FOX v. TVEyes: a new US decision widening further the legal doctrine of fair use

By Béatrice Martinet Farano

On 9 September 2014, the US District Court for the Southern District of New York issued a landmark decision in Fox v. TVEyes, adding a further rider to the doctrine of fair use.

TVEyes is a media-monitoring service that enables its subscribers – including the US Army, the White House, local and state polices and numerous members of the US Congress – to track the news coverage of a particular event, through a search using certain keywords or phrases. To do this, TVEyes permanently records the content of more than 1,400 television and radio stations – including Fox News – and creates a searchable database of that content. Subscribers can save, archive, edit and download to their personal computers an unlimited number of clips generated by their searches. The clips, however, are limited to ten minutes and a majority of the clips are shorter than two minutes.

Fox News is an international news organization headquartered in New York. It makes revenues by charging fees to cable companies and third party websites (including Yahoo, Hulu and Youtube) which are willing to broadcast its content. It also offers a limited portion of its programs (16%) directly on its website, making advertisement revenue from the pre-reel ads that are aired before each program.

Believing that the systematic recording and offering of its news clips to TVEyes subscribers infringed the copyright it owned over those clips, Fox News started a copyright infringement action against TVEyes before the Southern District of New York. Since there was no issue that Fox News clips were protected by copyright and had been reproduced without authorization, TVNews decided to play the card of fair use. The court mostly followed their reasoning, concluding, after assessing TVEyes’ services in view of the four traditional fair use factors, that its activity was mostly protected under the US fair use doctrine under 17 USC § 107.

Purpose & character of the use

The Court first analyzed the activity of TVEyes under the preamble and the first factor of fair use and concluded that in this instance, the analysis weighted in favor of fair use.

The Court first reasoned that this media monitoring service qualified under the preamble as a use “for purpose such as criticism, comment, news reporting, teaching or research” which definitely weigh in favor of fair use.

As for the first factor itself, i.e. the purpose and character of the use, the Court found that while there was no issue that this service was provided for money and therefore had a “commercial purpose” under the first factor, the main issue the Court had to consider was whether this service “merely superseded the objects of the original creation or instead added something new, with a further purpose or different character, altering the first with new expression, meaning or message”. To reach this decision, the Court extensively relied upon its prior decision in Authors Guild Inc v. Google (SDNY 2013) (see TTLF Newsletter No 5-6/2013 p.17) in which Google’s systematical scanning of more than 20 million books without permission from the copyright holder was found to be fair use based on the “transformative use” and different purpose for which Google books’ users were using this service (research and reference) as opposed to users of the original work (reading).

In this regard, the Court rejected Fox News arguments that TVEyes service was akin to Meltwater’s online monitoring service – which was held infringing by the same Court in Associated Press v. Meltwater decision (SDNY, 2013) (see TTLF Newsletter No 2/2013 p.7-8), stressing that, differently from Meltwater, TVEyes added commentary and insights to its news report so that its use could be held transformative. The Court concluded that TVEyes’s search engine together with its display or result clips was transformative and served a new and different function from the original work rather than serve as a mere substitute for it.

Nature of the copyright work

The Court also found that the second factor – i.e. the nature of the copyrighted work, did not weigh for or against a finding of fair use. Indeed, while the court acknowledged that there was no question that Fox News’ clips were copyrighted content, the Court, quoting the famous decision in Cariou v. Prince (2nd Cir. 2013), reaffirmed that there was “greater leeway” for a determination of fair use when the work was – as news content usually is  – factual or largely informational.

Amount and substantiality of the portion used

While the third factor – amount and substantiality of the portion used in relation to the copyrighted work as a whole – undoubtedly weigh against fair use since TVEyes had copied all of Fox News’ content, the Court insisted on the fact that more than a mere quantitative comparison, the third factor required to assess whether the copying was excessive in relation to any valid purpose asserted under the first factor. Stressing that in this instance, the essential value of TVEyes’ service depended on its all-inclusive nature and that the copying of all this content was necessary to achieve the valid purpose mentioned above, the Court concluded that this factor weighs neither in favor of nor against fair use.

The effect of the use upon the potential market for or value of the copyrighted work

The Court finally analyzed TVEyes activity in relation to the fourth and often more important factor, i.e. the effect of the use upon the potential market for or value of the copyrighted work. Here, although Fox News was asserting some damages in terms of diverted consumers or loss of license fees, the Court stressed that the only type of economic injury it was interested in was the harm that resulted from the fact that the secondary use served as a substitute for the original work. The Court then observed that the average length of play of Fox’s clips on TVEyes was of 53 seconds, with 85.5% of the clips being played for less than a minute. The court added that in a typical month, fewer than 1% of TVEyes’ users actually played a video clip that resulted from a keyword search of its watch terms. The Court concluded that no reasonable juror could find that people were using TVEyes as a substitute for watching Fox News broadcast on television. Paired with the benefit the public derived from this service – news comments, criticizing and monitoring among others – the Court concluded that this factor weighted in favor of fair use, regardless of the “small financial harm potentially suffered by Fox as a result of the loss of this potential derivative source of revenue”

The Court only remanded this case with regard to the service’s feature of letting subscribers download, archive, email and share clips via social media as well as the service’s allowance of searches by date and time instead of keywords.

As a whole, this decision was a clear victory for TVEyes and for the partisan of fair use.

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