July 10, 2006

Publisher’s Use of Grateful Dead Posters Found to Be Fair Use

Holland & Knight Newsletter
Gordon P. Katz

In October 2003, Grateful Dead: The Illustrated Trip, a 480-page coffee table book telling the story of the celebrated rock group in words and pictures, was published by Dorling Kindersley Publishing (DK). The book included more than 2,000 images illustrating concerts and other events in the long and colorful history of the Grateful Dead.

Reproduced in the book were seven artistic images originally used on Grateful Dead event posters and tickets. Prior to publication, DK sought a license to use the artwork from the claimed copyright owner, Bill Graham Archives (BGA). The parties never reached an agreement on an appropriate licensing fee, but DK nonetheless proceeded to include the seven BGA images, in notably reduced size, in The Illustrated Trip.

BGA promptly brought suit against DK for copyright infringement in federal court for the Southern District of New York. Cross motions for summary judgment resulted in the district court’s finding that DK’s use of the seven images constituted fair use under the Copyright Act of 1976, 17 U.S.C. § 107. On May 9, 2006, the United States Court of Appeals for the Second Circuit, after a thorough examination of the four fair use factors as applied to the works at issue, affirmed.

The fair use doctrine is a statutory exception to copyright infringement. Section 107 of the Copyright Act permits unauthorized use or reproduction of copyrighted work if it is “for purposes such as criticism, comment, news reporting, teaching … scholarship or research.” To determine if the exception applies, the following four factors are examined on a case-by-case basis: (1) the character of the use; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used relative to the copyrighted work as a whole; and (4) the effect of the use on the market value of the copyrighted work.

The court’s decision finding fair use was based largely on its analysis of the first factor, the character of the use. Because The Illustrated Trip was a biography, its use of the seven images was seen as “transformatively different from the mere expressive use of images on concert posters or tickets.” The court noted that biographies are a recognized form of scholarship and criticism, and that DK’s purpose in using the images was decidedly different from the promotional purpose for which the posters were created. That The Illustrated Trip was a for-profit publication did not require a contrary conclusion, the court ruled. Because the copyrighted images constituted only 0.2 percent of the book and were produced in a significantly reduced size, the use of the images was seen as incidental to the commercial value of the book.

In examining the second factor, nature of the copyrighted work, the court had no difficulty finding that the artwork at issue was “creative artwork,” which it termed “the core of intended copyright protection.” However, it gave this factor little weight, since “the purpose of DK’s use was to emphasize the images’ historical rather than creative value.”

The third factor, substantiality of use, also militated in favor of fair use. The court was again strongly influenced by the fact that the seven images were displayed in reduced size and scattered among many other images and texts.

The final factor for consideration was the effect of DK’s unauthorized use upon the market of or value of the posters. The court, also finding in favor of fair use, rejected BGA’s argument that DK interfered with the market for licensing its images for use in books. The court affirmed prior rulings that “copyright owners may not preempt exploitation of transformative markets.” The court refused to accept the argument that the failed license negotiation between the parties mandated the conclusion that there existed a real, rather than hypothetical, market for licensing publication of the posters in “transformative,” here, historical works.

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