Library Issues

Editor: Richard M. Dougherty, University of Michigan.
Contributing Editors: Steve Marquardt, South Dakota State University; William Miller, Florida Atlantic University; Sarah Pritchard, Smith College; Mark Sandler, University of Michigan

Vol. 17, No. 2 November 1996

Coursepacks and Fair Use

by Carol Ann Hughes

Shortly after the printed copy of the November issue of Library Issues was received from the printer, the Sixth Circuit Court of Appeals ruled in the PUP and MDS case. It wasn't possible to alter the printed version of LI, but thanks to technology we can provide our readers with the latest developments in this important case.

The Sixth Circuit Court of Appeals on November 8, 1996 announced its decision in the case of Princeton University Press vs. Michigan Document Services, Inc. In an 8 to 5 ruling, the court held that the making of photocopied course packs for sale by a for-profit copy shop is not fair use and therefore is an infringement of copyright. Five judges concluded that the copying had been fair use. The court also vacated the original panel's ruling that MDS's infringement was willful.

In an interview, the owner of MDS stated that it is his intent to seek a review from the U.S. Supreme Court. Smith noted that the dissenting judges provided a range of understandings of fair use, and because the case is so important to educators and scholars, he believes the case merits a review by the country's highest court.

On February 12, 1996, the Sixth Circuit Court of Appeals handed down a decision (Princeton University Press et al. v. Michigan Document Services, Inc. et al.) that production of coursepacks is a "fair use" as outlined in the production of Copyright Act of 1976. The decision was a near reversal of the opinion rendered in a seemingly similar case against Kinko's by a District Court in Manhattan in 1991. On June 12, 1996, the Sixth Circuit reheard the case "en banc" the outcome of which is still pending. What are the apparently volatile issues involved? And what might be some implications for the academic community of the points made in this case?

The details of the case are freely available. You may consult the Copyright and Fair Use Website <http://fairuse.stanford.edu/> or the Association of Research Libraries Copyright and Intellectual Property pages <http://arl.cni.org/scomm/copyright/copyright.html> for background documents. But the arguments presented about the details of the case can illuminate more than points of copyright law. They can highlight mounting pressures which are threatening the vitality of academic endeavor in the United States.

Determination of Fair Use

Fair use is determined by four factors:

  • The purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
  • the nature of the copyrighted work;
  • the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
  • the effect of the use upon the potential market for or value of the copyrighted work.

One of the most striking points of the Michigan Document Services (MDS) case is the determination of the Court to characterize the copying done by MDS as educational in nature rather than commercial. This is not to say that all educational copying is a fair use. But the Court focused on the purpose of the copying rather than the fact that a third party, a commercial entity, was making the copies.

Key Questions

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Key questions, then, revolve around the purpose of the use, When the facts were tested against the first fair use factor, the Court agreed with an earlier opinion that determined that "the central inquiry `is not whether one motive of the use is monetary gain but whether the user stands to profit from exploitation of the copyrighted material without paying the customary price.'"1 The court reasoned that "the professors and students, who might otherwise copy the materials themselves, have assigned the task of copying to a professional service that can perform the copying more efficiently... MDS does not "exploit" copyrighted material... because its fee does not turn on the content of the materials, copyrighted or not, that it copies."2 MDS was merely providing the most efficient mechanism through which a class could make use of materials. Since neither the academic "use" nor the MDS "use" of the content was exploitative of the copyright, the Court ruled that the copying qualified as fair use.

Character of Use

In examining the character of the use, the Court made another significant assessment. Coursepack copying is "premeditated" and not the spontaneous, last minute decision by a harried teacher, allowed under the Classroom Guidelines. But the Court dismissed this argument as being founded on a "misplaced" reliance. Guidelines - even those read into the Congressional Record - are not statutory text. No criteria beyond the four factors of fair use can rightly be used to gauge whether the act of copying is a fair use. Systematic copying for the classroom is not automatically unfair.

Catalyst of Debate

Within the Court's analysis of the pertinent facts of the case are three elements that are the catalysts of a potent debate:

  • the nature of the agent doing the copying may not be a determining factor against fair use;
  • exploitation of copyright may be separated from the act of making a copy;
  • and premeditation is allowable within fair use.

These three elements are a volatile mix that ignites a debate not confined to the world of print. Discussions about whether use of a computer program that requires copying of software into memory to operate or display on a monitor also wax intense. The higher education community must begin to participate more proactively in these discussions at both the national and local level. It can not allow all types of copying to become illegal or subject to license fees.

It is essential that classroom and private study uses be especially protected. We must maintain the distinction between (1) facilitating access to material copied at the behest of a student or a faculty member for study in a designated section of one course held during a particular semester with a limited class enrollment and (2) facilitating access to material requested by no individual, copied in bulk and marketed to the anonymous public for commercial gain. Perhaps academe can provide leadership to a society that seems to be in danger of losing all sense of balance between the rights of users and privileges of rights holders.


"Perhaps academe can provide leadership to a society that seems to be in danger of losing all sense of balance between the rights of users and privileges of rights holders."


