Amicus brief filed by American Library Association

 Case No. 92-9341

                       IN THE UNITED STATES COURT OF APPEALS

                              FOR THE SECOND CIRCUIT

           AMERICAN GEOPHYSICAL UNION; ELSEVIER SCIENCE PUBLISHING CO.;

      PERGAMON PRESS, LTD.; SPRINGER-VERLAG, GMBH & CO., K.G.;

      JOHN WILEY & SONS, INC. and WILEY HEYDEN, LTD., on behalf

      of themselves and others similarly situated,

                                              Plaintiffs and Counter-Claim

                                                    Defendants - Appllees,

                                      - v. -

                                   TEXACO INC.,

                                                  Defendant-Counter-Claim-

                                                      Plaintiff-Appellant.

           IN RE  TEXACO INC., TEXACO CAPITAL INC., TEXACO CAPITAL N.V.,

                                                      Reorganized Debtors.

ACADEMIC PRESS, INC.; ALAN R. LISS, INC.; ALLERTON PRESS INC.;

      AMBIENT PRESS LTD.; AMERICAN ASSOCIATION FOR THE ADVANCEMENT

                     (Caption continued on inside front cover)

                       ON APPEAL FROM AN INTERLOCUTORY ORDER

                        OF THE UNITED STATES DISTRICT COURT

                       FOR THE SOUTHERN DISTRICT OF NEW YORK

                    BRIEF FOR THE AMERICAN LIBRARY ASSOCIATION,

                           AMICUS CURIAE, IN SUPPORT OF

                     REVERSAL OF THE DISTRICT COURT'S DECISION

Of Counsel:                                 INGERSOLL AND BLOCH, CHARTERED

                                            Sherman House

Susan G. Braden                             1401 Sixteenth Street, N.W.

Reuben B. Roberston                         Washington, D.C.  20036

                                            (202) 232-1015

                                            Attorneys for the Amercian

                                              Library Association

Dated:       March 4, 1993

                   (CONTINUATION OF CAPTION FROM PREVIOUS PAGE)

OF SCIENCE; AMERICAN ASSOCIATION OF COST ENGINEERS, INC.; AMERICAN

CHEMICAL SOCIETY; AMERICAN CONFERENCE OF GOVERNMENTAL INDUSTRIAL

HYGIENISTS; AMERICAN INSTITUTE OF PHYSICS; AMERICAN MATHEMATICAL

SOCIETY; AMERICAN MEDICAL ASSOCIATION; AMERICAN SOCIETY FOR

BIOCHEMISTRY AND MOLECULAR BIOLOGY, INC.; AMERICAN SOCIETY FOR

MICROBIOLOGY; ASPEN PUBLISHERS, INC.; ASSOCIATION FOR SYMBOLIC

LOGIC; BIRKHAUSER BOSTON; BLACKWELL SCIENTIFIC PUBLICATIONS, LTD.;

BUREAU OF NATIONAL AFFAIRS, INC.; BUSINESS MONTH CORPORATION;

BUSINESS PUBLISHERS, INC.; BUTTERWORTH & CO. (PUBLISHERS) LTD.;

C.V. MOSBEY COMPANY; CANNING PUBLICATIONS, INC.; CENTER FOR

COMPUTER/LAW; CORNELL UNIVERSITY; CRC PRESS, INC.; DATA PROCESSING

MANAGEMENT ASSOCIATION, INC.; EDITIONS SCIENTIFIQUES ELSEVIERS;

ELSEVIER SCIENCE PUBLISHERS B.V.; ELSEVIER SEQUOIA SA; FEDERATION

OF SOCIETIES FOR COATING TECHNOLOGY; GROVE & STRATTON, INC.;

HARCOURT BRACE JOVANOVICH LIMITED (FORMERLY ACADEMIC PRESS INC.

(LONDON) LTD.); HEMISPHERE PUBLISHING CO.; THE INFORMATION STORE,

INC.; INSTITUTION OF ELECTRICAL ENGINEERS/PETER PEREGRINUS LTD.;

INTERNATIONAL ACADEMY AT SANTA BARBARA, INC.; J. SCHWEITZER VERLAG;

JOHN WILEY & SONS LIMITED; KENNETH MASON PUBLICATIONS LTD.; THE

LAUX COMPANY; LAW & TECHNOLOGY PRESS; LITTLE, BROWN & COMPANY;

MARCEL DEKKER, INC.; MASSACHUSETTS MEDICAL SOCIETY; MBR PRESS,

INC.; MIT PRESS; MUNKSGAARD INTERNATIONAL PUBLISHERS LTD.; MULTI-

SCIENCE PUBLISHING CO. LTD; OPEN-APPLE; PHYSOLOGIA PLANTARUM; PJD

PUBLICATIONS LTD.; PRINCETON UNIVERSITY PRESS; RAVEN PRESS; ROYAL

AUSTRALASIAN ORNITHOLOGIST'S UNION, SCANNING MICROSCOPY

INTERNATIONAL, INC.; SCRIPTA TECHNICA, INC.; SKY PUBLISHING

CORPORATION; SOCIETY OF NAVAL ARCHITECTS AND MARINE ENGINEERS;

