Debating derivatives

During a recent visit to another university, I got into an interesting discussion with students about the difference, if there is one, between derivative works, the exclusive rights in which are reserved to copyright holders, and transformative fair uses.  The latter, of course, are considered “not infringement.”  The class of graphic arts students that attended my presentation was quite naturally confused about where the line between these two very different adaptations of an original work is.  I really couldn’t help them very much, but more about that in a minute.

When I got back to my office, one of my first tasks was to read the complaint in the lawsuit filed by the e-text platform company Kno against textbook publisher Cengage, alleging breach of contract.  The allegation is that Cengage has breached its contract to allow publication of content that it owns on the Kno platform, allegedly because certain features of the platform infringe Cengage’s copyrights.

Two qualifications are necessary.  First, a complaint is only one side of the story, so conclusions cannot be drawn from it.  Second, this may just be a contract dispute in which the two parties are bargaining for the best terms they can get, and litigation is simply a strategy in the negotiation.  That would be an unfortunate use of judicial resources, but it does happen.  Nevertheless, it is worth looking at the copyright issues that are raised, even if they never reach the stage of a decision on their merits.

According to Kno’s complaint, Cengage alleges that several features of the Kno platform create impermissible derivative works.  Specifically, Cengage allegedly objects to a “smart links” feature that inserts links to external educational resources into the text, to a “quiz me” feature that can create review quizzes from certain diagrams, and a “journal” feature that allows studies to record their own notes and pulls out from the text the excerpt to which the relevant notes refer.  The pedagogical value of each of these features is obvious, I think, but it is interesting to ask if they really do create derivative works.

Traditionally, derivative works are those that adapt the actual expression that is protected in a work, and usually they adapt the entire body of that expression.  Thus, a translation or an adaptation (novel to play, play to movie, etc.) are the paradigmatic examples.  Based on these criteria, it does not seem like inserting “smart links” into a text creates a derivative work, just a more useful one.  On the other hand, the “Quiz Me” feature does adapt some of the original expression in the text, but it adapts only a small portion.  Here, I think Kno could argue that this is a transformative fair use rather than a derivative work (they do raise fair use as one potential response to Cengage’s objections).

It is the “Journal” feature that seems to be most in dispute, based on how much the complaint has to say about it.   Students repeatedly tell us, of course, that one prerequisite to adopting e-texts is the ability to annotate the works, so this seems like a necessary part of any e-text platform.  It also seems like a classic fair use of the excerpts.  Insofar as the journal is just a layer over the top of the text, it hardly seems to implicate copyright at all.  And where excerpts are pulled out for the student to comment upon, that is exactly what fair use permits.  It is hardly different than if the student kept a separate notebook and copied out key phrases and passages, as I did throughout law school.  If that is fair use, and no one really disputes that it is, so, it seems to me, is the journal feature of the Kno platform (as described in the complaint).

My biggest concern about the dispute described in this complaint is the possibility that it shows us another publisher trying to disable they very possibilities that make e-books attractive to consumers because they do not understand how those features work and feel threatened by them.  E-texts specifically offer tremendous new potential for innovative learning, and ways to study a subject that work for a variety of different learning styles.  But these are possibilities only if the publishers get over their intense fear of the digital environment and their express desire to introduce “inconveniences” so that their digital products mirror the limitations of the print world.

After all this, let’s go back to the debate about derivatives versus transformative fair use.  My proposed criteria for what makes a derivative do not entirely solve the question.  Both derivatives and transformative fair uses adapt the original expression of the work in question.  In two examples above I suggest that the amount of the original work that is used may make a difference (it is, after all, one of the fair use factors).  This is helpful, I think, but probably not sufficient.  Perhaps the determinative question will be if there is market harm; courts that find transformative fair use usually remark that there is no direct market competition, and no “customary” licensing market, for the new, transformative use.   These reflections suggest, I think, a broad outline of how to make this slippery distinction, but they do not make it easy.  And they suggest that the dispute between Kno and Cengage really will turn on the terms of the license that is at the heart of the issue.

One thought on “Debating derivatives”

  1. This is a tough question. Tony Reese has an article on the subject which I think does a decent job teasing the two apart by looking at relevant case law post-Acuff-Rose. Starting with the Seinfeld Aptitude Test case (Castle Rock Ent. v. Carrol Pub. Group, a hard case, to me), among others, the key seems to be whether the purpose of the new use is “transformative,” regardless of whether there is literal “transformation” of the original work. Which purposes are “transformative”? Hard to say. I’m not sure that a different purpose is required, because surely quoting a previous scholar in the context of new scholarship is at the heart of fair use, and is in some intuitive sense transformative. I guess it can depend on how narrowly you describe the purpose – two scholars may both be engaged in scholarship, but the former’s purpose could be more narrowly described as “To advance thesis A,” and the latter’s as, “To rebut thesis A and defend thesis B.”

    So the Seinfeld quiz book was a derivative work because its purpose was entertainment, just like Seinfeld the TV show. Presumably parody of Seinfeld, or a scholarly commentary on Seinfeld, would be transformative even if it took the same amount of the original material. This could be disappointing for mash-up and remix artists who don’t have an explicitly critical or scholarly bent, but then again, it’s not hard to describe even the most entertaining remix as a comment on the original, if you’re so inclined. It may also be that courts favor purposes described in the preamble of 107 (scholarship, criticism, commentary, news reporting, etc) as “transformative,” leaving entertainment out in the cold.

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