A recent copyright decision articulates in clear and direct language the underlying policies that guide copyright law. This past January, several publishers and author estates filed suit against Frederik Colting and Melissa Medina for allegedly infringing their works through a series of childrens’ books called “Kinderguides”. These books were billed as “Learning Guides” to classical works of literature by defendants; they each generally followed a similar format, with a story summary followed by a series of back-pages containing, for example, keywords and quizzes. At issue here were works still under copyright protection: Breakfast at Tiffany’s by Truman Capote, The Old Man and the Sea by Ernest Hemingway, On the Road by Jack Kerouac, and 2001: A Space Odyssey by Arthur C. Clarke. Defendants argued that any potential infringement was excused by fair use.

The court ruled against the defendants in late July, finding that they were liable for infringement and not excused by fair use. On September 7, Judge Rakoff of the Southern District Court of New York issued a detailed opinion describing his reasoning.

Copyright aficianados may remember Colting from the 2010 Second Circuit decision Salinger v Colting, where he was facing allegations of copyright infringement over an unauthorized sequel to J.D. Salinger’s Catcher in the Rye. 1The Second Circuit vacated the district court’s preliminary injunction on the grounds that it did not apply the proper standard, though it agreed with the court’s conclusion that Colting was not likely to succeed on his fair use claim. The parties subsequently settled, with Colting consenting to a permanent injunction barring him from publishing or distributing his unauthorized sequel. The current case demonstrates that he has not strayed far from the type of conduct that landed him in court then.

The case also demonstrates Judge Rakoff’s deft ability to apply the sometimes challenging concepts involved with copyright to determine that the Kinderguides are substantially similar to the original works, despite Colting’s attempt to argue that he only copied unprotected elements from the works. (For example, “Breakfast at Tiffany’s is, according to defendants, just the story of ‘a small town girl with a tough past who has come to the big city'” and thus a stock, unprotected character.)  He also easily rejects defendants’ fair use defense, with a particularly clear and correct articulation of the fourth fair use factor, which instructs courts to consider “effect of the use upon the potential market for or value of the copyrighted work.”

But it is under Judge Rakoff’s examination of “other considerations” within the fair use analysis where this opinion really stands out. He writes that among these other considerations “is whether, as defendants argue, their works should be protected because otherwise the constitutional purpose of copyright law — to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries — would be frustrated.”

The crux of defendants’ argument is that plaintiffs have declined to create children’s versions of their novels, so it would be contrary to the constitutional imperative of copyright for them to be able to use their exclusive rights to bar others from doing so. But, Judge Rakoff replies, “Congress did not provide a use-it-or-lose-it mechanism for copyright protection. Instead, Congress granted a package of rights to copyright holders, including the exclusive right to exploit derivative works, regardless of whether copyright holders ever intend to exploit those rights.

I agree fully with Judge Rakoff, and believe his statement is correct not just for copyright but for all property. Once the decision has been made to vest exclusive rights in a resource to an owner, as government has historically done with property and Congress has done through the Copyright Act, that right remains exclusive regardless of whether a non-owner sincerely believes they may put the resource to better use. At times, the non-owner may even be correct. But absent an exception, property prioritizes the owner’s use (or non-use) over the non-owner’s interest in use because in the aggregate, among other benefits, this facilitates the most productive use of resources. 2See, for example, Eric Claeys, Labor, Exclusion, and Flourishing in Property Law 95 N.C. L. Rev. 413 (2017).

That is not to undervalue the work that exceptions do at the margins, but at its core, this initial allocation of entitlements—property—is exactly what Congress had in mind. It is, indeed, not a “use-it-or-lose-it” mechanism. Rather, it is a “set-it-and-forget-it” mechanism.

But Judge Rakoff is not finished—he takes defendants further to task. Rakoff writes, “Implicit in defendants’ argument, then, is a contention that the Copyright Act itself is unconstitutional. As defendants put it, ‘the original copyright act granted authors exclusive rights for a 14-year term, with the option for a renewal term of the same length. Over the course of the following 200+years, the grant of rights has expanded unchecked, leading us here today.”

This is a common argument among copyright minimalists, who point to the 1790 Copyright Act as though it should operate as some ideal baseline for copyright policy, despite the fact that the first Congress spent very little time creating the Act (the majority of it was cribbed directly from England’s Statute of Anne)3See Oren Bracha, The Adventures of the Statute of Anne in the Land of Unlimited Possibilities: The Life of a Legal Transplant, 25 Berkeley Tech. L.J. 1427 (2010). and despite the extraordinary cultural and technological changes since that time. Rakoff spent little time rebutting this argument. “Defendants are no doubt correct in pointing out that Congress’ policy judgments have changed substantially over the course of our nation’s history.”

[B]ut as a legal matter, for the Copyright Act to withstand constitutional scrutiny, it must merely be the case that, in constructing its general scheme, Congress had a rational basis to believe that granting a suite of exclusive derivative rights to copyright holders would advance progress in the sciences and the arts. See Eldred v. Ashcroft, 537 U.S. 186, 208 (2003) (finding that, if the Copyright Act is “a rational enactment,” the Court is “not at liberty to second-guess congressional determinations and policy judgments . . . however debatable or arguably unwise they may be”). As defendants make no effort to show that Congress lacked such a rational basis for providing plaintiffs an exclusive right to exploit derivative works, including children’s adaptations, this Court cannot provide defendants with the relief they are seeking.

Perhaps recognizing the futility of continuing to push this argument, defendants subsequently stated that an appeal of the decision would be “highly unlikely.”

References   [ + ]

1. The Second Circuit vacated the district court’s preliminary injunction on the grounds that it did not apply the proper standard, though it agreed with the court’s conclusion that Colting was not likely to succeed on his fair use claim. The parties subsequently settled, with Colting consenting to a permanent injunction barring him from publishing or distributing his unauthorized sequel.
2. See, for example, Eric Claeys, Labor, Exclusion, and Flourishing in Property Law 95 N.C. L. Rev. 413 (2017).
3. See Oren Bracha, The Adventures of the Statute of Anne in the Land of Unlimited Possibilities: The Life of a Legal Transplant, 25 Berkeley Tech. L.J. 1427 (2010).