SPRINGER-VERLAG NEW YORK INC.; TECHNICAL CONFERENCES, also known as

T/C Press; TECHNOMIC PUBLISHING CO., INC.; TISSUE CULTURE

ASSOCIATION, INC.; TRANSACTION PUBLISHERS; VAN NOSRTRAND REINHOLD;

VCH PUBLISHERS, INC.; VNU BUSINESS PUBLICATIONS INC.; W.B. SAUNDERS

COMPANY; WALTER DE GRUYTER, INC.; WARREN GORHAM & LAMONT, INC.;

WASHINGTON REGULATORY REPORTING ASSOC.; WILLIAMS & WILKINS, INC.;

WOLTERS KLUWER ACADEMIC PUBLISHERS B.V.; AMERICAN GEOPHYSICAL

UNION; ELSEVIER SCIENCE PUBLISHING CO., INC.; PERGAMON PRESS, LTD.;

SPRINGER-VERLAG, GMBH & CO., K.G.; JOHN WILEY & SONS, INCORPORATED;

WILEY HEYDEN, LTD.; HUMAN SCIENCES PRESS INC. PUBLISHING

CORPORATION AND PLENUM PUBLISHING CORPORATION, 

                                                  Petitioners - Appellees,

                                      - v. -

                                   TEXACO INC.,

                                                   Respondent - Appellant.

                                 TABLE OF CONTENTS

 Page

INTEREST OF THE AMERICAN LIBRARY ASSOCIATION  . . . . . . . . . . . . .   1

      A.     Libraries Have Had a Special Historical Role

             in Disseminating Published Works . . . . . . . . . . . . .   2

      B.     The American Library Association Has Been

             at the Forefront of the Development of the

             Fair Use Doctrine . . . . . . .  . . . . . . . . . . . . .   4

ARGUMENT . . . . . . . . . . . . . . . . . .  . . . . . . . . . . . . .   6

I.THE SCOPE OF COPYRIGHT IS LIMITED BY THE

CONSTITUTION AND THE DOCTRINE OF FAIR USE. . . . . . . . . . . . . . . .  7

II.THE DISTRICT COURT'S ANALYSIS IS UNSOUND AND

UNSUPPORTED BY THE RECORD. . . . . . . . . . . . . . . . . . . . . . . .  9

A.    The District Court Incorrectly Analyzed the

      Purpose and Character of Texaco's Use. . . . . . . . . . . . . . . 10

B.    The Nature of the Copyrighted Work Fully

      Supports A Finding of Fair Use   . . . . . . . . . . . . . . . . . 13

C.    The District Court Erred in Applying the

      Amount and Substantiality Test . . . . . . . . . . . . . . . . . . 14

D.    The District Court Failed to Make a Coherent

      Analysis of the Effect on the Market for the

      Copyrighted Work . . . . . . . . . . . . . . . . . . . . . . . . . 17

CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

                   INTEREST OF THE AMERICAN LIBRARY ASSOCIATION

      The American Library Association ("ALA") is a non-profit

organization with more than 55,000 members, including libraries,

information specialists, library users, trustees, educators and

friends of libraries.  Founded in 1876, ALA is the oldest and

largest national library association in the world.  ALA provides

leadership for the development, promotion and improvement of

library and information services.  ALA also furthers the work of

librarians by its defense of intellectual freedom and support for

widespread access to information to expand knowledge.

      The district court decision in this case, American Geophysical

Union v. Texaco, 802 F. Supp. 1 (S.D.N.Y. 1992) ("Texaco"),

misapplies and significantly erodes the fair use doctrine, a

judicially created defense to copyright infringement that Congress

enacted into law in 1976, which permits the copying of copyrighted

works if certain conditions are met.  While Congress has provided

public and special libraries with specific protection for

photocopying of copyrighted materials in Section 108 of the

Copyright Revision Act of 1976 ("the Act"), the scope of the fair

use doctrine conveys far broader and more important protection.

      If allowed to stand, the district court's decision will

significantly impair libraries from fulfilling historic and

constitutionally protected obligations and potentially will require

them to assume substantial costs and burdens.  In the end, it is

the public's interest in the advancement of learning and expansion

of knowledge that will be injured the most; that loss will be

irreparable.  Therefore, ALA respectfully files as amicus to urge

reversal of the decision of the district court.

      A.     Libraries Have Had a Special Historical Role in

             Disseminating Published Works                           

      When our nation was founded, an individual's personal library

was an important measure of one's wealth and standing in society. 

R. A. Rutland, "Madison's Bookish Habits," 37 Quarterly Journal of

the Library of Congress No. 2, 176 (Spring 1980).  Libraries open

to the public were virtually nonexistent.

      James Madison, known as "the father of the Constitution,"

thought a great deal about the importance of and how to make the

scarce published works of the day available to promote the quality

of public knowledge and debate.  See generally, A. Koch, "James

Madison and the Library of Congress," 37 Quarterly Journal of the

Library of Congress, No. 2, 159 (Spring 1980).  Towards that end,

while serving as a member of the Constitutional Congress, Madison

prepared a list of over 1300 volumes "proper for the use of

Congress," which included histories, political discourse,

philosophy, law and literature.  Rutland, supra at 181.  Many of

these works were copyrighted.  Ibid.

      When he became President, Madison authorized the acquisition

of Thomas Jefferson's library, perhaps the finest and most complete

collection in the country at that time, to replace the books and

publications that were destroyed when the British burned the U.S.

