[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]






                         THE SCOPE OF FAIR USE

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                     COURTS, INTELLECTUAL PROPERTY,
                            AND THE INTERNET

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                            JANUARY 28, 2014

                               __________

                           Serial No. 113-82

                               __________

         Printed for the use of the Committee on the Judiciary





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                       COMMITTEE ON THE JUDICIARY

                   BOB GOODLATTE, Virginia, Chairman
F. JAMES SENSENBRENNER, Jr.,         JOHN CONYERS, Jr., Michigan
    Wisconsin                        JERROLD NADLER, New York
HOWARD COBLE, North Carolina         ROBERT C. ``BOBBY'' SCOTT, 
LAMAR SMITH, Texas                       Virginia
STEVE CHABOT, Ohio                   ZOE LOFGREN, California
SPENCER BACHUS, Alabama              SHEILA JACKSON LEE, Texas
DARRELL E. ISSA, California          STEVE COHEN, Tennessee
J. RANDY FORBES, Virginia            HENRY C. ``HANK'' JOHNSON, Jr.,
STEVE KING, Iowa                       Georgia
TRENT FRANKS, Arizona                PEDRO R. PIERLUISI, Puerto Rico
LOUIE GOHMERT, Texas                 JUDY CHU, California
JIM JORDAN, Ohio                     TED DEUTCH, Florida
TED POE, Texas                       LUIS V. GUTIERREZ, Illinois
JASON CHAFFETZ, Utah                 KAREN BASS, California
TOM MARINO, Pennsylvania             CEDRIC RICHMOND, Louisiana
TREY GOWDY, South Carolina           SUZAN DelBENE, Washington
RAUL LABRADOR, Idaho                 JOE GARCIA, Florida
BLAKE FARENTHOLD, Texas              HAKEEM JEFFRIES, New York
GEORGE HOLDING, North Carolina       DAVID N. CICILLINE, Rhode Island
DOUG COLLINS, Georgia
RON DeSANTIS, Florida
JASON T. SMITH, Missouri
[Vacant]

           Shelley Husband, Chief of Staff & General Counsel
        Perry Apelbaum, Minority Staff Director & Chief Counsel
                                 ------                                

    Subcommittee on Courts, Intellectual Property, and the Internet

                 HOWARD COBLE, North Carolina, Chairman

                TOM MARINO, Pennsylvania, Vice-Chairman

F. JAMES SENSENBRENNER, Jr.,         JOHN CONYERS, Jr., Michigan
Wisconsin                            HENRY C. ``HANK'' JOHNSON, Jr.,
LAMAR SMITH, Texas                     Georgia
STEVE CHABOT, Ohio                   JUDY CHU, California
DARRELL E. ISSA, California          TED DEUTCH, Florida
TED POE, Texas                       KAREN BASS, California
JASON CHAFFETZ, Utah                 CEDRIC RICHMOND, Louisiana
BLAKE FARENTHOLD, Texas              SUZAN DelBENE, Washington
GEORGE HOLDING, North Carolina       HAKEEM JEFFRIES, New York
DOUG COLLINS, Georgia                JERROLD NADLER, New York
RON DeSANTIS, Florida                ZOE LOFGREN, California
JASON T. SMITH, Missouri             SHEILA JACKSON LEE, Texas
[Vacant]                             [Vacant]

                       Joe Keeley, Chief Counsel

                   Stephanie Moore, Minority Counsel
























                            C O N T E N T S

                              ----------                              

                            JANUARY 28, 2014

                                                                   Page

                           OPENING STATEMENTS

The Honorable Howard Coble, a Representative in Congress from the 
  State of North Carolina, and Chairman, Subcommittee on Courts, 
  Intellectual Property, and the Internet........................     1

The Honorable John Conyers, Jr., a Representative in Congress 
  from the State of Michigan, Ranking Member, Committee on the 
  Judiciary, and Member, Subcommittee on Courts, Intellectual 
  Property, and the Internet.....................................     2

The Honorable Bob Goodlatte, a Representative in Congress from 
  the State of Virginia, and Chairman, Committee on the Judiciary     3

                               WITNESSES

Peter Jaszi, Professor, Faculty Director, Glushko-Samuelson 
  Intellectual Property Clinic, Washington College of Law, 
  American University
  Oral Testimony.................................................     6
  Prepared Statement.............................................     8

June M. Besek, Executive Director, Kernochan Center for Law, 
  Media and the Arts and Lecturer-in-Law, Columbia School of LAw
  Oral Testimony.................................................    13
  Prepared Statement.............................................    14

Naomi Novik, Author and Co-Founder, Organization for 
  Transformative Works
  Oral Testimony.................................................    22
  Prepared Statement.............................................    25

David Lowery, Singer/Songwriter and Lecturer, Terry College of 
  Business, University of Georgia
  Oral Testimony.................................................    32
  Prepared Statement.............................................    34

Kurt Wimmer, General Counsel, Newspaper Association of America
  Oral Testimony.................................................    40
  Prepared Statement.............................................    42

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

Material submitted by the Honorable Zoe Lofgren, a Representative 
  in Congress from the State of California, and Member, 
  Subcommittee on Courts, Intellectual Property, and the Internet    58

                                APPENDIX
               Material Submitted for the Hearing Record

Material submitted by the Honorable Blake Farenthold, a 
  Representative in Congress from the State of Texas, and Member, 
  Subcommittee on Courts, Intellectual Property, and the Internet    70

Prepared Statement of the Association of American Publishers 
  (AAP)..........................................................   104

Prepared Statement of the American Council on Education (ACE)....   112

Prepared Statement of the American Society of Media Photographers 
  (ASMP).........................................................   116

Prepared Statement of the Computer & Communications Industry 
  Association (CCIA).............................................   123

Letter from the Copyright Alliance...............................   127

Prepared Statement of the Future of Music Coalition..............   135

Prepared Statement of the Library Copyright Alliance (LCA).......   144

Prepared Statement of Marc Maurer, President, The National 
  Federation of the Blind........................................   155

Prepared Statement of Sherwin Siy, Vice President, Legal Affairs, 
  Public Knowledge...............................................   162

 
                         THE SCOPE OF FAIR USE

                              ----------                              


                       TUESDAY, JANUARY 28, 2014

                        House of Representatives

            Subcommittee on Courts, Intellectual Property, 
                            and the Internet

                       Committee on the Judiciary

                            Washington, DC.

    The Subcommittee met, pursuant to call, at 1:32 p.m., in 
room 2141, Rayburn Office Building, the Honorable Howard Coble 
(Chairman of the Subcommittee) presiding.
    Present: Representatives Coble, Goodlatte, Conyers, Marino, 
Smith of Texas, Holding, Collins, Smith of Missouri, Johnson, 
Chu, Deutch, DelBene, Nadler, and Lofgren.
    Staff present: (Majority) Joe Keeley, Chief Counsel; Olivia 
Lee, Clerk; (Minority) Stephanie Moore, Minority Counsel; Jason 
Everett, Counsel.
    Mr. Coble. Good afternoon, ladies and gentlemen.
    The Subcommittee on Courts, Intellectual Property, and the 
Internet will come to order. Without objection, the Chair is 
authorized to declare recesses of the Subcommittee at any time.
    We welcome all of our witnesses today.
    And I will give my opening statement at this point. And I 
think Mr. Conyers is en route, I am told.
    Fair use was formally incorporated into our copyright law 
in 1976 and has been at the heart of a large number of 
copyright infringement disputes. Disputes over fair use range 
from cases that only pertain to individual uses of copyrighted 
works to cases involving high-technology goods, which 
oftentimes can affect millions of consumers in congressional 
districts throughout the country.
    North Carolina, my state, is home to several large 
universities that rely upon copyright law to protect their 
research and innovation at the same time, and through fair use, 
to make other works available for libraries, scholarship, and 
other research. Fair use has an important role in our copyright 
system. And while it offers tremendous benefits, it has also 
raised some concerns, which is why today's hearing is so 
important.
    Rather than steal thunder from our talented panel of 
witnesses, I am going to withhold my comments about the pros 
and cons of fair use, until our expert witnesses have had an 
opportunity to lay out their arguments of what has worked well 
and what deserves additional scrutiny.
    As many of you know, the strength of fair use is that it is 
somewhat ambiguous, leaving the courts with the discretion to 
clarify what is and what is not fair use. This ambiguity is 
also, unfortunately, its greatest weakness, particularly in the 
digital era because new technologies develop far faster than 
disputes are resolved in the courts. We have an important role 
and many believe that we can do a better job providing the 
courts with guidance on what we intend and what we do not 
intend to be fair use, which could help resolve many disputes 
dealing with fair use.
    It is true that fair use can be very controversial. But, I 
want to assure our witnesses and those in the audience today 
that all of the extra security you see today on the Capitol 
complex is due to the State of the Union Address rather than 
the topic of this hearing. [Laughter.]
    So, we can all rest easy about that.
    So, please feel free to speak candidly and help us 
understand how we can improve fair use and protect the rights 
of authors and creators.
    In closing, we welcome our eminently qualified panel of 
witnesses. Thank you for taking time from your busy schedules 
to join us today. And we look forward to hearing from you.
    I yield back my time and now recognize the distinguished 
gentleman from Michigan, the Ranking Member of the full 
Committee, Mr. John Conyers.
    Mr. Conyers. Thank you, Chairman Coble. It is very kind of 
you to bring us all together again for this first hearing.
    Today's hearing provides an important opportunity to 
examine the scope of the fair use doctrine, as codified in 
section 107 of the copyright law, fair use is an affirmative 
defense against infringement, under certain criteria as a 
starting point. I generally believe that fair use is working as 
intended. It provides a limited exception to the creator's 
property rights when certain public interests conflict with 
those rights.
    The current law attempts to strike a delicate balance 
between the public interests and a creator's ability to earn a 
living from his or her work. Creators should be able to tell 
new stories that contribute to public learning by using 
permitted copyrighted material as historical artifacts to 
depict real-world scenes and events. Historians, biographers, 
and filmmakers use these materials in their works to draw 
meaning and insights about historical events. The use of this 
copyrighted material is essential to discuss historic events, 
which is critical to news organizations and public 
broadcasters. Additionally, current law, while not perfect, 
provides reliable guidance to copyright holders.
    Although we must continue to monitor this area, as digital 
technology continues to develop and change distribution of 
content, we must be vigilant in safeguarding the rights of 
creators. In particular, I want the witnesses today to address 
whether certain calls for expansion of fair use is due partly 
to the fact that specific statutory limitations have not kept 
pace with emerging technologies.
    And finally, content owners and user groups should continue 
to develop best practices to ensure that both of their 
interests are reflected. To be clear, I believe that the 
interests in maintaining the fair use's historic role as a 
flexible doctrine should continue to be applied in a broad 
range of contexts. We should also reexamine the application of, 
quote, unquote, ``Transformative use standard.'' The 
transformative use standard has become all things to all 
people. Fair use impacts all types of industry, including 
filmmaking, poetry, photography, music, education, and 
journalism. We must continue to encourage these industries to 
develop best practices.
    I too look forward to hearing the witnesses discuss their 
opinions about the scope of fair use and what steps, if any, 
they believe we in Congress should take to make the law more 
effective and efficient.
    I thank you, Chairman.
    Mr. Coble. I thank the gentleman from Michigan, Mr. 
Conyers.
    And the Chair is now pleased to recognize the distinguished 
gentleman from Virginia, the Chairman of the full Judiciary 
Committee, Mr. Goodlatte.
    Mr. Goodlatte. Thank you very much, Mr. Chairman.
    This afternoon the Subcommittee will hear about a crucial 
component of our Nation's copyright law system, fair use. As a 
judicial doctrine, fair use has long been part of copyright 
infringement cases. As a statutory provision, however, fair use 
is a much more recent part of our Nation's copyright law, 
codified in section 107 only in 1976. With the exception of the 
last sentence of section 107 that added in 1992 to address fair 
use issues related to unpublished works, section 107 has 
remained unchanged since 1976.
    Over the years, fair use has been widely recognized as 
providing flexibility in the copyright system, flexibility that 
has enabled commercial parody and flexibility that has 
encouraged new business models in the tech sector. Fair use has 
been at the heart of several important Supreme Court cases, 
such as the Pretty Woman and Betamax cases. While there is no 
doubt that flexibility in the copyright system is beneficial, 
certainty, with regard to our legal provisions, is just as 
beneficial, both for copyright owners and copyright users. Not 
every dispute over what is and what is not fair use should 
require a judicial interpretation.
    So, I am interested in learning how the statutory 
provisions of section 107 have succeeded since their initial 
codification in 1976. Are these provisions too specific or not 
specific enough? Are the current four factors the appropriate 
factors? And, are they defined correctly? How should fair use 
interact with other provisions of copyright law? And, probably 
the most important question, how does one define what is 
transformative?
    As several of our witnesses have noted in their written 
testimony, the test of what is transformative has been widely 
viewed by Federal judges to be of primary importance. I look 
forward to hearing--learning more about this and other fair use 
issues this morning.
    And I thank the Chairman and yield back.
    Mr. Coble. I thank the Chairman.
    And the statements of other Members of the Judiciary 
Committee, without objection, will be made part of the record.
    Ladies and gentlemen, there is a no taxpayer funded 
prohibition for funding abortion, and it will be on the floor 
later today. The Judiciary Committee has been given a timeslot 
and I think some of the Members, John, maybe will want to 
participate in that. So, when that timeslot arrives, we will 
stand in a brief recess giving--to accommodate those who want 
to go on the floor. So, we will try to keep this going as 
quickly as we can, without keeping you all here until dark. 
[Laughter.]
    We traditionally swear in our witnesses----
    Mr. Nadler. Mr. Chairman?
    Mr. Coble. Yes, sir.
    Mr. Nadler. Mr. Chairman, it is, I believe, the invaluable 
custom of the House that a Committee or Subcommittee hearing 
does not occur while a Committee bill is pending on the floor. 
And that means the entire Committee bill, since I am sure many 
Members of the Committee will want to be on the floor for 
debate on the abortion bill, a rather important bill, and 
should not be and would not want to be there only for a small 
segment of that debate. And I think that it is improper, under 
the precedence of the House, to have the Subcommittee reconvene 
prior to or while H.R. 7 is still being debated on the floor.
    Mr. Coble. Well, I say to my colleague from New York, I 
don't set the schedule of the floor schedule, nor the 
Subcommittee schedule for hearings. So, hold me harmless for 
that.
    Mr. Nadler. Well, I will--Mr. Chairman, I don't--I am not 
seeking to place blame at all. I imagine that the intent was to 
have H.R. 7 started today, just do the rule and do the bill 
tomorrow, and have the Agriculture bill, but the AG bill came 
up. But, that is, nonetheless, where we stand now. And it is, I 
think, an imposition on the duties of the Members of this 
Subcommittee who have to participate in the debate on H.R. 7 to 
try to be in two places at once. And I think it wrong and an 
adjustment ought to be made in the schedule of the Subcommittee 
now, since we cannot control the schedule of the House.
    Mr. Goodlatte. Mr. Chairman?
    Mr. Coble. Mr. Goodlatte?
    Mr. Goodlatte. Thank you, Mr. Chairman.
    Well, first of all, the Committee ordinarily tries to avoid 
conflicting activities. We did not plan this hearing intending 
to have a conflict on the floor. We only learned of exact floor 
timing, for H.R. 7, yesterday. Many of our witnesses have come 
from out of town. We need to make every effort to complete this 
important hearing. And this is a very important hearing, one of 
the most important hearings we will hold on copyright law. And 
we have the State of the Union Address coming up rapidly later 
on. So, we have to take the time to get this done. We certainly 
should recess the Subcommittee during the time that the 
Judiciary Committee will be managing the bill on the floor.
    But, our Committee rules state that the Subcommittee should 
plan hearings with a view toward avoiding simultaneous 
scheduling of full Committee and Subcommittee meetings or 
hearings whenever possible. We scheduled this hearing. We were 
not aware of a potential conflict with floor activities. 
Nonetheless, the rule does not prevent us from moving forward 
today.
    And H.R. 7, the bill on the floor, while it is an important 
bill and we have paid close attention to it in this Committee, 
is not primarily the jurisdiction of the Judiciary Committee. 
The Subcommittee will, in my opinion, be best served by moving 
ahead expeditiously with our witnesses and our questioning of 
the witnesses and then recessing at the time that our portion 
of the debate is in close proximity to beginning, allowing 
enough time for Members to get over there for when it does 
begin.
    And I thank the Chairman and yield back.
    Mr. Coble. I thank the gentleman----
    Mr. Conyers. Mr. Chairman?
    Mr. Coble. The gentleman from Michigan?
    Mr. Conyers. May I add to this discussion? First of all, I 
want to commend Jerry Nadler for initiating this discussion. I 
think that this conflict of an important bill coming out of 
Judiciary, being on the floor and we being overlapped with 
important hearings and distinguished witnesses at the same 
time, that this should serve as an example for all of us that 
this should not happen again under any circumstances for the 
remainder of the 113th Congress.
    Mr. Coble. Well, I thank the gentleman.
    After having said all of that, I think we need to move 
along because we have out-of-state witnesses here. And as I 
say, I don't want to keep you all here until the last dog is 
hanged tonight.
    So, we traditionally swear in our witnesses.
    [Witnesses sworn.]
    Mr. Coble. And I now am pleased to recognize our witnesses.
    Our first witness today, Mr. Peter Jaszi, Professor of Law 
at American University of Washington's College of Law and 
Faculty Director of the Glushko-Samuelson Intellectual Property 
Clinic. Professor Jaszi teaches domestic and international 
copyright law as well as Law in Literature. Professor Jaszi 
received both his J.D. and his A.B. degrees from Harvard 
University.
    Our second witness is Ms. June Besek. Correct 
pronunciation, Ms. Besek?
    Ms. Besek. Besek.
    Mr. Coble. Lecturer in law at Columbia School of Law and 
Executive Director of the Kernochan Center for Law, Media, and 
the Arts. In her position she oversees studies on national and 
international intellectual property issues. Professor Besek 
received her J.D. from New York University and her B.A. from 
Yale University.
    Ms. Novik, our third witness is author and cofounder of the 
Organization of Transformative Works. Ms. Novik is best known 
for her fantasy and alternative history series of novels. She 
received her Master's in Computer Science from Columbia 
University and B.S. in English Literature from Brown 
University.
    Our fourth witness, Mr. David Lowery is a singer and 
songwriter and lecturer at the Terry College of Business at the 
University of Georgia. As a guitarist, vocalist, and 
songwriter, Mr. Lowery founded the alternative rock band Camper 
Van Beethoven and cofounded the rock band Cracker. He received 
his B.A. in mathematics from the University of California, 
Santa Cruz.
    Our final witness is Mr. Kurt Wimmer, General Counsel for 
the Newspaper Association of America, a nonprofit organization 
representing publishers of more than 2,000 newspapers in the 
United States and Canada. Mr. Wimmer received his degree--his 
law degree and Master's degree from Syracuse University and his 
Bachelor's from Missouri School of Journalism.
    We welcome you all. And, in view of the time restraints, we 
would appreciate your confining your statements, if you can, in 
or about 5 minutes. There is a panel on the table that will 
reflect green, amber, and red. When the red light appears, the 
ice upon which you are skating will become thinner and thinner. 
[Laughter.]
    You won't be keelhauled, but you--we will ask you to--and 
we try to comply with the 5-minute rule as well.
    So, if--we will start, Professor, with you. You will be our 
first witness.
    Mr. Jaszi. Thank you, Mr. Chairman. And thanks to the 
Members of the Committee----
    Mr. Coble. Mike.
    Mr. Jaszi [continuing]. For this invitation.
    Mr. Coble. Thank you, John, for your comments.
    Mr. Conyers. No, thank you, sir.

