Book Digitization Ruling Shifts Transformative Use Analysis

The HathiTrust Digital Library (HDL) is a digital compilation of over 10 million books scanned by Google from the collections of the libraries of the University of Michigan, Cornell University, the University of California at Los Angeles, the University of Wisconsin and Indiana University. The HDL is used by the libraries for preservation of their collections and by students, faculty, researchers and other patrons for searching and accessibility.

The HDL's search function enables researchers to input search terms and obtain a list of the books containing the terms and the pages within the books on which the terms appear. The accessibility function enables blind and other print-disabled persons to have complete access to the entire text of all books in the HDL through the use of now-widely available screen access software that magnifies or vocalizes the digitized text or displays the text as refreshable braille.

Last month, the U.S. Court of Appeals for the Second Circuit ruled that use of the HathiTrust Digital Library for the purpose of search and accessibility each constitutes fair use. Authors Guild Inc. v. HathiTrust, 12-4547. (The appeals court remanded the preservation issue for an initial determination of the plaintiffs' standing to raise it.)

[ Editor's Note: The Second Circuit also ruled that the plaintiffs' claim over the University of Michigan's Orphan Works Project wasn't ripe for consideration because the school has suspended the program. The program involved digitizing copies of books that are out-of-print and whose authors' couldn't be located.]

Is Transformative Use Test Being Reigned In?

The HathiTrust opinion simultaneously represents the latest appellate application of transformative use to mass digitization, and a possible harbinger of more widespread recognition that traditional fair use analysis has not been superseded by the often determinative weight that courts have given to transformative use in the overall balance. This, in turn, could engender a renewed recognition that, long before '107 of the Copyright Act of 1976 codified the federal common law doctrine of fair use, courts flexibly applied an “equitable rule of reason” to the circumstances presented, case-by-case and without homage to any particular mode of analysis.

The Second Circuit upheld in full the determination by the late Southern District of New York Judge Harold Baer in Authors Guild Inc. v. HathiTrust, 902 F.Supp.2d 445 (S.D.N.Y. 2012), that use of the HDL for search was both “transformative” and fair. The appeals court also upheld the holding that use for accessibility was fair, but on a different basis. Rejecting Baer's characterization of accessibility as a transformative use, the appeals court instead found such use to be non-transformative because the books were used for the same purpose intended by their authors-to be read. Nevertheless, the court held accessibility to be a fair use based on a traditional approach that pre-dated (by 150 years) the emergence of transformation as a focal point of the fair use analysis. Thus, the Second Circuit considered accessibility to be a fair use based on two fundamental findings: The use was both productive and non-superseding.

As noted by the U.S. Supreme Court in Campbell v. Acuff-Rose Music, 510 U.S. 569 (1994): “Although transformative use is not absolutely necessary for a finding of fair use, the goal of copyright, to promote science and the arts, is generally furthered by the creation of transformative works. Such works thus lie at the heart of the fair use doctrine's guarantee of breathing space within the confines of copyright ' [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.”

In the ensuing two decades, lower courts have endeavored to apply the concept of transformative use to a wide variety of uses, some more than others fitting nicely into the definition. Consistency has not been a hallmark of the approaches adopted by various circuits, with the Ninth and Fourth Circuits being less concerned with actually changing the original work or its context, and more prepared to accept as transformative a use that is both productive (enhancing knowledge) and different in purpose (non-superseding). (See, e.g., Perfect 10 v. Amazon.com, 508 F.3d 1146 (9th Cir. 2007), and A.V. ex rel. Vanderhye v. iParadigms, 562 F.3d 630 (4th Cir. 2009).)

After Campbell, with the exception of its recent decision in Swatch Group Mgmt. Servs. Ltd. v. Bloomberg L.P., 12-2412 (2d Cir. 2014), the Second Circuit had not applied the term “transformative use” to uses that did not either alter the original in some manner or place it in a different context. Until HathiTrust, the Second Circuit, in contrast to the Fourth and Ninth, had not been called upon to decide any cases involving mass digitization of entire works. Nor had any court, anywhere, ever addressed whether digitization of the entire contents of university libraries to enable the print disabled to read and research on a par with sighted users constitutes fair use.

