No. _______________________
In The Supreme Court of the
United States October Term, 1996
__________________
Michigan Document Services, Inc., and James M. Smith,
Petitioners,
vs.
Princeton University Press, MacMillan, Inc., and St. Martin's
Press, Inc.,
Respondents.
__________________
On Petition For Writ Of Certiorari To The United
States Court Of Appeals For The Sixth Circuit
__________________
PETITION FOR WRIT OF CERTIORARI __________________
Susan M. Kornfield Counsel of Record David G. Chardavoyne
James D. Lewis Alan N. Harris Bodman, Longley & Dahling
LLP Attorneys for Petitioners 110 Miller, Suite 300 Ann
Arbor, Michigan 48104 (313) 761-3780
Questions Presented A. Where the
Copyright Act identifies the fair use of a copyrighted
work as including the making of "multiple copies for classroom
use" for teaching purposes, do teachers and students lose
their rights of fair use when they ask a commercial copyshop
to make their classroom copies for them, as held by a
closely-divided, en banc U.S. Court of Appeals for the
Sixth Circuit? B. Is a copyright owner legally injured
when it does not receive permission fees it demands for
certain uses of a work, including fair uses, as held by
a closely-divided, en banc U.S. Court of Appeals for the
Sixth Circuit? Parties to the Proceedings
The parties to the proceedings are those identified in
the caption. Petitioner Michigan Document Services, Inc.
is wholly-owned by Petitioner James M. Smith, and has
no related business entities. Table of Contents
Page Questions Presented i List of Parties and Rule 29.6
List ii Table of Contents iii Table of Authorities v Opinions
Below 1 Statement of Jurisdiction 1 Constitutional and
Statutory Provisions Involved 1 Statement of the Case
3 Professors' Creation of Coursepacks 4 Nationwide Impact
of Kinko's 6 The Decisions Below 7 Reasons for Granting
the Writ 9 A. The Sixth Circuit's Theory Of Market Harm
Departs From This Court's Decisions And The Plain Language
Of The Copyright Act 11 B. The Sixth Circuit Limited Congress'
Grant Of Fair Use By Identifying The Named Defendant As
The Only Relevant User. 16 C. The Sixth Circuit Applied
Commercial Presumptions That Virtually Eliminate Educational
Fair Use. 20 D. The Sixth Circuit Established Kinko's
As The Definitive Statement Of Educational Fair Use 23
Conclusion 26 Appendices: Appendix A: Opinion of the United
States Court of Appeals for the Sixth Circuit, En Banc,
Filed November 8, 1996 1a Appendix B: Panel Opinion of
the United States Court of Appeals for the Sixth Circuit,
Filed February 12, 1996 75a Appendix C: Opinion of the
United States District Court for the Eastern District
of Michigan, Filed June 9, 1994 108a Appendix D: Affidavits
of Professors Who Selected the Excerpts at Issue 127a
Table of Authorities Cases: American
Geophysical Union v. Texaco Inc., 60 F.3d 913 (2d Cir.
1995) 16 Basic Books, Inc. v. Kinko's Graphics Corp.,
758 F. Supp. 1522 (S.D.N.Y. 1991) passim Campbell v. Acuff-Rose
Music, Inc., 510 U.S. 569 (1994) passim Community for
Creative Non-Violence v. Reid, 490 U.S. 730 (1989) 12
Feist Publications, Inc. v. Rural Telephone Service Co.,
499 U.S. 340 (1991) 9, 14, 25 Fogerty v. Fantasy, Inc.,
510 U.S. 517 (1994) 9, 25 Harper & Row Publishers, Inc.
v. Nation Enterprises, 471 U.S. 539 (1985) passim Sony
Corp. of America v. Universal City Studios, Inc., 464
U.S. 417 (1984) passim Stewart v. Abend, 495 U.S. 207
(1990) 14 Williams & Wilkins Co. v. United States, 487
F.2d 1345 (Ct. Cl. 1973), aff'd by an equally divided
court, 420 U.S. 376 (1975) 10, 11 Constitution: U.S. Const.
art. I, § 8, cl. 8 passim Statutes: 17 U.S.C. § 106 passim
17 U.S.C. § 107 passim Other References: Pierre N. Leval,
Campbell v. Acuff-Rose: Justice Souter's Rescue of Fair
Use, 13 Cardozo Arts & Ent. L.J. 19 (1994) 23 Pierre N.
Leval, Toward A Fair Use Standard, 103 Harv. L. Rev. 1105
(1990) 22, 25
PETITION FOR WRIT OF CERTIORARI
Petitioners Michigan Document Services, Inc. and James
M. Smith respectfully petition for a writ of certiorari
to review the judgment of the United States Court of Appeals
for the Sixth Circuit. Opinions Below
The district court opinion is reported at 855 F. Supp.