TESTIMONY OF PETER JASZI, PROFESSOR, FACULTY DIRECTOR, GLUSHKO-
 SAMUELSON INTELLECTUAL PROPERTY CLINIC, WASHINGTON COLLEGE OF 
                    LAW, AMERICAN UNIVERSITY

    Mr. Jaszi. Thank you, Mr. Chairman. And thanks to the 
Members of the Committee for this invitation.
    The fair use doctrine helps guarantee the continued 
international permanency of the United States as a site of 
innovation. After a rocky start, the courts now are doing an 
excellent job of implementing the legislative direction 
contained in section 107, which, itself, restated more than a 
century of case law. Fair use doesn't need reform, but it could 
use legislative support. For example, Congress could exempt 
noncommercial creators of derivative works from potentially 
onerous statutory damages, which today chill the exercise of 
fair use. Congress could further enable fair use by amending 
section 301, which deals with Federal preemption of state law 
to bar some or all contractual waivers of the fair use right.
    In my written testimony, I tried to describe the current 
unified field theory of fair use that informs decisions from 
every part and at every level of the Federal court system 
today. As already noted, that unified field theory is keyed to 
the notion that uses that advance transformative ends, those 
that repurpose and add value to copyrighted material they 
employ, deserve special consideration.
    Yesterday, a Second Circuit Court of Appeals panel provided 
an illustration. The Bloomberg Professional Service had posted 
the recording of a conference call between executives of the 
Swatch Group and hundreds of registered financial advisors on 
its site, and Swatch had complained. In finding fair use, the 
court noted that, ``In the context of news reporting and 
analogous activities, the need to convey information to the 
public accurately may, in some instance, make it desirable and 
consonant with copyright law for a defendant to faithfully 
reproduce an original work. In such cases,'' the court 
continued, ``courts find transformation by emphasizing the 
altered purpose or context.'' The court also made it clear that 
Bloomberg's use of the entire recording was reasonable, in 
light of its purpose of disseminating important financial 
information to American investors and analysts. The point, 
again, and I want to stress this, was that Bloomberg was 
serving the collective public interest in access to 
information, without working great harm to any competing 
private interest.
    It is not surprising to see fair use at work in the 
journalism sector given that the Supreme Court has stressed the 
intimate connection between the fair use doctrine and the First 
Amendment. More broadly, however, we have seen, over the past 
20 years, how the fair use doctrine is experienced as an 
important positive right by readers and publishers, movie 
producers and remix artists, tech incumbents and startups, 
teachers, developers of educational materials, artists, 
scholars, librarians, providers of disability services, 
filmmakers, and other contributors to the kind of progress that 
our IP laws serve. Of course, not every person in every sector 
likes every fair use decision. But, we have all benefited, 
collectively, from this general, pro-innovation trend in our 
copyright law.
    The pattern of decisions, of which this Bloomberg case is 
the most recent example, articulate no a priori limits on the 
range of situations to which the doctrine is potentially 
applicable. They don't limit it to situations involving the 
creation of new copyrightable works or anything of the kind. 
And, given the ultimate goal of copyright, which isn't to favor 
any particular form of expression over others, but to promote 
the production and dissemination of useful knowledge, there is 
no apparent practical, non-ideological reason why such 
limitations would be desirable. At the very least, those who 
would now seek to rein in the future development of the fair 
use doctrine, have a heavy burden of persuasion to demonstrate 
why doing so would be in the public interest.
    We value fair use for its flexibility and dynamism, which 
allow courts to adapt the doctrine to new social, economic, and 
especially technological circumstances. This isn't to denigrate 
the value of static specific exceptions in copyright law, like 
sections 108 for libraries or 110 for education or 121 for the 
print disabled. Where these apply, they are valuable, highly 
valuable, to particular groups of users, because they provide 
high levels of certainty. They are, in effect, safe harbors 
even though never comprehensive and often not up to date. As 
Congress and the courts have recognized repeatedly, these 
provisions do not supplant fair use, rather they are 
supplemented by it.
    As Mr. Coble noted, one common critique of fair use is that 
its commendable flexibility gives rise to unacceptable levels 
of uncertainty. In fact, however, recent scholarship tends to 
show that fair use jurisprudence is both patterned and 
predictable. Lawyers and their clients actually have relatively 
little real difficulty forecasting likely fair use outcomes in 
areas where there are direct or even analogous precedents. Also 
contributing something to the predictability of fair use is the 
work of professional organizations that are developing fair use 
best practices, documents to guide their constituents in 
exercising their fair use rights responsibly and 
constructively, a tendency to which Mr. Conyers referred 
earlier.
    Finally though, the greatest credit for the healthy state 
of fair use law belongs to users large and small who invest 
time and thought in making sound fair use decisions, thus 
helping to assure the condition of cultural flourishing, which 
is the constitutional objective of copyright in the United 
States. I should add, then, that we at American University have 
been very pleased and proud to be involved, to some extent, in 
the work of developing fair use best practices. And have, over 
the last decade, been able to collaborate with a wide range of 
different professional organizations beginning with documentary 
filmmakers----
    Mr. Coble. Pardon?
    Voice. Are you going to----
    Mr. Coble. Yes.
    Mr. Jaszi [continuing]. Moving over the decade through a 
number of different areas of practice to a present day when we 
are working with the College Art Association on developing a 
comprehensive code of best practices----
    Mr. Coble. Professor----
    Mr. Jaszi [continuing]. For future use----
    Mr. Coble [continuing]. Your time is expired.
    Mr. Jaszi [continuing]. For instance in visual arts.
    Mr. Coble. Your time is expired.
    Mr. Jaszi. Thank you.
    [The prepared statement of Mr. Jaszi follows:]
    Prepared Statement of Peter Jaszi, Professor, Faculty Director, 
 Glushko-Samuelson Intellectual Property Clinic, Washington College of 
                        Law, American University
    I teach copyright law at the American University law school here in 
DC. For last decade or so, most of my work as a scholar, an activist 
and (occasionally) a litigator has focused on the fair use doctrine, 
which provides that under certain conditions, unlicensed uses of 
copyrighted material should be considered non-infringing because they 
contribute significantly to cultural progress and innovation in the 
information economy--a doctrine that the recent Commerce Department 
copyright Green Paper referred to as ``a fundamental linchpin of the 
U.S. copyright system.'' \1\
---------------------------------------------------------------------------
    \1\ Department of Commerce Internet Policy Task Force, ``Copyright 
Policy, Creativity, and Innovation in the Digital Economy'' (July 
2013), available at http://www.uspto.gov/news/publications/
copyrightgreenpaper.pdf.
---------------------------------------------------------------------------
    Over this period, I've come to the conclusion that fair use is 
definitely alive and well in U.S. copyright law, and that, after a 
rocky start, the courts are doing an excellent job implementing the 
congressional direction contained in Sec. 107. Fair use doesn't need 
legislative ``reform,'' but (as I'll explain) it might benefit from 
certain kinds of legislative support in years to come--especially 
relief from the operation of other statutory provisions (such as the 
current law of statutory damages) that have the unintended consequence 
of discouraging its legitimate exercise.
    At the outset, I should mention that whatever else can be said 
about it, my preoccupation with fair use and its benefits has an 
honorable pedigree. Like many copyright lawyers of my generation, I was 
introduced to the doctrine at a time when it did not loom as large as 
it does today--perhaps because copyright wasn't such a strong presence 
in our individual and collective cultural lives. Nonetheless, Professor 
Benjamin Kaplan, from whom I learned the basics of the subject in the 
early 1970's, was prescient about the importance of fair use--as he was 
about so much to do with the future of copyright and its coming 
engagement with new technology. Later in that decade it was Professor 
L. Ray Patterson who caught or attention by pointing out how much more 
important user-friendly copyright doctrines like fair use were likely 
to become in the aftermath of the Copyright Act of 1976.
    It's been 40 years, more or less, since I first spoke in public 
about fair use doctrine. In 1983, just prior to the Betamax 
decision,\2\ the doctrine (which traces its origins in our courts back 
to 1841) wasn't in particular good shape. After its codification in 
1978, a bad decade or so of false starts in judicial interpretation had 
ensued.\3\ In the midst of it I took the unconventional step--more out 
of naivete than as a matter conscious choice--and referred to fair use 
as a ``right,'' I was promptly taken to task by my more experienced co-
panelists.
---------------------------------------------------------------------------
    \2\ Sony Corp. Of Amer. v. Universal City Studios, Inc., 464 U.S. 
417 (1984).
    \3\ Today I'll draw a veil across this unfortunate historical 
episode, which is happily and firmly behind us; I've written about it 
elsewhere should anyone be interested, in ``Getting to Best Practices: 
A Personal Journey Around Fair Use,'' 57 J. of the Copyright Soc'y of 
the U.S.A. 315 (2010).
---------------------------------------------------------------------------
    Today, in a very different legal environment, I'd like to make four 
points about fair use, of which first is that the proposition that 
citizen's ability to make some socially and economically positive uses 
of copyrighted material without permission is a right, and now widely 
recognized as such--including acknowledgements by both the Congress \4\ 
and the Supreme Court, which has stressed the connection between fair 
use and the freedom of expression secured by the First Amendment:
---------------------------------------------------------------------------
    \4\ 17 U.S.C. Sec. 108(f)[4] (``Nothing in this section . . . in 
any way affects the right of fair use. . . .'')

        Copyright contains built-in First Amendment accommodations . . 
        . [T]he ``fair use'' defense allows the public to use not only 
        facts and ideas contained in a copyrighted work, but also 
        expression itself in certain circumstances.\5\
---------------------------------------------------------------------------
    \5\ Eldred v. Ashcroft, 537 U.S. 186, 219 (U.S. 2003)