Capitol during the War of 1812.  He also ordered construction of a

building, now part of the Library of Congress, in which to house

this priceless acquisition.  Madison wanted this library to be the

principal national repository of copyrighted works and a model for

other libraries.  Madison further envisioned libraries as essential

for the dissemination of published works to foster the free flow of

ideas necessary to keep a democracy vibrant.  His words to that

effect remain inscribed on the Library of Congress' Madison

Memorial Hall:

             Learned institutions ought to be favorite objects

             with every free people.  They throw that light over

             the public mind which is the best security against

             crafty and dangerous encroachments on the public

             liberty.

Letter from James Madison to W.T. Barry, Lieutenant Governor of

Kentucky (Aug. 4, 1822).  While the public today has greater

overall access to information sources than existed in Madison's

time, access to academic, scientific and scholarly publications

continues to exist primarily through libraries.

      B.     The American Library Association Has Been at the

             Forefront of the Development of the Fair Use Doctrine 

      Because of the special role of libraries in our nation's

heritage, ALA has been at the forefront of development of the fair

use doctrine in the courts, as well as the Congress.  In 1972,

ALA participated as an amicus curiae before the United States Court

of Claims, the predecessor of the Federal Circuit, in the ground-

breaking case of Williams & Wilkins Company v. United States, 487

F.2d 1345 (Ct. Cl. 1973), aff'd per curiam by an equally divided

Court, 420 U.S. 376 (1975) ("Williams & Wilkins").  ALA argued in

that case that not-for-profit academic, research and public

libraries should not be liable for copyright infringement under the

fair use doctrine where single photocopies of portions of

copyrighted works were made for scientific and scholarly research. 

ALA also was concerned that an adverse holding in that case would

             quickly embroil libraries and librarians in

             negotiations, administrative matters and legal

             actions, the prospects or net effect of which will

             force the cessation of traditional library

             photocopying and the consequent denial of this

             important means of access to recorded knowledge to

             scientists, researchers and scholars.

Brief for Amicus ALA at 3, Williams & Wilkins Co. v. United States,

No. 73-68 (Ct. Cl. 1973).  

      The Court of Claims was persuaded by ALA's argument that

research and scholarship were the primary ends served rather than

commercial exploitation.  Accordingly, it held that copying done by

employees of the National Institute of Health, a nonprofit quasi-

governmental entity, qualified for fair use protection because it

served to advance science.  Williams & Wilkins, 487 F.2d at 1354. 

The Supreme Court affirmed Williams & Wilkins without an opinion,

in the absence of a majority.  ALA then turned to the Congress,

which codified the fair use doctrine in Section 107 of the Act.

      The Supreme Court first considered the statutory contours of

fair use in Sony Corp. of America v. Universal City Studios, 464

U.S. 417 (1984) ("Sony").  Participating as amicus curiae, ALA

successfully argued for reversal of the Ninth Circuit's decision to

deny copied video recordings the safe harbor of fair use, even when

the copies were made without any commercial motivation and did not

diminish the value of the owner's copyright.  Brief for Amicus ALA,

Sony, No. 81-1687 (Sup. Ct. 1984).  In particular, ALA argued

against the Ninth Circuit's misguided holding that "intrinsic" uses

of copyrighted materials were not fair use, since that would

             profoundly affect the ability of librarians to

             serve their patrons effectively [as] [l]ibraries

             are the critical link in bringing new information

             technologies to the public at large. . . .  If the

             decision of the Court of Appeals is not reversed,

             libraries could be accused of making, or of aiding

             and abetting unfair "intrinsic" uses of copyrighted

             materials.

Id. at 2.

                                     ARGUMENT

      Many of the same concerns presented in Williams & Wilkins and

Sony as to the scope and viability of the fair use doctrine and the

potential impact of the copyright law on libraries throughout the

nation compel ALA to appear before this Court as an amicus in this

case.  Held to the specific stipulated facts in which the instant

case arises, the Texaco decision can be read narrowly as simply

denying for-profit corporations and their employees the legal

defense of fair use when single copies are made of eight different

scientific articles in their entirety.  As explained more fully

below, rather than applying this Circuit's precedent to the facts

presented by this case, the district court has used this "test

case" to advance its perception of what the law should be.  See

generally, Leval, "Toward a Fair Use Standard," 103 Harv. L. Rev.

1105 (1990).  In doing so, the district court has exceeded its

jurisdiction and issued an ill-considered decision that must not be

allowed to stand.

I.    THE SCOPE OF COPYRIGHT IS LIMITED BY THE CONSTITUTION

      AND THE DOCTRINE OF FAIR USE                         

      Many of the deficiencies in the district court's fair use

analysis are derived from a central misperception about the

constitutional limits and purpose of the copyright law.  The

district court opined that

             The copyright law celebrates the profit motive . .

             .  The profit motive is the engine that ensures the

             progress of science . . .  The result is the

             progress of science; the means is the profit

             motive, which is underwritten by the law of

             copyright.

Texaco, 802 F. Supp. at 27 (emphasis in original).  The

Constitution and the courts, which initially created the fair use

doctrine, however, approach copyright from a far different

perspective than that of the district court in this case.