905 (E.D. Mich. 1994) and reproduced in Appendix C, 108a
- 126a. The opinion of the en banc U.S. Court of Appeals
for the Sixth Circuit is reported at 99 F.3d 1381 (6th
Cir. 1996) and reproduced in Appendix A, 1a - 74a. The
original panel opinion of the Court of Appeals was reported
at 74 F.3d 1512 (6th Cir. 1996), has been withdrawn, and
is reproduced in Appendix B, 75a - 107a. Statement
of Jurisdiction The United States Court of Appeals
for the Sixth Circuit issued its en banc opinion on November
8, 1996. No rehearing was sought. This Court's jurisdiction
is based upon 28 U.S.C. § 1254(1). Constitutional
and Statutory Provisions Involved U.S. Const.
art. I, § 8, cl. 8 states: The Congress shall have Power
. . . To promote the Progress of Science and useful Arts,
by securing for limited Times to Authors and Inventors
the exclusive Right to their respective Writings and Discoveries.
Sections 106 and 107 of the Copyright Act of 1976, 17
U.S.C. §§ 106 and 107, state: § 106. Exclusive
rights in copyrighted works Subject to sections
107 through 120, the owner of copyright under this title
has the exclusive rights to do and to authorize any of
the following: (1) to reproduce the copyrighted work in
copies or phonorecords; (2) to prepare derivative works
based upon the copyrighted work; * * * § 107.
Limitations on exclusive rights: Fair use Notwithstanding
the provisions of sections 106 and 106A, the fair use
of a copyrighted work, including such use by reproduction
in copies or phonorecords or by any other means specified
by that section, for purposes such as criticism, comment,
news reporting, teaching (including multiple copies for
classroom use), scholarship or research, is not an infringement
of copyright. In determining whether the use made of a
work in any particular case is a fair use the factors
to be considered shall include ‹ (1) the purpose and character
of the use, including whether such use is of a commercial
nature or is for nonprofit educational purposes; (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. * * * Statement
of the Case Petitioner Michigan Document Services,
Inc. ("MDS") provides photocopying services to professors
and students. Petitioner James M. Smith is the sole shareholder
and president of MDS. Respondents are publishers who own
copyrights in the six works at issue. Excerpts of those
six works were selected by three University of Michigan
professors who assigned them to their students as classroom
reading materials. The professors brought the reading
assignments to MDS and requested copies for their students.
The students picked up their personal copies from MDS
and paid a per-page copying charge. Respondents filed
a copyright infringement action against Petitioners in
February, 1992, claiming that Petitioners could not photocopy
the six excerpts on behalf of professors and students
without first asking permission of Respondents and paying
fees to Respondents. Petitioners responded that their
actions were protected by the fair use provision of the
Copyright Act, which identifies the fair use of a copyrighted
work to include the making of "multiple copies for classroom
use" for "teaching" purposes. MDS's photocopying services
simply assisted the professors and students in their educational
use of the excerpts. Professors' Creation of Coursepacks
Although Respondents brought this suit in 1992, the practice
they challenge has been longstanding and widespread among
university professors and students ‹ the use of commercial
photocopying services to make copies of their classroom
materials without the payment of permission fees. Professors
are responsible for determining the classroom reading
materials for their courses. When they believe books are
appropriate, they assign books for purchase by their students.
JA 1231-85.FN1 They also may assign
supplemental reading materials, such as journal and newspaper
articles, course notes, syllabi, sample test questions,
and excerpts from books. JA 1218, 1259, 3070. For example,
Professor Michael Dawson, who selected an excerpt at issue
in this case, selected nine books and 30 excerpts from
a wide variety of disciplines for his course "Black Americans
and the Political System." JA 1232. Excerpts are used
to develop students' interest in a particular aspect of
the subject matter, expose them to a variety of ideas,
provide depth in a particular discipline, and keep course
materials current. JA 1218-56. After professors select
and organize the supplemental materials, they deliver
them to a copyshop, such as MDS, and request copies for
their students. At the professors' direction, the copyshop
makes the copies and binds them together with a table
of contents into a "coursepack." JA 3070. Coursepacks
are not books. They are the semester's assigned supplemental
readings, bound together for the convenience of the students.FN2
These readings are unique, representing personal selections
by a particular professor for use by students enrolled
in a specific course. The excerpts in this case were selected
and used in just this way. Three University of Michigan
professors brought MDS the classroom reading materials
they selected, including the excerpts at issue, and requested
copies for their students. MDS made the copies per the
professors' instructions. The students picked up their
coursepacks and paid MDS for its copying services. The
students could have copied the excerpts themselves at
the library's reserve reading room, but at twice the per-page
price of MDS. The publishers charge no permission fees
when students do their own copying at the library. MDS
did not select the coursepack materials and did not offer
the professors any economic incentive to choose its photocopying
service. JA 1214. MDS did not sell coursepacks to the
public. App. C at 110a. Thus, the relationship among the
professors, MDS, and the students was a closed loop ‹
the professors and students simply requested that MDS
perform the copying they otherwise would have done themselves.
