The Second Circuit Weighs In On How Far Digital Databases Can Go

On June 10, 2014, the Second Circuit Court of Appeals held that the creation of a full-text searchable database of protected works constitutes fair use where: (i) the use of the database is limited to searching for terms contained in the works; or (ii) access to the full text of the works is limited to print-disabled individuals.

Authors Guild, Inc. v. HathiTrust involved the HathiTrust Digital Library (“HDL”), a digital repository of nearly ten million works composed of the collections of its 80 members, including colleges, universities and nonprofit organizations.  The idea for the HDL began in 2004, when several universities agreed to allow Google to digitally scan their collections (Google’s participation is the subject of a second suit pending before the Second Circuit).  The HDL was created for three purposes: (i) to allow the general public to search for particular terms contained in the works; (ii) to provide full-text access to individuals with certified print disabilities; and (iii) to allow members to replace works that have been lost, destroyed, or stolen where a replacement copy is unobtainable at a “fair” price.  In September 2011, twenty authors and authors’ associations sued HathiTrust, one of its member universities, and the presidents of four other member universities for copyright infringement.  The district court held the fair use defense applied and dismissed the case, relying heavily on the “transformative nature” of the three uses of the HDL.

On appeal, the Court of Appeals had to evaluate the three uses of the HDL under the four statutory fair use factors: (i) the purpose and character of the use; (ii) the nature of the copyrighted work; (iii) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (iv) the effect of the use upon the potential market for or value of the copyrighted work.  The Court began its analysis with the full-text searching capability of the HDL.  Following the lead of the district court, the Court relied heavily on the first fair use factor, namely whether the use of the HDL was “transformative.”  Using surprisingly strong language, the Court held “that the creation of a full-test searchable database is a quintessentially transformative use.”  The Court noted that “the result of a word search is different in purpose, character, expression, meaning, and message from the page (and the book) from which it is drawn.”  In essence, “by enabling full-text search, the HDL adds to the original something new with a different purpose and a different character.”

The Court then turned to the remaining fair use factors.  As for the nature of the copyrighted work, the Court held that factor of limited usefulness given the transformative use of the work.  As for the amount of the work used, the Court recognized that to enable full-text searching of the works, the entire works had to be used.  Finally, the Court found no ascertainable harm (the authors were unable to provide a single instance of harm) to the existing or potential market for the works.

The Court also held the use of the HDL to provide print-disabled individuals with access to versions of the works to constitute fair use, although for a different reason.  The Court acknowledged that the use by print-disabled individuals is not transformative.  Instead, the Court reiterated and relied on the Supreme Court’s language in Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417 (1984): “Making a copy of a copyrighted work for the convenience of a blind person is expressly identified by the House Committee Report as an example of fair use, with no suggestion that anything more than a purpose to entertain or to inform need motivate the copying.”  The Court agreed that making the HDL works accessible to print-disabled individuals constituted fair use.

As for the third use of the HDL (replacement of lost and stolen works), the Court did not rule on the issue and instead remanded to the district court to determine whether the authors were able to bring the lawsuit despite lacking actual ownership of the copyrights in the works contained in the HDL.

The Court noted that its holding did not “foreclose[] a future claim based on circumstances not now predictable, and based on a different record[.]”  Of course, this is precisely the concern of authors, copyright holders and commentators throughout the country who see the opinion as an opening for other non-traditional uses (foreseeable or not) that may arguably chip away at the traditional market for protectable works.  It is therefore likely that this decision is the beginning, rather than the final word, on the intersection between fair use and digital repositories.