    In a procedural setting, fair use typically is invoked (like other 
rights) as a affirmative defense, but in daily life, it's experienced 
as a important positive right by readers and publishers, movie 
companies and remix artists, tech giants, start-up innovators, 
teachers, developers of educational materials, artists, scholars, 
librarians, filmmakers and a long list of other contributors to the 
condition of ``cultural flourishing'' that our copyright system exists 
to support.
    My second point grows directly from this one. Today, fair use is 
working! For this we have two groups to thank--the federal courts and 
the ``user community'' (which means, of course, just about all of us, 
from time to time and situation to situation). The courts, with a big 
push from Judge Pierre Leval's classic law review article of 1990,\6\ 
managed to extricate the doctrine from the morass into which it had 
sunk in the 80's, and set it on a new course--the critical lever here 
being (of course) the notion that certain cases of productive 
unlicensed use, should be deemed fair and noninfringing because of 
their transformative purposes--a determination that, once made, 
cascades through the other statutory factors defined in Sec. 107.
---------------------------------------------------------------------------
    \6\ ``Toward a Fair Use Standard,'' 103 Harv. L. Rev. 1105.
---------------------------------------------------------------------------
    A word more may be in order here about the ``new'' jurisprudence of 
fair use and its implications. It arose, at least in part, as a result 
of two critical insights. The first was that, while many of the most 
characteristic forms of fair use in our daily cultural life (as 
acknowledged in the preamble to the statutory section) were private 
and/or non-commercial, most of the value-added uses that had been 
recognized as fair in decided cases were both public and commercial--
and that would continue to come before the courts. The other insight 
was that, at least in potential, any use of a copyrighted work can be 
licensed (and that, with new technology, more or less frictionless 
licensing was an ever more real possibility). So if the fourth fair use 
factor--harm to an actual or potential market--were to continue to 
dominate judicial analysis, the right often would lose out, and the 
public would go without the benefit of the innovation that was foregone 
or suppressed, whether a hard-hitting new documentary or a refinement 
of Internet search technology.
    The effect of the new jurisprudence of fair use has been to 
decenter the fourth fair use factor and to install in a central 
position the first factor inquiry into the purpose of the use, with an 
emphasis on whether the use can be considered a ``transformative'' 
one--that is, one that, as the Supreme Court put it in 1994, whether a 
use ``merely `supersede[s] the objects'' of the original . . . or 
instead
    adds something new, with a further purpose or different character, 
altering the first with new expression, meaning, or message[.]'' \7\ 
We've now had more than two decades of experience with this approach, 
and--as University of California-Los Angeles Professor Neal Netanel has 
noted--the courts have arrived at a point where the standard fair use 
analysis, which incorporates by reference all the considerations 
highlighted in the statute, has effectively been reduced to a two-stage 
inquiry: Does the use have a transformative purpose, and is the amount 
of copyright material used appropriate to that purpose? \8\ This 
development makes the doctrine more widely available and (as I'll 
discuss below) easier to predict.
---------------------------------------------------------------------------
    \7\ Campbell v. Acuff-Rose Music, 510 U.S. 569, 579 (1994), quoting 
Folsom v. Marsh, 9 F. Cas. 342, 348 (C.C.D. Mass. 1841) (this being the 
decision by Justice Story that launched fair use in the courts).
    \8\ ``Making Sense of Fair Use,'' 15 Lewis & Clark L. Rev. 715 
(2011).
---------------------------------------------------------------------------
    Recently, judicial decisions also reminded us that there may be 
more to the interpretation of the public-facing fair use doctrine than 
the four enumerated statutory factors, which by the terms of the 
stature clearly were not intended to exhaust the range of 
considerations that a court could take into account in making its 
determination. Thus, for example, in his recent decision in the Google 
Books case, Judge Denny Chin make clear reference to the ``public 
interest'' that would be served by allowing this digitization project 
to go forward under the rubric of fair use--as an independent 
consideration supporting the conclusion of his transformativeness-based 
analysis of the four factors.\9\
---------------------------------------------------------------------------
    \9\ Authors Guild, Inc. v. Google Inc., 2013 U.S. Dist. LEXIS 
162198 (S.D.N.Y. 2013), at *10-14 & 27-29 (``In my view, Google Books 
provides significant public benefits'').
---------------------------------------------------------------------------
    But no amount of forward looking judicial interpretation of the 
doctrine would have been enough had the constituent parts of what we 
describe with the ungainly designation of the ``user community'' not 
been willing to step up and make their own contribution to develop fair 
use by employing it and--where necessary--defending its exercise. Many 
groups deserve credit here: on the one hand, of course, libraries and 
tech startups, but also their occasional sparring partners commercial 
publishers and entertainment companies. All have made investments in 
``growing'' the fair use doctrine, and those investments have paid off. 
\10\
---------------------------------------------------------------------------
    \10\ Thus, for example, what is arguably the most significant 
single fair use decision after Campbell, Bill Graham Archives v. 
Dorling Kindersley Ltd., 448 F.3d 605 (2d Cir. N.Y. 2006), was the 
direct outcome of arguments present by a commercial publisher.
---------------------------------------------------------------------------
    Fair use, one might say, is like a muscle--it will grow in strength 
if it is exercised, and atrophy if it is not. But, by the same token, 
fair use is hardly unusual or exotic today. Everyone who makes culture 
or participates in the innovation economy relies on fair use 
routinely--whether they recognize it or not. Participants in the U.S. 
entertainment and information industries have well-established 
standards and norms relating to fair use; some, like book publishers, 
have long been accustomed to relying on the doctrine explicitly, both 
in and out of court, while others, like journalism, would not 
necessarily recognize their time-honored practices of unlicensed 
quotation from source material as falling under that legal designation. 
Something similar can be observed in the arts: for example, while there 
is a lively argument about the outer limits on ``appropriation art'' 
practices that should be sanctioned under fair use,\11\ most working 
artists will acknowledge that they rely extensively on their ability to 
quote the work of others in less flamboyant ways. What's notable about 
the current situation is that more and more business and practice 
communities are actively acknowledging the ways in which their 
contributions to our collective cultural and economic life depend on 
the ability to exercise the right of fair use in appropriate 
circumstances.\12\
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    \11\ As evidenced by responses to the decision in Cariou v. Prince, 
714 F.3d 694 (2d Cir. N.Y. 2013).
    \12\ A eloquent example--Georgetown Law School Professor Rebecca 
Tushnet's 2013 submission to the Commerce Department copyright task 
force--is to be found at www.ntia.doc.gov/files/ntia/
organization_for_transformative_works_comments.pdf.
---------------------------------------------------------------------------
    Which brings me to my third point. As recently as a decade ago, 
critics of fair use on the left and the right were calling attention to 
what they described as its ``vagueness'' and unpredictability. Today, 
even those critics have come to recognize the desirable flexibility of 
an open-ended fair use doctrine, but this grudging acknowledgement has 
linked to continuing expressions of doubt about the doctrine's 
uncertainty of application. The current state of the law is proving 
those critics wrong. Although, like any other legal doctrine, the 
application of fair use may sometimes be uncertain in true cases of 
first impression, lawyers (and their clients) have little real 
difficulty forecasting likely outcomes in areas where there are direct 
or analogous precedents.
    Scholars have demonstrated that fair use law is in fact more 
patterned, more predicable, and hence more reliable than the critics 
have claimed. Recently, New York University Professor Barton Beebe and 
Loyola University of Chicago Professor Matthew Sag, have employed 
rigorous empirical methodologies to arrive at this conclusion \13\ Two 
other comprehensive studies of the fair use doctrine in the United 
States, which emphasize its internal consistency and predictability, 
also deserve special mention--one by University of Pittsburgh Professor 
Michael Madison and another by University Of California, Berkeley, 
Professor Pamela Samuelson.\14\ Samuelson, one of the most respected 
figures in United States Copyright law, surveyed the entire landscape 
of fair use case law and grouped the decisions into `policy relevant 
clusters'. She concluded that ``once one recognizes that fair use cases 
tend to fall into common patterns'', the ``fair use is both more 
coherent and more predictable than many commentators have 
perceived''.\15\
---------------------------------------------------------------------------
    \13\ Beebe, Barton Beebe, An Empirical Study of United States 
Copyright Fair Use Opinions, 1978- 2005, 156 U. Pa. L. Rev. 549, 574-5 
(2008); Matthew Sag, Predicting Fair Use, 73 Ohio St. L.J. 47 (2012).
    \14\ Michael J. Madison, A Pattern-Oriented Approach to Fair Use, 
45 Wm. & Mary L. Rev. 1525 (2004); Pamela Samuelson, Unbundling Fair 
Uses, 77 Fordham L. Rev. 2537 (2009).
    \15\ Id. at 2541.
---------------------------------------------------------------------------
    Also contributing to the predictability of fair use are groups like 
the team I've helped to organize at American University, in 
collaboration with Prof. Patricia Aufderheide, have been helping groups 
of practitioners to develop fair use Best Practices documents to guide 
their constituents in exercising their fair use rights responsibly and 
constructively.\16\ And -most important of all--users, large and small, 
have been investing time in making sound fair use decisions, and 
resources in carrying them through to successful conclusion.
---------------------------------------------------------------------------
    \16\ Patricia Aufderheide and Peter Jaszi, Reclaiming fair use: How 
To Put Balance Back in Copyright (2011)
---------------------------------------------------------------------------
    Here I'd also stress a fourth point: Although there may be aspects 
of the copyright law that could benefit from modest updating to make 
them more appropriate to the new conditions of digital information 
exchange, fair use is not one of them. In fact, the last decade has 
seen a proliferation of decisions applying this flexible, purpose-based 
doctrine to uses in the digital domain, from the development of 
interoperable software products and Internet search technology, to the 
practice of remix culture, though mass digitization in the promotion of 
access to knowledge. Until recently, some had argued that the federal 
courts were developing two competing (or at least potentially 
inconsistent) cultures of transformative fair use--one in the Ninth 
Circuit, where most cases specifically involving new digital 
technologies had been litigated, and another in the Second, the long-
time home of fair use decision-making involving more traditional forms 
of culture-making. But (putting aside the unlikely chance of 
significant revision on appeal), the recent decisions of Judge Harold 
Baer in Authors Guild v. HathiTrust and Judge Denny Chin in Authors 
Guild v. Google Books, both from the Southern District of New York,\17\ 
demonstrate otherwise by relying significantly on relevant Ninth 
Circuit precedents with no direct counterparts in the Second. In 
effect, in only a few short decades, the courts have developed a robust 
``unified field theory'' of fair use which is fully capable of meeting 
the digital challenge and should be allowed to do so, just as fair use 
doctrine has been allowed, over more that 170 years, to adapt to other 
changes in circumstance.
---------------------------------------------------------------------------
    \17\ Authors Guild v. HathiTrust and Authors Guild, Inc. v. Google 
Inc., 2013 U.S. Dist. LEXIS 162198 (S.D.N.Y. 2013).
---------------------------------------------------------------------------
    I'd add here that the adaptation of fair use to the networked 
information environment has been significantly enhanced by the work of 
Congress and the agencies. Many of us were concerned in 1998 that the 
new anti-circumvention provisions of the DMCA might spell the effective 
end of fair use in the Internet environment, but these concerns were 
met, in part, by Congress' foresight in incorporating the Sec. (a)(1) 
triennial rulemaking into the DMCA, and the fair and conscientious 
manner in which the U.S. Copyright Office, the NTIA, and--ultimately--
the Librarian of Congress have exercised the authority delegated under 
this provisions. No rulemaking can ever satisfy everyone, and those of 
us who have unsuccessfully proposed exceptions in this process would, 
of course, prefer that they had been granted, and hope that they will 
be in the future. That said, the procedure as it stands is 
unnecessarily cumbersome. and imposes considerable costs on the often 
poorly funded NGO's who bear the primary burden of proposing and 
justifying exceptions. One modest reform would be to create a procedure 
through which exceptions that have been renewed, in substantially the 
same form, over a series of triennia, could be incorporated into the 
statutory text itself.
    I'll conclude, if I may, with a pair of suggestions, a trio of 
recommendations, and a question for this subcommittee.
    The first suggestion is simply this: Don't mess with fair use. 
After a rough start post-1978, the doctrine has now been recognized for 
the essential feature of copyright doctrine that it is, and tweaks or 
improvements (whether intended to broaden or narrow the doctrine) could 
have serious and adverse unintended consequences--discouraging exactly 
the kind of new creativity that copyright is supposed to promote. The 
doctrine works in practice, as already described, and it is also 
theoretically sound.
    One theoretical critique is that the new transformativeness-based 
jurisprudence of fair use is somehow in conflict with the reservation 
to the copyright owner, in Sec. 106, of an exclusive right to prepare 
``derivative'' works (a category defined in the Act to include works in 
which preexisting materials are ``transformed'' through re-use). This 
argument misses the mark in two different ways. Most important, it 
fails to recognize that all the Sec. 106 exclusive rights are made 
specifically subject to exception in Sec. 107, which provides for fair 
use. In addition, it overlooks the fact that the word ``transform'' 
means different things in different contexts: Thus, any slight 
adjustment to an existing work renders it a ``derivative'' one within 
the meaning of Sec. 101, but according the courts a ``transformative 
purpose'' that can qualify a use as fair demands far, far more in the 
nature of value added.
    Finally, let me suggest--in the strongest terms--that you approach 
with extreme caution any proposal to facilitate short-form, non-
precedential determinations of fair use disputes--whether by 
administrative or judicial means. Fair use decisions belong in the 
Article III courts, and the continued development of the doctrine, over 
time, has been the result of the accrual of precedents from the federal 
judiciary. Tampering with this proven scheme could only work mischief 
with the functioning of this important doctrine.
    My recommendations are these:

          One. Although ``transformative'' fair use is thriving 
        in the courts, the same cannot be said of another branch of the 
        same doctrine--that is, private use. Once we took for granted 
        that members of society who had legitimate access to 
        information products could do a wide range of things with their 
        content, including uses for study, research and personal 
        entertainment. Increasingly, however, this understanding is 
        threatened in the digital environment, by contractual 
        provisions (often included as ``boilerplate'' in terms of 
        service offered to consumers on a take-it-or-leave-it basis). 
        Congress should consider taking action, perhaps in the form of 
        amendments to Sec. 301 of the Copyright Act, that would insure 
        that fair use survives such attempts at contractual override.

          Two. I mentioned earlier that, all in all, Sec. 
        1201(a)(1) of the Copyright Act has produced an imperfect 
        compromise between the concerns of content owners who employ 
        technological protection measures to secure their content, on 
        the one hand, and legitimate users, on the other; not even that 
        much can be said of the so-called notice-and-takedown 
        provisions of Sec. 512, also introduced under the DMCA. As the 
        provision now stands, ISP's have every incentive to remove from 
        their services and platforms whatever on-line content that has 
        been designated, on no matter how superficial a basis, as 
        potentially infringing. By contrast, the provisions of Sec. 
        512(g), which describe a procedure by which such content can be 
        replaced on line at the demand of the individual or company who 
        originally posted it, are cumbersome and largely unworkable. 
        Clearly, Congress should consider the fact, documented in 
        several studies,\18\ that the public at large is losing access 
        to legitimate fair use expressions by virtue of Sec. 512--a 
        cultural problem that deserves congressional consideration, and 
        probably requires a legislative solution.
---------------------------------------------------------------------------
    \18\ See Dena Chen, Musetta Durkee, Jared Friend, and Jennifer 
Urban, ``Updating 17 U.S.C. Sec. 512's Notice and Takedown Procedure 
for Innovators'' (Public Knowledge, 2011), available at http://
www.publicknowledge.org/files/docs/cranoticetakedown.pdf.

          Three. By raising the apparent stakes for would-be 
        fair users, the current law of statutory damages has the effect 
        of significantly discouraging reliance on the doctrine by just 
        those individuals whose cultural contributions it is designed 
        to foster. Creative artists, independent scholars, filmmakers 
        and others sometimes forego fair use because they do not 
        understand or feel they cannot predict the application of the 
        ``innocent infringement'' provisions of Sec. 504(c)(2) to their 
        situations. I'd suggest that a more straightforward, ``fair 
        use-friendly'' approach would be to bar statutory damages in 
        all actions for non-willful infringement brought against non-
        commercial users--and to make clear that a good-faith belief in 
---------------------------------------------------------------------------
        the fairness of a particular use negates willfulness.

    The question I'll leave you with requires a preamble. As already 
noted, we know that in the United States the fair use doctrine adds 
materially to our cultural choices, our learning opportunities, and our 
access to innovation. We can only wonder (with some bemusement) why 
some of our most important foreign competitors, like the European 
Union, haven't figured out that fair use is, to a great extent, the 
``secret sauce'' of U.S. cultural competitiveness.\19\ But that's their 
loss and our gain. The position may be different where some of our 
other trading partners are concerned. In trade-based agreements that 
are designed, in part, to ``harmonize'' national copyright laws between 
the U.S. and less developed countries, limitations on copyright 
protection (and especially fair use) typically go unaddressed. These 
agreements often leave lingering and often crippling doubts in these 
countries about whether (from the U.S. perspective) they are free to 
follow our example and adopt a flexible, dynamic approach to 
transformative uses in their national legislation. The presence of such 
doubts may, I suppose, work to the short-term competitive advantage of 
the U.S. But given the dependence of our national economy on the 
success of the world economy, I would ask whether this one-sided 
approach is really in our national interest--and (beyond that) whether 
it is ethically defensible?
---------------------------------------------------------------------------
    \19\ For a sense of the value that fair use (and allied doctrines) 
contribute to the U.S. economy, see Thomas Rogers and Andrew 
Szamosszegi, Economic Contribution of Industries Relying on Fair Use, 
(Computer & Communications Industry Ass'n 2001).
---------------------------------------------------------------------------
                               __________

    Mr. Coble. I failed to tell you folks, when the illuminated 
red goes to illuminated yellow that is your 4-minute warning.
    But, Miss--Professor Besek, you are next.
    Ms. Besek. Thank you, Mr. Chairman--is that on?
    Mr. Coble. Mike.
    Ms. Besek. This one?