Nationwide Impact of Kinko's In 1991,
a district court decision cast doubt upon the longstanding
practice of copyshops providing printing services to professors
and students. Basic Books, Inc. v. Kinko's Graphics Corp.,
758 F. Supp. 1522 (S.D.N.Y. 1991) ("Kinko's") held that
a copyshop violated publishers' copyrights when it made
copies of course materials without paying fees to the
publishers. Based on that district court decision, Respondents'
trade group warned colleges and copyshops throughout the
country that copyright law prohibits the making of coursepacks
for students and professors unless the publishers first
give permission (on whatever terms they choose), and unless
copying fees are paid (at whatever rates they demand).
As a result, nonprofit educational institutions nationwide,
as well as copyshops and their student-customers, now
pay significant sums to publishers under systems established
to charge for the photocopying of excerpts for classroom
use. For example, MDS's total copying charges for the
three coursepacks containing the excerpts at issue was
$107.35; yet the coursepacks would have cost $703.95 under
Respondent MacMillan's permission fee system. Some excerpts
would not have been available at any price because MacMillan
would have refused permission. App. A at 14a. Believing
Kinko's to be inconsistent with this Court's decisions
and the Copyright Act, Petitioner Jim Smith refused to
charge students and professors the fees demanded by Respondents.FN3
Consequently, he was sued. The Decisions Below
In June, 1994, the District Court for the Eastern District
of Michigan granted Respondents' motion for summary judgment
as to willful copyright infringement. The court awarded
Respondents $30,000 in damages and, by a later order,
$326,000 in attorneys' fees. The court enjoined Petitioners
from copying any portion of Respondents' current or future
copyrighted publications. App. C. On appeal, a panel of
the Sixth Circuit Court of Appeals reversed the district
court, finding MDS's photocopying services to professors
and students to be part of a fair use, and ordering that
summary judgment be entered for Petitioners. App. B. The
panel majority held that the use of the excerpts was a
"classroom use" under § 107 of the Copyright Act because
students and professors used the excerpts, while MDS efficiently
assisted the users by performing only the ministerial
act of copying assigned classroom readings. Id. at 88a-90a.
The panel stressed that Respondents never challenged the
students' and professors' rights to make copies of the
excerpts at issue. Id. at 89a. Respondents neither alleged
nor demonstrated any harm to the market for the original
works or for derivative works. Id. at 94a-95a. Respondents'
sole claim of injury was that they did not receive the
fees they desired to charge MDS for copying classroom
readings for students and professors. The panel rejected
that claim as circular, determining that the entitlement
(or not) to such fees was precisely the issue to be decided
by the court. Id. at 95a. The panel also noted that use
of excerpts promoted access to works without harming markets
for the works, increased authors' incentives to create
new works, and benefitted authors, students, professors,
and publishers. Id. at 96a-97a. The Court of Appeals subsequently
granted Respondents' motion for reconsideration and rehearing
en banc, and ruled 8-5 against fair use. The majority
found the selection of the excerpts by the professors
and the classroom use by the students to be irrelevant
to the fair use inquiry because the professors and students
were not named as defendants. App. A at 8a. It adopted
a theory of market harm under which a copyright owner
is "injured" when it is not paid for uses for which it
wishes to charge, even though it can show no harm to the
market for the original work or derivative works. Id.
at 11a-14a. The five judges dissenting from the en banc
decision agreed with the original panel of the Court of
Appeals that MDS's photocopying services could not be
analyzed apart from the classroom use by the professors
and students, and was a fair use. The en banc majority
reversed the district court's finding of willfulness,
noting that with one appellate victory, five dissenting
en banc judges, and three dissenting opinions, Petitioners
were not willful infringers. The Court of Appeals vacated
the award of damages and remanded for re-determination
in light of the absence of willfulness, and affirmed entry
of a permanent injunction against Petitioners. Id. at
23a-25a. Reasons For Granting The Writ
Fair use is a constitutional counterweight to the privileges
granted to copyright owners. Article I, § 8, cl. 8 of
the Constitution grants Congress the power to enact copyright
law but requires that copyright serve the public interest.
Fogerty v. Fantasy, Inc., 510 U.S. 517, 526 (1994). One
way in which the Copyright Act fulfills this constitutional
purpose is through the right of fair use. Harper & Row
Publishers, Inc. v. Nation Enterprises, 471 U.S. 539,
549-50 (1985). This case squarely presents the most fundamental
questions in a copyright fair use case. Whose use of a
copyrighted work is the proper subject of a court's fair
use inquiry? May fair users ask a commercial enterprise
to make their copies without losing their right of fair
use? Is a copyright owner harmed when it does not receive
fees it demands for certain uses, including fair uses?
The analysis used by the en banc majority to answer these
questions cannot be reconciled with the plain language
of the Copyright Act or this Court's copyright jurisprudence.
See Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569 (1994);
Fogerty, supra; Feist Publications, Inc. v. Rural Telephone
Service Co., 499 U.S. 340 (1991); Harper & Row, supra;
Sony Corp. of America v. Universal City Studios, Inc.,
464 U.S. 417 (1984). The en banc majority's fair use analysis
eliminates fair use where owners decide to charge for
such uses and commercial enterprises assist the users.
