Peering Into Copyright Office's Report on Orphan Works

As the 2015 Report notes, good-faith users who elect to use orphan works without permission from the copyright owner do so “under a legal cloud, as there is always the possibility that the copyright owner could emerge” and bring a suit for copyright infringement. The orphan works problem is a fact-sensitive, double-edged sword: potential users may refrain from using a work, which use might have otherwise provided exposure and royalties to the author/owner; in other cases, the copyright owner may prefer the prospective user not use the work until licensing terms are settled.

Good-faith users seeking to identify copyright owners are faced with many obstacles, most significantly: 1) limited access to Copyright Office records and the often arduous task of searching those records; and 2) the digitization and widespread electronic dissemination of works. The Copyright Office maintains an online archive of works registered from Jan. 1, 1978, to the present. Users seeking to identify the owners of copyrights registered before Jan. 1, 1978, however, must search the physical card catalog housed in the Copyright Office or the Catalog of Copyright Entries (CCE), a several-hundred-volume print publication available online in nonsearchable form.

Because orphan works tend to be older, users who wish to license a particular work are often left with no other option but to undertake the onerous task of searching the card catalog and/or CCE. Unfortunately, even if registration information is located, the information in those filings may be out of date if, for example, the registered owner is no longer alive and the statutory heirs are not identified, or assignment information has not been recorded. (The recordation of transfer documents with the Copyright Office is encouraged but not required). Finally, potential users may not even get to these resources if a work, particularly a work of the visual arts, lacks a title or other identifying information to be used in the search process.

The 2015 Report also addresses the related problem of mass digitization of protected works, an issue that has been widely publicized in connection with the decade-long litigation arising from Google's mass digitization of millions of books housed in libraries throughout the country. However, at a more basic level, digitization has created another significant hurdle for good-faith users who may locate a work in digital form on the Internet or social media and are unable to license the work because it lacks identifying information about the copyright owner.

Congressional Action

Congress has attempted to address the orphan works problem on several occasions, most recently in 2008, when the Senate passed the Shawn Bentley Orphan Works Act of 2008 (Bentley Act), S.2193. Although never approved by the House of Representatives, the Bentley Act would have limited damages where the infringer undertakes a diligent effort to locate a copyright owner. “Diligent effort” meant, at a minimum, a search of the Copyright Office online archive and other reasonably available sources.

International Action

The 2015 Report also summarizes international attempts to address the orphan works problem, including legislation passed in the United Kingdom, Hungary, France, Germany, Canada, Japan and Korea. For example, the United Kingdom recently amended its copyright law, authorizing renewable seven-year nonexclusive licenses for orphan works following a diligent search for the copyright owner. A diligent search under UK law includes, at a minimum, a search of the Orphan Works Register created by the Comptroller-General of Patents, Designs and Trade Marks, the Orphan Works Database maintained by the EU Office for Harmonization in the Internal Market, and other identified databases. A similar regime was enacted in Canada, where the Copyright Board of Canada may now issue limited licenses for certain types of works following a reasonable effort by the user to locate the owner.

Balanced Approach

In the 2015 Report, the Copyright Office considered a number of approaches to balance the policy of promoting new creative expression, including the use of existing works in new works, against the rights of copyright owners. It first considered whether any legislative action is necessary, beginning with an analysis of whether the existing “fair use” doctrine sufficiently covers the field. This inquiry finds roots in the Bentley Act, which provided for injunctive relief except where the infringer had already prepared or commenced preparation of a new work that “recasts, transforms, adapts or integrates the infringed work with a significant amount of original expression,” language that effectively mirrors the statutory fair use defense. The fair use doctrine, however, is notoriously difficult to apply and has been the subject of extensive litigation, without clear resulting guidance.

The 2015 Report also considers a government-sponsored licensing regime and an “extended collective licensing” model where industry-specific organizations (such as ASCAP, BMI and SESAC in the music industry) would collect royalties on works and distribute them to copyright owners if and when those owners are identified.

