In November the United States Supreme Court denied the petition for writ of certiorari in Cariou v. Prince, the most significant copyright fair use case to be petitioned to the Court in 20 years. The case involves the unlicensed use of Patrick Cariou’s photographs in works of art made by appropriation artist Richard Prince, some of which were then sold by Prince for millions of dollars. When Cariou filed suit for copyright infringement, Prince defended himself against the claim by asserting that he did not need Cariou’s permission to use the photographs because his use was a “fair use” under the Copyright Act. Cariou prevailed at the federal district court level: the judge found that the fair use defense did not apply and held for Cariou. When Prince appealed to the Second Circuit, the appeals court reversed and found that Prince’s appropriation of the photographs was fair.Cariou v. Prince, 714 F.3d 694 (2nd Cir. 2013)

The test for whether or not an unauthorized use of copyrighted material constitutes a fair use requires a court to measure and weigh four separate and broadly stated factors: the purpose and character of the use, the nature of the copyrighted work, the amount and substantiality of the portion used in relation to the whole, and the effect of the use on the market for the original (17 USC § 107). Any one of the four factors may, depending on the specific facts of the case, tip the scales one way or the other. Trying to apply this test in practice has, more than in some other areas of law, driven both litigants and courts to look for guidance from the Supreme Court, and for at least two reasons. First, because the analysis is so fact-specific, almost every fair use case differs from almost every other fair use case, which makes it difficult to find precedent that precisely applies to current cases. Second, because the test is inherently ambiguous, parties and courts have relied on the Supreme Court’s statements about how the test should be interpreted. In a case that involved a question about whether the rap group 2 Live Crew’s use of the Buddy Holly song “Pretty Woman” was a fair use, the Court said that an aspect of the inquiry under the first fair use factor, which looks at “the purpose and character of the use”, should be whether the use is “transformative” in the sense that it “adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message.”Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579-80 (1994). This statement has been highly influential in guiding lower courts’ applications of the fair use test in many cases over the last twenty years.

Cariou, for one, believes the transformative test (a first factor sub-test of the fair use test) has carried too much weight. The primary argument in his petition to the Supreme Court was that through undue expansion of the transformative test, the Second Circuit changed the first factor analysis from an examination of “the purpose and character of the use” to an examination of “the purpose or character of the use.” Cariou objected to the Second Circuit’s having disregarded Richard Prince’s testimony that commenting on Cariou’s work was not his purpose: Prince testified, against his own interest, that he was just trying to create “a balls-out, great, unbelievably looking great painting that had to do with a kind of rock-and-roll painting on the radical side, and on a conservative side something to do with Cézanne’s bathers.” Cariou argued that by asserting that “the law imposes no requirement that a work comment on the original” from which it borrows “in order to be considered transformative,” the Second Circuit expanded the transformative test to such an extent that any unauthorized use of copyrighted material which adds new expression or meaning to the original would qualify as fair use, regardless of its purpose. Prince v. Cariou, 713 F.3d at 708. Cariou cited prior Second Circuit precedent against the Second Circuit’s current reasoning: “If an infringement of copyrightable expression could be justified as fair use solely on the basis of the infringer’s claim to a higher or different artistic use . . . there would be no practicable boundary to the fair use defense.” Rogers v. Koons, 960 F.2d 301, 310 (2nd Cir. 1992).

The New York Intellectual Property Law Association agreed with Cariou. In an amicus brief filed on the same day that the Supreme Court denied Cariou’s petition, NYIPLA argued that the Second Circuit’s analysis was plainly wrong and that its expansion of the transformative test does not accord with the statutory preamble of the fair use test, which states that fair use exists “for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship or research.” 17 USC § 107. NYIPLA asserted that although the Supreme Court created the transformative test regarding the first factor, the Supreme Court “never said that the inquiry into transformation should be divorced from the purposes set forth in the preamble.” NYIPLA and Cariou both argued that allowing the Second Circuit’s expanded transformative test to stand would undermine a copyright owner’s important right to control the creation of derivative works based on an original copyrighted work, as NYIPLA asserted: “if no distinction is recognized between transforming something for purposes of fair use, on the one hand, and transforming something for purposes of creating a derivative work, on the other hand, then the exclusive right of the original author to prepare and authorize derivative works will be judicially written out of the Copyright Act.” 

The Second Circuit’s ruling has already influenced at least two subsequent cases this year. In a case involving the unlicensed use of a work of graphic art in a video backdrop created for a concert by the band Green Day, the Ninth Circuit cited the opinion in support of the assertion that “an allegedly infringing work is typically viewed as transformative as long as new expressive content of message is apparent . . . even where – as here – the allegedly infringing work makes few physical changes to the original or fails to comment on the original.” Seltzer v. Green Day, Inc., 725 F.3d 1170, 1177 (9th Cir. 2013). And, in a case involving the unlicensed use of a photograph of Mayor Paul Soglin of Madison, Wisconsin on T-shirts, the Federal District Court for the Western District of Wisconsin followed the Second Circuit’s reasoning and stated that “a work could be transformative even without commenting on [the author’s] work or on culture.” Kienitz v. Sconnie Nation LLC, 2013 U.S. Dist. LEXIS 115141, 17. 

Are Cariou and its supporting amicus NYIPLA correct that the Second Circuit has improperly expanded fair use by allowing the transformative test to trump the fair use purposes stated in the preamble of the statute? The argument they advance may be too restrictive a reading of the fair use test, because the Supreme Court stated in Campbell that the statutory text “employs the terms ‘including’ and ‘such as’ in the preamble paragraph to indicate the ‘illustrative and not limitative’ function of the examples given” Campbell, 510 US at 577. This language would appear to justify the Second Circuit’s reasoning that fair use can include other purposes than those listed in the preamble. On the contrary, the Second Circuit’s reading of the transformative test does appear to pose a real danger to a copyright owner’s exclusive right to prepare, and authorize others to prepare, derivative works. By definition, every derivative work is transformative of the original, so is every unlicensed derivative work now to be considered a fair use, so long as it adds something new to the original? The Second Circuit clearly did not intend to render copyright licenses unnecessary in all circumstances, but such an extremity may find interpretive support in the Second Circuit’s reading of the transformative test, which could mean that unauthorized users of copyrighted works who make transformative use could carry the first fair use factor in their favor regardless of the purposes of their use.

This clash of views would benefit from clarification. Although the Supreme Court denied Cariou’s petition for writ of certiorari, the case is not over, because the Second Circuit remanded the open issues to the Federal District Court. That means that Cariou may be able to file another petition once there is a final ruling in his case, though he would have to come back before the Second Circuit to obtain it. If Cariou takes a second bite at the writ of certiorari apple in 2014, that could prove nourishing to authors, photographers, songwriters, filmmakers and lots of other kinds of artists who are in the business of licensing their creative work under copyright law.