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Editor's Notes: REX S. HEINKE, SBN 066163 Telephone: (310) 859-7811 Attorneys for Plaintiffs Los Angeles Times, UNITED STATES DISTRICT COURT
TABLE OF CONTENTS Page TABLE OF AUTHORITIES [omitted]
1. SUMMARY OF ARGUMENT Despite Defendants’ attempts to create the appearance of a serious First Amendment issue, this case has nothing to do with the First Amendment. Rather, this case is simply about Defendants’ desire to steal copyrighted news articles that Plaintiffs have created at great expense, instead of linking to them on Plaintiffs’ websites. Defendants are not just stealing one or two of Plaintiffs’ copyrighted articles. They stealing thousands, and this number is growing every day. The fair use doctrine has never allowed such systematic infringement of thousands of copyrighted works for years at a time. If it did, hundreds if not thousands or hundreds of thousands of websites could republish Plaintiffs’ copyrighted articles to the world, just like Free Republic does. Copyrights would become meaningless if such wholesale theft were tolerated. Defendants attempt to justify their systematic infringement by arguing that it is “essential” that Defendants and their users read Plaintiffs’ entire articles so they can accurately “comment” on them. Even assuming this is true, it does not explain why the world needs to read unauthorized copies of Plaintiffs’ articles on Free Republic, when the same articles are easily available on Plaintiffs’ websites, just a click away. Plaintiffs do not seek to limit Defendants’ and their readers’ First Amendment right to comment on Plaintiffs’ copyrighted articles. Defendants and their members can comment all they want. All Plaintiffs ask is that Defendants and their members stop posting unauthorized copies of Plaintiffs’ articles on Free Republic, and instead post links to such articles. Defendants and their members could then comment all they want without infringing Plaintiffs’ copyrights. Finally, while Defendants trumpet their support for the First Amendment, their arguments, if accepted by this Court, would actually totally undermine the First Amendment. Defendants seek to deprive authors, like Plaintiffs, of their copyrights, which would eliminate the economic incentives that copyrights protect. If Defendants succeed, the result would be less speech, not more, because authors will lose the economic incentive to create new works. Thus, it is Defendants who seek to undermine the First Amendment, not Plaintiffs. For all of these reasons, and the reasons discussed in more detail below, Defendants’ systematic theft of thousands of copyrighted articles is well outside the limited doctrine of fair use. Accordingly, Plaintiffs’ fair use motion should be granted, and Defendants’ motion should be denied. 2. THERE IS NO FIRST AMENDMENT RIGHT TO PLAGIARIZE BY REPUBLISHING ENTIRE COPYRIGHTED WORKS. Plaintiffs are long recognized champions of the First Amendment. Despite Defendants’ assertions to the contrary (Defendants’ Motion 6:14-17), Plaintiffs have never sought any relief that would shut down Free Republic. Nor do they seek to dictate what Defendants can and cannot say, nor claim any monopoly on the facts contained in their news articles. Plaintiffs made this clear in their Complaint. Complaint, § 22. All Plaintiffs want is for Defendants and Defendants’ members to stop posting the full text of Plaintiffs’ copyrighted articles on Defendants’ website. What is really going on here is that Defendants want to be in the “breaking news” business without doing any work. What they like about infringing Plaintiffs’ copyright rights is simply that -- particularly with the Internet -- it is extremely easy, and essentially cost free. Koefoot Decl., § 17; Perruso Decl., § 18. Defendants’ use of an ever-growing army of “Registered Subscribers” makes it even easier. Every day, Defendants have thousands of members who help them scour the Internet for more and more articles to add to Free Republic’s archives. Thanks to the clever system that Defendants devised and put in place, Defendants can now sit back and watch their library -- and traffic -- grow; all without any effort or expense on their part. Defendants’ argument also proves too much. By Defendants’ “logic,” anyone who wants to criticize or comment on anyone else’s work would be entitled to make a copy of it for free. A person could go into a bookstore, for example, and make a copy of an entire book (instead of buying it) because they do not just want to read it, they want to “comment” on it. If Defendants’ argument is adopted, anyone could copy hundreds of books and articles so they could “comment” on them. Then they could scan this library of books and articles, and post them on the Internet for the entire world to “comment.” To make their websites more appealing, they might also decide to “comment” on photographs, paintings, music, documentaries, and movies. Copyright law would be eviscerated if Defendants’ argument is adopted. Stated bluntly, Defendants do not want copyright laws to be enforced. This would have as pernicious an effect on the First Amendment as anything imaginable, however. It would destroy long existing incentives to create and publish high quality works of authorship in various media, including the Internet. Harper & Row, 471 U.S. at 554-55 (“The obvious benefit to author and public alike of assuring authors the leisure to develop their ideas free from fear of expropriation outweighs any short-term ‘news value’ to be gained from premature publication of the author's expression.”). If authors cannot expect compensation for their creative works, they will stop creating them. Id. Not only does the First Amendment not compel this, to allow this would undermine the very First Amendment values that Defendants so ardently claim they believe in. This would deprive authors of any economic incentive to speak. The result: less free speech, not more.[1] 3. EVERY FAIR USE FACTOR FAVORS PLAINTIFFS.