      The Constitution empowers Congress only

             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.

U.S. CONST., Art. I,  8, cl. 8 (emphasis added).  Copyright thus

is a privilege, which extends no further than necessary to provide

a qualified incentive for an individual to commit ideas into public

expression that may then be read, examined, and used by others to

expand on the existing body of knowledge.  As the Supreme Court

articulated in Twentieth Century Music Corp. v. Aiken, 422 U.S. 151

(1975):

             The limited scope of the copyright holder's

             statutory monopoly, like the limited copyright

             duration required by the Constitution, reflects a

             balance of competing claims upon the public

             interest: Creative work is to be encouraged and

             rewarded, but private motivation must ultimately

             serve the cause of promoting broad availability of

             literature, music and the other arts.

Id. at 156 (emphasis added).  Justice Stevens, writing for the

Court more recently in Sony, likewise observed that under the

Constitution,

             The monopoly privileges that Congress may authorize

             are neither unlimited nor primarily designed to

             provide a special private benefit.  Rather, the

             limited grant is a means by which an important

             public purpose may be achieved.

464 U.S. at 429.  The Sony opinion further underscored this

important historical point, quoting former Chief Justice Hughes in

Fox Film Corp. v. Doyal, 286 U.S. 123, 127 (1932), as follows:

             "The sole interest of the United States and the

             primary object in conferring the monopoly lie in

             the general benefits derived by the public from the

             labors of authors."

464 U.S. at 429.

      In Rosemont Enterprises, Inc. v. Random House, Inc., 366 F.2d

303 (2d Cir. 1966), cert. denied, 385 U.S. 1009 (1967) ("Rosemont

Enterprises), this Circuit defined the doctrine of fair use as

             a "privilege in others than the owner of a

             copyright to use the copyrighted material in a

             reasonable manner without his consent,

             notwithstanding the monopoly granted to the owner"

             . . .  

             The fundamental justification for the privilege

             lies in the constitutional purpose in granting

             copyright protection in the first instance . . . . 

             To serve that purpose, "courts in passing upon

             particular claims of infringement must occasionally

             subordinate the copyright holder's interest in a

             maximum financial return to the greater public

             interest in the development of art, science and

             industry."  Berlin v. E.C. Publication, Inc., 329

             F.2d 541, 544 (2d Cir. 1964).  Whether the

             privilege may justifiably be applied to particular

             materials turns initially on the nature of the

             materials, e.g., whether their distribution would

             serve the public interest in the free dissemination

             of information and whether their preparation 

             requires some use of prior materials dealing with

             the same subject matter.

366 F.2d at 306-7 (citations omitted, emphasis added). 

      However, the First Amendment further constrains Article I,

Section 8, Clause 8.  This tension has been resolved by application

of the equitable doctrine of fair use, as reflected in Wainwright

Securities, Inc. v. Wall Street Transcript Corp., 558 F.2d 91, (2d

Cir. 1977), cert. denied, 434 U.S. 1014 (1978):

             [c]onflicts between interests protected by the

             first amendment and the copyright law thus far have

             been resolved by application of the fair use

             doctrine.

Id. at 95.  See also, New Era Publications International, ApS v.

Henry Holt, & Co., 873 F.2d 576, 584 (2d Cir. 1989), cert. denied,

110 S. Ct. 1168 (1990) ("New Era I").

      Therefore, copyright conveyed by Article I, Section 8, Clause

8 of the U.S. Constitution is limited not only by its own terms,

but by the First Amendment and the doctrine of fair use, as it has

developed in the case law and by congressional mandate.

II.   THE DISTRICT COURT'S ANALYSIS IS UNSOUND AND

      UNSUPPORTED BY THE RECORD                   

      ALA's brief examines each of the four factors enumerated in 17

U.S.C.  107, which this Court's de novo review must consider.  In

Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539

(1985) ("Nation"), the Supreme Court instructed the lower courts

that fair use must be analyzed on a case-by-case basis because it

is not susceptible to a single, uniform definition:

             "[S]ince the doctrine is an equitable rule of

             reason, no generally applicable definition is

             possible, and each case raising the question must

             be decided on its own facts."

Id. at 560, quoting H. R. Rep. No. 1476, 94th Cong., 2d Sess. 65,

reprinted in U.S. Code Cong. & Admin. News 1976, 5659, 5679.  This

examination must also include consideration of the overall public

policy considerations inherent in application of an equitable

doctrine.  See, e.g., New Era I, 873 F.2d at 589; Weissmann v.

Freeman, 868 F.2d 1313, 1323 (2d Cir. 1989); Maxtone-Graham v.

Burtchaell, 803 F.2d 1253, 1260 (2d Cir. 1986), cert. denied, 481

U.S. 1059 (1987) ("Maxtone-Graham"); accord, Sony, 464 U.S. at 448

& n. 31, 454-56.

      A.     The District Court Incorrectly Analyzed the Purpose and

             Character of Texaco's Use                               

      It has long been recognized in this Circuit that

             whether an author or publisher has a commercial

             motive . . . is irrelevant to a determination of

             whether a particular use of copyrighted material in

             a work which offers some benefit to the public

             constitutes a fair use.

Rosemont Enterprises, 366 F.2d at 307.  See also, Consumers Union

of U.S. v. General Signal Corp., 724 F.2d 1044, 1049 (2d Cir.

