Court Rules on HathiTrust and Fair Use

Update on November 8, 2012: The Authors Guild and other plaintiffs have filed their notice of appeal of the decision with the U.S. Court of Appeals for the Second Circuit.  Watch for further developments.

In September 2011 a group of authors, with The Authors Guild and other associations, filed a lawsuit against HathiTrust, five major universities, and multiple university officials alleging that the many of the activities of HathiTrust related to the storage and search of full-text digital books was an infringement of copyright.  This week the judge ruled on motions for summary judgment, finding that the retention and use of millions of digital books for purposes of preservation, text search, and accessibility for the visually impaired were within the limits of fair use.  The ruling is enormously important for the continued vitality of HathiTrust, but Judge Baer’s written opinion offers an analysis of fair use that will be helpful in the evaluation of many future projects, especially in the context of libraries, education, and research.

This post is my first review of the 23-page decision.  Other blog posts are hitting different highlights, and I am pitching in the following thoughts for the conversation.

The Covered Activities.  HathiTrust is a digital repository of almost 10 million scanned books, most of them created as part of the Google Books project in partnership with leading research libraries.  Approximately 76% of the books are still in copyright.  At issue in the case are these specific uses: (1) Storing of the scanned book images and text files for preservation; (2) Enabling researchers to conduct word searches of the text files, but the search results only indicate where words appear in the text of books and do not allow viewing of the text; and (3) Facilitating formats of the books to meet the needs of persons who are blind or visually impaired.

Orphan Works.  HathiTrust announced in 2011 that it was soon to embark on an innovative approach to opening the full text of books that are deemed to be orphan works.  The proposal was lauded and criticized, and it may well have been the lightning rod that drew this lawsuit.  However, HathiTrust soon dropped that plan and took no steps to open the full text of books in that manner.  With no current plans to actually launch the orphan works initiative, the court declined to rule on whether it would have been lawful.  We might want to know how the court would rule on issues of orphan works, but getting that issue out of the way allowed the court to focus on uses that are much more likely to be within fair use: preservation copies; text searches and data mining; and serving the needs of the blind.

Relationship to Section 108.  This section of the U.S. Copyright Act allows libraries to make copies for preservation and research, within limits.  The statute includes an explicit statement preserving the application of fair use: “Nothing in this section . . . in any way affects the right of fair use as provided by section 107.”  The copyright owners argued nonetheless that because one specific statute applies to libraries, the general statute on fair use cannot apply.  We have been hearing that argument for decades.  It never had any validity, and at long last a court has ruled on it.  Libraries may apply Section 108 and Section 107 on fair use.

Fair Use and Persons with Disabilities.  The opinion provides a strong opinion about fair use as applied to serving persons with disabilities, especially when an educational institution is mandated to serve needs under the Americans With Disabilities Act.  The court goes further and resolves a long-time quandary that arose under Section 121 of the Copyright Act.  That statute permits an “authorized entity” to make formats of certain works available to persons who are visually impaired.  An “authorized entity” is one that has a “primary mission” to serve those needs.  Libraries and universities have many functions, so is that service a “primary mission”?  The court said yes.

Principles of Fair Use.  In ruling that the activities in question were within fair use, the court rightly based its decision on the facts as presented and on a balancing of the four factors in Section 107.  Here a few highlights about the factors:

Purpose and Character of the Use:

• The ability to search for terms and to store a digital copy for preservation serves scholarship and research, and those purposes lean in favor of fair use.
• These purposes are also noncommercial when carried out by HathiTrust and the universities.
• The defendants asserted that the preservation copy is “transformative,” but the court found that the argument that “preservation on its own is transformative is not strong.”
• However, maintaining text files for searching is a transformative use, “because the copies serve an entirely different purpose than the original works.”  The files were for search only, and no copyrighted content was accessible.  Specialized formats to serve print-disabled persons is also transformative.

Nature of the Work:

• Although the books included fiction, poetry, and drama, in addition to nonfiction, the court found this factor to be “not dispositive” in the context of the transformative uses for searches and serving print-disabled persons.

Amount of the Work Used:

• Maintaining copies of entire works was justified for the purposes of searching and serving print-disabled persons.

Effect on the Market for the Works:

• For noncommercial uses, the plaintiff must show “by a preponderance of the evidence that some meaningful likelihood of future harm exists.”
• The court rejected the argument of lost sales, finding that sales of books would have not served text searches or access for persons who are print disabled.
• The court found that the copies in HathiTrust were not a security risk, noting the evidence presented about the security measures in place.
• The court also found assertions of future licensing revenue to be “conjecture” without evidence of some actual harm.
• In broad terms, the court also ruled that copyright owners “cannot preempt a transformative market” and uses that are in a “transformative market” do not cause a loss of license revnue.
• The projected high cost of any possible license market would also be cost prohibitive for an initiative such as HathiTrust, and it may not be possible at all given the numerous works and the need to locate copyright owners.
• Regarding the needs of the print-disabled, the evidence showed that they are a “tiny minority” and a market to allow them access to millions of books “is consequently almost impossible to fathom.”

This case offers much more about fair use and other legal issues.  The ruling came down only hours ago, and this is my first look.  Nevertheless, summary of key points above offer a useful insight into the meaning of fair use for HathiTrust and many other pursuits.  More analysis to come, and so much more to consider about future appeals, the relationship to the litigation over Google Books, the future of copyright exceptions for libraries and the visually impaired, and the possibilities of fair use for mass digitization.

News about the ruling:

The Michigan Daily.

Inside Higher Education.

Publishers Weekly.

Some early blogging:

Nancy Sims at the University of Minnesota.

James Grimmelmann and of New York Law School.

Michael Madison of the University of Pittsburgh.

Mathew Sag of Loyola University, Chicago.

Posted: 101112 Updated Links: 101212 Updated re Appeal 110812