   TESTIMONY OF JUNE M. BESEK, EXECUTIVE DIRECTOR, KERNOCHAN 
    CENTER FOR LAW, MEDIA AND THE ARTS AND LECTURER-IN-LAW, 
                     COLUMBIA SCHOOL OF LAW

    Ms. Besek. Thank you, Mr. Chairman and Members of the 
Committee, for giving me the opportunity to be here today.
    In early 2008, Columbia Law School sponsored a daylong 
symposium titled Fair Use: Incredibly Shrinking or 
Extraordinarily Expanding. What was apparent 6 years ago is 
even more obvious now. Fair use is extraordinarily expanding.
    Until recently, the courts held that generally it is not a 
fair use if you copy an entire work. From the point where 
copying an entire work generally defeats fair use, now copying 
the full contents of millions of works can qualify as fair use. 
So, why might this expansion spark concern? Fair use is an 
essential part of U.S. copyright law, but it isn't meant to be 
a carte blanche to make unlimited use of others' works, even 
for a socially beneficial cause. The rights of creators and the 
interests of users have to be balanced.
    How did the law move so far so quickly? Well, the principal 
reason for this expansion has been the increasing significance 
of transformative use in evaluating fair use. This happened 
since the Supreme Court's decision in Campbell against Acuff-
Rose. You may know that opinion; it had to do with a parody by 
2 Live Crew of the song ``Pretty Woman.'' Now, the Sixth 
Circuit had said 2 Live Crew did not make a fair use; it had 
relied on an earlier case which said that commercial use is 
presumptively unfair. The Sixth Circuit resolved factors one 
and four, which are often considered to be the most important, 
on the basis of this commercial use. Its decision wasn't 
atypical. A lot of courts had been doing that, depending on the 
commercial use and making commercial use virtually dispositive 
of fair use. In reversing, the Supreme Court said commercial 
uses can be fair, and that is one aspect of factor one. But, 
another important one is transformative use, and that is using 
a work in a way that adds something new, altering the other 
work with new expression, meaning, or message.
    Like Campbell itself, earlier fair use cases involved 
productive uses. And they were premised on use of the work 
itself, for example to annotate, to analyze, to create a 
parody. But, post-Campbell cases began to interpret 
``transformative'' in two significantly expansive ways.
    First, to encompass not only changes to the substance of a 
work, but changes to how the work is used. They referred to 
this repurposing as ``functional transformation.'' But, the 
second aspect, and more concerning, is that courts began to 
apply the transformative and functional transformation labels 
not only to new works that incorporate unaltered copies of 
earlier works, but also to new uses that exploit the prior work 
without creating a new work. So, transformative has been 
uprooted from its original context of new works to become 
applied to a much broader context of new purposes, enabling new 
business models rather than new works of authorship.
    One troubling consequence is that if a court finds the 
defendant's use of an author's work is transformative, because 
it reaches new markets or a new audience, that finding can 
usurp the author's derivative work rights, particularly with 
respect to potential markets for the work. Because once a court 
has found that a transformative purpose exists with respect to 
a new use it tends, increasingly, to find that the new use 
exploits a transformative market that doesn't compete with the 
author's markets. Basically, authors' rights can hinge on a 
race to the market for new and sometimes unanticipated uses.
    Now, over the years, fair use case law has sometimes 
strayed too far in one direction or the other. I mentioned 
earlier that courts had been using commercial use as, 
dispositive of factors one and four, because of the statement 
of Sony that commercial use is presumptively unfair. And, in 
Campbell, the court stepped in to try to restore that balance. 
But, now the pendulum has swung the other way. A finding that a 
use is transformative tends to sweep everything before it, 
reducing the statutory multifactor assessment to a single 
inquiry. It is important that the fair use pendulum once again 
be moved back toward the center.
    Despite the concerns I just voiced, fair use remains a rule 
whose application is best made by judges, as the Congress 
recognized when it first put fair use into the statute, back in 
the 1976 Act. But, as we have seen, the pendulum can swing in 
both directions. There are times when a legislative 
intervention may be appropriate, when that application proves 
too rigid or too expansive.
    I think the current judicial expansion of fair use may 
reflect concern to preserve the benefits of mass digitization, 
notwithstanding the tension between mass digitizing and the 
Copyright Act itself. I think, without altering the text of 
section 107, Congress might separately address the problems of 
mass digitization, which is skewing the law. If Congress turned 
its attention to those issues, it might relieve the pressure 
that risks turning the fair use doctrine into a free pass for 
new business models, and restore fair use to its most 
appropriate role of fostering new authorship.
    Thank you.
    [The prepared statement of Ms. Besek follows:]
  Prepared Statement of June M. Besek, Executive Director, Kernochan 
 Center for Law, Media and the Arts and Lecturer-in-Law, Columbia Law 
                                 School
    Thank you, Chairman Goodlatte, Chairman Coble, Ranking Member 
Conyers, and members of the Committee. Good afternoon, ladies and 
gentlemen. My name is June Besek. I am the Executive Director of the 
Kernochan Center for Law, Media and the Arts at Columbia Law School and 
a Lecturer-in-Law at Columbia, where I teach seminars on advanced 
copyright and legal issues concerning individual creators--authors, 
artists and performers. I have practiced in the field of copyright 
since 1985, roughly half of that time in private practice and the other 
half in academia.
    I'm here today to discuss fair use, and to emphasize its rapid 
expansion.
                       the importance of fair use
    Fair use is an exception to the exclusive rights the Copyright Act 
vests in authors. It excuses exploitations of a work that would 
otherwise be infringing. Fair use is an essential part of U.S. 
copyright law. It promotes cultural exchange and the creation of new 
works by facilitating activities such as education and scholarship, 
news, criticism and parody. Fair use is a critical means by which the 
copyright law fosters creative expression.
    The fair use doctrine is contained in section 107 of the Copyright 
Act:

        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.

        The fact that a work is unpublished shall not itself bar a 
        finding of fair use if such finding is made upon consideration 
        of all the above factors.

    In broad brush, the fair use factors look to the purpose for which 
the copyrighted work was used; the type of work it is; how much was 
taken; and how the new use could affect the actual or potential market 
for the copyrighted work.
                  fair use: extraordinarily expanding
    In early 2008 Columbia Law School sponsored a day-long symposium 
titled Fair Use: ``Incredibly Shrinking'' or Extraordinarily Expanding? 
What was apparent six years ago is even more obvious now: Fair use is 
extraordinarily expanding.
    Until recently, the courts held that ``[t]hough not an absolute 
rule, `generally, it may not constitute a fair use if the entire work 
is reproduced.''' \1\ From the point where copying an entire work 
generally defeats fair use, now copying the full contents of millions 
of works can qualify as fair use, regardless of whether it's done for 
commercial or noncommercial purposes.\2\
---------------------------------------------------------------------------
    \1\ Infinity Broadcasting Corp. v. Kirkwood, 150 F.3d 104, 109 (2d 
Cir. 1998), quoting Nimmer on Copyright Sec. 13.05[A][3] at 13-178 
(1997).
    \2\ See Authors Guild, Inc. v. Hathitrust, 902 F.Supp. 2d 445, 457 
(S.D.N.Y. 2012), appeal pending (2d Cir.); Author's Guild, Inc. v. 
Google, Inc., 2013 U.S. Dist. Lexis 162198, 2013 WL 6017130, appeal 
pending (2d Cir.).
---------------------------------------------------------------------------
    If fair use provides the important benefits described earlier, why 
might this expansion spark concern? Fair use is not a carte blanche to 
make unlimited use of others' work, even for a socially beneficial 
cause. The rights of creators and the interests of users must be 
balanced. As the Supreme Court stated in Harper & Row v. Nation 
Enterprises, reversing the Second Circuit's holding that Nation 
magazine was protected by fair use when it used pre-publication 
excerpts of President Ford's memoirs without authorization:

        [C]opyright is intended to increase and not to impede the 
        harvest of knowledge. But we believe the Second Circuit gave 
        insufficient deference to the scheme established by the 
        Copyright Act for fostering the original works that provide the 
        seed and substance of this harvest. The rights conferred by 
        copyright are designed to assure contributors to the store of 
        knowledge a fair return for their labors.\3\
---------------------------------------------------------------------------
    \3\ Harper & Row, Publrs. v. Nation Enters., 471 U.S.539, 545-46 
(1985) (citation omitted).

---------------------------------------------------------------------------
    The Court went on to warn that

        It is fundamentally at odds with the scheme of copyright to 
        accord lesser rights in those works that are of greatest 
        importance to the public. Such a notion ignores the major 
        premise of copyright and injures author and public alike. . . . 
        [A]s one commentator has noted: ``If every volume that was in 
        the public interest could be pirated away by a competing 
        publisher, . . . the public [soon] would have nothing worth 
        reading.'' \4\
---------------------------------------------------------------------------
    \4\ Id. at 555 (citation omitted).
---------------------------------------------------------------------------
                     the rise of transformative use
    How did the law move so far so quickly? The principal reason for 
this expansion has been the increasing significance of ``transformative 
use'' in evaluating a fair use defense. The term ``transformative use'' 
is nowhere found in the fair use statute. It is not an entirely new 
concept, however: ``productive use''--in the sense of producing new and 
independent creative works--has long been part of the fair use 
determination. In Campbell v. Acuff-Rose,\5\ the Supreme Court embraced 
``transformative use'' as a highly influential (though not 
determinative) factor in assessing fair use.
---------------------------------------------------------------------------
    \5\ Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 579 (1994) 
(``[T]he more transformative the new work, the less will be the 
significance of other factors, like commercialism, that may weigh 
against a finding of fair use.'').
---------------------------------------------------------------------------
    Campbell v. Acuff-Rose involved a parody by 2 Live Crew of Roy 
Orbison's song, ``Pretty Woman.'' Campbell asserted a fair use defense. 
\6\ The district court found in Campbell's favor, but the Sixth Circuit 
Court of Appeals reversed and held that fair use did not apply. Relying 
on the Supreme Court's statement in Sony v. Universal City Studios that 
``commercial use is presumptively an unfair exploitation'' of the 
copyright owner's rights,\7\ the Sixth Circuit resolved the first 
factor--the purpose and character of the use--in plaintiff's favor, 
because 2 Live Crew's parody was commercial. \8\ On the fourth factor, 
often said to be the most important, the court stated that because 2 
Live Crew's parody was entirely commercial, it ``presume[d] that a 
likelihood of future harm to Acuff-Rose exists.'' \9\ The Sixth 
Circuit's decision was typical of many post-Sony courts, which had made 
commercial use virtually dispositive of factors one and four. As a 
result, it had become very difficult to make a commercial fair use, so 
the Supreme Court intervened.
---------------------------------------------------------------------------
    \6\ Campbell was 2 Live Crew's lead vocalist and the first named 
defendant.
    \7\ Sony Corp. of America v Universal City Studios, 464 U.S. 417, 
451 (1984).
    \8\ Acuff-Rose Music, Inc. v. Campbell, 972 F.2d 1429, 1436-37 (6th 
Cir. 1992) rev'd, 510 U.S. 569 (1994)
     (citing Rogers v. Koons, 960 F.2d 301, 312 (2d Cir. 1992)).
    \9\ Id. at 1438-39.
---------------------------------------------------------------------------
    The Supreme Court reversed the Sixth Circuit's decision. It 
criticized the appellate court for letting the commercial nature of the 
use so heavily influence its fair use determination. The Court 
explained that commercial use is not dispositive of fair use, and 
commercial uses can be fair. But commerciality is only one aspect of 
factor one; whether a use is ``transformative'' is a very important 
consideration.\10\ To determine whether a use is transformative, one 
looks at whether ``the allegedly infringing work ``merely 
supersede[s]'' the original work ``or instead add[s] something new, 
with a further purpose or a different character, altering the first 
with new expression, meaning or message.'' \11\ As Judge Pierre Leval 
explained in an article on which Campbell relied, ``[i]f . . . the 
secondary use adds value to the original--if the quoted matter is used 
as raw material, transformed in the creation of new information, new 
aesthetics, new insights and understandings--this is the very type of 
activity that the fair use doctrine tends to protect for the enrichment 
of society.'' \12\
---------------------------------------------------------------------------
    \10\ Transformative use is not essential to fair use; as the 
Campbell court observed, making complete copies, such as multiple 
copies for classroom use, can be fair use. 510 U.S. 569, 579 n. 11 and 
Sec. 107.
    \11\ Campbell, 510 US at 579 (citing Leval, Towards a Fair Use 
Standard, 103 Harvard L. Rev. 1105, 1111 (1990)).
    \12\ Leval, supra note 11 at 1111.
---------------------------------------------------------------------------
    The Supreme Court also emphasized that all four fair use factors 
must be analyzed independently--there are no shortcuts. Still, it 
observed that ``the more transformative the new work, the less will be 
the significance of other factors, like commercialism, that may weigh 
against a finding of fair use.'' \13\ As this quotation illustrates, it 
bears emphasis that the Supreme Court embraced the inquiry into 
``transformative use'' in the context of a second author's creation of 
a ``new work.''
---------------------------------------------------------------------------
    \13\ Campbell, 510 U.S. at 579 (emphasis supplied).
---------------------------------------------------------------------------
        ``functional transformation'' and making complete copies
    Prior to Campbell, fair use cases involving transformative (or 
productive) use were premised on changes made to the subject work 
itself: annotating a work, analyzing or critiquing it, creating a 
parody, and so on. Campbell itself involved a parody of ``Pretty 
Woman,'' achieved through changes to both lyrics and music. Moreover, 
even where a second author transforms the copied material, the amount 
of the copying remains an important consideration. In Campbell, the 
Supreme Court, although it stressed the ``transformativeness'' of the 2 
Live Crew parody, ultimately remanded to the Sixth Circuit to determine 
whether the resulting work copied too much--that is, more than was 
needed to achieve its parodistic purpose.
    As explained above, the Supreme Court defined transformative use as 
use of a copyrighted work for ``a further purpose or different 
character, altering the first with new expression, meaning or 
message.'' \14\ Post-Campbell cases began to interpret 
``transformative'' in two significantly expansive ways. First, to 
encompass not only changes to the substance of a work, but also changes 
to how the work is used, referring to this repurposing in a new work as 
``functional transformation.'' Second, and more radically, courts began 
to apply the ``transformative'' and ``functional transformation'' 
labels not only to new works incorporating unaltered copies of 
preexisting works, but also to new uses that exploited the prior work 
without creating a new work. ``Transformative'' thus became uprooted 
from its original context of ``new works'' to become applied to a much 
broader context of ``new purposes.''
---------------------------------------------------------------------------
    \14\ Id.
---------------------------------------------------------------------------
    This expansive view of what it means to be transformative has 
opened the door to claims that making complete copies of multiple 
works, even for commercial purposes, and even without creating a new 
work, can be a fair use. This is a substantial departure from the long-
prevailing view that copying an entire work is generally not a fair 
use.\15\ It also implies an important constriction of the author's 
rights respecting ``potential market[s]'' for her work, because, once a 
court has found a ``transformative purpose'' to a new exploitation, it 
tends increasingly to find that the new use exploits a ``transformative 
market'' that does not compete with the author's markets. In other 
words, contrary both to statutory text and to the Supreme Court's 
cautious reminder in Campbell, a finding that a use is 
``transformative'' now tends to sweep all before it, reducing the 
statutory multifactor assessment to a single inquiry.
---------------------------------------------------------------------------
    \15\ The Supreme Court's decision in Sony v. Universal City 
Studios--the ``Betamax case''--was a notable exception. There the Court 
concluded that in-home copying of free broadcast programming for 
timeshifting purposes was a fair use, because it was noncommercial and 
merely allowed consumers to watch at a different time programs they 
were invited to view without charge. Sony v. Universal City Studios, 
464 U.S. 417. Sony also dubbed any commercial use ``presumptively 
unfair''--a position from which the Supreme Court later retreated.
---------------------------------------------------------------------------
    How did we get here? For example, in Bill Graham Archives v. 
Dorling Kindersley Ltd., the court found defendant's use of complete 
copies of Grateful Dead concert posters to be a fair use because the 
copies were used, in reduced size, as part of a historical timeline in 
a group biography of the Grateful Dead, rather than for their original 
purpose. The court stated that ``[a] transformative use may be one that 
actually changes the original work. However, a transformative use can 
also be one that serves an entirely different purpose.'' \16\ The 
Grateful Dead poster case, however, still concerned a new and 
independent work (indeed, of a kind that has traditionally come within 
the ambit of fair use): a biography.
---------------------------------------------------------------------------
    \16\ Bill Graham Archives v. Dorling Kindersley Ltd., 448 F.3d 605, 
609 (2d Cir. 2006).
---------------------------------------------------------------------------
    The more radical shift came in Perfect 10 v. Amazon.com. \17\ 
There, the Ninth Circuit Court of Appeals concluded that making 
complete copies of Perfect 10's copyrighted photos, and providing 
``thumbnail'' reproductions to consumers in response to image search 
requests was a fair use. According to the court, ``even making an exact 
copy of a work may be transformative so long as the copy serves a 
different function than the original work.'' \18\ The court viewed 
defendants' use as ``highly transformative'' because their search 
engine served an ``indexing'' purpose which improved access to 
information on the Internet, entirely different from the photographs' 
aesthetic purpose, and because of the considerable public benefit the 
search engine conferred.\19\
---------------------------------------------------------------------------
    \17\ Perfect 10, Inc. v. Amazon.com, Inc., 508 F.3d 1146 (9th Cir. 
2007).
    \18\ Id. at 1165 (citation omitted).
    \19\ Id. at 1165-66. Some of the distinctions that courts use to 
support ``functional transformation'' are simply untenable. For 
example, in American Inst. of Physics v. Schwegman Lundberg & Woessner, 
P.A., 2013 U.S. Dist. Lexis 124578 (D. Minn. July 30, 2013), the court 
found defendant law firm's internal use of scientific articles (reading 
them to determine whether they represent ``prior art'' required to be 
supplied to the USPTO with a patent application) was intrinsically 
different from the plaintiff's purpose in publishing them (informing 
interested readers about developments in various scientific 
disciplines). In both cases the articles were read for information 
about scientific developments; there is no transformative purpose here.
---------------------------------------------------------------------------
    Two recent ``functional transformation'' cases involve mass 
digitization of books from research libraries. Authors Guild v. Google 
\20\ was a challenge to the mass digitization project initiated by 
Google, which contracted with research libraries to digitize their 
entire collections of published books. Google would provide each 
library with a full text digital version of the books in their 
collection. It would also retain copies of the full text database to 
enable it to allow customers to search Google's database to identify 
books of interest. A user's search would not retrieve a full-text 
version of a book unless it were in the public domain, but it would 
provide ``snippets'' of books in response to search requests, and 
information as to how one might get access to particular books. Google 
also uses its full text database to improve its translation 
capabilities and enhance its search capabilities, from which it derives 
revenue. Unlike the libraries, who purchased the books, Google did not 
pay the authors or publishers for its creation of full-text permanent 
retention copies.
---------------------------------------------------------------------------
    \20\ Author's Guild, Inc. v. Google, Inc., 2013 U.S. Dist. Lexis 
162198, 2013 WL 6017130, appeal pending (2d Cir.).
---------------------------------------------------------------------------
    The Authors Guild and publishers filed suit for copyright 
infringement against Google. Some time after the suit commenced, the 
parties entered into a class action settlement agreement, which the 
court declined to approve. The publishers subsequently entered into a 
separate settlement agreement with Google and dropped out of the suit.
    In November 2013, the district court entered judgment in favor of 
Google on its fair use defense. The court found Google's use was 
``highly transformative'' because Google had converted the books' text 
into digital form and created a valuable word index. It had also 
transformed the text into data that enabled new forms of research, like 
data-mining. Google's profit motive was accorded little weight in the 
decision, especially in light of the important educational purposes 
served by its project. The court found that Google's activities had 
little likely effect on the authors' actual or potential markets for 
their works. The court did not consider the market impact that could 
ensue were other for-profit enterprises to follow Google's lead in mass 
digitizing library collections. The Authors Guild has appealed the 
case.
    Authors Guild v. Hathitrust \21\ was the second case addressing 
massive databases of digitized books. Hathitrust is a nonprofit entity 
housed at the University of Michigan. It manages a large shared digital 
repository of millions of books that were scanned for Hathitrust's 
constituent libraries as part of Google's Library project. The 
repository is used for searches by library patrons (those search 
results yield information but no excerpts of text), preservation, and 
to provide full text of books in the libraries to persons who are 
visually impaired. In a suit brought by the Authors Guild against 
Hathitrust, the court concluded that Hathitrust's use was a fair use. 
It considered the use transformative since Hathitrust and the libraries 
were using the works for a different purpose than the originals--
providing a searchable index that enabled locating books, data mining, 
and providing access for the print-disabled. The court found factor two 
``not dispositive'' and concluded that the amount copied was reasonable 
in relation to the transformative purpose. The court decided that there 
was likely to be little impact on the market for plaintiffs' works 
since the plaintiffs were unlikely to set up a licensing system for 
this type of use. An appeal to the Second Circuit is pending.
---------------------------------------------------------------------------
    \21\ Authors Guild, Inc. v. Hathitrust, 902 F.Supp. 2d 445, 457 
(S.D.N.Y. 2012), appeal pending (2d Cir). Hathitrust was filed after 
Authors Guild v. Google, but it was decided first.
---------------------------------------------------------------------------
        potential consequences of ``functional transformation''
    The ascendency of transformative use, and in particular, 
``functional transformation,'' gives rise to concern that the fair use 
pendulum has now swung too far away from its roots and purpose, now 
enabling new business models rather than new works of authorship, and 
potentially placing the U.S. in violation of international restrictions 
on the scope of copyright exceptions and limitations. Lower courts 
applying ``transformative use'' analysis appear at times to be ignoring 
the Supreme Court's warning to consider the impact on copyrighted works 
were the challenged use to become widespread. Similarly, their analyses 
of ``transformative markets'' that fall outside the author's exclusive 
rights risk inappropriately cabining the scope of the derivative works 
right. The sheer volume of the taking in some of these functional 
transformation cases has at times resulted in courts' failure to 
consider distinctions among subject works that should be analyzed, if 
not individually, then by categories of works with certain 
characteristics. A capacious concept of ``transformative use'' also 
seems to be swallowing up the more specific exceptions Congress has 
crafted for particular uses, overriding their limitations and thus 
disregarding the balance Congress set for those exceptions.
1.  Some Courts Fail to Give Due Consideration to the Effect of 
        Defendant's Use on the Copyright Owner's Potential Market.
    Some courts are giving short shrift to two important considerations 
under factor four: First, the effect on the market if the use should 
become widespread, and second, the appropriate scope of authors' 
potential markets.
    The analysis of factor four requires a court to consider