In the end, the Copyright Office's 2015 Report recommends a very American, quasi-market driven solution. The report suggests limiting the risk of incurring liability for the good-faith use of orphan works. As with the Bentley Act, a good-faith user's damages exposure would be limited to “reasonable compensation” for the use of the orphan work, as long as the user satisfies certain eligibility prerequisites. Specifically, the user would have to, among other things:

• Conduct a good-faith diligent search for the owner, including, at a minimum, a search of Copyright Office online (but not paper) records and the use of other online sources and technological tools, based on a statement of recommended practices to be published by the Copyright Office;
• File a Notice of Use with the Copyright Office, facilitating copyright owners' search for the use of their works;
• Provide reasonable compensation and attribution to the copyright owner, if later discovered;
• Include an “orphan works” symbol with the new work; and
• Satisfy certain pleading and discovery requirements if litigation were to ensue.

The proposal would apply to all works and users. Nonprofit organizations making noncommercial use would enjoy a further “safe harbor” precluding any recovery if the nonprofit entity immediately ceases use upon notice of a potential claim. The proposal would permit injunctive relief under some circumstances but would leave it to the courts to consider the consequences of injunctive relief to the good-faith user and craft an appropriate remedy under the particular circumstances of each case. For example, the courts could bar further printings or publications but permit sale of existing copies. Injunctive relief for derivative works would be further limited and fair use defenses would be preserved.

There is no question that the proposed legislative framework contained in the 2015 Report (as with any legislative framework) leaves open the possibility of abuse. That said, the resolution should reward artists and potential users who are proactive in utilizing the resources available to them, ideally resulting in increased collaboration, oversight, attribution, exposure and alternative income streams. In the meanwhile, however, the debate promises to continue generating plenty of heat.

David M. Kohane is member of the litigation department and chair of the intellectual property department of Cole Schotz in Hackensack, NJ. David S. Gold is an associate in the firm's intellectual property and litigation departments.

What happens when a party wants to use a photograph, image, writing or other work that may be subject to copyright protection, but cannot identify or locate the original author to secure permission? The dilemma these “orphan works” poses was the subject of a recent 106-page report by the U.S. Copyright Office titled, “Orphan Works and Mass Digitization” (2015 Report) (June 2015). The report has left the creative world abuzz and, in many cases, aghast at the implications of proposed legislation some believe would effectively overhaul the U.S. Copyright Act and permit the use of copyright-protected works without the permission of copyright owners who cannot be identified or located.

Although the 2015 Report includes a proposed legislative framework, its primary purpose was to revisit the orphan works problem in an organized and comprehensive fashion and to solicit comments from the general public.

Double-Edged Sword

As the 2015 Report notes, good-faith users who elect to use orphan works without permission from the copyright owner do so “under a legal cloud, as there is always the possibility that the copyright owner could emerge” and bring a suit for copyright infringement. The orphan works problem is a fact-sensitive, double-edged sword: potential users may refrain from using a work, which use might have otherwise provided exposure and royalties to the author/owner; in other cases, the copyright owner may prefer the prospective user not use the work until licensing terms are settled.

Good-faith users seeking to identify copyright owners are faced with many obstacles, most significantly: 1) limited access to Copyright Office records and the often arduous task of searching those records; and 2) the digitization and widespread electronic dissemination of works. The Copyright Office maintains an online archive of works registered from Jan. 1, 1978, to the present. Users seeking to identify the owners of copyrights registered before Jan. 1, 1978, however, must search the physical card catalog housed in the Copyright Office or the Catalog of Copyright Entries (CCE), a several-hundred-volume print publication available online in nonsearchable form.

Because orphan works tend to be older, users who wish to license a particular work are often left with no other option but to undertake the onerous task of searching the card catalog and/or CCE. Unfortunately, even if registration information is located, the information in those filings may be out of date if, for example, the registered owner is no longer alive and the statutory heirs are not identified, or assignment information has not been recorded. (The recordation of transfer documents with the Copyright Office is encouraged but not required). Finally, potential users may not even get to these resources if a work, particularly a work of the visual arts, lacks a title or other identifying information to be used in the search process.

The 2015 Report also addresses the related problem of mass digitization of protected works, an issue that has been widely publicized in connection with the decade-long litigation arising from Google's mass digitization of millions of books housed in libraries throughout the country. However, at a more basic level, digitization has created another significant hurdle for good-faith users who may locate a work in digital form on the Internet or social media and are unable to license the work because it lacks identifying information about the copyright owner.