Judge Barrington D. Parker, writing for the unanimous Second Circuit panel in HathiTrust , analyzed the HDL's search function under Campbell, placing particular emphasis on whether the use is transformative, productive and non-superseding. (The other panel members were Judge John M. Walker and Judge Jose Cabranes. Judges Parker and Cabranes, along with Judge Pierre N. Leval, have been assigned to the panel that will hear the appeal of the Authors Guild's separate lawsuit over digitization by Google Books in which Judge Denny Chin granted Google summary judgment on a fair use defense (See, Authors Guild Inc. v. Google Inc., 954 F.Supp.2d 282 (S.D.N.Y. 2013).) Applying these principles in HathiTrust, Judge Parker made the following determinations under the four fair-use factors listed in '107 of the Copyright Act:

“[T]he creation of a full-text searchable database is a quintessentially transformative use [of purpose and character]. ' [T]he result of a word search is different in purpose, character, expression, meaning, and message from the page (and the book) from which it is drawn. Indeed, we can discern little or no resemblance between the original text and the results of the HDL full-text search.”

“The HDL permits the full-text search of every type of work imaginable. Consequently, there is no dispute that the works at issue are of the type that the copyright laws value and seek to protect. However, this factor [i.e., the nature of the copyrighted work] may be of limited usefulness where, as here, the creative work ' is being used for a transformative purpose. ' Accordingly, our fair-use analysis hinges on the other three factors.”

“In order to enable the full-text search function, the Libraries ' created digital copies of all the books in their collections. Because it was reasonably necessary for the HDL to make use of the entirety of the works in order to enable the full-text search function, we do not believe the [amount and substantiality] of the copying was excessive.”

“[T]he Factor Four analysis [only] concern[s] ' [economic] ' harm that results because the secondary use serves as a substitute for the original work. ' Any economic “harm” caused by transformative uses does not count because such uses, by definition, do not serve as substitutes for the original work. ' Lost licensing revenue counts under Factor Four only when the use serves as a substitute for the original and the full-text-search use does not.”

The Authors Guild also claimed market harm from alleged security risks caused by potential unauthorized access to the HDL. However, the appeals court found no evidence in the record that HDL security measures were insufficient or that “a security breach is likely to occur, much less one that would result in the public release of the specific copyrighted works belonging to any of the plaintiffs in this case.”

Having balanced all the fair use factors in favor of the HDL (except for discounting the factor on the nature of the plaintiffs' copyrighted works), the Second Circuit concluded that “the doctrine of fair use allows the Libraries to digitize copyrighted works for the purpose of permitting full-text searches.”

As noted at the outset of this article, the court held accessibility to be a fair use even though it concluded that converting the original works into a format accessible (readable or audible) to the print disabled was not “transformative.” But in the context of accessibility, transformative use was not considered a condition precedent, or even relevant, to the purpose-and-character factor. In support of this approach, Judge Parker cited Campbell 's caution that “transformative use is not absolutely necessary for a finding of fair use” and the recent Second Circuit holding in Swatch that unauthorized publication of an audio recording of an earnings report conference was a fair use.

The HathiTrust court noted that Congress expressly recognized convenience of a blind person as fair use, intended the Chafee Amendment to the Copyright Act, 17 U.S.C. '121 to accommodate print-disabled people and cited self-sufficiency as a goal of the Americans with Disabilities Act.

In part, the Second Circuit rejected the Authors Guild's contention that retaining copies of image files was excessive. Rather, the court found that “the image files will provide an additional and often more useful method by which many disabled patrons, especially students and scholars, can obtain access to these works. ' Consequently, it is reasonable for the Libraries to retain both the text and image copies.”

The appeals court also noted that the market for books accessible to the print disabled is insignificant and that publishers did not usually make their books available in specialized formats for the blind.

The court concluded upon weighing and balancing the fair use factors together, “that the doctrine of fair use allows the Libraries to provide full digital access to copyrighted works to their print-disabled patrons.”

Conclusion

With the HathiTrust decision, the Second Circuit has joined the Ninth and Fourth Circuits in finding, in appropriate circumstances, that mass digitization to facilitate search may qualify as a transformative use even if the original work itself is not changed or placed in a new context that could be considered commentary or scholarship. At the same time, in its examination of accessibility, HathiTrust unbinds fair use from transformative-dependent analysis and reminds us that a highly useful analytical tool is only that.

Robert J. Bernstein practices law in The Law Office of Robert J. Bernstein in New York City. He represented Intervenors-Defendants-Appellees National Federation of the Blind, Georgina Kleege, Blair Seidlitz and Courtney Wheeler as co-counsel in the HathiTrust case. Robert W. Clarida is a partner of Reitler, Kailas & Rosenblatt, and author of Copyright Law Deskbook (BNA).

