Even if a work is found to be an unauthorized derivative work, an alleged infringer can escape liability via the defense of
fair use. For example, in
Campbell v. Acuff-Rose Music, Inc., the Supreme Court found that although a parody of the song "
Oh, Pretty Woman" by
2 Live Crew was an unauthorized derivative work, fair use was still available as a complete defense. This case marked the Supreme Court's pointing to
transformativeness as a major clue to application of the fair use defense to derivative works. The defense of fair use has become very important in computer- and Internet-related works. Two 1992 Ninth Circuit decisions are illustrative. In
Lewis Galoob Toys, Inc. v. Nintendo of America, Inc., the appellate court held that it was a fair use for owners of copies of video games, such as
Super Mario Bros., to use Galoob's product the
Game Genie to customize the difficulty or other characteristics of the game by granting a character more strength, speed, or endurance. Nintendo strongly opposed Galoob's product, allegedly because it interfered with the maintenance of the "Nintendo Culture," which
Nintendo claimed was important to its marketing program. The court held, among other things, that the fair use defense shielded Galoob's conduct. The court said that "a party who distributes a copyrighted work cannot dictate how that work is to be enjoyed. Consumers may use ... a Game Genie to enhance a Nintendo Game cartridge's audiovisual display in such a way as to make the experience more enjoyable." In
Sega Enterprises, Ltd. v. Accolade, Inc., the court excused Accolade from copyright infringement liability on fair use grounds. Nintendo and
Sega produced video game consoles. Each stored the games in plastic cartridges that provided game data to the consoles. By way of analogy, the Sega hardware console's "platform" differed from Nintendo's, as a
Macintosh platform differs from that of a
PC. Hence, a video game cartridge that works on one system does not work on the other. Sega and Nintendo sought to "license" access to their hardware platforms, and each company developed software "locks" to keep out cartridges that did not have the proper "key." Accolade sought a license from Sega for its key, but negotiations broke down over price. Accolade then decided to reverse engineer Sega's lock and key system. To do so, it had to download (copy) all of the computer code from Sega's product and disassemble it (translate it from machine code into human-readable assembly). Accolade succeeded and began to market new video games that it independently wrote, which were capable of being operated in Sega consoles. This led to copyright infringement litigation, in which Sega alleged that the downloading was improper copying (reproduction) of Sega's code. The court held that Sega was trying to use the copyright in its computer code to maintain a monopoly over the sale of video games, to which it was not legally entitled. Accolade downloaded the computer code only to ascertain how the lock worked, so that it could make a key that would permit its games to work in Sega consoles. The court held that such a use was fair use: "We conclude that where disassembly is the only way to gain access to the ideas and functional elements embodied in a copyrighted computer program and where there is a legitimate reason for seeking such access, disassembly is a fair use of the copyrighted work, as a matter of law." However, since the passage of the anti-circumvention statutes contained in the
DMCA, further court cases involving the fair-use defense of such activities have yet to be actually litigated.
Transformativeness A crucial factor in current legal analysis of derivative works is
transformativeness, largely as a result of the Supreme Court's 1994 decision in
Campbell v. Acuff-Rose Music, Inc. The Court's opinion emphasized the importance of transformativeness in its fair use analysis of the parody of "
Oh, Pretty Woman" involved in the
Campbell case. In parody, as the Court explained, the transformativeness is the new insight that readers, listeners, or viewers gain from the parodic treatment of the original work. As the Court pointed out, the words of the parody "derisively demonstrat[e] how bland and banal the Orbison [Pretty Woman] song" is. The modern emphasis of transformativeness in fair use analysis stems from a 1990 article by Judge
Pierre N. Leval in the
Harvard Law Review, "Toward a Fair Use Standard", which the Court quoted and cited extensively in its
Campbell opinion. In his article, Leval explained the social importance of transformative use of another's work and what justifies such a taking: I believe the answer to the question of justification turns primarily on whether, and to what extent, the challenged use is transformative. The use must be productive and must employ the quoted matter in a different manner or for a different purpose from the original. ...[If] the secondary use adds value to the original--if the quoted matter is used as raw material, transformed in the creation of new information, new aesthetics, new insights and understandings--this is the very type of activity that the fair use doctrine intends to protect for the enrichment of society. Transformative uses may include criticizing the quoted work, exposing the character of the original author, proving a fact, or summarizing an idea argued in the original in order to defend or rebut it. They also may include parody, symbolism, aesthetic declarations, and innumerable other uses. The concept, as Leval and the
Campbell Court described it, developed in relation to fair use of traditional works: literary works, musical works, and pictorial works. But recently courts have extended this rationale to Internet and computer-related works. In such cases, as illustrated by
Kelly v. Arriba Soft Corporation and
Perfect 10, Inc. v. Amazon.com, Inc., the courts find a use (such as that of thumbnails in an image search engine, for indexing purposes) transformative because it provides an added benefit to the public, which was not previously available and might remain unavailable without the derivative or secondary use. The