The “critical inquiry” under the first fair use factor is to determine whether the new work "adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message." Infinity Broadcast Corp. v. Kirkwood, 150 F.3d 104, 108 (2d Cir. 1998); Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 578 (1994) (“central inquiry”). Defendants, however, merely republish verbatim copies of Plaintiffs’ unaltered news articles. This is not transformative in the least. Infinity Broadcast, 150 F.3d at 108 (“simply tak[ing] [plaintiff’s unaltered broadcasts] and market[ing] them to a specific clientele” is not transformative under the first factor; no fair use); Basic Books, Inc. v. Kinko’s Graphics Corp., 758 F. Supp. 1522, 1530 (S.D.N.Y. 1991) (copying “that merely repackages or republishes the original is unlikely to pass the test” under the first factor). Unable to deny this, Defendants nevertheless claim they “transform” Plaintiffs’ articles by offering exact copies on Free Republic for a “very different purpose than the intended purpose of the original Los Angeles Times and Washington Post articles” – to alow their users to “comment” on Plaintiffs’ articles. Defendants’ Motion 11:21-22 (original emphasis). This argument fails as a matter of law. Transformativeness is not about a defendant’s subjective intent; it is about “add[ing] something new.” Infinity Broadcast, at 108 (defendants’ marketing of plaintiffs’ articles to a different audience does not “transform” them). See also American Geophysical Union v. Texaco, Inc., 60 F.3d 913, 922 (2d Cir. 1994) (photocopying scientific articles for purpose of “research in the sciences [which] might well serve a broader public purpose” is not a fair use); Nihon Keizai Shimbun, Inc. v. Comline Business Data, Inc., 166 F.3d 65, 72 (2d Cir. 1999) (defendant’s “abstracts” of plaintiffs’ news articles “add[ed] almost nothing new” because they were “for the most part direct translations”; no fair use). Defendants’ “transformation” arguments are also meritless as a matter of fact. As the undisputed facts show, there is nothing unique about Free Republic: Like Plaintiffs’ websites, Free Republic’s purpose is to attract readers by distributing “breaking news” articles to thousands of readers every day. See also Defendants’ Motion 11:8 (admitting that Free Republic‘s “very purpose” includes “education[]” and “news reporting”). The only difference is that Defendants have virtually no expenses because they steal almost all of their content from other websites, including Plaintiffs’. Defendants do not deny this. The only distinction they draw is that Free Republic offers an opportunity to not only read Plaintiffs’ articles, but also comment on them. Defendants’ Motion 12:21. That is like arguing that taping a pencil and note-pad to a pirated VHS copy of Star Wars is fair use, because then the movie is being offered for “comment.” This is not transformation; this is theft. Indeed, as the undisputed facts show, Free Republic offers a perfect substitute for Plaintiffs’ copyrighted articles -- exact copies of Plaintiffs’ entire articles. There is no transformation whatsoever. That is precisely why people can -- and do -- read Plaintiffs’ articles on Free Republic, instead of on Plaintiffs’ websites: they are perfect substitutes. 3 Nimmer on Copyright, § 13.05[D][1] (“whatever the intent of the copier, a verbatim reproduction will of necessity serve the function of the plaintiff’s work”). See also Aldridge Decl., §§ 2-6. Access to Plaintiffs’ articles on Free Republic is also free. Aldridge Decl., § 6 (explaining how Free Republic allows Defendants and others to free-ride off Plaintiffs’ substantial investments).[2] Defendants are simply republishing untransformed, exact copies of Plaintiffs’ copyrighted news articles, and free-riding on Plaintiffs’ substantial and expensive news gathering efforts. Therefore, the “critical” inquiry -- transformation -- under the first factor strongly favors Plaintiffs.