Rights of Copyright Owners

The rights of copyright owners extend importantly into the fourth factor of fair use: the effect of the use upon the potential market for or the value of the copyrighted work. The Sixth Circuit was not unified in its assessment of this factor. The majority opinion in the MDS case reasoned that since the professors would not have required students to purchase the original works represented by the experts included in the coursepacks, and the students were unlikely to have purchased the works on their own without being introduced to the possible merits of the original works through the coursepack, no adverse effect upon the market for or value of the original work existed.

The dissenting opinion reminded the court that scholarly publishing exists in a limited market. "One suspects that the profitability of at least some of the... books at issue here is marginal. If publishers cannot look forward to receiving permission fees, why should they continue publishing marginally profitable books at all?"3

Following this rationale to its logical conclusion could totally undermine the right of fair use. The majority opinion abandoned such circular reasoning in stating that "Evidence of lost permission fees does not bear on market effect... It is circular to argue that a use is unfair, and a fee therefore required, on the basis that the publisher is otherwise deprived of a fee."4 Fair use should not be discarded in favor of the creation of price incentives for copyright owners. The classroom can not thrive without the continued opportunity for a faculty member to cost effectively bring together a customized mix of study materials from a variety of sources as stimulation for budding scholars.

A decision based upon the rehearing has yet to be released in Princeton University Press et al. v. Michigan Document Services, Inc. et al. Regardless of the disposition of this case, higher education must become an informed partner in the continuing debate. Administrators must act provocatively in their analysis of local practice and in defending users' rights in the conduct of research and private study. The academic enterprise depends upon it. Carol Ann Hughes is Head of SHARES, The Research Libraries Group, Inc., Mountain View, CA.

References

1Harper and Row, Publishers, Inc. v. Nation Enterprises, 471 : U.S. 539,562 (1985)

2Princeton University Press, et al. v. Michigan Document Services, Inc. et al. 74 F.3d 1512 (6th Cir. 1996). 168.

3Ibid.

4Ibid.


Copyright, Licensing, and a Rule of Reason

by Carol Ann Hughes

An earlier version of this article appeared in the November 1993 issue of LI. In the original article considerable attention was paid to the NREN which has since been superseded by the Internet. This version discusses the limitations on the use of licensed electronic data.

The vitality of our system of higher education and the quality of the research performed within it is one of the great strengths of the United States. A continuous free-flow of information is essential to the continued vigor of the educational community. It fosters creative interconnections among ideas and leverages the investment of public monies in scholarly research and communication. But copyright protection, as conceived by the writers of the U.S. Constitution, has created a delicate relationship between the rights of those who have created knowledge and those who are attempting to make further advances.

These writers, who were deeply interested in fostering the expansion of knowledge, adopted a strategy intended "to promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries."1 Over 200 years later, two other authors concerned with the continued growth of knowledge stated that

all Americans need to realize that the copyright law is the infrastructure supporting the progress of learning in our free society and that if it is to serve this crucial function, the law must take into account not only rewards for creators and disseminators but also reasonable rights for the users who provided those rewards.2

In the Copyright Act of 1976, Congress chose to include its first codification of what might constitute reasonable rights for users. Fair use, which had existed as a judicial law, a "rule of reason," since the 1840s was given statutory recognition in "Section 107. Limitations on Exclusive Rights: Fair Use." (These are listed on page 1 of the preceding article.)

Section 107 is intended to cover fair use within competing commercial markets as well as within the nonprofit education market. The language is intentionally general to allow some flexibility of application in light of new situations and new technologies that could not have been foreseen by framers of the Copyright Act. "This was done in order to accommodate the perpetually unsettled quality associated with the technological production and dissemination of ideas, products and artistic creations... the fluidity of the statutory exception of `fair use' was oriented toward the unknown not the known."3

Ambiguity of "Fair Use"

The educational community's understanding of what actions constitute fair use has been impeded by the ambiguity in the language of the law and the fact that the vast majority of case law has been based on disputes between commercial interests. For example, although the intent behind Section 107, as indicated by its title, reflects the fact that its goal is to state the minimum standards of fair use, too often this section and related guidelines are interpreted as guidelines to the maximum allowable. This limited understanding of fair use provisions may have led the academic community to forego opportunities to firmly establish or even enhance its rights in the scholarly use of information.

No court cases have been undertaken by higher education or its representatives to clarify fair use parameters in the academic community. As with many issues, those who have a direct economic gain to be realized have been the first to enter court to establish precedents. Consequently recent actions such as that initiated against Texaco, Inc. or Michigan Document Supply may have increased uncertainty within academe of the meaning of fair use.

Heightened Uncertainty

Advances in information technology and electronic publishing may soon require the academic community to examine fair use more closely. The Internet and the World Wide Web present the scholarly communication system with an entirely new set of alternatives for information creation, reproduction and dissemination. However the ease with which multiple copies can be distributed without the knowledge of or remuneration to the copyright holder is one of myriad factors that make publishers nervous about protecting their rights in an electronic environment. On the other hand, responsible users of technology have the right to be productive even though the software or hardware used requires temporary copies to be created in the normal course of operation.