This departure from this Court's precedents jeopardizes
the "First Amendment protections" embodied in the Copyright
Act. Harper & Row, 471 U.S. at 559-60. This Court has
noted that fair use embodies First Amendment protections
necessary to an educated and informed society. Id. The
enumerated fair uses in § 107 ‹ "criticism, comment, news
reporting, teaching (including multiple copies for classroom
use), scholarship or research" ‹ reflect these First Amendment
values. This case has generated seven opinions, with four
in favor of fair use. There is profound disagreement as
to how to identify the user of the work, the legal relevance
of the students' and professors' use of commercial printing
services, and the relevance of the publishers' desire
to charge fees for the making of multiple copies for classroom
use. In its closely-divided decision, the en banc court
characterized fair use as "one of the most unsettled areas
of the law," and acknowledged that the strong dissents
demonstrated "[t]he potential for reasonable disagreement."
App. A at 24a. Indeed, over twenty years ago this Court
split 4-4 in a fair use case rejecting similar demands
by copyright owners for fees for the photocopying of scholarly
articles for researchers. Williams & Wilkins Co. v. United
States, 487 F.2d 1345 (Ct. Cl. 1973), aff'd by an equally
divided court, 420 U.S. 376 (1975). Fifteen years later,
Kinko's held that publishers may demand fees for the copying
of classroom reading materials, a decision found persuasive
by the district court below. App. C at 121a. This Court's
subsequent decision in Campbell soundly repudiated the
Kinko's analysis. See infra at 24. The Sixth Circuit panel
found Campbell directly applicable, ruling that MDS's
services to students and professors were part of a fair
use. Notwithstanding Campbell, the en banc majority adopted
the Kinko's analysis and ruled against fair use.FN4
In short, the lower courts are uncertain as to Campbell's
relevance to educational fair use, and as to the meaning
of the phrase "multiple copies for classroom use" in the
Copyright Act. Although judges are deeply divided, the
effect of the en banc decision on educational fair use
is certain. Because the decision cements the district
court ruling in Kinko's, it effectively decides the issue
left unresolved by this Court in Williams & Wilkins. Thus,
the educational community will treat it as an authoritative
statement of the limits of educational fair use. The "broad
consequences," App. A at 29a (Merritt, J., dissenting),
of the en banc decision will "hinder scholastic progress
nationwide." Id. at 28a (Martin, C.J., dissenting). This
Court's review is necessary to resolve fundamental questions
of copyright law and to affirm the vitality of educational
fair use. A. The Sixth Circuit's Theory Of Market
Harm Departs From This Court's Decisions And The Plain
Language Of The Copyright Act. The en banc majority
held that copyright owners are legally injured when they
do not receive fees they wish to charge for the copying
of excerpts for classroom use, even though the use of
the excerpts does not harm the markets for the original
work or derivative works, and the owner alleges no harm
to those markets. App. A at 11a-14a. This ruling radically
departs from this Court's precedents, the plain language
of the Copyright Act, and the purpose of copyright law.
Congress granted copyright owners certain rights. 17 U.S.C.
§ 106. Those rights are limited in nature, purely statutory,
and subject to the right of fair use. Sony, 464 U.S. at
432-33. Certain uses of works are outside the rights of
owners; in particular, no owner may control fair use.
Id. at 433. This balance between owners and users ensures
that copyright fulfills its constitutional purpose to
benefit the public. Campbell, 510 U.S. at 575. This statutory
balance should not be recalibrated by courts; rather,
"[s]trict adherence to the language and structure of the
[Copyright] Act is particularly appropriate where, as
here, a statute is the result of a series of carefully
crafted compromises." Community for Creative Non-Violence
v. Reid, 490 U.S. 730, 748 n.14 (1989). The Copyright
Act declares that a fair use is "not an infringement of
copyright," and gives guidance to owners, users, and courts
as to the types of uses that are likely to further the
purpose of copyright law. 17 U.S.C. § 107. Such fair uses
of copyrighted works include "reproduction in copies .
. . for purposes such as criticism, comment, news reporting,
teaching (including multiple copies for classroom use),
scholarship or research." Id. The public benefit purpose
of copyright is evident from these enumerated uses, and
is fostered by students' and professors' ability to readily
obtain their fair use copies. Section 107 creates no presumptions
of fair use or infringement. Instead, it directs courts
to consider a number of factors in deciding whether a
particular use of a copyrighted work is fair. One factor
requires courts to "assess[] the likelihood of significant
market harm," Campbell, 510 U.S. at 590, by considering
"the effect of the use upon the potential market for or
value of the copyrighted work." 17 U.S.C. § 107(4). The
plain language of § 107 dictates that the making of multiple
copies for classroom use sometimes will be a fair use.