        not only the extent of market harm caused by the particular 
        actions of the alleged infringer, but also ``whether 
        unrestricted and widespread conduct of the sort engaged in by 
        the defendant . . . would result in a substantially adverse 
        impact on the potential market'' for the original.\22\
---------------------------------------------------------------------------
    \22\ Campbell, 510 U.S. at 590 (quoting Nimmer on Copyright, 
Sec. 13.05 [A][4], at 13-102.61).

    Similarly, the Court in Sony stated that a plaintiff must show that 
defendant's use is harmful or that ``if it should become widespread, it 
would adversely affect the potential market for the copyrighted work.'' 
---------------------------------------------------------------------------
The Court explained in more detail:

        Actual present harm need not be shown; such a requirement would 
        leave the copyright holder with no defense against predictable 
        damage. Nor is it necessary to show with certainty that future 
        harm will result. What is necessary is a showing by a 
        preponderance of the evidence that some meaningful likelihood 
        of harm exists.\23\
---------------------------------------------------------------------------
    \23\ Sony, 464 U.S. 417, 451. The Supreme Court placed the burden 
of this showing on plaintiffs when the challenged use is noncommercial: 
since fair use is an affirmative defense, the burden respecting harm 
remains with defendants whose use is commercial.

    Lower courts have in the past heeded this counsel. For example, in 
A&M Records v. Napster,\24\ the Ninth Circuit found that Napster's 
activities in promoting and enabling consumers to engage in file-
sharing of copyright-protected music CDs harmed the record companies' 
future markets. Although the record companies had not yet entered the 
market for digital downloads, they had ``expended considerable funds 
and effort'' to commence licensing digital downloads. The court found 
that the presence of unauthorized copies of plaintiffs' recordings on 
Napster's file-sharing network ``necessarily harms'' the record 
companies' potential market.\25\
---------------------------------------------------------------------------
    \24\ A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 
2001).
    \25\ Id. at 1017.
---------------------------------------------------------------------------
    In some of the more recent ``transformative use'' cases, however, 
the courts have taken an unduly narrow view of the ``transformative'' 
use's effect on potential markets. For example, in Perfect 10, the 
Ninth Circuit was unwilling to find market effect attributable to 
defendant's transformative use because Perfect 10 could not demonstrate 
current sales of thumbnails, even though Perfect 10 had just begun a 
program to offer thumbnail photos (specifically, cellphone downloads) 
in the market. In contrast to its decision six years earlier in 
Napster, the Ninth Circuit did not find plans to enter a market 
sufficient; it would recognize a market for thumbnails only if Perfect 
10 could prove actual sales.
    In Authors Guild v. Google, the court never considered the 
consequences ``if the use should become widespread.'' Perhaps the court 
implicitly assumed that no one but a Google could (or might want to) 
create such a comprehensive and expensive database. But it could well 
be that smaller, more narrowly tailored databases (e.g., financial 
economics or travel guides) would be of value to specific entities or 
individuals for a variety of purposes). The cost of book-scanning is 
far less now than it was when Google began its digitization project, so 
the prospect of a ``democratization'' of mass digitization is hardly 
far-fetched, and may already be well in prospect. Or, another internet 
service provider may seek a database to enhance its searches and bring 
in more advertising revenue, just as Google has done. The court simply 
never addressed the possible adverse effects on plaintiffs of a 
multiplicity of such databases.
2.  Confusion Between a Transformative Work and a Derivative Work.
    Cases since Campbell have contributed to tension between the market 
for derivative works and exploitation of transformative works.
    Under the Copyright Act:

        A ``derivative work'' is a work based upon one or more 
        preexisting works, such as a translation, musical arrangement, 
        dramatization, fictionalization, motion picture version, sound 
        recording, art reproduction, abridgment, condensation, or any 
        other form in which a work may be recast, transformed, or 
        adapted. A work consisting of editorial revisions, annotations, 
        elaborations, or other modifications, which, as a whole, 
        represent an original work of authorship, is a ``derivative 
        work''.

    A transformative work is one that adds ``something new, with a 
different purpose or a different character, altering the first with new 
expression, meaning or message.'' \26\
---------------------------------------------------------------------------
    \26\ Campbell, 510 U.S. at 579.
---------------------------------------------------------------------------
    This overlap in terms and concepts has led to confusion. When is a 
work ``transformed'' in such a way that it becomes a protectable (or 
infringing) derivative work? On the other hand, when is it transformed 
in such a way that the transformation significantly bolsters a fair use 
claim? This decision has important implications for authors' potential 
markets. If a court finds that defendants' use of an author's work is 
``transformative'' because it reaches new markets or makes the work 
available to a new audience, that finding could risk usurping the 
author's derivative work rights. Ultimately, those rights could hinge 
on a ``race to the market'' for new and sometimes unanticipated uses. 
If the party allegedly making transformative use gets there first, that 
market may belong to him and be foreclosed to the author or copyright 
owner. Moreover, in some cases the copyright owner, who may have 
obligations to its licensors or others, may be unable to move as 
quickly as the putative ``fair'' user.
3. Fair Use is Swallowing Other Copyright Exceptions.
    In some cases, expansive readings of fair use have virtually 
swallowed other exceptions to copyright. For example, the Hathitrust 
case's interpretation of fair use effectively reads section 108 (c) of 
the Copyright Act and portions of section 121 out of the statute.
    Section 108(c) permits qualified libraries and archives under 
certain circumstances to make copies of published works in their 
collections. It provides:

        (c) The right of reproduction under this section applies to 
        three copies or phonorecords of a published work duplicated 
        solely for the purpose of replacement of a copy or phonorecord 
        that is damaged, deteriorating, lost, or stolen, or if the 
        existing format in which the work is stored has become 
        obsolete, if------

        (1) the library or archives has, after a reasonable effort, 
        determined that an unused replacement cannot be obtained at a 
        fair price; and

        (2) any such copy or phonorecord that is reproduced in digital 
        format is not made available to the public in that format 
        outside the premises of the library or archives in lawful 
        possession of such copy.

    The courts in both Authors Guild v. Hathitrust and Authors Guild v. 
Google apparently accepted that libraries are free to copy in digital 
form (or have copied for them) all published works in their 
collections, without qualification. The Hathitrust court finds no 
inconsistency between this comprehensive copying and section 108(c) 
quoted above, because section 108(f) provides that nothing in section 
108 ``in any way affects the right of fair use as provided by section 
107. . . .'' \27\ But section 108(f) does not justify the court's 
conclusion. Under fundamental principles of statutory interpretation, 
statutes are to be interpreted in a manner that gives sense to the 
whole.\28\ A statutory provision should not be interpreted in a manner 
that renders another provision superfluous or redundant.\29\ 
Interpreting fair use to permit a library to copy every published work 
in its collections leaves section 108(c) with no remaining 
significance.
---------------------------------------------------------------------------
    \27\ Sec. 108 (f)(4). The idea that fair use could make substantial 
portions of section 108 irrelevant was clearly not anticipated by 
Congress when the 1976 Act was passed. According to the House Report 
accompanying the 1976 Act, ``[n]o provision of section 108 is intended 
to take away any rights existing under the fair use doctrine. To the 
contrary, section 108 authorizes certain photocopying practices which 
may not qualify as a fair use.'' H.R. Rep. No. 96-1476, 94th Cong. 2d 
sess. at 74 (1976).
    \28\ 2 Norman J. Singer & J.D. Shambie Singer, Sutherland Statutory 
Construction Sec. 46:5 (7th ed. 2013).
    \29\ Bilski v. Kappos, 130 Sup. Ct. 3218, 3228-29 (2010) (citation 
omitted); Kungys v. United States, 485 U.S. 759, 778 (1988).
---------------------------------------------------------------------------
    Similarly, the Hathitrust rationale effectively swallows section 
121 as well. That section provides an exception from copyright for the 
blind and visually impaired. Section 121(a) states:

        (a) Notwithstanding the provisions of section 106, it is not an 
        infringement of copyright for an authorized entity to reproduce 
        or to distribute copies or phonorecords of a previously 
        published, nondramatic literary work if such copies or 
        phonorecords are reproduced or distributed in specialized 
        formats exclusively for use by blind or other persons with 
        disabilities.

    As it did in setting a balance in section 108, Congress carefully 
crafted section 121 to provide a balance between the interests of the 
visually impaired and those of authors. In Hathitrust, however, the 
court concluded that although defendants in its view ``fit squarely 
within'' section 121, they ``may certainly rely on fair use . . . to 
justify copies made outside of these categories or in the event they 
are not authorized entities.'' \30\
---------------------------------------------------------------------------
    \30\ Hathitrust, 902 F. Supp. 2d at 465 (footnote omitted).
---------------------------------------------------------------------------
    The court's conclusion reads the essential conditions in section 
121 out of the law.
4. Evaluating Fair Use ``In Gross.''
    The sheer volume of works involved in the mass digitization cases 
has led courts to eschew the case-by-case fact-based analysis fair use 
has traditionally required. Of course it is not possible to evaluate 
each work individually in these cases. But even significant differences 
among subgroups of works seem irrelevant in these cases, e.g., fiction 
versus nonfiction? Works no longer available on the market versus those 
recently released? It's as though courts are according some kind of 
``volume discount'' for fair use, where a massive taking justifies a 
lower level of scrutiny in a fair use determination. It becomes 
increasingly difficult to explain to authors and public alike a 
copyright regime that rigorously examines the extent of a single 
scholar's partial copying,\31\ while essentially according a free pass 
to a for-profit enterprise's massive takings. It also risks putting the 
U.S. at odds with international norms.
---------------------------------------------------------------------------
    \31\ See, e.g., Craft v. Kobler, 667 F. Supp. 120 (S.D.N.Y. 1987) 
(Leval, J.) (holding that a biographer copied more than was needed for 
his critical examination of the letters of Igor Stravinsky).
---------------------------------------------------------------------------
5.  Expansive Interpretations of ``Transformative Use'' Risk Putting 
        the U.S. in Violation of its International Treaty Obligations.
    The United States is a member of a number of international 
copyright treaties and agreements--e.g., TRIPs, the Berne Convention, 
and the WIPO Copyright Treaty--that require that member states' 
copyright exceptions (as applied to foreign works) meet the ``Three 
Step Test.'' As set out in the TRIPS, that test provides:

        Members shall confine limitations or exceptions to exclusive 
        rights to certain special cases which do not conflict with a 
        normal exploitation of the work and do not unreasonably 
        prejudice the legitimate interests of the right holder.\32\
---------------------------------------------------------------------------
    \32\ TRIPS, Annex 1C, art. 13.