1983), cert. denied, 469 U.S. 823 (1984) ("Consumers Union").  The

mere fact that Texaco potentially may derive some remote indirect

commercial gain from its scientists' copying of articles from The

Journal of Catalysis ("Catalysis") does not compel an adverse

finding under 17 U.S.C.  107(1), since Texaco had no interest in

"supplanting" the "right of first" publication.  Nation, 471 U.S.

at 562.  See also, Maxtone-Graham, 803 F.2d at 1260-62.  Accord,

Sega Enterprises Ltd. v. Accolade, Inc., 977 F.2d 1510, 1522-23

(9th Cir. 1992) ("Sega").

      The district court erroneously concluded that because the use

within Texaco's commercial environment was not "transformative," it

could not qualify as fair use.  Texaco, 802 F. Supp. at 11-13.  The

district court's reasoning, however, was based on the flawed

premise that the courts 

             consistently [express] preference for secondary

             uses that [do] not merely copy and offer themselves

             as substitutes for the original copyrighted text,

             but that used the matter taken from the copyrighted

             work for some new objective or purpose.  

Id. at 11.  It is not surprising that the district court cites no

authority for this proposition.  Id.  No such extrajudicial value

judgment is found in the case law because the plain language of 17

U.S.C.  107(1) does not speak of "transformative" uses, and the

courts must first and foremost be guided by the language that

Congress used to describe this requisite element of fair use. 

Accord, Sony, 464 U.S. at 431 ("The judiciary [should be reluctant]

to expand the protections afforded by the copyright without

explicit legislative guidance").

      Since the articles copied by one of Texaco's researchers

consisted primarily of published scientific research, that use fits

closer to the use approved in Williams & Wilkins than the

commercial exploitation of unpublished works disfavored in Nation. 

See 17 U.S.C.  107 ("research" is a specific category authorized

in 17 U.S.C.  107 as fair use).  Even when commercial gain is

conferred, this Circuit requires that the overall public benefit

resulting from a particular use be considered.  MCA Inc. v. Wilson,

677 F.2d 180, 182 (2d Cir. 1981).  The Ninth Circuit recently has

strongly endorsed a similar approach in Sega, 977 F.2d at 1523

("Public benefit need not be direct or tangible, but may arise

because the challenged use serves a public interest.")  The purpose

of the copied Catalysis articles in this case was for accuracy and

personal convenience, akin to note taking -- a use approved of by

this Circuit in Consumers Union:

             where accurate reporting requires use of verbatim

             quotations, fair use will be liberally applied.

724 F.2d at 1050.  See also, Nation, 471 U.S. at 563; Wright v.

Warner Books, Inc., 953 F.2d 731, 740 (2d Cir. 1991) ("Wright");

Lish v. Harper's Magazine Foundation, 807 F. Supp. 1090, 1095

(S.D.N.Y. 1992) ("Lish") ("where the original text will best report

the facts, copying the original words may be permissible because

the quotation of the factual statement may involve no expressive

content whatsoever"), citing, Newman, "Not the End of History:  The

Second Circuit Struggles with Fair Use," 37 J. Copyright Soc'y 12

(1990).

      Justice O'Connor, writing for the Court in Nation, carefully

made the point that

             The crux of the profit/non-profit distinction is

             not whether the sole motive of the use is monetary

             gain but whether the user stands to profit from

             exploitation of the copyrighted material without

             paying the customary price.

471 U.S. at 562.  See also, Roy Export Co. Establishment v.

Columbia Broadcasting System, Inc., 672 F.2d 1095, 1104 (2d Cir.),

cert. denied, 459 U.S. 826 (1982).  In light of Texaco's increased

purchases of Catalysis subscriptions, it cannot credibly be argued

that consumer demand was diminished in any significant or

meaningful manner or that Texaco sought to avoid paying "the

customary price."  In this regard, the district court erred by

failing to give due credit to the propriety of Texaco's conduct. 

See e.g., Salinger v. Random House, Inc., 811 F.2d 90, 96 (2d

Cir.), cert. denied, 484 U.S. 890 (1987) ("Salinger"); Maxtone -

Graham, 803 F.2d at 1264; Lish, 807 F. Supp. at 1096-1101. Since

Texaco was a subscriber to Catalysis, and indeed increased its

subscriptions from one to three at the higher $828 per subscription

institutional rate, the purpose and character of its researcher's

copying individual articles thereof does not exhibit bad faith.  

Thus, the equities reflect that the purpose and character of

Texaco's use was not unfair.  The district court's finding

otherwise should be reversed.

      B.     The Nature of the Copyrighted Work Fully Supports A

             Finding of Fair Use                                   

      The district court properly concluded that, because the

material copied by Texaco was essentially factual in nature, "the

nature of the copyrighted work" element supported a finding of fair

use.  Texaco, 802 F. Supp. at 16-17.  While ALA concurs with this

conclusion, certain assumptions in the district court's reasoning

must be addressed.

      Without publishers being willing to assume financial risks of

publication and dissemination, the district court assumes that

"there would be no reason for authors to write [scientific

articles]; even if they did, the articles would fail to achieve

distribution that promoted the progress of science."  Id. at 16. 

