Iowa State University Research Foundation, Inc. v. American Broadcasting Companies, Inc.

• Decision Date: 12 May 1980
• Docket Number: No. 1122,D,1122
• Citation: 621 F.2d 57
• Parties: , 1978-81 Copr.L.Dec. 25,156, 6 Media L. Rep. 1855 IOWA STATE UNIVERSITY RESEARCH FOUNDATION, INC., an Iowa Corporation, Plaintiff-Appellee, v. AMERICAN BROADCASTING COMPANIES, INC., a New York Corporation, and ABC Sports, Inc., a New York corporation, Defendants-Appellants. ocket 79-7819.
• Court: U.S. Court of Appeals — Second Circuit

Page 57

621 F.2d 57

207 U.S.P.Q. 97, 1978-81 Copr.L.Dec. 25,156,

6 Media L. Rep. 1855

IOWA STATE UNIVERSITY RESEARCH FOUNDATION, INC., an Iowa

Corporation, Plaintiff-Appellee, v. AMERICAN BROADCASTING COMPANIES, INC., a New York Corporation, and ABC Sports, Inc., a New York corporation, Defendants-Appellants.

No. 1122, Docket 79-7819.

United States Court of Appeals, Second Circuit.

Argued April 22, 1980.

Decided May 12, 1980.

Coudert Brothers, New York City (Michael J. Calvey, Dennis R. Pearson, Carleton G. Eldridge, Jr., New York City, of counsel), for defendants-appellants.

Leonard Horn, New York City (Sprung, Felfe, Horn, Lynch & Kramer, Ira J. Schaefer, New York City, of counsel), for plaintiff-appellee.

Before KAUFMAN, Chief Judge, OAKES, Circuit Judge, and WILL, District Judge. ^*

IRVING R. KAUFMAN, Chief Judge:

Appellants, the American Broadcasting Co. and ABC Sports, Inc. ("ABC"), ask this court to reverse a judgment entered against them in the district court. They urge us to hold that their copying and broadcast of portions of a student-produced film, without permission of the copyright holder, constitute "fair use," exempt from liability because the benefits of broad public dissemination outweighed any harm to the owner of the copyright. We disagree and affirm the judgment of the district court finding copyright infringement.

I

During the 1970-71 college term, James Doran and another student enrolled at Iowa State University, supervised by Professor Richard Kraemer, produced a 28-minute film titled Champion. It presented a short biography of a fellow student, Dan Gable, a champion wrestler who was destined to win a gold medal at the 1972 Munich Olympics. The film was financed jointly by appellee Iowa State University Research Foundation ("Iowa") and the Gable family, and chronicled Gable's quest for excellence in wrestling. Throughout the film, comments by Gable, his family, coaches, and teammates accompanied footage of wrestling matches, training sessions, and Gable's home life. Iowa obtained a valid statutory copyright and retained all rights to Champion, except that it granted Doran the right to license its first television showing, but only with "the full knowledge and consent of the University." Doran proceeded to attempt, without success, to sell the television rights to a number of potential customers, including ABC, the National Broadcasting Co., and the Hughes Sports Network. Thus, prior to the summer of 1972, the film was rented exclusively to high school wrestling coaches, service organizations, and sports booster clubs.

In August 1972, Doran was employed by ABC as a temporary videotape operator, in connection with its telecast of the 1972 Summer Olympic Games in Munich. Toward the end of the month, with the Olympics fast approaching, Doran overheard ABC producers Don Ohlmeyer and Doug Wilson discussing a filmed biography of Dan Gable, which the network was planning to air as background material during the olympic telecast. When Doran heard Ohlmeyer complain that ABC's film crews had not provided enough footage of Gable suitable for use as biographical background, he informed the producer of the existence of Champion. At Ohlmeyer's request, Doran gave him a copy of the film, and ABC reproduced its own videotape of at least portions of the student work. ¹

At this point, the parties' accounts of the facts diverge. Ohlmeyer claims that, although he said he would attempt to provide $250 compensation for Doran, he advised him that he could not guarantee payment because of budget constraints. According to Ohlmeyer, Doran asserted he was not interested in monetary payment and would be pleased simply to have his film on television. Doran, on the other hand, alleges that Ohlmeyer promised to investigate compensation, but did not offer to purchase the film. As a result, Doran believed he had entered into no agreement, and that ABC was never granted any right to use Champion. Thus, Doran claimed he was "shocked" when he saw edited portions of Champion on ABC's olympic telecasts.

