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Designer Skin LLC v. S & L Vitamins, Inc., et al.
Unauthorized internet reseller of plaintiff’s products is not guilty of trademark infringement, and does not cause actionable initial interest confusion, by using plaintiff’s trademarks in meta tags of website at which plaintiff’s and its competitors’ products are sold, and in...

Leslie Kelly, et al. v. Arriba Soft Corp.

77 F.Supp. 2d 1116 (C.D. Cal., Dec. 15, 1999) aff'd. in part, reversed in part, 280 F.3d 934 (9th Cir., Feb. 6, 2002)

Court holds that defendant's operation of a "visual search engine" which presents, without the owners' permission, "thumbnails" of copyrighted images that appear both without identifying copyright management information, and separated from the Internet web page in which the image was originally displayed, is a protected fair use under the Copyright Act which does not run afoul of the Digital Millennium Copyright Act ("DMCA").

Defendant operates a "visual search engine" which allows users to search for images on the Internet that are responsive to their inquiry. The responsive images presented by defendant's search engine are initially presented as "thumbnails" separated from both the web page on which they were placed by their owner, as well as any identifying copyright management information (unless the same is embedded into the same image that contains the picture in question). At present, clicking on this "thumbnail" image causes two additional screens to open. The first screen displays a full-size version of the thumbnail image in question, and partially blocks from view the second screen. The second screen displays the full web page in which the image is situated. This represented a change from a prior version of defendant's search engine. In that version, a click on the thumbnail image resulted in the display of a larger, full-size version of the thumbnail image, as well as a link to the web page from which the image originated. Defendant currently maintains approximately two million images in its database. Importantly, defendant does not seek the approval of the owner of the image before posting it in its database. It has, however, posted instructions for blocking its web crawler from obtaining images from a web site.

Plaintiff is the owner of the copyright in 35 images, which were included in defendant's site without his permission. Plaintiff has posted these images on two web sites, which he uses to promote various products, including a book plaintiff authored. After plaintiff objected, defendant took steps to remove his works from its database. Plaintiff thereafter commenced this action, claiming that defendant, by its conduct, infringed his copyright in the images in question, and violated the Digital Millennium Copyright Act. Finding that defendant's conduct constituted a fair use of plaintiff's works and not a violation of the DMCA, the court granted defendant summary judgment dismissing these claims.

Defendant conceded that plaintiff had made out a prima facie case of copyright infringement. However, defendant claimed that its use was a permitted fair use under 17 U.S.C. Section 107. Analyzing the various factors the statute directs be considered, the court held that defendant's use was a permitted fair use.

The most important factor relied upon by the court was the "transformative nature" of defendant's use. In determining whether a use is fair, one of the factors the courts consider is the "purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes." This involves, according to the court, "an assessment of whether 'the new work merely supersedes the objects of the original creation, or instead adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message; it asks, in other words, whether and to what extent the new work is transformative." The more transformative, the more likely the use will be found to be a permitted fair use. The court held that defendant's use was "transformative." Said the court:

The most significant factor favoring Defendant is the transformative nature of its use of Plaintiff's images. Defendant's use is very different from the use for which the images were originally created. Plaintiff's photographs are artistic works used for illustrative purposes. Defendant's visual search engine is designed to catalog and improve access to images on the Internet. The character of the thumbnail index is not esthetic, but functional; its purpose is not to be artistic, but to be comprehensive.

Analysis of the other factors produced mixed results. The works in question, plaintiff's photographs, were artistic works entitled to a greater degree of protection, making a finding of "fair use ... more difficult to establish ...". The court also held that defendant had copied all of the plaintiff's work in its attribute page, and reproduced the entire work in thumbnail fashion in its initial search results. As a result, the amount and substantiality of the use "weighs slightly against fair use." On the other side of the ledger, the court concluded that because plaintiff could not show either that defendant's use had caused him injury, by for example decreasing the traffic to his web sites, or that it had resulted in copying of his images, the effect of defendant's use on the potential market for or value of plaintiff's work favored a finding of fair use.

Ultimately, the court, relying predominantly on its determination that defendant's use was transformative, concluded the use in question was a fair use. Said the court:

the first factor of the fair use test is the most important in this case. Defendant never held Plaintiff's work out as its own, or even engaged in conduct specifically directed at Plaintiff's work. Plaintiff's images were swept up along with two million others available on the Internet, as part of Defendant's efforts to provide its users with a better way to find images on the Internet. Defendant's purposes were and are inherently transformative, even if its realization of those purposes was at time imperfect. Where, as here, a new use and new technology are evolving, the broad transformative purpose of the use weighs more heavily than the inevitable flaws in its early stages of development.

The court also held that defendant's display of the images in question without their associated copyright management information did not constitute a violation of the DMCA. The court held that Section 1202(b)(1) of the DMCA did not apply to the case at bar because that provision "applies only to the removal of copyright management information on a plaintiff's product or original work."

Instead, the applicable provision was Section 1202(b)(3). To establish a violation of this provision, the plaintiff must show that "defendant makes available to its users the thumbnails and full-size images which were copies of plaintiff's work separated from their copyright management information, even though it knows or should know this will lead to infringement of plaintiff's copyrights." The court held that defendant did not have reasonable grounds to know that its actions would cause such infringement, because it posts a warning on its site about possible restrictions on use of the images, and instructs users to check the originating web pages for such restrictions, which can be obtained via a link, before copying the images. What made the images vulnerable to copying, according to the court, was their display by plaintiff on a web site.

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