Here, the district court ignored credible and undisputed evidence

that authors of scholarly articles in scientific journals such as

Catalysis are primarily motivated to prepare and submit such works

in order to make a contribution to learning and gain peer

acceptance for their ideas rather than to generate copyright

royalties.  See, Schwartz Trial Testimony at pp. 8-9.  Moreover, it

is well known that university faculty members typically give away

such research for nominal or even no royalties in order to publish

works which will qualify for tenure or simply promote their ideas. 

See generally, S. Bennett and N. Matheson, "Scholarly Articles: 

Valuable Commodities for Universities," Chronicle of Higher

Education 1 (May 27, 1992).  Ironically, university libraries in

particular are the largest purchasers of scientific journals and

make up the primary market for such research and scholarship. 

Ibid.  Therefore, libraries and library users, particularly those

in the academic community, should certainly be among the prime

beneficiaries of the fair use doctrine, in light of the "nature of

the copyrighted work."

      C.     The District Court Erred in Applying the Amount

             and Substantiality Test                        

      The Supreme Court has held that even copying a copyrighted

work in its entirety does not preclude a finding of fair use.  See

Sony, 464 U.S at 449-50.  This Circuit in Maxtone-Graham held that

             There are no absolute rules as to how much of a

             copyrighted work may be copied and still be

             considered fair use.

803 F.2d at 1263.  See also, Wright, 953 F.2d at 738; accord, Sega,

977 F.2d at 1526.  This Circuit has acknowledged that this factor

has "both a quantitative and a qualitative component."  New Era

Publications International v. Carol Publishing Group, 904 F.2d 152,

158 (2d. Cir. 1990).

      Although Catalysis' publisher registered entire issues with

the U.S. Copyright Office, the record reflects that the individual

articles contained therein were not registered.  Without citation

to any evidence or authority, however, the district court concluded

that "Each article, note or letter published in Catalysis is a

separately authored work, protected by a copyright."  Texaco, 802

F. Supp. at 17 (emphasis added).  Catalysis, however, clearly is a

"collective work," which is defined in the Act as

             a periodical issue. . ., in which a number of

             contributions, constituting separate and

             independent works in themselves, are assembled into

             a collective whole.

17 U.S.C.  101.  By law, the copyright for a compilation or

collective work extends only to the material contributed by the

author of the work, e.g., the collection and assembling of pre-

existing materials or data that are selected, coordinated, or

arranged in such a way that the resulting work as a whole

constitutes an original work.  Id.  The evidence is undisputed that

Texaco copied only unregistered articles, not entire issues of

Catalysis.  Therefore, plaintiffs do not -- even to this day --

have a properly registered copyright in the material that was

actually copied, a prerequisite for bringing an infringement

action.  While the defective registration may still be curable

at this juncture, see e.g., Computer Associates Intern., Inc. v.

Altai, Inc., 775 F. Supp. 544, 555-57 (E.D.N.Y. 1991) (Pratt, J.),

aff'd in part and rev'd on other grounds, No. 91-7893, Slip op. at

4770 (2d Cir. Dec. 17, 1992), the underlying policy judgment made

by the district court in glossing over this statutory requirement

is most troubling, since it subsumes substantive jurisdiction and

standing.  Nevertheless, the district court sua sponte excused the

publisher from complying with the statutory registration

requirements established by Congress on grounds of presumed

burdensomeness

             it would involve gigantic expense and inconvenience

             to register separately each of the 20 odd items

             that appear in an individual issue.

Texaco, 802 F. Supp. at 17.  The publishers' perceived burden,

however, pales beside the one that the district court readily would

impose on libraries, particularly non-public ones.  To avoid even

the potential threat of liability, such libraries either would be

required to succumb to the unregulated royalty structure designed

and imposed by the Copyright Clearance Center ("CCC") or to

assume the burden of ascertaining the employment status and intent

of every library user who wishes to make a copy, as well as the

ultimate purpose to which the copy would be put.  Placing aside the

affront to individual constitutional rights, the administrative and

financial burdens required to conduct such interrogations would

seriously impair the principal work of libraries.  The district

court's subsumed judgment that libraries rather than publishers

should bear these burdens, is patently inconsistent with the

underlying purpose of copyright, i.e., to enhance knowledge.  For

these reasons, the district court's findings as to amount and

substantially of copying should be reversed.

      D.     The District Court Failed to Make a Coherent Analysis of

             the Effect on the Market for the Copyrighted Work       

      The Supreme Court has made it clear that the effect on the

market "is undoubtably the single most important element of fair

use."  Nation, 471 U.S. at 566.  This inquiry should focus on

whether if the challenged use

             "should become widespread, it would adversely

             affect the potential market for the copyrighted

             work," by diminishing potential sales, interfering

             with market ability, or usurping the market.

Sega, 977 F.2d at 1523, quoting Sony, 464 U.S. at 451.

      This Circuit also has made it clear that the proper inquiry

concerns the potential market for the copyrighted work.  Salinger,

811 F.2d at 99.  As it also explained in Consumers Union

             The theory behind the copyright law is that

             creation will be discouraged if demand can be

             undercut by copiers.  Where the copy does not

             compete in any way with the original, this concern

             is absent.

724 F.2d at 1051 (emphasis added).  Texaco's copying, however, did

not "usurp" the market, as was done in Nation and Salinger, nor did

it affect the limited monopoly conveyed by copyright.