Unable to present any evidence of transformativeness, Defendants are forced to falsely portray “[t]he [Free Republic] site [as] a not for profit enterprise.” Defendants’ Motion 6:20-21, 7:5 (relying on the Declaration of Howard K. Szabo). In fact, the Free Republic website is a for-profit limited liability company in the business of “Internet discussion and marketing.” Wayland Decl., §§ 9-10, Exhs. H & I (fictitious business name statement for Free Republic). Free Republic is not -- and never has been -- a non-profit entity. Szabo Decl., § 6 (conceding that Defendants have only recently begun “working” on becoming a non-profit, and that they have not even completed or submitted the necessary IRS forms to become a non-profit entity). Even aside from Defendants’ misleading claim of non-profit status (which Defendants have been using to solicit “donations” for years), it is difficult to imagine that the Internal Revenue Service would ever grant non-profit status to a website like Free Republic. As the undisputed facts show, the Free Republic website (1) displays commercial advertisements, including for Defendants’ own website design business and its commercial clients, (2) sells Free Republic merchandise for “profit,” and (3) [REDACTED]. Plaintiffs’ Motion 8-10. Even if non-profit law were as lax as Defendants argue, there is still no fair use because non-profit status has never conferred immunity to steal copyrighted works.[3] In summary, the undisputed facts demonstrate a complete lack of transformativeness, and that Free Republic is commercial. The first fair use factor could not more strongly favor Plaintiffs.
Defendants argue that the second fair use factor favors them because “[t]here could hardly be more ‘informational and functional’ a work than [Plaintiffs’] newspaper article[s].”[4] Defendants’ Motion 13:8. As explained in Plaintiffs’ moving papers, however, news articles are not like phone directories or residential housing listings, which receive very limited copyright protection. Plaintiffs’ Motion 17-18. Instead, it is well established that news articles are fully protected by copyright law. Harper & Row v. Nation Enterprises, 471 U.S. 539, 548 (1985) (republishing excerpts from a book about newsworthy political events is not a fair use); Nihon Keizai Shimbun, Inc. v. Comline Business Data, Inc., 166 F.3d 65, 72 (2d Cir. 1999) (publishing translated abstracts of news articles in Japanese-language business journals is not a fair use).[5] Thus, this factor favors Plaintiffs, not Defendants.
Defendants argue that they do not steal entire copyrighted works because they “only” steal entire articles, not entire newspapers. This is wrong. Under long settled principles of copyright law, each of Plaintiffs’ news articles represents an independent and entire work. American Geophysical Union v. Texaco, Inc., 60 F.3d 913, 925-26 (2d Cir. 1994) (copying an entire article from a journal whose copyright was only registered as a whole still constituted copying of the entire work); Hustler Magazine, Inc. v. Moral Majority, Inc., 796 F.2d 1148, 1155 (9th Cir. 1986) (“A creative work does not deserve less protection just because it is part of a composite work.”). Therefore, Defendants must satisfy their burden of proving that republishing thousands of articles is somehow “essential” so that Free Republic’s users can “comment” on them. Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 589 (1994) (requiring that “no more [be] taken than necessary”); Supermarket of Homes, Inc. v. San Fernando Valley Bd. of Realtors, 786 F.2d 1440, 1449 (9th Cir. 1986) (“Generally, no more of a work may be taken than is necessary to making the accompanying comment understandable.”). Defendants can never meet their burden of proving that it is somehow “essential” to copy the entire article. Campbell, 510 U.S. at 589 (explaining that "attention [under the third factor] turns to the persuasiveness of a [copier's] justification for the particular copying done"). Free Republic is attracting visitors by republishing unaltered copies of Plaintiffs’ entire works to up to 40 million persons who would otherwise need to go Plaintiffs’ sites to see them. Defendants say that this is necessary to allow “criticism” of and “comment” on Plaintiffs’ articles, but there is nothing “essential” about republishing and archiving verbatim copies of thousands of Plaintiffs’ entire works on Free Republic. See, e.g., Infinity Broadcast, 150 F.3d at 109 (“Though not an absolute rule, ‘generally, it may not constitute a fair use if the entire work is reproduced.’” because it is almost never “essential” to copy the entire work) (quoting 3 Nimmer on Copyright, § 13.05[A][3]). Indeed, Defendants’ agreement to stop stealing articles from Jewish World Review effectively admits that the criticism and comment that purportedly occurs on Defendants’ website does not require Defendants to steal entire copyrighted works. Wayland Decl., Exh. Q. All Defendants have to do is link to Plaintiffs’ websites if they want their users to be able to read Plaintiffs’ articles before they comment on them.[6] In short, Defendants are republishing thousands of copyrighted works in their entirety, without any conceivable justification when Plaintiffs’ news articles are already published on Plaintiffs’ websites, just a click away. Therefore, the third fair use factor strongly favors Plaintiffs.
