lexicon to make considerable use of the original works.”

However, the court was concerned that the Lexicon went too far: “The Lexicon's verbatim copying of ' highly aesthetic expression raises a significant question as to whether it was reasonably necessary for the purpose of creating a useful and complete reference guide.” Perhaps most telling, the court criticized “Vander Ark's lack of restraint due to an enthusiastic admiration of Rowling's artistic expression, or perhaps haste and laziness as Rowling suggested, in composing the Lexicon entries.”

Market Harm

Under this factor, courts look “to 'not only the primary market for the copyrighted work, but the current and potential market for derivative works' as well.” The court determined that “the Lexicon does not present any potential harm to the markets for the original Harry Potter works,” but “[b]ecause the Lexicon's use of the companion books is only marginally transformative, the Lexicon is likely to supplant the market for the companion books.” This conclusion was buttressed by Vander Ark's own admission that “using the companion books without 'replac[ing] Ms. Rowling's encyclopedia content' presents 'quite a challenge.'”

The Court's Synthesis of the Factors

The court held that “[a]lthough the Lexicon has a transformative purpose, its actual use of the copyrighted works is not consistently transformative.” Most importantly, the court determined that the Lexicon used more than was reasonably necessary to accomplish its purpose, particularly with respect to the companion works. “In striking the balance between property rights of original authors and the freedom of expression of secondary authors, reference guides to works of literature should generally be encouraged by copyright law as they provide a benefit [to] readers and students; but to borrow from Rowling's overstated views, they should not be permitted to 'plunder' the works of original authors 'without paying the customary price' lest original authors lose incentive to create new works that will also benefit the public interest.”

A Road Map for Future Reference Guides

Rowling won this battle, but the real winners may be future authors aiming to create a reference guide to a fictional work. Despite finding against fair use, the court's opinion provides a surprising amount of guidance on what would constitute a fair use. The crux of the finding against fair use, as noted above, is that the Lexicon took too much copyrighted expression to fulfill its transformative purpose. The court reviewed a plethora of examples where Vander Ark had copied the Harry Potter works verbatim or closely paraphrased. Given the court's statement that “reference works that share the Lexicon's purpose of aiding readers of literature generally should be encouraged rather than stifled,” a reference guide that borrowed less heavily would likely have passed the court's test. Indeed, the court even acknowledged that the Lexicon itself is not beyond repair in noting only that the Lexicon “in its current state” is not a fair use of the Harry Potter works. Moreover, although the court found that the Lexicon had infringed the seven novels and the two companion books, it is not clear that the result would have been the same if the Lexicon had not significantly borrowed from the companion books. Clearly, the court was persuaded that the companion books served both an entertainment and informational purpose, thus making the use in the Lexicon only slightly transformative. For the same reason, the court determined that there was potential market harm for the companion books but not the novels.

In the end, while the court came down against fair use on these facts, it seems likely that this decision will serve to encourage others to follow the court's direction in creating reference guides that successfully balance the incentive to create and the freedom to produce secondary works.

W. Andrew Pequignot ([email protected]) is an associate in the Atlanta office of Kilpatrick Stockton LLP, where he practices in the areas of copyright, trademark, and entertainment law.