      The district court did not even bother to define the universe

of existing Catalysis customers or the scope of that publication's

potential market.  Absent such analysis, it is impossible to deduce

any potential market that may be foreclosed by Texaco's copying or

to conclude from the evidence that it had any affect on Catalysis,

other than an insignificant or de minimus one.  Nevertheless, the

district court was persuaded that, but for Texaco's copying, it

would "need to provide" its researchers with additional copies of

Catalysis which would "substantially supplement the revenues of the

copyright owning publishers."  Texaco, 802 F. Supp. at 18.  Of

course, the district court does not reveal the number of additional

subscriptions that it would require Texaco to buy in order to avoid

liability.

      The district court also concludes that Texaco would

"nonetheless continue to provide its scientists with copies, so

long as there exists a means of doing so that is not excessively

expensive or burdensome. . . ."  Id.  Nothing in the record

supports that assumption nor does the district court provide any

insight as to what it believes "excessive expense" or "burdensome"

means.

      Instead, the district court repeated plaintiffs argument that

Texaco

             could purchase additional subscriptions; it could

             purchase back issues or back volumes; it could

             order tear sheets from document delivery services

             that purchase subscriptions; it could order

             photocopies from document services that make copies

             and license agreements with the plaintiff-

             publishers and pay royalties to the publishers for

             all copies made; it could negotiate a license

             directly with a particular publisher to pay a

             blanket fee for the right to make photocopies at

             will; or, alternatively, Texaco could photocopy

             articles as needed for its scientists by operating

             under the TRS or AAS licensed services offered by

             the CCC.

Id.  None of these options would appear to be a realistic

alternative since the copy was made by Texaco's researcher for

accuracy, as well as his personal convenience.  As the district

court even acknowledged, "what a scientist needs is a photocopy,"

not complete back volumes, back issues and the like.  Id. (emphasis

in original).

      Of direct concern to ALA is that Texaco could make a

reasonable business judgment and choose to close its in-house

library, deciding that the cost of providing 400-500 scientists

with secondary research materials in-house was too high.  Thus,

Texaco's management could require its scientists to obtain any such

research from other sources, including public libraries.  While the

district court at least recognized that this route could be

pursued, it does not acknowledge or consider the burden this would

shift to libraries.  Texaco, 802 F. Supp. at 22.

      The most revealing defect in the district court's analysis of

the effect on the market is its failure to acknowledge that the

Constitution does not guarantee publishers profitability; it merely

provides authors with a limited incentive to creative in order to

serve a larger societal goal -- the enhancement of knowledge.  See,

U.S. CONST. Art. I,  8, cl. 8.  Yet, the district court was not

constrained from leaping over this hurdle concluding that the

publishers "powerfully demonstrated entitlement" to prevail as to

the effect of Texaco's copying on the market for the copyrighted

work.  Texaco, 802 F. Supp. at 18.

      For these additional reasons, the district court's conclusion

that Catalysis' market was adversely affected by Texaco's copying

is incorrect and should be overruled.

                                    CONCLUSION

      In effect, this Circuit has been asked to hold that copying

factual research, which ultimately may benefit a commercial entity,

is presumptively not fair use.  If that holding becomes the law of

this Circuit, how do libraries protect themselves from even

potential liability other than barring users from copying

information, which may even remotely result in a benefit to a for-

profit entity?  How do libraries conduct this inquiry without a

direct assault on constitutionally and statutorily protected rights

to privacy?  How do libraries pay for this inquiry?  Certainly the

publishers who will directly profit from such a scheme, including

the coalition members listed in the caption of this case, do not

propose to reimburse libraries for the direct and indirect costs

they would impose.  Their objective is to use libraries, which are

undoubtably the largest purchasers of copyrighted works,

particularly of scientific research, to further increase publisher

profits by making libraries accede to the highly questionable CCC

arrangement and police library patrons --- goals far from Madison's

mind when he looked to libraries to promote learning and expand

knowledge to foster democracy.

      Clearly the continued viability of the fair use doctrine is an

essential pre-requisite to our nation's libraries being able to

fulfill the unique and important role that the Constitution's

author envisioned and intended for libraries in a free society. 

The wisdom of James Madison's words, written over two hundred years

ago, is still valid today.

             Knowledge Will Forever Govern Ignorance:  And A

             People Who Mean To Be Their Own Governors, Must Arm

             Themselves With The Power Which Knowledge Gives.

Letter from James Madison to W.T. Barry, Lieutenant Governor of

Kentucky (August 4, 1822).

      Texaco's copying of research articles, under the facts as

stipulated by parties in this litigation, should be accorded the

defense of fair use by this Circuit as the benefits to society from

the "use" in this case, far outweigh any remote pecuniary benefit

to Texaco, without denigrating or devaluing the limited monopoly

that Catalysis enjoys in any way.  Because of the scholarship of

former Judge Learned Hand this Circuit has long been recognized as

one of the leading courts concerning the law of copyright.  

      This Circuit previously has utilized the fair use doctrine to

"avoid rigid application of the copyright statute  when, on

occasion, it could stifle the very creativity which that law is

designed to foster."  Iowa State Univ. Research Found., Inc. v.