The fourth fair use factor concerns “the effect of the use upon the potential market for or value of the copyrighted work.” 17 U.S.C. § 107(4). Defendants’ expert, however, effectively concedes a “detrimental effect [that Free Republic is causing] to the plaintiff’s web sites.” However, all he claims is that “any detrimental effect[s]” are “trivial” and “probably [] more than offset by the beneficial effect of the referrals.” Stout Decl., § 51. The only “evidence” Defendants offer of this is the personal opinion of their own expert, which is inadmissible. See Plaintiffs’ Evidentiary Objections. This attempt to trivialize the harms caused by Free Republic’s systematic infringement of thousands of Plaintiffs’ copyrighted articles also rings hollow. Defendants must understand that the harm is great, because that is why they decided not to inflict it on Jewish World Review. Wayland Decl., Exh. Q (requesting that members stop posting Jewish World Review articles on Free Republic because of the detrimental effect on Jewish World Review’s traffic volume). This diversion of traffic is also substantial as a matter of common sense, because Plaintiffs lose valuable traffic every time a visitor reads one of their thousands of articles on Free Republic, instead of Plaintiffs’ websites. Perruso Decl., § 21; Koefoot Decl., § 22; Aldridge Decl., § 6.[7] Even if it were true that Defendants are referring more hits to Plaintiffs’ websites than they divert (and it is not), Defendants still have no basis for claiming that Plaintiffs are “benefitted” by Defendants’ infringement of Plaintiffs’ articles. Defendants use and republication of thousands of Plaintiffs’ articles to the world without a license violates the fundamental right of copyright owners to control copying, publication, distribution, and use of their works. In addition, it deprives Plaintiffs of potential licensing benefits and revenue from Defendants (or, alternatively, the right to refuse a license). Moreover, countless publishers and others who are paying Plaintiffs’ license fees are not going to continue paying for a license -- or paying as much for a license -- if Free Republic does not have to pay. See, e.g., Koefoot Decl., §§ 10-13, 21-24 (describing the harmful effects of Defendants’ conduct on Plaintiffs’ licensing revenue, as well as advertising revenue); Perruso Decl., §§ 10-13, 20-23 (same). Plaintiffs have also been harmed by the loss of archive revenue, and by the even more fundamental harm of loss of control over one’s own property. Id. Taking into account all this, Defendants have no basis for arguing that Plaintiffs will ultimately “benefit” or “profit” as a result of Defendants’ theft of thousands of works that copyright law has always recognized as the copyright owner’s property. Moreover, even if all of these harms were somehow “offset by” the beneficial effect of [Free Republic’s] referrals” (and not even Defendants’ expert predicts this with any certainty), this is still not fair use. It is not a defense to copyright infringement to say that the copyright owner somehow benefitted from having his works stolen, any more than it is a defense to theft that the victim “benefitted” because the stolen jewelry was “borrowed” and worn on camera by Marilyn Monroe. This may increase the jewelry’s value, but it does not excuse the theft.