Congressional Action

Congress has attempted to address the orphan works problem on several occasions, most recently in 2008, when the Senate passed the Shawn Bentley Orphan Works Act of 2008 (Bentley Act), S.2193. Although never approved by the House of Representatives, the Bentley Act would have limited damages where the infringer undertakes a diligent effort to locate a copyright owner. “Diligent effort” meant, at a minimum, a search of the Copyright Office online archive and other reasonably available sources.

International Action

The 2015 Report also summarizes international attempts to address the orphan works problem, including legislation passed in the United Kingdom, Hungary, France, Germany, Canada, Japan and Korea. For example, the United Kingdom recently amended its copyright law, authorizing renewable seven-year nonexclusive licenses for orphan works following a diligent search for the copyright owner. A diligent search under UK law includes, at a minimum, a search of the Orphan Works Register created by the Comptroller-General of Patents, Designs and Trade Marks, the Orphan Works Database maintained by the EU Office for Harmonization in the Internal Market, and other identified databases. A similar regime was enacted in Canada, where the Copyright Board of Canada may now issue limited licenses for certain types of works following a reasonable effort by the user to locate the owner.

Balanced Approach

In the 2015 Report, the Copyright Office considered a number of approaches to balance the policy of promoting new creative expression, including the use of existing works in new works, against the rights of copyright owners. It first considered whether any legislative action is necessary, beginning with an analysis of whether the existing “fair use” doctrine sufficiently covers the field. This inquiry finds roots in the Bentley Act, which provided for injunctive relief except where the infringer had already prepared or commenced preparation of a new work that “recasts, transforms, adapts or integrates the infringed work with a significant amount of original expression,” language that effectively mirrors the statutory fair use defense. The fair use doctrine, however, is notoriously difficult to apply and has been the subject of extensive litigation, without clear resulting guidance.

The 2015 Report also considers a government-sponsored licensing regime and an “extended collective licensing” model where industry-specific organizations (such as ASCAP, BMI and SESAC in the music industry) would collect royalties on works and distribute them to copyright owners if and when those owners are identified.

In the end, the Copyright Office's 2015 Report recommends a very American, quasi-market driven solution. The report suggests limiting the risk of incurring liability for the good-faith use of orphan works. As with the Bentley Act, a good-faith user's damages exposure would be limited to “reasonable compensation” for the use of the orphan work, as long as the user satisfies certain eligibility prerequisites. Specifically, the user would have to, among other things:

• Conduct a good-faith diligent search for the owner, including, at a minimum, a search of Copyright Office online (but not paper) records and the use of other online sources and technological tools, based on a statement of recommended practices to be published by the Copyright Office;
• File a Notice of Use with the Copyright Office, facilitating copyright owners' search for the use of their works;
• Provide reasonable compensation and attribution to the copyright owner, if later discovered;
• Include an “orphan works” symbol with the new work; and
• Satisfy certain pleading and discovery requirements if litigation were to ensue.

The proposal would apply to all works and users. Nonprofit organizations making noncommercial use would enjoy a further “safe harbor” precluding any recovery if the nonprofit entity immediately ceases use upon notice of a potential claim. The proposal would permit injunctive relief under some circumstances but would leave it to the courts to consider the consequences of injunctive relief to the good-faith user and craft an appropriate remedy under the particular circumstances of each case. For example, the courts could bar further printings or publications but permit sale of existing copies. Injunctive relief for derivative works would be further limited and fair use defenses would be preserved.

There is no question that the proposed legislative framework contained in the 2015 Report (as with any legislative framework) leaves open the possibility of abuse. That said, the resolution should reward artists and potential users who are proactive in utilizing the resources available to them, ideally resulting in increased collaboration, oversight, attribution, exposure and alternative income streams. In the meanwhile, however, the debate promises to continue generating plenty of heat.

David M. Kohane is member of the litigation department and chair of the intellectual property department of Cole Schotz in Hackensack, NJ. David S. Gold is an associate in the firm's intellectual property and litigation departments.