In such cases, a demand for fees is irrelevant to a market
harm analysis because "[i]f the use is otherwise fair,
then no permission need be sought or granted." Campbell,
510 U.S. at 585 n.18. Thus, the mere demand for copying
fees can never be dispositive as to whether owners are
entitled to charge such fees. If it were, owners could
claim entitlement to charge for "criticism, comment, news
reporting, teaching (including multiple copies for classroom
use), scholarship or research." § 107. This Court has
stated that the proper markets to consider in a market
harm analysis are the markets for the original work and
for derivative works. Campbell, 510 U.S. at 590-92; Harper
& Row, 471 U.S. at 568. These markets flow from the rights
granted by Congress to copyright owners ‹ the rights to
reproduce the work and to prepare derivative works. 17
U.S.C. § 106(1) and (2). The en banc majority did not
confine its market harm analysis to this statutory framework.
It found, instead, that owners also control the market
for making multiple copies of excerpts for classroom use,
and that owners are legally harmed when they do not receive
fees they demand for such uses. The court reached this
conclusion by characterizing the photocopying services
of MDS as a "potential market" for copyright owners, and
using § 107's reference to "the potential market for .
. . the copyrighted work" as a source of rights of owners.
App. A at 10a, 13a. In short, the en banc majority took
language from a statutory limitation on copyright owners,
§ 107, and created an exclusive right of owners not granted
to them by Congress in § 106. While the photocopying of
an excerpt in some circumstances could harm the market
for the original work or for derivative works, this case
presents neither allegations nor proof of such harm. The
en banc court's market harm analysis rested solely on
Respondents' demand for copying fees. Without allegations
or proof of harm, however, those fees are irrelevant to
legal injury, as were the licensing fees for the use of
telephone listings in Feist, the parody licensing revenues
in Campbell, and the fees for home videotaping in Sony.FN5
This Court recognizes that licensing fees for the "potential
market" are relevant to market harm only when the license
is for a derivative work. See, e.g., Harper & Row, 471
U.S. at 567-68 (serialization rights of a book); Stewart
v. Abend, 495 U.S. 207, 228-30 (1990) (television, motion
picture, and dramatic adaptations of a literary work);
Campbell, 510 U.S. at 590 (nonparody, "rap" adaptation
of a musical work). Thus, an owner cannot control a use
simply by characterizing that use as a "potential market"
and deciding to charge for it. This Court routinely rejects
attempts by owners to expand the scope of their exclusive
rights. Sony, 464 U.S. at 431 ("The judiciary's reluctance
to expand the protections afforded by the copyright without
explicit legislative guidance is a recurring theme.").
The dissenting en banc judges criticized the majority's
acceptance of the publishers' argument that they are "harmed"
when they do not receive the very fees at issue. "[W]e
should not validate that practice by now using the income
derived from it to justify further imposition of fees."
App. A at 36a (Merritt, J). The publishers' argument was
flawed and circular because it assumed, as its premise,
the conclusion that the publishers were entitled to the
fees they sought. Such an argument would "always yield
a conclusion that the market had been harmed because any
fees that a copyright holder could extract from a user"
could be claimed to be "lost" regardless of whether the
use were fair or infringing. Id. at 63a (Ryan, J.). The
dissenting judges understood that the issue was not whether
the publishers had set up a system to charge for classroom
copying, or how well or poorly it functioned, but whether
the publishers were legally entitled to control the challenged
use. The fair use analysis of the en banc majority shifts
the focus from the allocation of rights in the Copyright
Act to an inquiry as to whether the owner desires to charge
for the use at issue. It converts the right to make a
fair use of a copyrighted work ‹ a right reserved by Congress
to the public ‹ into a prohibition against such use without
prior permission and payment of fees. Lower courts have
applied this flawed market harm analysis and will find
further encouragement in the decision below. Thus, lower
courts need direction from this Court as to how they should
identify the markets for which permission fees are the
lawful province of owners and those markets which are
outside their control. Without this guidance, courts will
regard an owner's permission system as dispositive evidence
of legal injury, thereby defeating the congressional grant
of fair use and preventing the Copyright Act from fulfilling
its constitutional purpose. B. The Sixth Circuit
Limited Congress' Grant Of Fair Use By Identifying The
Named Defendant As The Only Relevant User. At
the outset of any fair use inquiry a court must correctly
identify the user of the copyrighted work at issue. The
user is central to a proper analysis of "the purpose and
character of the use," "the amount and substantiality
of the portion used," and "the effect of the use upon
the potential market for . . . the copyrighted work."
17 U.S.C. § 107 (emphasis added). The en banc majority
confused the identity of the defendant with the identity
of the user, thus shifting the fair use analysis FN6
away from the true user and dramatically restricting the
congressional grant of fair use. Section 107 identifies
the making of "multiple copies for classroom use" for
"teaching" purposes as typical of fair use. By directly
linking the use of the excerpts with the classroom and
teaching activities, the plain language of the Copyright
Act directs a court's fair use inquiry to the activities
of the students and professors. However, the en banc majority
did not analyze the use of the excerpts by the students
and professors because "the use of the materials by the
students is not the use that the publishers are challenging."
