Monday 6 September 2010

Fair Use, the Standard Hail Mary

When a judge starts his opinion, “For the fourth time we consider on appeal…” you get the impression he’s a little annoyed and tired of seeing these two parties in court.

That’s exactly how Judge Michael of the United States Court of Appeals for the Fourth Circuit started his opinion in the latest iteration of Bouchat v. National Football League. (full opinion).  The case began over a dozen years ago when Bouchat first brought suit against the NFL and one of its teams, the Baltimore Ravens.

Bouchat designed the first Ravens’ logo used in the mid-90s, except the Raven’s didn’t acknowledge this, didn’t license Bouchat’s work from him and didn’t pay him any royalties for the use of the “strikingly similar logo.”  So Bouchat sued and won and got absolutely no damages. Obviously not happy with this outcome, he attempted to sue other companies that had manufactured and sold goods bearing the Ravens’ logo.  That didn’t pan out well for him either. 

Then, 10 years after the original suit against the Ravens and NFL for using the logo on its helmets and fields, Bouchat tried again, suing again for copyright infringement but this time for using the logo in a highlight reel that includes video of those original uses and for displaying the logo on historical memorabilia in the franchise’s headquarters.  (How an expansion team that’s been in existence for less than 20 years has enough highlights for a full-length video is beyond me, but then I come from hardcore-football land.)

The Play: Fair Use

The Ravens tried to claim fair use of the logo, citing its use in the highlight reel as historical and non-commercial. The district court agreed and found in favor of the Ravens.  The appellate court disagreed and reversed.

Fair Use in the Film - Blocked

Under the US Copyright Act, fair use in analyzed against four factors: Purpose and character of defendant’s use of the work, the nature of the copyrighted work, the amount and substantiality of the portion of the work used compared to the whole, and the effect of the use on the potential market for the copyrighted work.

Looking at the logo’s original use in the footage rather than the usage of the footage itself in the highlight reel, the appellate court found that the use was not transformative.  The logo was used to identify the team.  A standard use for a logo.  Additionally, the highlight reel was sold commercially giving the use of the logo a commercial purpose. [When a defendant’s use is transformative or non-commercial, the use is more likely to be deemed a fair use.]

The appellate and district courts agreed with each other on the second fair use factor, finding that the copyrighted work was highly creative. The logo is a drawing of a flying B.  [When a work is very fact-based or only minimally creative, the factor leans in favor of fair use.]

The third fair-use factor is probably the one responsible for misleading 10% guides and other myths that suggest there is a certain set amount of a work one can take without infringing.  In this case, the court did not need to consider any percentages; the entire work was used.  This was a place where the appellate court disagreed with the district court as the district court had compared the logo to the entire video content instead of to itself.  [The less of the work that is used, the more likely there will be a finding of fair use.]

The defense attempted to rely on the absence of damages awarded in the previous lawsuits to show that there was no market for Bouchat’s work, but the court disagreed.  “The licensing of NFL logos for use in the sale of official team merchandise, in exchange for royalties,is exactly the type of potential market that exists for Bouchat’s copyrighted logo.”  [If the use has little to no impact on the potential market, it is more likely to be fair use.]

Having found that all four fair use factors weighed against fair use, the court held that the Ravens were liable for copyright infringement for showing the Bouchat logo in the highlight videos.

Fair Use in Memorabilia – It’s Good

When analyzing fair use in terms of the memorabilia displayed in the lobby, the court came to a different conclusion.

With the video, original footage showing the original use of the logo was deemed not transformative and for commercial purposes.  However, when displaying an original ticket with the logo in a location open to the public free of charge, the court found this use to be both transformative and non-commercial.  “Most important, the use of the logo in a museum-like set-ting "adds something new" to its original purpose as a symbol identifying the Ravens.”

The second factor analysis remains the same as above since the work is still highly creative.  Interestingly enough, although the amount of the work used under the third factor did not change, both the ticket and the video used the whole work, the court found the third factor to be neutral in the lobby display context.  The court decided that using the whole work was justified in relation to transformative nature discussed under the first factor.  (Professor David Franklyn of the University of San Francisco stated at this year’s American Bar Association meeting that the transformative factor has morphed fair use; this use of transformative to justify taking the entire work seems to be a good example of Professor Franklyn’s concern.)

Transformative is brought in again for the fourth factor, with the court stating that transformative uses are less likely to have an effect on the potential market.  The fact that Bouchat presented no evidence to support any market harm didn’t help either.  The court found the fourth factor to be in favor of fair use.

The court held that it was fair use to display the logo on memorabilia in the lobby.

Final Score – not quite

Finding one use as infringing and the other as fair, the court remanded and sent the case back to the district court to decide whether an injunction is appropriate.  After all that, the review from the booth overturned the ruling on the field and it’s back to the game to find out who will win in the end.

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