The first fair use factor — the purpose and character of the use — requires that courts consider whether the allegedly infringing work has a commercial or nonprofit educational purpose. That being said, nearly all of the illustrative uses listed in the preamble paragraph of 17 U.S.C.S. § 107, including news reporting, comment, criticism, teaching, scholarship, and research are generally conducted for profit. The commercial/nonprofit dichotomy concerns the unfairness that arises when a secondary user makes unauthorized use of copyrighted material to capture significant revenues as a direct consequence of copying the original work. This factor must be applied with caution because the United States Congress could not have intended a rule that commercial uses are presumptively unfair. Instead, 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.
A photographer filed an action against an artist, a gallery, and its owner, claiming that the artist's artworks infringed on the photographer's registered copyrights in certain photographs. The district court granted summary judgment and an injunction that ordered the artist, gallery and owners to deliver the works to the photographer. The case was appealed.
Did the district court err in granting summary judgment in favor of the photographer?
The court held that the district court imposed an incorrect legal standard when it concluded that, in order to qualify for a fair use defense the artist's work had to comment on the photographer, the photographs, or on aspects of popular culture closely associated with the photographer or the photographs. The court ruled that 25 of the artworks made fair use of the copyrighted photographs because the artworks presented a new expression, meaning, or message. The artworks were transformative because they manifested an entirely different aesthetic from the photographs since the artist's composition, presentation, scale, color palette, and media were fundamentally different and new compared to the photographs, as was the expressive nature of the artist's work. The artist's audience was very different from the photographer's audience, and there was no evidence that the artist's work ever touched, much less usurped, either the primary or derivative market for the photographer's work. The court expressed no view as to whether five of the artworks were also entitled to a fair use defense, and the court left the issue to the district court on remand.