Ninth Circuit Court explained this in the
Perfect 10 case: Google's use of thumbnails is highly transformative. In
Kelly we concluded that Arriba's use of thumbnails was transformative because "Arriba's use of the images served a different function than Kelly's use — improving access to information on the Internet versus artistic expression." Although an image may have been created originally to serve an entertainment, aesthetic, or informative function, a search engine transforms the image into a pointer directing a user to a source of information. Just as a "parody has an obvious claim to transformative value" because "it can provide social benefit, by shedding light on an earlier work, and, in the process, creating a new one," a search engine provides social benefit by incorporating an original work into a new work, namely, an electronic reference tool. Indeed, a search engine may be more transformative than a parody because a search engine provides an entirely new use for the original work, while a parody typically has the same entertainment purpose as the original work. ...In conducting our case-specific analysis of fair use in light of the purposes of copyright, we must weigh Google's superseding and commercial uses of thumbnail images against Google's significant transformative use, as well as the extent to which Google's search engine promotes the purposes of copyright and serves the interests of the public. Although the district court acknowledged the "truism that search engines such as
Google Image Search provide great value to the public," the district court did not expressly consider whether this value outweighed the significance of Google's superseding use or the commercial nature of Google's use. The Supreme Court, however, has directed us to be mindful of the extent to which a use promotes the purposes of copyright and serves the interests of the public. ...We conclude that the significantly transformative nature of Google's search engine, particularly in light of its public benefit, outweighs Google's superseding and commercial uses of the thumbnails in this case. ... We are also mindful of the Supreme Court's direction that "the more transformative the new work, the less will be the significance of other factors, like commercialism, that may weigh against a finding of fair use." The Ninth Circuit's treatment of transformativeness and fair use in the
Arriba Soft and
Perfect 10 cases illustrates different data points on the copyright infringement spectrum, at least with respect to transformativeness and fair use.
Arriba Soft was a relatively polar case. The harm to Kelly, the copyright owner, was negligible; it was hardly more than hurt feelings, because as the Ninth Circuit said in its opinion – "Arriba's creation and use of the thumbnails [the derivative work] does not harm the market for or value of Kelly' s images." On the other hand, the court found that Arriba's use benefited the public: "Arriba's use of the images serves a different function than Kelly's use — improving access to information on the internet versus artistic expression." The balance thus tilted strongly in Arriba's favor. The foregoing analysis in this case thus made the Ninth Circuit to be the first court to make the equation
highly beneficial to public = transformative, and as the Supreme Court explained in
Campbell, the more transformative a derivative use the more likely the use is to be a fair use. The
Campbell Court recognized that the balance may not always be one-sided, as it was in
Campbell itself and in
Arriba Soft. In the
Perfect 10 case the interests were more evenly balanced, for the first time in a derivative work case involving new information technology. Both Google and Perfect 10 had legitimate interests at stake and support for their respective positions. Thus, there was a finding that "Google's wide-ranging use of thumbnails is highly transformative: their creation and display is designed to, and does, display visual search results quickly and efficiently to users of Google Image Search." But Google's use had some commercial aspects and was claimed to impair P10's commercial interests. Yet, on balance the Ninth Circuit found that the transformativeness outweighed the other fair use factors because "Google has provided a significant benefit to the public" in facilitating image searches by means of thumbnail images. This opinion provided a second instance of the "beneficial=transformative" equation described in the preceding paragraph (from the
Arriba Soft case). The use of pop-up advertising, in which third-party advertisements pop up on a competitor's Web page and change its appearance to allegedly create a derivative work, may present transformativeness issues. The proponents of such pop-ups (the defendants in infringement litigation) argue that they provide the public with additional information about making buying decisions (particularly in the form of price comparisons), but the opponents (the plaintiffs in these cases) argue that the defendants' conduct adversely affects the Web page proprietor's interest in the "integrity" of its Web page and its investment interest in creating and maintaining the page. An example of promotional advertising for a pop-up company, illustrating various pop-up techniques for changing the appearance of another firm's Web page is shown in this Flash . Little attention has been paid to the balancing of the interests at stake in derivative work copyright disputes where conflicting interests are present. In the
Perfect 10 and
Castle Rock cases, however, the courts appeared to have recognized that some conflict existed, but they finessed the balancing task by finding one side or the other's interest negligible, so that no serious work had to be done in gauging the balance. although several courts have found no copyright infringement for one reason or another. In an analogous area of copyright law, a solution reached was to permit the use challenged as infringement, but to require payment of a reasonable royalty.