D.C. Comics Inc. v. Reel Fantasy, Inc., 698 F.2d 24, 28 (2d Cir. 1982) (rejecting defendants’ arguments that the fourth fair use factor favored them because their infringing activities increased plaintiffs’ sales).[8] Accordingly, Defendants have no evidence to deny the detrimental effect of Defendants’ infringing activities on Plaintiffs’ websites. Moreover, the “benefits” that purportedly “offset[]” these conceded harms are irrelevant as a matter of law. Therefore, the fourth factor -- like all the others -- strongly favors Plaintiffs. See also Plaintiffs’ Motion 19-22. As demonstrated by Plaintiffs’ moving papers, and above, all four fair use factors strongly favor Plaintiffs. Defendants have not even remotely “carr[ied] their burden of proof as to all issues in the dispute.” Texaco, 60 F.3d at 918. See also Columbia Pictures v. Miramax Films Corp., 11 F. Supp. 2d 1179, 1187 (C.D. Cal. 1998) (“Defendants bear the burden of proof on all of [the fair use] factors.”). Therefore, Plaintiffs’ motion should be granted, and Defendants’ cross-motion should be denied. DATED: October 25, 1999 Copyright Tech Law Journal GREINES, MARTIN, STEIN, & RICHLAND LLP
By ____________________ Attorneys for Plaintiffs Los Angeles Times, Footnotes [1] “‘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.’” Harper & Row, 471 U.S. at 559 (quoting Sobel, Copyright and the First Amendment: A Gathering Storm?, 19 ASCAP Copyright Law Symposium 43, 78 (1971)). See also id., 471 U.S. at 554-56 (“First Amendment protections [are] already embodied in the Copyright Act's distinction between copyrightable expression and uncopyrightable facts and ideas”); New York Times Co. v. United States, 403 U.S. 713, 726 (1971) (Brennan, J., concurring) (Copyright laws are not restrictions on freedom of speech as copyright protects only the form of expression and not the ideas expressed); Zacchini v. Scripps Howard Broad. Co., 433 U.S. 562, 577 n.13 (1997) (“Federal District Courts have rejected First Amendment challenges to the federal copyright law on the ground that 'no restraint (has been) placed on the use of an idea or concept.’”) (citations omitted); Nimmer, Does Copyright Abridge The First Amendment Guarantees of Free Speech and Press?, 17 U.C.L.A. Rev. 1180 (1970) (copyright law does not abridge the First Amendment because it does not restrain the communication of ideas or concepts). [2] Defendants try to leave the impression that searching the Free Republic archives is somehow “impracticable.” See, e.g., Defendants’ Motion 12:13. In fact, Free Republic’s users find it easy to locate specific articles in Free Republic’s archives. Aldridge Decl., § 5. See also Defense Exhibits 1002 & 1003 (demonstrating Defendants’ similar success in locating Plaintiffs’ articles in Free Republic’s archives). The purported “time lag” associated with “third party search engines” is likewise a red herring because Free Republic‘s own search engine is immediately searchable. See Defendants’ Motion 12:4-9 (describing the “time lag” as an issue with only “third-party search engines”). Finally, even if Defendants’ search engine were as primitive as Defendants seek to imply (and it is not), that would still not be a defense to copyright infringement. That is like arguing that it is okay to copy so long as the pirated copies are somehow not as “good” as the original. This has never been the law. Just because Defendants’ theft is not perfect, that does not make it lawful. [3] See, e.g., Marcus v. Rowley, 695 F.2d 1171, 1175 (9th Cir. 1983) (first factor favored plaintiff, even though it was “uncontroverted [that defendant’s use] was for a nonprofit educational purpose”). See also Television Digest, Inc. v. United States Telephone Association, 841 F. Supp. 5, 9-10 (D.D.C. 1993) (unauthorized duplication and distribution of copyrighted newsletter was a commercial use, even though done by a non-profit entity); Marobie-FL, Inc. v. National Assoc. of Fire Equipment Distributors, 983 F. Supp. 1167, 1175 (N.D. Ill. 1997) (Even where a defendant “is a non-profit organization and d[oes] not receive any compensation for placing the [copyrighted material] on its Web page . . . . its conduct may still be considered commercial.”). [4] If anything, this argument cuts against Defendants because communicating the facts in Plaintiffs’ articles does not require Defendants to mechanically copy thousands of Plaintiffs’ entire articles. Defendants could write their own articles using the facts from Plaintiffs’ articles if their