App. A at 8a. Thus, the majority's fair use analysis was
dictated by Respondents' strategic selection of the commercial
copyshop as the named defendant. Once the en banc majority
isolated the mechanical activity of making copies from
the actual use of those copies, it saw only a company
making money by copying pages of books. Id. Yet "[n]either
the language of section 107 nor simple common sense warrant
examining the production of multiple copies in a vacuum
and ignoring their educational use." App. A at 47a (Ryan,
J., dissenting). "[MDS] does not `use' the material independent
of the university professors' and students' use; it is
a participant in their use and its profits are derived
only from photoreproduction services the students pay
it to perform." Id. at 50a. By recognizing the professors
and students as the true users, Judge Ryan correctly saw
the use at issue as nonprofit and educational. "[T]he
use that is to be evaluated for fairness in this case
is the use to which the protected substantive text is
put, not the mechanical process of copying it." Id. at
47a (Ryan, J., dissenting). "The professors and students
clearly do use" Respondents' copyrighted material, but
do so for a nonprofit purpose expressly recognized in
§ 107. Id. at 51a-52a. A focus on the defendant rather
than the user allows a copyright owner to strategically
name as a defendant only the commercial service provider
assisting in the fair use (typically a printer or manufacturer
of tangible media, such as audiotapes, videotapes, or
compact discs). As a result, a court will misperceive
even an educational, nonprofit use as a commercial use.
This Court rejected such a strategy in Sony, where it
examined the use of the work by the home viewers even
though they were not before the Court. Sony, 464 U.S.
at 422 n.2, 434. This Court's most recent fair use decision
illustrates the danger of limiting the fair use inquiry
to the named defendant. Suppose the copyright owner in
Campbell had sued only the record manufacturer of the
"Pretty Woman" parody, and not the user of the work, 2
Live Crew. Under the formulation of the en banc majority,
a court would disregard the parodic purpose and transformative
nature of the use and focus solely on the mechanical act
of reproducing the records, which had only a commercial
purpose. MDS provides the users of the excerpts the same
mechanical reproduction services as did the record manufacturer
for 2 Live Crew. Campbell shows that the correct focus
is on the use of the excerpts by the professors and students.
A failure to correctly identify the user precipitates
other serious analytical flaws in all fair use cases involving
duplication. For example, once the en banc majority isolated
the act of copying the excerpts from their educational
use, it declared that photocopying was not a "productive"
use. Yet this Court has recognized that copying can be
productive in the context of education: "A teacher who
copies to prepare lecture notes is clearly productive.
But so is a teacher who copies for the sake of broadening
his personal understanding of his specialty." Sony, 464
U.S. at 455 n.40. The productive nature of a use is not
evident if the copying is viewed in isolation. Moreover,
by insisting that a fair use go beyond reproduction of
printed matter, the en banc majority disregarded this
Court's express instruction that "[t]he obvious statutory
exception to this focus on transformative uses is the
straight reproduction of multiple copies for classroom
distribution." Campbell, 510 U.S. at 579 n.11. Indeed,
§ 107 expressly declares that photocopying for educational
purposes can be a part of a fair use of a copyrighted
work. Correct identification of the user also is central
to a proper analysis of the third statutory factor ‹ "the
amount and substantiality of the portion used in relation
to the copyrighted work as a whole." 17 U.S.C. § 107(3).
Using "reasonableness" as the touchstone, this Court stated
that a §107(3) analysis must be performed in light of
the other § 107 factors. Campbell, 510 U.S. at 586-87.FN7
The en banc majority, however, did not look to the purpose
for which the excerpts were used (teaching), the character
of the use (educational), the market effect (no harm to
the market for the work or for derivative works), or the
amount used (no more than was necessary to accomplish
the teaching purpose). Instead, it adopted two bright-line
rules from Kinko's ‹ first, whatever was selected for
copying must be the "heart" of the work and thus too much
to fairly use; and second, any copying beyond a safe harbor
in the legislative history weighed against fair use. App.
A at 18a, 20a. The majority's identification of the defendant
as the only relevant user will be the thumb on the scales
against fair use every time the named defendant happens
to make money, threatening to "swallow nearly all of the
illustrative uses listed in . . . § 107." Campbell, 510
U.S. at 584. It severely impairs the exercise of fair
use rights, since few users have their own manufacturing
or photocopying equipment. It imposes a requirement on
fair users that Congress did not impose ‹ they must manufacture
their own fair use copies. It shifts the court's inquiry
from the "purpose and character of the use" to whether
money changes hands. The majority's focus on the defendant
rather than the user of the copyrighted work is a "profound
indication that its approach is misguided." App. A at
28a. (Martin, C.J., dissenting). C. The Sixth
Circuit Applied Commercial Presumptions That Virtually
Eliminate Educational Fair Use. In Campbell,
this Court reversed the Sixth Circuit for, among other
things, holding that a commercial use is presumptively
unfair. 510 U.S. at 583-84. The Sixth Circuit repeated
its mistake here and then compounded its mistake by employing
a new presumption: money that copyright owners are willing
to charge for a use is "lost" when they do not receive
it, even if the use may be a fair use. The en banc majority
viewed the money paid by the students for MDS's photocopying
services as establishing a commercial use. It then found
that "[t]here is a presumption of unfairness here." App.
