Bill Graham Archives v. Dorling Kindersley, Ltd., 448 F.3d 605, is a 2006 case of the United States Court of Appeals for the Second Circuit regarding fair use of images in a pictorial history text. It affirmed the United States District Court for the Southern District of New York, which held at trial that the publisher's use of several images of past Grateful Dead concert posters and tickets, reduced considerably, in a timeline of the band's history was a sufficiently transformative use.
The case began during the pre-production of Grateful Dead: The Illustrated Trip, a coffee table book published by Dorling Kindersley (DK) that included a wide variety of information and imagery, presented in a timeline format beginning with the band's 1965 founding. DK had been negotiating licensing terms with the Bill Graham Archives (BGA), whose holdings include many works created to promote Grateful Dead concerts staged by Bill Graham. After the parties could not reach an agreement on terms for seven images to which BGA held the rights, DK nevertheless decided to use them in the book, which was published in October 2003.
BGA sued for copyright infringement in the Southern District. Both parties sought summary judgement. Judge George B. Daniels granted DK's motion for summary judgement in 2005, holding that the use of reduced images to illustrate historic moments in the band's past was sufficiently transformative from their original promotional purpose to make them fair use. On appeal, the Second Circuit's affirmation elaborated on Daniels's reasoning, narrowing his finding that the second factor in the fair use analysis, the nature of the original work, favored BGA, since the transformative use of the works as history limited the relevance of their artistic value. It also distinguished the case from an earlier Second Circuit precedent, limiting the analysis of the fourth factor, the market impact of the allegedly infringing work, to only traditional markets for derivative works. Lastly, it held that a reuser's willingness to license a work does not preclude it from later claiming fair use if it chooses not to., hereafter Bill Graham Archives II
While Bill Graham Archives has been praised for its limitation on assessing the market impact, it has been criticized for extending a standard of transformative use originally intended to be applied only to parody to all such uses, and expanding the role of the transformative use analysis to the point where it by itself becomes dispositive of the fair-use question.
Legal background
Fair use, the legal doctrine that allows those who do not own the copyright on a work to use it (or at least portions thereof) under certain circumstances, dates to early 18th-century England. It was first recognized by an American court in 1841, with Folsom v. Marsh, a case over a published volume of George Washington's letters in what is now the District of Massachusetts, where Joseph Story, at the time also a justice of the U.S. Supreme Court, recognized its importance to the public good even as he ruled against the defendant claiming it. He identified three factors on which a defendant might prevail when accused of infringement: the "nature and objects of the selections made", the "quantity and value of the materials used", and the degree in which the use may prejudice the sale, or diminish the profits, or supersede the objects, of the original work"
Fair use remained, on those grounds, a purely judicial construction until 1978, when Congress codified them into law with the Copyright Act of 1976. Section 107 formally recognized fair use, based on case law to that point, providing for the same factors Story identified, with the first one split into "the purpose and character of the use" and "the nature of the work". In an influential 1990 Harvard Law Review article, "Toward a Fair Use Standard", Judge Pierre Leval, then sitting on the Southern District of New York, which hears many copyright cases due to the many media companies located in Manhattan, offered guidance on how to interpret the statute based on cases decided under it.
Cases deciding the first factor had turned on a concept Leval identified as transformative use: "[It] must employ the quoted matter in a different manner or for a different purpose than the original ... [using it as] raw material, transformed in the creation of new information, new aesthetics, new insights and understanding." He found this to be consistent with the Constitutional rationale for copyright. Four years later, in Campbell v. Acuff-Rose Music, Inc., a case brought over 2 Live Crew's parody of Roy Orbison's song "Oh, Pretty Woman", the Supreme Court cited Leval's paper and recognized transformative use as something courts could consider in the fair use analysis.
The Southern District had begun considering transformative use claims even before Campbell, in cases involving photocopying. In Basic Books v. Kinko's Graphics Corp., Judge Constance Baker Motley rejected the claim that the defendant chain of copy centers was transforming the plaintiff publishers' works by creating course packs for college classes as the kind of "mere repackaging" Leval had explicitly excluded from transformative use. Leval also rejected the transformative use claimed by the defendant in American Geophysical Union v. Texaco, since its photocopying for the library at its research center "supersede[s] the original and permit duplication, indeed, multiplication ... This kind of copying contributes nothing new or different to the original copyrighted work. It multiplies the number of copies.", hereafter Texaco I Leval also held that since the publishers had created a system to license bulk photocopying, and Texaco had other alternatives if it found that system unsatisfactory, the company's copying was harming the market for the original work.Texaco I, 17–21
On appeal the Second Circuit affirmed Leval, although with some modifications. Jon Newman, then the circuit's chief judge, wrote that the transformative use inquiry "assesses the value generated by the secondary use and the means by which such value is generated. To the extent that the secondary use involves merely an untransformed duplication, the value generated by the secondary use is little or nothing more than the value that inheres in the original.", hereafter Texaco II Newman also affirmed Leval's holding that the existence of a market for the copied articles made Texaco's fair use claim less tenable,Texaco II, 926–32 logic criticized as circular both by dissenting judge Dennis JacobsTexaco II, 932–41 and later academic commentators, who agreed with Jacobs that that logic created a situation where copyright holders could—and did—almost always prevail if they could show the slightest possible market existed.