true goal was to convey the facts in Plaintiffs’ articles. But this would require work, and Defendants find it so much easier to just steal Plaintiffs’ works. Why work when stealing is so effortless? Indeed, it is Defendants’ use of Plaintiffs’ entire articles that demonstrates Defendants are not interested in just the facts in Plaintiffs’ articles. Defendants are interested in the way Plaintiffs express these facts – precisely what copyright law protects from copying. [5] Defendants offer only two cases to purportedly get around this rule. Defendants’ Motion 13:10-11. Diamond v. Am-Law Corp., 74 F.2d 142 (2d Cir. 1984), however, was really a defamation case disguised as a copyright action. Id. at 147 (American Lawyer did not infringe plaintiff’s copyright by publishing plaintiff’s letter to the editor in only redacted form). Although the court recognized that the letter to the editor was “informational,” it emphasized that “a person who writes a letter to the editor of a magazine has ‘no right’ to commandeer publication on printing the letter in its entirety or ‘to commandeer the space of the publication for all that he wished to say.’ “ Id. Plaintiffs’ reliance on Hustler is equally unavailing. Hustler Magazine, Inc. v. Moral Majority, Inc., 796 F.2d 1148, 1154 (9th Cir. 1986) (concluding that the Hustler parody of the Reverend Jerry Falwell was “more creative than informational” under the second fair use factor, thus favoring plaintiffs, so not examining “whether it [also] represented a substantial investment of time and labor made in anticipation of a financial return”). [6] Defendants cite only two cases that purportedly support them on the third factor. Defendants’ Motion 13:12 - 14:1. In Belmore, however, the District Court emphasized that the allegedly infringed work was “cast as a fable,” and even then refused to hold that the third factor favored the defendants. Belmore v. City Pages, Inc., 880 F. Supp. 673, 679 (D. Minn. 1995) (“declin[ing] to further involve itself in myriad possible methods of excerpting [from plaintiff’s work] and the extent to which these methods would affect [its] purported purpose”). The court in Hustler likewise refused to find for defendants on the third factor. Hustler Magazine, Inc. v. Moral Majority, Inc., 796 F.2d 1148, 1155 (9th Cir. 1986) (“although wholesale copying does not preclude fair use per se, the amount of copying that the Defendants did in this case still militates against a finding of fair use”). See also 3 Nimmer on Copyright, § 13.05[D] (although copying of an entire work does not preclude fair use per se, "a subsequent user does not require such complete copying if he is truly pursuing a different functional mileau"). [7] If it is truly “essential” that readers view Plaintiffs’ articles in their entirety, as Defendants argue, then the question is not whether Free Republic’s visitors read Plaintiffs’ articles, but where they read them. In other words, without the alternative of an infringing copy on Free Republic, 100% of Free Republic’s visitors would click on a link to the article on Plaintiffs’ website, so they could read and then discuss the article. In this case, Plaintiffs are already losing millions of page views every month. Wayland Decl., § 18, Exh. R (Free Republic already attracts between 25 and 50 million page views each month). Plaintiffs are also losing actual and potential archive revenue, as well as licensing revenue. Aldridge Decl., § 6; Perruso Decl., §§ 21-22; Koefoot Decl., §§ 22-23. See also Koefoot Decl.,§ 19 (describing the substantial market for discussion groups around high quality news articles from The Washington Post). [8] Accord Harper & Row Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 569 (1985) (“Any copyright infringer may claim to benefit the public by increasing public access to the copyrighted work . . . . But Congress has not designed, and we see no warrant for judicially imposing, a ‘compulsory license’ to copyrighted works.”); Ringgold v. Black Entertainment Television, Inc., 126 F.3d 70, 81 n.16 (2d Cir. 1997) (“Even if the unauthorized use of plaintiff’s work in the televised program might increase poster sales, that would not preclude her entitlement to a licensing fee.”); Storm Impact, Inc. v. Software of the Month Club, 13 F. Supp. 2d 782, 790 (N.D. Ill. 1998) (“This argument that increased distribution of the author’s work is a benefit to the author has been rejected by the Supreme Court.”).
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