Discussion of rights aside, the difference between using a work and using its copyright has become increasingly blurred in the electronic environment. The distinction has been easy to perceive in the world of books. An individual can purchase, use and sell a book at will without fear of infringing on the rights of the copyright owner. But an individual may in the future be prohibited from displaying, storing or printing an electronic work unless payment is made to the copyright holder if some proponents of copyright "reform" hold sway. The concatenation of the meanings of "making use of" and "making a copy of" has profound implications for the future of academic investments in information technology.

Growth of Licensing

In an effort to clarify their rights, publishers have increasingly moved toward licensing agreements rather that copyright law as the primary means of asserting control in the market for electronic products. There is no consensus as to whether fair use does or should exist within a licensing environment. It seems possible that fair use may not exist outside of the terms negotiated in each agreement. If this is the case, the potential is great for losing fair use altogether in an international maze of local licensing agreements. Many worry that in this scenario more educational barriers would be created than could be justified by the need to protect economic incentives for publishers. Especially if the license agreement has the result of dramatically raising the cost of providing distance education by prohibiting access by students off campus or perhaps even outside the library building.

Limitations on Licensed Electronic Data

Limitations on the use of licensed electronic data are subject to negotiation as are all other license terms. Skill in addressing myriad legal and technical details involved in supporting access to licensed electronic material is a new expertise being required of librarians. Those who were formerly primarily concerned with assessing the intellectual content of materials are now being asked to consider issues such as terms for consortial purchases of databases whereby multiple institutions can use electronic materials, how to maintain rights to information that has been licensed over a period of years but which has recently been discontinued, and how to protect the security of resources and the privacy of people using those resources. They are even being asked to learn how to partner with information providers in developing new electronic products that exploit a particular university's library resources.

The result of these negotiations can have profound implications for the community that the library serves. Campus administrators need to be alert to the new demands placed upon librarians and support them in acquiring the necessary campus support from legal counsel and technical staff.

Increased awareness of the substantial role that fair use plays in supporting teaching and research has led some campuses to negotiate terms that include fair use "provisions" with the licensing agreement. Terms that allow unlimited viewing, downloading and printing for the campus community and a definition of the campus community that includes people working from home, at affiliated institutions, and in distant laboratories are increasingly common. However, the debate about the role of fair use in access to electronic materials is by no means settled.

The Public's Investment

Education is based upon exchange of information. In both the classroom and the "invisible college" the educational community relies on free inquiry and the testing of knowledge in a public forum. The significance of the investment made by the public sector in the scholarly communication process argues for the retention and protection of fair use on behalf of society's greater good.

Publication of research in peer-reviewed journals is a significant part of the scholarly communication process. Federal public funds are granted, often being matched by local public monies, for research projects, the results of which are required to be disseminated widely. Some grants even provide "page-charges" with which publishers are paid to publish research results. Professors are paid salaries from public coffers while they write articles, review the work of others, and provide editorial services for professional journals.

Public monies go to research libraries that purchase the work of the professoriate in published form for the university community where it is read by other scholars who get more grants, do more research, and the cycle repeats itself. Ultimately out-of-print material from which publishers may still generate copyright fees, is archived and stored in perpetuity by research libraries with further support by public monies in the form of storage facilities and resources for preservation.

The significant public investment made in higher education infrastructure for the advancement of knowledge requires that we not allow insurmountable barriers to be put up between scholars and the information they need. Our country cannot afford the potential for duplication of human intellectual effort and missed opportunities to fully leverage precious research dollars. The well-being of the nation's educational and research establishment in the Information Age requires that we come together to discuss how best to maintain fair use as a primary right of academe. Carol Ann Hughes is Head of SHARES, The Research Libraries Group, Inc., Mountain View, CA.

References

1United States Constitution. Article I. Section 8.

2L. Ray Patterson and Stanley W. Lindberg, The Nature of Copyright: A Law of Users' Rights (Athens, GA: University of Georgia Press, 1991), p. 14.

3Triangle Publications, Inc. vs. Knight-Ridder Newspapers, Inc., 445 F. Supp 875,880 (S.D. Fla. 1978) cited by Harry N. Rosenfield, "The American Constitution, Free Inquiry, and the Law," in Fair Use and Free Inquiry: Copyright Law and the New Media, 2nd ed., ed. by John Shelton Lawrence and Bernard Timberg (Norwood, NJ: Ablex, 1989).

Mountainside Publishing, Inc.

Library Issues: Briefings for Faculty and Administrators (ISSN 0734-3035) is published bimonthly beginning September 1980 by Mountainside Publishing Co., Inc., 321 S. Main St., #213, Ann Arbor, MI 48104; (734) 662-3925. Library Issues, Vol. 17, no. 2. ©1996 by Mountainside Publishing Co., Inc. Subscriptions: $44/one year; $74/two years. Additional subscriptions to same address $18 each/year. Address all correspondence to Library Issues, P.O. Box 8330, Ann Arbor, MI 48107. (Fax: 734-662-4450; E-mail: apdougherty@CompuServe.com) Subscribers have permission to photocopy articles free of charge for distribution on their own campus.

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