The HathiTrust Digital Library (HDL) is a digital compilation of over 10 million books scanned by Google from the collections of the libraries of the University of Michigan, Cornell University, the University of California at Los Angeles, the University of Wisconsin and Indiana University. The HDL is used by the libraries for preservation of their collections and by students, faculty, researchers and other patrons for searching and accessibility.

The HDL's search function enables researchers to input search terms and obtain a list of the books containing the terms and the pages within the books on which the terms appear. The accessibility function enables blind and other print-disabled persons to have complete access to the entire text of all books in the HDL through the use of now-widely available screen access software that magnifies or vocalizes the digitized text or displays the text as refreshable braille.

Last month, the U.S. Court of Appeals for the Second Circuit ruled that use of the HathiTrust Digital Library for the purpose of search and accessibility each constitutes fair use. Authors Guild Inc. v. HathiTrust, 12-4547. (The appeals court remanded the preservation issue for an initial determination of the plaintiffs' standing to raise it.)

[ Editor's Note: The Second Circuit also ruled that the plaintiffs' claim over the University of Michigan's Orphan Works Project wasn't ripe for consideration because the school has suspended the program. The program involved digitizing copies of books that are out-of-print and whose authors' couldn't be located.]

Is Transformative Use Test Being Reigned In?

The HathiTrust opinion simultaneously represents the latest appellate application of transformative use to mass digitization, and a possible harbinger of more widespread recognition that traditional fair use analysis has not been superseded by the often determinative weight that courts have given to transformative use in the overall balance. This, in turn, could engender a renewed recognition that, long before '107 of the Copyright Act of 1976 codified the federal common law doctrine of fair use, courts flexibly applied an “equitable rule of reason” to the circumstances presented, case-by-case and without homage to any particular mode of analysis.

The Second Circuit upheld in full the determination by the late Southern District of New York Judge Harold Baer in Authors Guild Inc. v. HathiTrust, 902 F.Supp.2d 445 (S.D.N.Y. 2012), that use of the HDL for search was both “transformative” and fair. The appeals court also upheld the holding that use for accessibility was fair, but on a different basis. Rejecting Baer's characterization of accessibility as a transformative use, the appeals court instead found such use to be non-transformative because the books were used for the same purpose intended by their authors-to be read. Nevertheless, the court held accessibility to be a fair use based on a traditional approach that pre-dated (by 150 years) the emergence of transformation as a focal point of the fair use analysis. Thus, the Second Circuit considered accessibility to be a fair use based on two fundamental findings: The use was both productive and non-superseding.

As noted by the U.S. Supreme Court in Campbell v. Acuff-Rose Music, 510 U.S. 569 (1994): “Although transformative use is not absolutely necessary for a finding of fair use, the goal of copyright, to promote science and the arts, is generally furthered by the creation of transformative works. Such works thus lie at the heart of the fair use doctrine's guarantee of breathing space within the confines of copyright ' [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.”

In the ensuing two decades, lower courts have endeavored to apply the concept of transformative use to a wide variety of uses, some more than others fitting nicely into the definition. Consistency has not been a hallmark of the approaches adopted by various circuits, with the Ninth and Fourth Circuits being less concerned with actually changing the original work or its context, and more prepared to accept as transformative a use that is both productive (enhancing knowledge) and different in purpose (non-superseding). (See, e.g., Perfect 10 v. Amazon.com, 508 F.3d 1146 (9th Cir. 2007), and A.V. ex rel. Vanderhye v. iParadigms, 562 F.3d 630 (4th Cir. 2009).)

After Campbell, with the exception of its recent decision in Swatch Group Mgmt. Servs. Ltd. v. Bloomberg L.P., 12-2412 (2d Cir. 2014), the Second Circuit had not applied the term “transformative use” to uses that did not either alter the original in some manner or place it in a different context. Until HathiTrust, the Second Circuit, in contrast to the Fourth and Ninth, had not been called upon to decide any cases involving mass digitization of entire works. Nor had any court, anywhere, ever addressed whether digitization of the entire contents of university libraries to enable the print disabled to read and research on a par with sighted users constitutes fair use.