Examples of derivative works under U.S. law The most famous derivative work in the world has been said to be
L.H.O.O.Q., also known as the
Mona Lisa With a Moustache. Generations of U.S. copyright law professors — since at least the 1950s — have used it as a paradigmatic example. Marcel Duchamp created the work by adding, among other things, a moustache, goatee, and the caption '''' (letters which
phonetically resemble the phrase in French "She is hot in the ass") to Leonardo's iconic work. These few seemingly insubstantial additions were highly transformative because they incensed contemporary French bourgeoisie by mocking their cult of "Jocondisme," at that time said to be "practically a secular religion of the French bourgeoisie and an important part of their self image." Duchamp's defacement of their icon was considered "a major stroke of
épater le bourgeois." Thus it has been said that the "transformation of a cult icon into an object of ridicule by adding a small quantum of additional material can readily be deemed preparation of a derivative work." A parodic derivative work based on Duchamp's parodic derivative work is shown at this location . The mockery of "Oh, Pretty Woman," discussed in
Campbell v. Acuff-Rose Music, Inc., is a similar example of transforming a work by showing it in a harsh new light or criticizing its underlying assumptions. Because of the parody's transformativeness, the Supreme Court found the derivative work a fair use. Trivia books based on TV shows, such as
Seinfeld, are considered derivative works, for purposes of infringement liability, at least if they incorporate a substantial amount of copyright-protected content from the TV episodes. In
Castle Rock the court found that any transformative purpose possessed in the derivative work was "slight to non-existent." Accordingly, the court held that defendants had prepared an infringing derivative work. A 2007 lawsuit,
CBS Operations v. Reel Funds International, ruled that television series that have some episodes lapse into the public domain can be classified as derivative works and subject to indirect copyright accordingly. The lawsuit centered around 16 episodes of
The Andy Griffith Show from the show's third season that had lapsed into the public domain in 1989; CBS successfully argued that because all of the episodes from the show's first two seasons were still under valid copyright, that CBS still held copyright on the characters used in those episodes and could block a public domain distributor from selling DVDs with those episodes. The musical
West Side Story, is a derivative work based on Shakespeare's
Romeo and Juliet, because it uses numerous expressive elements from the earlier work. However, Shakespeare's drama
Romeo and Juliet is also a derivative work that draws heavily from
Pyramus and Thisbe and other sources. Nevertheless, no legal rule prevents a derivative work from being based on a work that is itself a derivative work based on a still earlier work — at least, so long as the last work borrows expressive elements from the second work that are original with the second work rather than taken from the earliest work. The key is whether the copied elements are original and expressive (not merely conventional or
mise en scène); if that is so, the second or derivative work is independently subject to copyright protection, and if that is not, the second work (if unauthorized) may infringe the first, but it is not independently copyrightable.
Pop-up advertising provides derivative works that can be transformative, in that they provide the public with new functionality not previously offered — they may provide comparative price information, for example. Yet, pop-ups may also impair interests of the proprietors of Web pages subjected to them. For example, the
Half.com pop-up ad shown above left informs the public as to price competition between Half.com and
Amazon.com. But the derivative-work version of Amazon's web page partially covers up Amazon's advertising (at least temporarily) and adversely affects Amazon's investment interest in the preparation and maintenance of its web page. This may present a more difficult case of balancing interests than that which the court faced in
Arriba Soft or
Perfect 10. The
gif animation parody of Duchamp's work referred to above in this section, and pop-up advertising are examples of derivative works that became possible only with the advent of recent technology. The last sentence of section 101's definition of derivative work (at the beginning of section 1.1 of this Article) defines
annotations as derivative works. Annotations of other works have long existed, but new technology permits the creation of new forms of annotation. An illustration of such a new-technology annotation is provided in this example of an annotation of Chaucer's Prologue to the
Canterbury Tales, in which a small pop-up window provides the definition of a difficult word when the cursor is moused over the word. The
Internet Archive had created an archive of scans of books which it had physical copies of, which it initially lent out
digitally in a controlled manner. However, during the COVID-19 pandemic, the Internet Archive expanded the availability of the archives with an initiative it called the National Emergency Library, during which they removed the waitlists on the books that limited the number of people who could use them at the same time. Four major publishers filed suit against the Archive, and the court ruled in the publishers' favor in March 2023, declaring that the unrestricted access to the National Emergency Library infringed their copyrights. According to the court, the book scans were derivative works and the expansive National Emergency Library concept was unsupported by fair use, so it required permission from the book publishers that the Internet Archive did not receive. ==See also==