A at 10a (emphasis in original). Such a presumption is
reversible error. Campbell, 510 U.S. at 584. No such presumption
exists unless the entire work is copied verbatim for commercial
use. Id. at 591. Commerciality "is only one element of
the first factor enquiry," and even a commercial use may
be a fair use. Id. at 584. The en banc majority also found
that Respondents had established legal injury because
they had set up systems to charge for the making of multiple
copies for classroom use, other copyshops were paying
the fees demanded, and MDS was not. App. A at 11a. In
so doing, the court employed an irrebuttable presumption
of legal harm and relied upon that presumption as a basis
to find against fair use. Yet, in Campbell, this Court
held that parody (i.e., a fair use) "does not produce
a harm cognizable under the Copyright Act." Campbell,
510 U.S. at 592. Since fair use is outside the rights
of copyright owners, owners may not control fair use simply
by setting up systems to charge for it. Thus, the en banc
majority committed reversible error as to the existence
of market harm. This improper reliance on presumptions
flows from the majority's view of the relevance of money.
While the majority acknowledged that Campbell viewed no
single fair use factor as paramount, the majority nevertheless
found the fourth factor to be "at least primus inter pares,"
App. A at 8a, and the others "considerably less important."
Id. at 15a. Accordingly, it began with a fourth factor
market harm analysis, having not yet determined the purpose
or character of the use, the nature of the work used,
or the amount used.FN8 The en banc
majority assumed that money made by MDS belonged to Respondents.
The majority's analysis failed to recognize that a copying
service must acquire expensive equipment and service contracts,
purchase supplies, and pay wages, rent, taxes, and other
expenses. The majority disregarded that MDS's copying
charge depends solely on the number of pages, not the
content of the pages. The dissenting judges saw the distinction
between a printer and the user of the work, and saw the
copying costs for what they were ‹ payment for services
rendered. "The students paid the copyshop solely for the
time, effort and materials that each student would otherwise
have expended in copying the material himself or herself.
The money paid is not money that would otherwise go to
the publishers." App. A at 33a (Merritt, J., dissenting).
In short, even a commercial defendant can be a part of
a nonprofit use of a work. Through its use of presumptions,
the majority disregarded the fundamental fair use inquiry
‹ "Where should the author's exclusivity stop in order
to best serve the[] overall objectives of the copyright
law?" Pierre N. Leval, Campbell v. Acuff-Rose: Justice
Souter's Rescue of Fair Use, 13 Cardozo Arts & Ent. L.J.
19, 22 (1994). Instead, it focused on "commercial motivation
[which] is virtually ubiquitous in publishing." Id. at
21. The en banc majority upheld Respondents' demand for
copying fees because Petitioners had not shown that payment
of fees would eliminate educational use of excerpts. App.
A at 14a-16a. This reduces the "fair use" inquiry to an
inquiry into the point of "nonuse." If fair use had to
be "rescued" by this Court in Campbell, as Judge Leval
suggests, it will have to be resuscitated after this 8-5
decision. The en banc majority's analysis turns an educational
use into a commercial use, finds a commercial use to be
presumptively unfair, and finds harm where there is only
a demand for fees. Such an approach warrants this Court's
review. D. The Sixth Circuit Established Kinko's
As The Definitive Statement Of Educational Fair Use.
For a generation, professors and students used the services
of copyshops to make copies of their classroom materials,
including excerpts of copyrighted works. Copyshops provided
this service to professors and students with the understanding
that they were participants in the making of "multiple
copies for classroom use" under § 107 of the Copyright
Act. The district court decision in Kinko's, however,
coupled with threats of lawsuits from publishers, led
many copyshops to seek permission and pay the fees demanded
by publishers. App. A at 4a. The en banc decision, if
left standing, will establish Kinko's as the de facto
law of the land in the eyes of publishers, authors, universities,
students, libraries, and copyshops. This nationwide impact
of a lone district court decision is especially troubling
in light of the fact that Kinko's was decided three years
before this Court's decision in Campbell, which soundly
repudiates the Kinko's analysis. Kinko's held every commercial
use to be presumptively unfair, 758 F. Supp. at 1530,
which this Court held was reversible error. Campbell,
510 U.S. at 584. Kinko's required that a use be transformative
in order to be fair. 758 F. Supp at 1530-31. Campbell
noted that "[t]he obvious statutory exception to this
focus on transformative uses is the straight reproduction
of multiple copies for classroom distribution." 510 U.S.
at 579 n.11. Kinko's invoked the tautology that anything
selected for copying must have been the "heart of the
work" and thus too much to fairly copy. 758 F. Supp. at
1533. Campbell held that the proper inquiry examines the
amount used in relation to the purpose for the use and
the effect of the use on the market for the work, and
that a fair use may include the heart of a work. 510 U.S.
at 586-88. Finally, Kinko's held that the publishers'
permission system for classroom use was relevant to market
harm. 758 F. Supp. at 1534. In contrast, Campbell looked
to the rights granted by Congress in § 106 as the source
of the markets over which copyright owners may assert
control, and held that a fourth factor analysis may not
include claimed injury to the fair use market. 510 U.S.