Judge Barrington D. Parker, writing for the unanimous Second Circuit panel in HathiTrust , analyzed the HDL's search function under Campbell, placing particular emphasis on whether the use is transformative, productive and non-superseding. (The other panel members were Judge John M. Walker and Judge Jose Cabranes. Judges Parker and Cabranes, along with Judge Pierre N. Leval, have been assigned to the panel that will hear the appeal of the Authors Guild's separate lawsuit over digitization by Google Books in which Judge Denny Chin granted Google summary judgment on a fair use defense (See, Authors Guild Inc. v. Google Inc., 954 F.Supp.2d 282 (S.D.N.Y. 2013).) Applying these principles in HathiTrust, Judge Parker made the following determinations under the four fair-use factors listed in '107 of the Copyright Act:

“[T]he creation of a full-text searchable database is a quintessentially transformative use [of purpose and character]. ' [T]he result of a word search is different in purpose, character, expression, meaning, and message from the page (and the book) from which it is drawn. Indeed, we can discern little or no resemblance between the original text and the results of the HDL full-text search.”

“The HDL permits the full-text search of every type of work imaginable. Consequently, there is no dispute that the works at issue are of the type that the copyright laws value and seek to protect. However, this factor [i.e., the nature of the copyrighted work] may be of limited usefulness where, as here, the creative work ' is being used for a transformative purpose. ' Accordingly, our fair-use analysis hinges on the other three factors.”

“In order to enable the full-text search function, the Libraries ' created digital copies of all the books in their collections. Because it was reasonably necessary for the HDL to make use of the entirety of the works in order to enable the full-text search function, we do not believe the [amount and substantiality] of the copying was excessive.”

“[T]he Factor Four analysis [only] concern[s] ' [economic] ' harm that results because the secondary use serves as a substitute for the original work. ' Any economic “harm” caused by transformative uses does not count because such uses, by definition, do not serve as substitutes for the original work. ' Lost licensing revenue counts under Factor Four only when the use serves as a substitute for the original and the full-text-search use does not.”

The Authors Guild also claimed market harm from alleged security risks caused by potential unauthorized access to the HDL. However, the appeals court found no evidence in the record that HDL security measures were insufficient or that “a security breach is likely to occur, much less one that would result in the public release of the specific copyrighted works belonging to any of the plaintiffs in this case.”

Having balanced all the fair use factors in favor of the HDL (except for discounting the factor on the nature of the plaintiffs' copyrighted works), the Second Circuit concluded that “the doctrine of fair use allows the Libraries to digitize copyrighted works for the purpose of permitting full-text searches.”

As noted at the outset of this article, the court held accessibility to be a fair use even though it concluded that converting the original works into a format accessible (readable or audible) to the print disabled was not “transformative.” But in the context of accessibility, transformative use was not considered a condition precedent, or even relevant, to the purpose-and-character factor. In support of this approach, Judge Parker cited Campbell 's caution that “transformative use is not absolutely necessary for a finding of fair use” and the recent Second Circuit holding in Swatch that unauthorized publication of an audio recording of an earnings report conference was a fair use.

The HathiTrust court noted that Congress expressly recognized convenience of a blind person as fair use, intended the Chafee Amendment to the Copyright Act, 17 U.S.C. '121 to accommodate print-disabled people and cited self-sufficiency as a goal of the Americans with Disabilities Act.

In part, the Second Circuit rejected the Authors Guild's contention that retaining copies of image files was excessive. Rather, the court found that “the image files will provide an additional and often more useful method by which many disabled patrons, especially students and scholars, can obtain access to these works. ' Consequently, it is reasonable for the Libraries to retain both the text and image copies.”

The appeals court also noted that the market for books accessible to the print disabled is insignificant and that publishers did not usually make their books available in specialized formats for the blind.

The court concluded upon weighing and balancing the fair use factors together, “that the doctrine of fair use allows the Libraries to provide full digital access to copyrighted works to their print-disabled patrons.”

Conclusion

With the HathiTrust decision, the Second Circuit has joined the Ninth and Fourth Circuits in finding, in appropriate circumstances, that mass digitization to facilitate search may qualify as a transformative use even if the original work itself is not changed or placed in a new context that could be considered commentary or scholarship. At the same time, in its examination of accessibility, HathiTrust unbinds fair use from transformative-dependent analysis and reminds us that a highly useful analytical tool is only that.

Robert J. Bernstein practices law in The Law Office of Robert J. Bernstein in New York City. He represented Intervenors-Defendants-Appellees National Federation of the Blind, Georgina Kleege, Blair Seidlitz and Courtney Wheeler as co-counsel in the HathiTrust case. Robert W. Clarida is a partner of Reitler, Kailas & Rosenblatt, and author of Copyright Law Deskbook (BNA).