American Broadcasting, 621 F.2d 57, 60 (2d Cir. 1980).  See also,

Consumers Union, 724 F.2d at 1048.  It should again do so by

applying the fair use doctrine in this case and reverse the

district court's opinion.

                                            Respectfully submitted,

                                            Susan G. Braden

                                            INGERSOLL AND BLOCH, CHARTERED

                                            1401 Sixteenth Street, N.W.

                                            Washington, D.C.  20036

                                            (202) 232-1015

                                            Attorney for The American

                                              Library Association

Of Counsel:

Reuben B. Robertson

INGERSOLL AND BLOCH, CHARTERED

1401 Sixteenth Street, N.W.

Washington, D.C.  20036

(202) 232-1015

Attorney for The American Library

  Association

                                     FOOTNOTES

1.    Reflecting the diversity of its membership, ALA has eleven

functional divisions:  American Association of School Libraries;

Association of College and Research Libraries; Public Library

Association; Association of Specialized and Cooperative Library

Agencies; American Library Trustee Association; Association of

Library Collections and Technical Services; Association of Library

Service to Children; Library Administration and Management

Association; Library and Information Technology Association;

Reference and Adult Services Division and Young Adult Library

Services Association.

2.    Pub. L. 94-553, Title I,  101, 17 U.S.C.  101 et seq. (Oct.

19, 1976).  Under the statute, the rights of a libraries or

archives, or employees thereof acting within the scope of their

employment, to reproduce and distribute copies of copyrighted works

are limited to "no more than one copy of a work" and are subject to

three specific overall conditions:  (1) the copying or distribution

must be "made without any purpose of direct or indirect commercial

advantage"; (2) the collections of the library or archives must be

open to the public or available not only to affiliated researchers

but also to "other persons doing research in a specialized field";

and (3) "notice of copyright" must be included. 17 U.S.C.  108(a).

3.    Should this Court decide to affirm any aspect of the district

court's decision, ALA respectfully requests that this Court's

decision specifically distinguish any such holding to minimize any

potential adverse impact on libraries for the reasons discussed

herein.

4.    For a detailed historical perspective of ALA's role prior to

1972, particularly in formulating the "Gentlemen's Agreement" of

1935, a policy statement designed to define what constituted fair

use of library copying of both copyrighted and non-copyrighted

works, see L. C. Tepper, "Copyright Law and Library Photocopying: 

A Historical Survey," 84 Law Library Journal 341, 346-49 (1992).

5.    Section 107 of the Act establishes that the fair use of a

copyrighted work is not an infringement and further provides the

following guidance:

             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 non-profit 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 on the potential

             market for or value of the copyrighted work.

17 U.S.C.  107 (emphasis added).

6.    The district court noted that Catalysis was offered at an

institutional rate, which Texaco paid, that was double the price of

an individual subscription.  Texaco, 802 F. Supp. at 7.  The

district court's analysis failed to acknowledge that the existence

of these two rates in part reflects the publisher's inherent

recognition that it is likely that copies will be made of such

publications by institutional subscribers, or their users, thereby

justifying the substantial differential between institutional and

individual subscription rates.

7.    The fact that the authors of these articles may have agreed to

transfer their rights to the publisher, Texaco, 802 F. Supp. at 6,

does not affect the publisher's obligations regarding registration,

which remain.

      Moreover, ALA questions exactly what standing plaintiffs have

even to assert the claims that district court adjudicated.  Does

the district court have the power simply "to assume" critical

jurisdictional facts, without opening the door to advisory

opinions, not authorized by law?  Where is affirmative proof in the

record that these authors had proper and exclusive legal authority

to transfer their rights?  Without such proof, this decision should

be vacated as a matter of law.  See Lujan v. Defenders of Wildlife,

119 L. Ed. 2d. 351, 364-65 (1992) (the party invoking federal court

jurisdiction must establish each element of standing by specific

affirmative evidence).

8.    Among the most troubling aspects of the district court's

decision is its inherent endorsement of CCC and its publisher's set

fee structure.  Texaco, 802 F. Supp. at 24-26.  While some of ALA's

members have joined CCC, the majority have not.  Even if CCC

membership were obtained, libraries and their users would still

remain in peril, as not all publications are registered with CCC. 

Moreover, the "reasonableness" of CCC's unregulated fee structure

is far from settled.  Before embracing CCC, the district court

should bear in mind the warning of the Ninth Circuit in Sega:

             an attempt to monopolize [a] market by making it

             impossible for others to compete runs counter to

             the statutory purpose of promoting creative

             expression and cannot constitute a strong equitable

             bases for resisting the invocation of the fair use

             doctrine.

977 F.2d at 1524.  Yet the district court's decision would appear

to place libraries at risk if they fail to pay fees demanded by

CCC.  Texaco, 802 F. Supp. at 13-14 n.13.

9.    For example, if Texaco's employee went to a public library,

should it require that he disclose his employer, the nature of his

research, whether the research is for profit, or whether it is

close to fruition?  Should that library keep records of the

responses?  Who has the right to see them?  What if the library

user were an employee of a public university; of a private

university?  What if he were employed by a profit-making company,

but was conducting his research under a government contract? 

Public libraries should not be placed in the position of making

judgments as to the lawfulness of photocopying based upon their

view of the commerciality of the copier's motivations.