    As the World Trade Organization's dispute resolution panel held in 
a case in which the U.S. was found to be in violation of this test,\33\ 
under the first step, any limitations or exceptions must be clearly 
defined and limited in scope. ``Normal exploitation'' embraces all 
forms of exploitation that the author would normally seek to exploit 
now or in the future. In other words, an exception may not compromise a 
normal market for the work. The third and final step requires that 
authors be protected from unreasonable loss of income; in some cases a 
compulsory license or remuneration scheme is permissible if the 
author's rights are adequately protected.
---------------------------------------------------------------------------
    \33\ WT/DS160/R 15 June 2000 UNITED STATES--SECTION 110(5) OF THE 
US COPYRIGHT ACT Report of the Panel.
---------------------------------------------------------------------------
    An increasingly expansive fair use exception risks violating each 
of these three steps. Fair use is open-ended; its consistency with the 
first step depends on the scope of its application in particular cases. 
The broader the scope of the works affected, or the wider the uses the 
exception permits, the more likely that the exception will not be 
deemed limited to ``certain special cases.'' By the same token, the 
breadth of the exception's application can affect types of exploitation 
that the author is now or likely will in the future be engaging in. 
Finally, fair use is an all-or-nothing proposition. If a use is 
``fair'', authors receive no compensation for the use. The U.S. has no 
remuneration scheme in connection with fair use.
                       the fair use ``pendulum''
    Fair use doctrine is not static. Over the years fair use case law 
has sometimes strayed too far in one direction, favoring right holders, 
or in the other direction, favoring users. For example, after the Sony 
case, many lower courts interpreted the Supreme Court's statement that 
```commercial use is presumptively an unfair exploitation' of the 
copyright owner's rights'' to drive both the first and fourth fair use 
factors, making commercial fair use difficult to achieve. In Campbell, 
the court stepped in to restore the balance.
    Now, the pendulum has swung the other way. Now it is 
``transformative use'' that drives these two factors, which together 
are generally determinative of fair use. It is important that the fair 
use ``pendulum'' once again be moved back toward center.
                          a role for congress?
    Despite the concerns just voiced, fair use remains a rule whose 
application is best made by judges, as Congress recognized in codifying 
the doctrine in section 107.\34\ As we have seen, the pendulum can 
swing in both directions. But if Congress had best continue to leave 
the general task of applying the section 107 factors to the courts, 
legislative intervention may be appropriate when that application 
proves too rigid or too expansive. Thus, after a series of decisions in 
which lower courts misapprehended the Supreme Court's interpretation of 
the second fair use factor as wholly insulating unpublished works from 
quotation, Congress added a final sentence to section 107 to emphasize 
that all the factors should be taken into account, and that the single 
feature of a work's publication status was not dispositive.\35\
---------------------------------------------------------------------------
    \34\ See, e.g., H.R. Rep. No. 96-1476 at 66: ``Beyond a very broad 
statutory explanation of what fair use is and some of the criteria 
applicable to it, the courts must be free to adapt the doctrine to 
particular situations on a case-by-case basis. Section 107 is intended 
to restate the present judicial doctrine of fair use, not to change, 
narrow or enlarge it in any way.''
    \35\ In Harper & Row v. Nation Enters., the unpublished nature of 
the Ford memoirs was a key consideration in the Court's decision that 
the Nation had not a made a fair use. Harper & Row, 471 U.S. 539, 561-
62. After that decision, the high level of protection accorded 
unpublished works by some courts seemed largely to foreclose making 
fair use of unpublished material, posing serious obstacles to 
historians, biographers and others. E,g, Salinger v. Random House, 
Inc., 811 F.2d 90 (2d Cir.), cert. denied, 484 U.S. 890 (1987). In 
1992, Congress amended Sec. 107 to provide that ``[t]he fact that a 
work is unpublished shall not itself bar a finding of fair use if such 
finding is made upon consideration of all the above factors.''
---------------------------------------------------------------------------
    Just as some judges overreacted to the Supreme Court's protection 
of the right of first publication by overly-constricting fair use, the 
current judicial expansion of fair use may reflect concern to preserve 
the benefits of mass digitization notwithstanding the tension between 
those activities and the Copyright Act's charge to secure the actual 
and potential markets for works of authorship. Without altering the 
text of section 107, Congress might separately address the problems of 
mass digitization, including whether authors should be compensated for 
publicly beneficial uses (compensation is not currently an option under 
section 107). Congress' attention to those issues might relieve the 
pressure that has risked turning the doctrine into a free pass for new 
business models, and thus restore fair use to its most appropriate role 
of fostering new authorship.
    Thank you for this opportunity to provide comments to the 
Committee.
                               __________

    Mr. Coble. I thank you, Ms. Besek.
    Ms. Novik?

 TESTIMONY OF NAOMI NOVIK, AUTHOR AND CO-FOUNDER, ORGANIZATION 
                    FOR TRANSFORMATIVE WORKS

    Ms. Novik. I would like to thank the House Judiciary 
Committee for inviting me to testify about fair use and its 
role in promoting creativity.
    I am not a lawyer, but as one of the creators and artists 
whose work is deeply affected by copyright law, I hope to 
explain how vital fair use is to preserving our freedom and 
enabling us to create new and more innovative work.
    Today, I am the published author of 10 novels, including 
the New York Times bestselling ``Temeraire'' series, which has 
been optioned for the movies by Peter Jackson, the director of 
``The Lord of the Rings.'' I have worked on professional 
computer games and graphic novels, and on both commercial and 
open-source software. And I would have done none of these 
things, if I hadn't started by writing fan fiction.
    I found the online remix community, in 1994, when I was 
still in college. For the next decade, before I wrote one word 
of my first novel, I wrote fan fiction, built online computer 
games, wrote open-source archiving software, and created remix 
videos. I met hundreds of other artists creating their own work 
and found an enthusiastic audience who gave feedback and advice 
and help. We weren't trying to make money off our work. We were 
gathering around a campfire. We were singing, telling stories 
with our friends. The campfire was just a bigger campfire, 
thanks to the Internet, and instead of telling new stories 
about Robin Hood, we told new stories about Captain Picard, 
because that is who we saw on our television every week.
    Fair use gave us the right to do that. And, I am not a 
lawyer, but I can tell you that for all of us, what we were 
doing felt absolutely ``fair.'' We watched Star Trek every 
week, religiously. We bought the t-shirts and the videotapes 
and the spinoff books. And, when the DVDs came out, we bought 
those too. Of course we were going to have our own new ideas 
about the characters, about the universe, about what might 
happen. That is what we do. We are imaginative creatures. And 
of course we wanted to share our ideas with each other.
    I learned to explore ideas in the remix community and to 
see where they led me. And, eventually, they led me to my own 
characters and my own universe. And now other artists--other 
remix artists are writing fan fiction for ``Temeraire.'' And 
they make fan art. And sometimes they even send me a stuffed 
``Temeraire'' to give to my 3-year-old daughter. And I hope 
that one day one of the fans writing ``Temeraire'' fan fiction 
will go on to write their own bestseller or make their own 
movie or game, perhaps with an idea sparked by something that I 
wrote.
    We all build on the work and ideas of people who came 
before us. In fact, that is the only way to innovate. There 
isn't a hard line between remix work and work that stands on 
its own. Original work is at the end of a natural spectrum of 
transformation. And fair use protects the spectrum. It creates 
a space where artists can play with ideas and develop our 
skills, share our work within a community, and learn by doing.
    Licensing is just not a realistic alternative. On the 
purely practical level the vast majority of remix artists doing 
noncommercial work simply don't have any of the resources to 
get a license, not money, not time, not access. I wrote my 
first fan fiction story as a sophomore in college, taking five 
courses, working a part-time job doing page layout for the 
campus weekly, and occasionally calling my parents. If I had 
had to pay someone and go through a complicated licensing 
process to get to the point of writing that story, I would 
never have done it and I might never have written my own novels 
in the end. Imagine if kids who watched the ``Lone Ranger'' and 
ran outside to make up a new adventure in the backyard had to 
get a license before doing that. And today the Internet is 
increasingly becoming our shared backyard.
    And speaking also as a copyright holder, licensing is not a 
practical option for most of us on the other side of the 
problem as well. Most artists are not large media conglomerates 
with substantial legal departments. I am delighted for other 
artists to make fair use of my work. But, I don't want the 
difficulty and the expense and the legal risk of having to give 
a license to every kid who might want to write a story where 
they become the captain of a dragon in the ``Temeraire'' 
universe.
    More importantly, licensing still doesn't work, even if the 
practical considerations are removed, because licensing 
invariably stifles transformative work. I know authors who have 
written licensed tie-in novels. And they always face a long 
list of requirements. And, at the end of the book, they have to 
bring everything back to the beginning. The point of licensing, 
by the copyright holders, almost always is to avoid 
transformation because, by definition, a transformative work is 
one that doesn't match up to the copyright holder's vision.
    I see I am running out of time, so I am going to skip a 
little bit ahead and ask Congress to make it easier for 
developing artists, like the one that I once was, who are often 
at a significant disadvantage currently to exercise their fair 
use rights. Most remix artists, especially ones just starting 
out, don't so much as know a lawyer. They don't have the 
resources to defend themselves against even the most frivolous 
lawsuit or an automated takedown.
    Congress could give tremendous support to the incubator of 
remix art by making it less frightening to take the chance of 
creating. Artists creating transformative work should not be 
asked to pay more in damages than they have earned from their 
work, so long as they acted in good faith. Congress could also 
require platforms that create automated screening tools for 
copyrighted work, to provide a straightforward way for artists 
to identify their work as transformative and make the claim of 
fair use. And, Congress could add a specific exemption for 
noncommercial transformative work that would supplement fair 
use the same way that libraries and teachers have specific 
exemptions that provide a clear safe harbor.
    In general, I strongly urge Congress to resist any 
suggestion of narrowing fair use, including by trying to 
replace it with licensing. Innovation starts with asking, 
``What if?'' What if we could build a machine that could fly? 
What if you crossed a cellphone and a music player? Our country 
is a world leader in innovation precisely because here we ask 
the ``what if'' questions.
    Thank you very much.
    [The prepared statement of Ms. Novik follows:]



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                              __________

    Mr. Coble. Thank you, Ms. Novik.
    Ms. Besek, you are the only witness so far to beat the red 
light. [Laughter.]
    Mr. Coble. Now I am imposing pressure upon Mr. Lowery.
    Mr. Lowery, you are recognized for 5 minutes. [Laughter.]
    Mr. Lowery. I may have a distinct advantage, Mr. Chairman, 
since I am used to expressing myself in less than 5 minutes.
    Mr. Coble. Well, we--as I said, we won't penalize you if 
you fail in that effort.

  TESTIMONY OF DAVID LOWERY, SINGER/SONGWRITER AND LECTURER, 
        TERRY COLLEGE OF BUSINESS, UNIVERSITY OF GEORGIA

    Mr. Lowery. Okay. Chairman Goodlatte, Chairman Coble, 
Ranking Member, and Members of the Subcommittee, my name is 
David Lowery, and I am a mathematician, writer, musician, 
producer, and entrepreneur based in Richmond, Virginia, and 
Athens, Georgia. I also teach Music Business Finance at the 
University of Georgia. Thank you for this opportunity to speak 
with you today about the scope of fair use.
    The rise of the Internet corresponds with recent attention 
devoted to fair use as an excuse for trumping the rights of 
authors established both in the U.S. and other countries. This 
attention comes from technology companies, commentators, 
lobbyists, and some parts of the Academy.
    I am not concerned with parody, commentary, criticism, 
documentary filmmakers, or research. These are legitimate fair 
use categories. I am concerned with the illegal copy that 
masquerades as fair use, but is really just a copy. This 
masquerade trivializes legitimate fair use categories and 
creates conflict where there need be none. These 
interpretations of fair use have become important to my daily 
life as a singer-songwriter. There are attempts by certain Web 
sites and commercial services to pass off, as fair use, 
versions of my work that are indistinguishable from my work. As 
I will demonstrate, these works compete directly with licensed 
instances of my work.
    As a professional singer-songwriter, I believe that fair 
use doctrine, as intended by Congress, is working in the music 
business and music industry and should not be expanded. 
Sampling and remixing is one arena where there has been a push 
for expanded fair use. This defies logic, as there is no 
emergency. Hip-hop relies on samples of other artists' work. 
There exists robust market-based mechanisms for licensing these 
samples. And hip-hop has gone on to become the most popular 
form of music on the planet, without expanded fair use. ``Don't 
fix it, if it ain't broke.'' I go into great detail in my 
written testimony.
    Another arena is song lyrics. Some commentators have 
suggested that sites that reprint song lyrics with annotations 
or meanings may be covered by fair use. I have personally 
experienced the unauthorized use of my lyrics on one of the 
most famous lyric annotation sites called RapGenius. Exhibit 
one shows an example from this lyric annotation site. I 
research lyric sites as part of my academic work at the 
University of Georgia and produced the UGA ``Top Fifty 
Undesirable Lyric Website List.'' After I published my most 
recent update to the list, which placed RapGenius at number 
one, the editor in chief of RapGenius transcribed the lyrics of 
my song ``Low'' and began annotation of my lyrics. These 
annotations are invisible in the exhibit. They appear only as 
hyperlinks to popup windows. Now, note these links could refer 
to anything.
    How is this use any different from the use of my lyrics on 
the non-annotated-and-licensed site? These are virtually 
identical. The RapGenius instance of my lyrics is nearly 
identical to this one. How is it fair use? It competes directly 
with the revenue I receive from this licensed site. Following 
this logic, I could reprint an entire book and occasionally 
provide a hyperlink to the definition of a word. Indeed, the 
owners of RapGenius seem to agree that their use is not fair 
use, as evidenced by their recently completed licensing deals 
with Sony, ATV Music, and Universal.
    My final point, before thanking the Subcommittee for this 
opportunity to speak today, is: What is so hard about asking 
permission? As an artist, I only expect to be treated as I 
would treat other artists. I believe that permission or the 
legitimacy of consent and doing unto others are the very 
foundations of civilizations. The rights' holders have never 
been easier to look up. Millions of recordings can be 
identified with an iPhone application or looked up in a public 
database at no charge. It takes little effort.
    In conclusion, I respectfully request that the Members of 
the Subcommittee review the practical history of the 
application of fair use defense to see that it is working as 
intended. I hope you will agree with me that no legislative 
expansion or governmental intervention is needed at this time.
    Thank you very much.
    [The prepared statement of Mr. Lowery follows:]



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                               __________

    Mr. Coble. Thank you, Mr. Lowery. And you prevailed over 
the red light.
    Mr. Lowery. Barely. [Laughter.]
    Mr. Coble. Mr. Wimmer?

     TESTIMONY OF KURT WIMMER, GENERAL COUNSEL, NEWSPAPER 
                     ASSOCIATION OF AMERICA

    Mr. Wimmer. Chairman Coble, Members of the Subcommittee, 
thank you for having me here today.
    The professional reporting that newspapers publish starts 
important conversations in the communities that we serve. We 
recognize that this conversation often continues online, both 
on platforms that our industry owns and on those owned by 
others. Because our content is a central part of these 
conversations, the scope of fair use is an important issue for 
the news industry.
    The newspaper industry spends about $5 billion a year 
gathering and producing news and information. We are also 
investing heavily in new online and mobile platforms to deliver 
content to readers. As a result of these efforts, newspapers 
have a larger audience than ever before. Newspaper circulation 
revenue grew 5 percent in 2012 and digital-only circulation 
revenue grew by 275 percent. Nearly 65 percent of all U.S. 
adults read newspaper content in a typical week or access 
newspaper content on a mobile device in a typical month. The 
digital future, then, is bright. But there is much ground to 
make-up because of the unprecedented disruption caused by the 
digital transition. For every $15 in print advertising revenue 
lost, newspapers have gained only $1 in digital advertising 
revenue.
    Competition for viewers in the digital world is fierce. And 
our publishers increasingly find themselves competing not only 
against companies that create original content, but also with 
companies that build businesses on the backs of the very news 
content that our members produce. Newspaper content makes up 66 
percent of the content on news aggregation platforms such as 
Google News. Newspaper content also makes up more than half of 
the content on many popular digital platforms. These uses can 
result in some limited traffic to newspaper sites, but most 
don't result in meaningful revenue. The platforms using our 