For the most part the Second Circuit was stingy with transformative use. The use of a large poster of artist Faith Ringgold's work in the background on the set of Roc , a Seinfeld trivia quiz book, and purely decorative eyewear used in a clothing advertisement (in an opinion written by Leval after he was elevated to the Second Circuit) were found not to constitute transformative use. But a parody of Annie Leibovitz's famous Vanity Fair cover photo of a naked and pregnant Demi Moore used as a movie advertisement was held transformative enough to be fair use.
Underlying dispute
Founded in 1965, the Grateful Dead became a widely popular rock group over the next two decades, with devoted fans often following them from show to show due to their practice of eschewing a dedicated setlist in favor of extended jams based on their recorded works. The band also permitted fans to record those shows and exchange copies of those recordings with others, even as record companies began aggressively combating the practice generally. As a result a strong connection between the band and its fans developed, perpetuating the 1960s counterculture of the San Francisco Bay Area that defined its early years. The band stopped touring after the 1995 death of founding guitarist Jerry Garcia, but remained popular. In the early 2000s, the band's corporate arm, Grateful Dead Productions (GDP), partnered with publisher Dorling Kindersley (DK), a subsidiary of Penguin Books, for Grateful Dead: The Illustrated Trip, a coffee table book intended to tell the band's history through images and accompanying text.
By 2003, the project was well underway. DK's researcher contacted the Bill Graham Archives (BGA), which had administered the artistic and musical estate of Bill Graham since his death in 1991, describing the proposed book and confirming the participation of the band. The archives owned the copyright on seven images of Dead concert posters and tickets DK sought to include among the many planned and laid out on pages. BGA was willing to license those to DK in exchange for the band granting permission for the release of video and audio of several Dead concerts it also had.
Late that year, as publication approached, the parties had reached agreement on six of the seven images. DK asked for permission for two more, to which BGA responded with a request for $5,000 in fees. Upon seeing a mockup of the pages, BGA noticed that more of its images were included, and informed DK that if it did not reach an agreement with them by the end of the next day it would be initiating legal action.
District court
Trip was published in October 2003. BGA sued DK in the Southern District of New York for copyright infringement, seeking as a remedy an injunction against further sales and destruction of the unsold copies in addition to actual and statutory damages. The case was assigned to Judge George B. Daniels. BGA was represented by attorneys from Thelen Reid, including copyright authority William F. Patry, who had also represented the plaintiffs who had successfully sued Texaco a decade earlier over its unlicensed archival copying. Cowan, Liebowitz & Latman defended DK.
After presenting evidence, both parties moved for summary judgement. While DK had disputed whether BGA actually owned some of the copyrights, its motion was based entirely on fair use, which would moot that issue if granted. BGA in turn argued against fair use. The case was argued before Daniels in January 2005.Bill Graham Archives I, at 327
Four months later he handed down his opinion, holding in favor of DK's fair-use claim after reviewing all four fair-use factors. On the first, the purpose and character of the use, he noted BGA had not disputed that Trip was a biography of the Dead, telling the story of each month of its 30 active years with images from that time and text commentary on them, the use of third-party copyrighted images was "reasonable and customary", a key standard for fair use, in general. DK's specific use of them here was also transformative, as they had been repurposed from mere promotional and decorative items to illustrations of moments in the band's story.Bill Graham Archives I, at 328-33
This, to Daniels, distinguished the case from Ringgold, where the poster had simply served the same purely decorative function as the original artwork. He also found the reduction of the images to further support the claim to transformative use, since while the book was a commercial product, which can mitigate against a fair-use defense under the first factor, their reduction reduced their commercial value and they had not been used to market Trip. Daniels thus held that the first factor favored DK.
On the second factor, the nature of the original work, Daniels found that the posters were creative works, which usually makes fair use harder to assert, but at the same time published, which weighs in favor of fair use. He thus granted BGA a slight edge, although he acknowledged that "in the context of certain transformative uses", courts had found the second factor of minimal relevance to a fair use claim, such as the Leibovitz and Seinfeld cases.