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Copyright’s fair use defense faces higher bar after Warhol

October/November 2024 Cantor Colburn IP Newsletter

The impact of the U.S. Supreme Court’s 2023 intellectual property rulings continue to roll out in the lower courts. The high court’s guidance regarding the application of the fair use defense to copyright infringement recently played a key role in a case involving Netflix’s popular “Tiger King” docuseries.

What happened?

The seven-part series included short clips from several videos filmed by Timothy Sepi. Most were filmed while he worked for the zoological park that was featured in the series, but one was shot after his employment terminated. That video was a 24-minute recording of the funeral of the husband of the eponymous Tiger King who owned the zoo, also known as Joe Exotic.

After the series was released, Sepi registered the videos for copyright protection under either his name or the name of Whyte Monkee Productions. He and the production company then sued Netflix and the series producer for copyright infringement, claiming they used clips of the videos without permission.

The trial court dismissed the case before trial. Among other things, it found that the defendants’ use of the funeral video was fair use that didn’t infringe copyright. The plaintiffs appealed to the U.S. Court of Appeals for the Tenth Circuit, challenging the fair use finding.

Is it fair?

In support of its argument, the plaintiffs cited the Supreme Court’s ruling in Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith. The Warhol ruling focused on the first of the four fair use factors — “the purpose and character of the use, including whether such use is of a commercial nature or is for educational nonprofit purposes.” The factor also weighs whether, and to what extent, the new work is transformative.

The plaintiffs here claimed that the trial court misconstrued the meaning of “transformative” when it found that the defendants’ use of the funeral clip was a transformative use. Specifically, they asserted that the defendants’ streaming use was commercial and not transformative because it made no commentary on the work itself.

The appeals court sided with the plaintiffs on the first factor. It cited Warhol for the notion that, when a defendant’s work doesn’t provide critical commentary on the original work, the fairness in borrowing from that work may diminish accordingly — and may even vanish. Factors such as the extent of its commerciality also “loom larger.”

The defendants’ use of the funeral video didn’t comment on or target Sepi’s work at all. Rather, they used it to comment on Joe Exotic’s purported megalomania even in the face of tragedy. They provided a historical reference point in his life and commented on his showmanship, but they didn’t comment on Sepi’s video’s creative decisions or intended meaning. The focus wasn’t on the original composition but a target in the composition.

As for the commerciality aspect, the court pointed out that the defendants profited from the series, which was viewed by millions, and didn’t pay Sepi a licensing fee. Thus, both the commercial nature of their use and the lack of “transformativeness” weighed against a finding of fair use.

What’s next?

In the wake of the high court’s Warhol ruling, defendants are finding it more difficult to establish that their use of copyrighted works was transformative. If their works don’t target the original work itself, their fair use defense may fail.

© 2024

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