content, however, certainly benefit by using news content to 
build and monetize readership on their sites without paying a 
dime for the use of that content.
    Some of the uses of newspaper content certainly qualify as 
fair use, while others clearly do not. But this is an issue 
that we think can be remedied by the courts rather than 
Congress. We believe the current state of the Copyright Act, 
including the formulation of fair use, strikes the right 
balance and should not be changed. The fair use doctrine has 
been developed over decades as a common law concept allowing 
courts to respond to changes in technology. This case-by-case 
analysis allows courts to balance the competing individual 
interests at hand, and to capture both those needs and the 
welfare of society as a whole.
    A recent example of a court deftly applying this fair use 
doctrine is the Southern District of New York's decision in 
Associated Press v. Meltwater. Meltwater is a for-profit 
reporting service that scraped AP articles and delivered 
verbatim excerpts of them to its paying subscribers. The court 
properly found that Meltwater's customers viewed the service as 
a substitute for reading the original articles, judging by the 
minuscule click-through rates. The court held that Meltwater's 
republication of segments of news articles without additional 
commentary or insight was not transformative and not a fair 
use. Targeted enforcement actions focusing on commercial 
ventures that simply take and resell our content may continue 
to be necessary.
    Of course, not all fair use decisions are decided 
correctly. In particular, some courts' recent willingness to 
give undue weight to the concept of transformative use is 
troubling. This undue weight and the surprising types of rather 
pedestrian uses that have been found to be transformative risks 
allowing that element to subsume the other equally important 
factors. We hope and expect that this imbalance in applying the 
fair use factors will be corrected over time.
    Another reason that the Copyright Act need not be changed 
is because licensing arrangements are becoming more realistic 
in many industries, including ours. We believe that many 
participants in our ecosystem, particularly innovative startup 
ventures and social media platforms, would really prefer to 
deploy solutions that rely on licensed content rather than to 
rely on questionable business models, such as scraping and 
violation of copyright and terms of use. Licensing news content 
allows that content to be distributed on new platforms, but 
helps to support the cost of high quality original journalism.
    In all, our goal in the digital world remains consistent 
with our longstanding mission: We seek to inform audiences as 
broadly as possible about the communities in which they live. 
In the digital environment, we will seek the appropriate 
balance of enforcement, licensing, cross-industry partnerships, 
and deploying our own new platforms to achieve this goal. And 
continued reliance on steadfast areas of law, such as fair use, 
will be essential as we continue to move forward.
    Thank you for the opportunity to testify. And I look 
forward to your questions.
    [The prepared statement of Mr. Wimmer follows:]



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                               __________
    Mr. Coble. And you also prevailed, Mr. Wimmer. Thank you.
    Mr. Wimmer. Well, Mr. Lowery had raised the bar.
    Mr. Coble. And I am not penalizing you, Mr. Jaszi, by 
association.
    Because we try to apply the 5-minute rule to ourselves, so 
if you could be terse in your response, we would be 
appreciative. I will start.
    Let me start with you, Mr. Wimmer and Mr. Lowery. What--
with the focus of transformative uses, what, in your minds, are 
transformative works for the purpose of fair use and what is 
not?
    Mr. Wimmer. Well, it is a good question and it is one that 
is very fact based. You know, the transformative works that I 
have not been--that I really haven't been pleased with are the 
ones that have sort of allowed secondary uses to simply take 
copyright owners' work, use it in a very straightforward 
matter, and claim it is transformative.
    The case that really does stick in my craw is the Grateful 
Dead case in which a publisher was making a coffee-table book 
about the Grateful Dead, which seems to be sort of a 
contradiction in terms, and took Grateful Dead posters over the 
years and put them in chronological order. The court then found 
that simply putting those posters in chronological order 
transformed them into something else, which I really do not 
agree with. The Bloomberg case, however, I think is an 
interesting--which the professor talked about, is an 
interesting transformative use case that I do think makes a lot 
of sense for the reasons that the court announced just 
yesterday.
    Mr. Coble. Mr. Lowery, do you want to add to that?
    Mr. Lowery. Well, yes. I mean, my example that I showed 
before is an example which is--some commentators argue is a 
transformative case, as you can see the reprinting of my lyrics 
on a site, which has yet to license these lyrics.
    And this site, which I am sorry about the lady on there, 
but every ad I hit had something like this. I don't know if it 
is because I was at the airport or what. [Laughter.]
    Mr. Coble. No apology necessary.
    Mr. Lowery. Yeah. [Laughter.]
    But this is the same instance of my lyrics here. But some 
commentators have claimed that this is transformative because 
you can click on these hyperlinks and they might go to another 
window or a popup or something like that that has maybe an 
explanation of a word or says, ``Oh, he is referencing 
Baudelaire, right here.'' Which, by the way, is a perfect 
example of fair use. I subtly reference Baudelaire here. Well, 
actually, I mean, that doesn't even involve fair use, because I 
believe that is in the public domain. So this, to me, is a case 
of something that is not transformative that people argue is 
transformative. And so, it competes directly with this, for 
which I make, well, micro-pennies for each page view. But it is 
a market; it has been established. There are market-based 
mechanisms. There are, you know, agencies that license these. 
There is a free market in the reprinting of song lyrics.
    Mr. Coble. Thank you, Mr. Lowery.
    Mr. Lowery. Thank you.
    Mr. Coble. Professor Jaszi, should a definition of 
transformative be codified?
    Mr. Jaszi. I think that----
    Mr. Coble. Mike, please.
    Mr. Jaszi [continuing]. The--that it is--it would be a 
great mistake, at this time, to attempt to arrest this judicial 
development or this process of judicial development that is 
well underway. We have resisted, over time, codifying in detail 
other aspects of the fair use doctrine. The results have been 
enormously productive, in terms of social, cultural, and 
technological innovation. For the same reason, I think, the 
reduction to a narrow description of transformativeness would 
be a great error at this time.
    Mr. Coble. Thank you, sir.
    Professor Besek and Ms. Novik, are there recent fair use 
decisions with which you disagree? And, why?
    Ms. Besek. Well, there a number of recent decisions which I 
disagree with, but one comes to mind immediately. It was a case 
that dealt with whether use within a law firm of certain 
scientific articles was fair use or not. The argument for 
functional transformation was that the law firm was trying to 
decide if it needed to submit the articles to the PTO as 
evidence of prior art. The argument was that, ``Well, these 
articles are published so that people can understand new 
scientific developments, and the law firm is only using them to 
see if they are prior art.'' But they are both reading them. 
They are both reading them to see what substance is contained 
in the article and what it says about scientific development. 
So, I don't think that that is a transformative use. It may be 
excused on other grounds, but it is not transformative.
    Mr. Coble. And you want to add to that Ms. Novik?
    Ms. Novik. I am not a lawyer, so of course I am not as 
familiar with various cases that are coming out. But, I will 
say that I think transformative is one of those things where 
you kind of know it when you see it.
    And to actually speak to the case that Mr. Wimmer mentioned 
of the Grateful Dead posters, I actually happened to see an 
example of this. The coffee-table book presented the posters in 
thumbnail form and in chronological order in a way that, at 
least for me as a simple reader, I actually found did add 
information and did not replace the original. You know, if you 
want a big poster of the Grateful Dead on the wall, it is not 
the same thing as looking at a page in a coffee-table book that 
has seven or eight posters showing you the evolution of the 
style of the Grateful Dead. So, I actually felt that that was a 
reasonable judgment.
    And, so far at least, I feel that the court has been 
making--the courts have generally been making interpretations 
of transformative that, at least for myself as a creator, have 
made a certain sense.
    Mr. Coble. I thank you for that.
    And I plead guilty, I failed to prevail with the red light.
    Ms. Chu is recognized for 5 minutes.
    Ms. Chu. Thank you, Mr. Chair.
    As cochair of the Creative Rights Caucus I am so glad to 
see that we have individual creators here on today's hearing. 
And, in particular, I want to welcome back David Lowery to 
Capitol Hill. He is an outspoken singer-songwriter who is not 
afraid to speak his mind on key copyright issues, for the 
purpose of advocating for creative rights. So, thank you, Mr. 
Lowery, for speaking out for individual creators who simply 
want to preserve their right to make a living from their works, 
but often face many unique challenges.
    And, in fact, let me start with a question for you, which 
is on remixes and illegal lyric Web sites. In your testimony, 
you seem to indicate that there is a right way to sample music 
and that a permission-based solution is possible. You offer 
hip-hop and electronic dance as examples of music that rely on 
sampling and remixing. So, why is it that some choose not to do 
it the right way, when our current copyright system has 
allowed, as you say, ``market-based mechanisms and conventions 
to evolve and facilitate the licensing of sample and remixes?''
    And then, let me also ask about lyric Web sites, as a 
lesser-known kind of copyright infringement. And, you conducted 
a study to figure out how rampant this type of online 
infringement is and have even experienced that with your own 
lyrics. Can you tell us how serious and prevalent of a problem 
illegal lyric Web sites are?
    Mr. Lowery. Well, I will start with your second question. 
The lyrics were kind of a--they are an interesting case for the 
digital age, because really for a lot of artists there was no 
market for their lyrics because the fixed cost to print a book 
was too high. So, this is actually a success story for the 
Internet and music. One of the few ones. It is that there 
actually is a market for relatively obscure artists to market 
their, you know, essentially get some small amount of revenue 
from their lyrics. So--and, generally, the lyric Web sites have 
generally been licensed. Not all of them, but, looking at the 
traffic, about half of them or a slight majority of the traffic 
to these Web sites has been licensed. But, what started to, you 
know, peak my interests is that there seemed to be backsliding 
and a push for fair use, based around sort of annotations or 
meanings of the songs. And these are directly competitive with 
the, like I said, directly competitive with the market that 
already exists which has sort of established a market price, 
has established uses and all of that.
    Speaking to EDM and hip-hop, I often hear that there has 
been some sort of argument that hip-hop is not as innovative as 
it once was. Because of various rulings and stuff like that, 
people don't sample quite as much as they did before and stuff 
like that. All I can say is, I just like to point out that the 
market, basically, disagrees with that because hip-hop is now 
more popular than it ever was. So those rulings that may have 
sort of restricted some uses actually didn't affect the 
popularity of hip-hop.
    And finally, generally, having owned a studio for 20 years, 
I see that people tend to do what copyright intended when they 
are not able to obtain a license for a song that they sample. 
They tend to do what was intended in copyright, they create a 
new loop, we call them loops, to take the place of the sample. 
That is, they create a new work, which is something that I 
believe the founding fathers intended in the copyright clause.
    Ms. Chu. Okay. Thank you for that.
    Professor Besek, you expressed concerns with how there is 
the use of fair use in trade promotion authority. And, I 
understand that the courts don't always get it right, 
especially as digital technology continues to facilitate the 
reproduction and distribution of content in ways not 
contemplated by Congress. But some people are pushing for 
required exporting of our common law of fair use. What are the 
potential consequences of this, if--to the U.S. standards of 
fair use?
    Ms. Besek. I think the idea of exporting fair use is a 
really interesting one, although I don't think this is the time 
to do it. And that is because we have enough uncertainty here 
in our fair use doctrine that we should not be sending it to 
other countries. But, the part that I think is especially 
interesting is we are--I think some people are assuming that 
fair use, when exported, would be the same. But we have had so 
many different cases in the United States where the fair use 
has switched from the district court to the Appellate Court to 
the Supreme Court. And in another country it could have gone 
the other way. So, I don't think we can assume that fair use, 
applied in another country, would look like it does here.
    And the other point is that other countries have very 
different copyright laws, in the sense that they don't have a 
blanket exception, they have very specific exceptions. And for 
us to be imposing our fair use exception on them wouldn't sit 
very well, when they, in fact, cover a lot of the same uses 
that we do, but just in a different way.
    Ms. Chu. Thank you.
    I yield back.
    Mr. Coble. The gentlelady's time is expired.
    We have time for one more round of questions before we go 
vote.
    The gentleman from Pennsylvania is recognized for 5 
minutes.
    Mr. Marino. Thank you, Chairman.
    Professor Jaszi, I would like to begin with you, sir. Where 
do you draw the line on the fair use? Where do you draw the 
line on copyright using, particularly, lyrics for music or 
poetry?
    Mr. Jaszi. I think that line is properly drawn, although it 
is not easily drawn, between those uses which are genuine 
value-added uses which do infuse commentary, critique, and 
other added value into the material used----
    Mr. Marino. So, you----
    Mr. Jaszi [continuing]. And those----
    Mr. Marino [continuing]. You don't support the fair use, 
then? You just think that everything is game? Everything is--it 
can be used by anyone out there?
    Mr. Jaszi. I don't think that that was my answer.
    Mr. Marino. Okay.
    Mr. Jaszi. But I was about to say that, by contrast, there 
may be situations, and perhaps some of the sites to which Mr. 
Lowery refers are such situations, in which the added value or 
repurposing is protectoral rather than real.
    Mr. Marino. Okay, now----
    Mr. Jaszi. It is my----
    Mr. Marino.--I am at limited time here, sir. So, I would 
love to discuss this all day long with you because you seem--
you are certainly aware of it. But I have to move on in my line 
of questioning.
    I hear constantly from musicians, artists, individuals who 
supply the lyrics, supply the music, who are waiting on tables 
in restaurants and they see their music, their lyrics on the 
Internet. They receive nothing for that. Do you have any 
problem with that, whatsoever?
    Mr. Jaszi. I don't believe that the kinds of complaints 
about the use of music in public places, for example to which 
you refer, are even arguably covered by fair use. There may be 
enforcement issues concerning how well the music industry does, 
in fact, impose on restaurants which are subject to----
    Mr. Marino. No, no. You misinterpreted. I am sorry, maybe I 
wasn't clear enough. I don't mean using the material, playing 
it. I mean that these artists, these writers who write the 
lyrics then this music goes--makes a lot of money and then 
pirates on the line, on the Internet are using this music and 
selling it----
    Mr. Jaszi. Again, I don't believe that anyone, certainly 
not myself, would defend Internet piracy as a form of fair use. 
It lacks all of the characteristics of transformative use, 
repurposing and addition of value, which the courts have 
identified, over the last 20 years, as the earmarks of fair 
use.
    Mr. Marino. Okay. So, you don't have a problem with the 
courts then interpreting, as Attorney Wimmer--Wimmer, sorry, 
stated, that let us let the courts--it is common law, let us 
let them make that determination?
    Mr. Jaszi. I am sorry, the----
    Mr. Marino. Do you have any problem with the courts then 
making that determination on the four points that they usually 
use to determine whether there is transformation or not?
    Mr. Jaszi. Oh, I think that is exactly the way we should 
proceed.
    Mr. Marino. Okay. Let me pose this scenario, and please 
don't take it personally. You are a lecturer. And what would 
your position be that, concerning the--wherever you lecture, 
your employer pays you for that lecturing. So they video your 
lectures and then next year they say, ``We don't need you 
anymore. We are just going to run your videos and not pay you 
for them.'' What is your position on that?
    Mr. Jaszi. Well, they do that already. And---- [Laughter.]
    Mr. Jaszi [continuing]. So far I have survived. It is 
essentially a contractual thing.
    Mr. Marino. But, sir, there is the key. Therein lies the 
phrase, ``You have survived.'' Many, many of the people in the 
entertainment industry and the writers, they are not surviving. 
Fortunately for you, like myself, we have an income that we can 
live on. But individuals with the talents that I don't have are 
out there making--writing books and beautiful music, but yet 
are getting maybe, maybe a few cents, if at all. So you--would 
you--I would have to think that, based on what you said, you 
agree with me that they must be compensated.
    Mr. Jaszi. Oh, I absolutely agree. But the problem here is 
not a problem with copyright. Just as I am defended in my 
workplace by my contract, so the essential problem relating to 
the return from the markets to creative people is a problem of 
contract rather than copyright.
    Mr. Marino. So, why limit it then, with your position, why 
limit to copyright? Why not trademark? Why not patents?
    Mr. Jaszi. Well, we do have a very vital doctrine of fair 
use in trademark law. And the patent law, although it is 
different in its nature, far shorter in duration, is also 
subject to a number of public interest exceptions. So there 
is----
    Mr. Marino. But it is far more----
    Mr. Jaszi [continuing]. Nothing unique here.
    Mr. Marino [continuing]. It is--they are far more stringent 
than we are in the copyright areas.
    Mr. Jaszi. Well again, I would make a distinction, I think 
I would probably differ slightly, with respect to trademark. I 