at 593. The Sixth Circuit's stamp of approval in this
case demonstrates the continuing influence of Kinko's,
despite this Court's decision in Campbell. Given the nationwide
impact of Kinko's, it is highly unlikely that publishers'
permission fee systems for classroom use will be subject
to further legal challenges. Indeed, given the ruinous
effect of this protracted litigation, which put MDS into
bankruptcy, copyshops will be reluctant to assist the
legitimate exercise of fair use rights. Thus, Kinko's
theory of market harm will continue to be invoked by the
lower courts. The last time a new theory of market harm
was created it lasted over half a century before this
Court unanimously rejected it as unconstitutional. See
Feist, 499 U.S. at 1290-94. The history of copyright jurisprudence
reflects the difficulties experienced by lower courts
with fair use and its constitutional relationship to copyright.FN9
Copyright law is based not in economic property rights
but in the benefits of an informed and educated society.
"Fair use should not be considered a bizarre, occasionally
tolerated departure from the grand conception of the copyright
monopoly. To the contrary, it is a necessary part of the
overall design." Pierre N. Leval, Toward A Fair Use Standard,
103 Harv. L. Rev. 1105, 1110 (1990). This case squarely
presents important copyright fair use issues, and review
is timely. Conclusion The Chief Judge
of the Sixth Circuit described the en banc decision as
"one of the more obvious examples of how laudable societal
objectives, recognized by both the Constitution and statute,
have been thwarted by a decided lack of judicial prudence."
App. A at 26a (Martin, C.J., dissenting). This decision
puts at issue, and at risk, the future of fair use and
the purpose of copyright law ‹ "[t]o promote the Progress
of Science and useful Arts." U.S. Const. art. I, § 8,
cl. 8. This Court should issue a writ of certiorari to
the Court of Appeals for the Sixth Circuit in order to
ensure the place of educational fair use in the overall
design of copyright law. Respectfully submitted, Susan
M. Kornfield Counsel of Record Bodman, Longley & Dahling
LLP Attorneys for Petitioners 110 Miller, Suite 300 Ann
Arbor, Michigan 48104 (313) 761-3780 Dated: January 30,
1997
Footnotes
{1} All "JA" references are to pages
in the Joint Appendix filed with the Sixth Circuit. For
the Court's convenience, the affidavits of the three University
of Michigan professors who selected the excerpts at issue
are reproduced in Appendix D. {2} Professors
find that students who have their own copies of the assigned
readings are more likely to read the assignments and are
better prepared to discuss the assignments in class. JA
1204. Students with their own copies of the reading assignments
are able to annotate relevant portions and study the assignments
at a time and place convenient for them. JA 1220-21.
{3} This view is shared by the eleven copyright scholars
who signed an amicus brief on behalf of Petitioners in
the proceedings below. {4} Participation
at the appellate level by amici copyright scholars, library
associations, the Attorney General of the State of Georgia,
school board associations, school administrators, school
districts, publishers, authors, and others underscores
the importance of this case to the educational community.
{5} The system of permission fees at
issue here is completely different from licensing systems
for public performance rights, such as those administered
by organizations such as ASCAP and BMI. Performing rights
organizations exist to administer a right expressly granted
by Congress to copyright owners in 17 U.S.C. § 106(5).
There is no corresponding right to control the copying
of excerpts. {6} See, e.g., American
Geophysical Union v. Texaco Inc., 60 F.3d 913, 929-31
(2d Cir. 1995); Kinko's, 758 F. Supp. at 1534.
{7} Respondents object to the professors' selection of
chapters from books for inclusion in coursepacks, and
contend that such amounts can never be fair. Campbell
instructs, however, that the amount must be considered
in light of the other factors in § 107.
{8} The en banc majority's revival of the "presumption
of unfairness" and its reluctance to believe that photocopying
could ever be part of a fair use is exemplified by its
approval of a blanket injunction against MDS's copying
for students and professors. This Court has cautioned
against the use of injunctions in fair use cases where
there is "`a strong public interest'" in the challenged
use and where "`the copyright owner's interest may be
adequately protected by an award of damages for whatever
infringement is found.'" Campbell, 510 U.S. at 578 n.10
(quoting Pierre N. Leval, Toward a Fair Use Standard,
103 Harv. L. Rev. 1105, 1132 (1990)). As Judge Merritt
observed in his dissent, the injunction approved by the
en banc majority is "so grossly overbroad that it violates
the First Amendment," App. A at 29a, and is "without any
recognition that the doctrine of fair use exists." Id.
at 37a. {9} See Campbell, supra (reversing
the Sixth Circuit, which had reversed district court's
finding of fair use); Fogerty, supra (reversing the Ninth
Circuit, which had joined the Second and Seventh Circuits
in disadvantaging prevailing copyright defendants in the
award of attorney's fees); Feist, supra (reversing Tenth
Circuit's finding of copyright protection for telephone
listings); Sony, supra (reversing the Ninth Circuit, which
had reversed district court's finding of fair use); Harper
& Row, supra (reversing Second Circuit, which had reversed
district court's finding of infringement).
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