think trademark law actually is as porous or more porous than 
copyright law. But as to----
    Mr. Marino. I see my time----
    Mr. Jaszi [continuing]. Patent, there is a significant----
    Mr. Marino.--I see my time has elapsed and we have to go 
vote. But, thank you so much, I appreciate the exchange.
    Mr. Coble. I thank the gentleman.
    The gentlelady from California asked to be recognized.
    Ms. Lofgren. Thank you, Mr. Chairman.
    I would like you to ask unanimous consent to put into the 
record some fair use principles for user generated video 
content, submitted by a variety of advocacy groups.
    Mr. Coble. Without objection.
    [The information referred to follows:]



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    Mr. Coble. Ladies and gentlemen, the Committee will stand 
in recess for this series of votes. But Members should be 
advised that we will resume the hearing immediately after the 
votes. We will continue until it is time for Judiciary to 
manage its portion of H.R. 7, on the House floor.
    So, we will stand in recess until we come back.
    [Recess.]
    Mr. Coble. And now we will continue to hear from the 
gentleman from Pennsylvania until we wait for the others to 
show up.
    Mister--the gentleman from Pennsylvania?
    Mr. Marino. An innocuous question for the lawyers and we 
can start with Mr. Wimmer. If you have followed the cases that 
have come down through the Federal courts, following the law, 
the common law that has been established, and I am going to ask 
the others to respond to it too, were you able to see that 
there is a relative consistency in the courts' opinions?
    Mr. Wimmer. You know, it is an interesting question. I 
think there was a substantial amount of consistency until about 
the late 90's, when the transformative use concept really 
started to ascend. And now, when you look at cases, like the 
Kelly v. Arriba Soft Case, and Perfect 10, and even through 
Google Books, it almost seems as though the transformative use 
piece has really unsettled the marketplace. But in terms of the 
rest of the factors, it has been pretty consistent, I think.
    Mr. Marino. Professor Besek and then Professor Jaszi?
    Ms. Besek. I think that where you start finding 
inconsistencies is when there is a genuinely new use. So, for 
example, you see courts really split on issues. And it is hard 
to predict whether a new use will be fair or not. I mentioned 
earlier that, in some of these cases like Sony, the district 
court goes one way, the Appellate Court goes another way, the 
Supreme Court goes another way. And then, sometimes, the 
decision that is originally written, turns out to be the 
dissent. So that's where, I think, the principal areas of 
difference between the circuits and the courts generally come 
up.
    Mr. Marino. Professor?
    Mr. Jaszi. I actually, I think, have a somewhat different 
take on this. I think that there is a lot more consistency in 
the current pattern of decisions, what I referred to in my 
remarks as, ``the emerging unified field theory of 
transformative fair use,'' then I would actually have expected 
for an approach to legal analysis that really is only 20 years 
old. And, in particular, now we are seeing a convergence of the 
approaches of the two circuits that have done the most 
decision-making in this area, that is the Second and the Ninth, 
which for a while we believed might be on different tracks. 
But, which the last couple of significant opinions suggest are 
probably not. Now, one can agree or disagree with that emerging 
unified field theory. But, I think it is remarkably consistent, 
even though, as Professor Besek states, sometimes it isn't 
clear how it applies to the whatever the new thing is.
    Mr. Marino. As a prosecutor, I am used to the criminal 
statutes and it is fairly consistent. It is--I have done some 
civil work in the banking industry, and I see how it does vary 
from, you know, codified legislative law, whether it is at the 
State or at the Federal level.
    So, I yield back. Thank you.
    Mr. Coble. I thank the gentleman.
    And, while we are waiting, I recognize the distinguished 
gentleman from Virginia, the Chairman of the full Committee.
    Mr. Goodlatte. Thank you, Mr. Chairman.
    Ms. Novik, and I direct this to Mr. Lowery too on this 
issue of remixing. I, you know, I see that a lot. I see it is 
very popular with people. And I understand it and I certainly 
understand the attraction of taking somebody's work and 
altering it and doing new things that can be very creative. 
But, is there a way to--you know, it troubles me that if they 
take that, remix it and are able to exploit it and offer it and 
actually copyright their new work themselves, that the original 
artist, whose work has been altered, doesn't benefit from that. 
I wonder if you have any thoughts on that. And whether, if the 
standard is that you are allowed to do this, if you have to get 
a license if you are deriving a certain amount of commercial 
benefit from it, as opposed to just doing it for fun and to 
share with your friends, kind of thing.
    Ms. Novik. Well, obviously I have spoken a great deal about 
noncommercial transformative work, where, you know, it is 
really--I mean, I talk to a lot of 16-year-old kids who are 
writing their own Harry Potter story, for instance, where they 
get to go to Hogwarts. And that is not hugely transformative. 
They frequently participate in all the same events of the book. 
But, at the same time, it is noncommercial. And so, I think the 
four points of fair use balance each other out.
    When it comes to commercial use, again, I feel that, you 
know, there are cases like----
    Mr. Goodlatte. You do agree that, if they did that and they 
hit on something really cool, that they would have to get a 
license from J.K. Rowling to do that?
    Ms. Novik. I mean, I think that, you know, I think that 
obviously, depending on what they were doing, a court would 
have to look at it. I am sure if it were not and decide whether 
it were fair use. And part of the decision would be, how 
transformative it was. And, I think that most of us, most remix 
artists appreciate that and understand that and don't actually 
want to exploit work commercially when--and I am speaking as a 
remix artist, somebody who is really trying to create new 
forums.
    Mr. Goodlatte. Sure. Let me ask Mr. Lowery what he thinks 
about my question about whether, if you cross a certain 
threshold in terms of commercial gain, that the rules should be 
different.
    Mr. Lowery. Often, I find that, although these are 
noncommercial works by those who remix it, they are distributed 
on commercial platforms. Like, for instance, I went to, I think 
it is fanfiction.com, to look at that for a minute. And, right 
away, there is advertising on that site. The problem is not 
with so much with, you know, those who create the remixes. It 
is that, the problem is that then there are these large 
intermediaries who then disseminate this work, who do make a 
profit. And they often encourage their users to make these 
remixes. Which may be fair use or may not be fair use, but they 
may be fair use when they are noncommercial. But, they become 
commercial, they become vacuumed up, you know, sort of into the 
commercial world and then monetized.
    I have some examples on my laptop I can send to your 
office, if you like.
    Mr. Goodlatte. Thank you.
    Mr. Lowery. Thanks for the question though.
    Mr. Goodlatte. I am going to----
    Ms. Novik. I would say----
    Mr. Goodlatte. I am going to----
    Ms. Novik [continuing]. If I just may add to that though, 
that that doesn't actually change what the artist is doing. And 
the----
    Mr. Lowery. But they can still do it. It is just they don't 
put it onto that Web site. They could still do that. It doesn't 
infringe any rights of the remixer to continue to make that 
work. It is just----
    Ms. Novik. It is true----
    Mr. Goodlatte. It is a good point for additional thought. 
But, I need to ask another question before my time runs out.
    So, I am going to ask all of you, so you are going to get 
another shot at answering a question of mine, anyway. Professor 
Jaszi states that fair use is working. So I am going to ask the 
rest of you if you believe that fair use is working for 
everyone or only for specific groups of users. And then we will 
give you the last opportunity to rebut what your fellow 
panelists have to say. And we will start with Professor Besek.
    Ms. Besek. I think that fair use is working for some users, 
but it is not working for all users, and it is certainly not 
working for all right holders. One of the problems is these 
recent cases that deal with one party exploiting lots and lots 
of works at the same time are distorting fair use. The end that 
they want to serve, for example in the indexing of books or 
whatever, is truly a good one. I mean, you see these cases and 
you think, ``What a great public benefit.'' But, the question 
is how you get there, what is the appropriate means to that 
end. And I think by trying to shoehorn it into fair use, we are 
doing a disservice to the Copyright Act. And it would be better 
if we could find another way to do that.
    Mr. Goodlatte. All right. Let me jump ahead to Mr. Wimmer, 
since I haven't asked him anything yet.
    Mr. Wimmer. Thank you. I think it is generally working. You 
know, we look at fair use both from the offensive side and the 
defensive side. Newspapers and other news organizations have to 
employ fair use, in terms of reporting on other people's work 
and curating other people's content. At the same time, we try 
to not have fair use become an impediment when we have 
commercial appropriation of mass amounts of our content. So, 
our view is that it is generally working. This trend toward 
transformative use is concerning, but it has really been a 
fairly short-term trend in the overall path of the common law. 
So, we think the courts will eventually get it right.
    Mr. Goodlatte. Ms. Novik?
    Ms. Novik. I do believe that fair use is generally working. 
I do, obviously, think that sometimes individual artists, 
especially those working on noncommercial works, are at a 
substantial disadvantage when they are faced with a large media 
conglomerate or automated systems that essentially prevent them 
from exercising their fair use rights.
    Mr. Goodlatte. Mr. Lowery?
    Mr. Lowery. I generally believe for music it is working. I 
don't want to get too deep into it, but I think it is the 
photographers who have probably been abused because you see 
plenty of--I mean, they are just--their business model has been 
really kind of wrecked by what I don't think was the intent of 
fair use. But, I am not an expert on that. So----
    Mr. Goodlatte. Well, on that point, if I might, Mr. 
Chairman, do you think that Congress should set distinctions 
based on the technology area between music, photography, books?
    Mr. Lowery. The fair use does manifest itself in different 
ways. I can't really say that--I feel like a little out of my 
league on that legally what they should--I would be glad to 
think about that and give you a more coherent answer.
    Mr. Goodlatte. Yeah. We would welcome anything you want----
    Mr. Lowery. Yes.
    Mr. Goodlatte [continuing]. Any of you, want to submit----
    Mr. Lowery. Okay.
    Mr. Goodlatte [continuing]. Any of these questions----
    Mr. Lowery. Thank you.
    Mr. Goodlatte [continuing]. In writing. And, Professor 
Jaszi, I promised you, you would get a final word on your 
inflammatory statement.
    Mr. Coble. And, Professor, if you could accelerate it 
because we are on a red, red light here. [Laughter.]
    Mr. Jaszi. I certainly agree that there are some groups of 
creators who are struggling in the current marketplace. But, I 
don't think that that struggle is really attributable to fair 
use, as it is instead to other conditions.
    I actually want to disagree, mildly, with Professor Besek 
about her example of a situation in which fair use isn't 
working. Because I believe, in fact, that the recent mass 
digitization cases Author's Guild against HathiTrust and Author 
Guild against Google, in the Southern District of New York, are 
really excellent examples of the doctrine fulfilling its 
function. In those cases, material is being dramatically 
repurposed for non-superseding uses. The public interest, as 
the judges in both cases have acknowledged, in those uses going 
forward, is enormous. No existing licensing structures are 
available to enable those uses. So far from thinking about mass 
digitization and all the benefits that it has brought to 
various communities, including the print disabled for whom it 
has been my privilege to work on these issues, I must say that 
I would count that as a story of success rather than a story of 
failure.
    Mr. Goodlatte. Thank you.
    Mr. Chairman, I apologize for the extra time, but I thank 
you for it.
    Mr. Coble. You are indeed welcome.
    The gentleman from Florida, Mr. Deutch?
    Mr. Deutch. Thank you very much, Mr. Chairman.
    I would like to thank the witnesses for coming and for 
being so indulgent to our schedule. Thanks for the testimony. I 
enjoyed reading it. I am sorry that I haven't been able to be 
here for all of your presentations.
    I already--I appreciate the ability to hear the lively and 
ongoing debate about what constitutes fair use. I was able to 
hear some of that. And I understood that it was a frequently 
litigated area of copyright law. But it has been especially 
interesting for me to hear the witnesses and in reading their 
testimony just a very small sampling of the ongoing issues of 
the development of the law in this field.
    And what hearing all of this has reminded me is how 
critical the entire previous body of law is to our current 
understanding of fair use. It is easy to forget that, by 
themselves, the words ``fair use,'' in this context, really 
have no meaning. Instead, fair use is defined only by the 
hundred-plus years of precedent in the United States. And, as 
someone who has followed the ongoing negotiations for trade 
deals with interest and with some concern, I am troubled at the 
suggestions that we just simply insert the words ``fair use'' 
into our IP section.
    Now, I support continuing to not only allow, but encourage 
a country to develop fair-use-style exceptions, as our previous 
trade deals have. But, what I don't fully understand is what 
the words ``fair use'' would mean, when taken away from the 
precedents that define them. And, because you can't build that 
precedent into a trade agreement or export it, it makes it 
exceedingly difficult to understand how this would work. And, 
while our trade agreements allow flexibility for any countries 
that so desires to adopt fair-use-style exceptions, mandating 
it would just provide a loophole incapable of definition 
through its countries who, frankly, often care little about IP, 
can excuse the lack of protection for authors. Fair use has no 
definition at all, in the context of a trade agreement.
    So, in doing just a bit of research for the hearing, I 
acquired some background materials of fair use precedent. What 
I got was a multivolume set of books. [Laughter.]
    This being just one. And I have only read a few chapters of 
this one, to be perfectly honest with you. This is the first 
volume. It is a 700-page, condensed---- [Laughter.]
    Mr. Deutch [continuing]. It is a 700-page, condensed 
version of our fair use law. Now, clearly, we are not seriously 
considering including a 700-page footnote in our trade 
agreements. Obviously, that doesn't work. Or, in the reverse, 
we are not going to blindly assume that putting the words 
``fair use'' or the four statutory factors into a trade 
agreement would result in the inclusion of the decades of 
precedent represented by the piles of books that are now 
sitting on my desk.
    Mr. Besek--I am sorry, Professor Besek, you discuss cases 
in which our interpretations of fair use can threaten to move 
the U.S. out of compliance with our international treaty 
obligations. So, even in the U.S. fair use law, which is quite 
actually fluid and vague on its own, if you erase all the 
precedent behind fair use and started completely from scratch 
in this country, would you see the fair use defined by future 
courts in the same way that it is now?
    [No response.]
    Mr. Deutch. Well, let me just go on. So, going further 
though, if you inserted section 107 into another country's 
legal system, without including any of our defining precedent, 
what is the likelihood that you would come up with remotely 
similar meanings as other governments try to flush out what 
this means?
    Ms. Besek. It is certainly possible that there would be 
some aspects of it that would be similar. But, they have such 
different cultural and other factors, I don't think there is 
any reason to think that it would track our fair use law. For 
one thing, one of the aspects of fair use is that it attempts 
to accommodate First Amendment concerns and those same concerns 
don't necessarily apply in other countries. But, they have just 
come from a different tradition, where they have had more 
explicit, separate exceptions which--and not this general kind 
of catch-all exception. And so, I don't know that they would 
necessarily treat it the same way we did.
    Mr. Deutch. And safe to say their explicit exceptions may 
fill volumes of their own, in those countries.
    Ms. Besek. Probably, that is true. I mean, they tend to 
have more exceptions and more very specific exceptions. But 
often they track the kinds of things that fair use would 
embrace.
    Mr. Deutch. But it wouldn't mean, in another country, it 
wouldn't mean the same thing. It could easily--the concern, 
obviously, is that it then becomes a loophole to completely 
overturn what is a really sensitive balance that we have in 
this country, based on volumes and volumes of precedent. There 
is an important balance to be struck in our trade deals. And 
the words ``fair use'' themselves, I think, don't bring us 
anything.
    Mr. Wimmer, I wonder if you would agree with that.
    Mr. Wimmer. I do agree with it. I am not a trade expert, so 
I might be getting a little bit out of my depth here. But I 
have done legal work in about 20 different countries. And there 
are common law legal systems and there are civil law legal 
systems. We have a common law legal system, and that is the way 
fair use has grown up here. That is true for England, true for 
Canada, true for Australia. You go to all of the civil law 
legal systems, where judges don't have the same tradition of 
working to create precedent and expand precedent over time, and 
they really can't cope in the same way with these types of 
common law doctrines in a civil law society as we can. It is 
hard for me to see it working, truthfully.
    Mr. Deutch. Thanks, Mr. Wimmer, you may not be a trade 
expert, but your insight, I think, is right on point and was 
helpful.
    And I appreciate the Chairman. And I yield back.
    Mr. Coble. I thank the gentleman.
    I am told the gentleman from Missouri has no questions.
    I want to thank all the witnesses and those in audience, 
because your presence here indicates more than a casual passing 
interest in this very important issue.
    Without objection, all Members will have 5 legislative days 
to submit additional written questions for the witnesses or 
additional materials for the record.
    The hearing is adjourned.
    [Whereupon, at 3:34 p.m., the Subcommittee was adjourned.]















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