After Doran notified Iowa that the network had broadcast Champion, the University made several attempts to reach an amicable settlement with ABC. The network, however, repeatedly denied that any part of Champion had ever been used. Consequently, there never was any payment to Doran or Iowa. After Iowa filed this suit alleging copyright infringement in 1975, and following discovery, however, ABC admitted three uses of the film: (1) seven to twelve seconds of Champion were shown on ABC's pre-olympic telecast on August 25, 1972; (2) 21/2 minutes were used as part of an ABC report on Gable before his first olympic wrestling match on August 27; and (3) eight seconds were telecast in connection with Gable's appearance on ABC's Superstars program in February 1974, after Iowa had first written the network about its use of Champion during the Olympics. ² In addition Circuit Judge Lumbard (sitting by designation as the trial judge) found that Ohlmeyer's original production of a videotape of at least portions of the film constituted a fourth instance of infringement. See note 1 supra. ³

Although ABC thus admitted virtually all allegations of copying, it raised the defense of fair use. Following a two-day bench trial on the issue of liability in September 1978, Judge Lumbard rejected the defense, finding that no agreement had ever been reached by Doran and ABC. Indeed, he noted, Iowa had not been consulted prior to the network's telecasts of portions of Champion, and was therefore unable to "consent" to ABC's use as required by its own agreement with Doran. Accordingly, the judge found that "defendants appropriated something of value for which, from the nature and extent of their business, they were well prepared to pay," rendering their use of Champion "unfair." ⁴ After a subsequent trial on damages in May 1979, Judge Lumbard awarded statutory damages of $15,250 $250 for ABC's initial copying of the film, and $5000 for each of the three televised uses. He also awarded $17,500 in attorneys' fees. On this appeal, ABC does not challenge the amount or computation of damages and fees, but urges that the district court incorrectly rejected its defense of fair use.

II

The doctrine of fair use, originally created and articulated in case law, permits courts to avoid rigid application of the copyright statute when, on occasion, it would stifle the very creativity which that law is designed to foster. The cases emphasize that resolution of a fair use claim "depends on an examination of the facts in each case (and) cannot be determined by resort to any arbitrary rules or fixed criteria." Meeropol v. Nizer, 560 F.2d 1061, 1068 (2d Cir. 1977), cert. denied, 434 U.S. 1013, 98 S.Ct. 727, 54 L.Ed.2d 756 (1978). Evolution of the doctrine in these cases, however, suggests four commonly recognized factors that have traditionally been consulted in fair use cases: ⁵ (1) the purpose and character of the use; (2) the nature of the copyrighted work; (3) the amount and substantiality of material used in relation to the copyrighted work as a whole; and (4) the effect of the use on the copyright holder's potential market for the work. See 3 Nimmer on Copyright § 13.05(A) (1979); 17 U.S.C. § 107. Resort to these factors in the case before us demonstrates that ABC's fair use defense must fail.

The network relies most heavily on the first factor the purpose and character of its use. It claims it was engaged in the laudable pursuit of disseminating the life history of an important public figure involved in an event of intense public interest. Thus, ABC asserts that the public benefit in encouraging the development of historical and biographical works suitable for mass distribution, see Rosemont Enterprises Inc. v. Random House, Inc., 366 F.2d 303, 307 (2d Cir. 1966), cert. denied, 385 U.S. 1009, 87 S.Ct. 714, 17 L.Ed. 546 (1967), should impel us to the conclusion that it be free to use Champion for this purpose.

This argument proves too much. ABC possessed an unfettered right to use any factual information revealed in Champion for the purpose of enlightening its audience, see Hoehling v. Universal City Studios, Inc., 618 F.2d 972, 979 (2d Cir. 1980); Meeropol, supra, 560 F.2d at 1070; Wainwright Securities, Inc. v. Wall Street Transcript Corp., 558 F.2d 91, 95 (2d Cir. 1977), cert. denied, 434 U.S. 1014, 98 S.Ct. 730, 54 L.Ed.2d 759 (1978), but it can claim no need to "bodily appropriate" Iowa's "expression" of that information by utilizing portions of the actual film, Hoehling, supra, 618 F.2d at 980; Rosemont Enterprises, Inc., supra, 366 F.2d at 310; Meeropol, supra, 560 F.2d at 1070. See generally, 1 Nimmer on Copyright § 1.10(B); Gorman, Copyright Protection for the Collection and Representation of Facts, 76 Harv.L.Rev. 1569 (1963). The public interest in the free flow of information is assured by the law's refusal to recognize a valid copyright in facts. Cf. Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 569, 97 S.Ct. 2849, 2854, 53 L.Ed.2d 965 (1977) (under state statute analogous to copyright law, television newscast could report fact of performance, but could not broadcast actual event without compensating performer). The fair use doctrine is not a license for corporate theft, empowering a court to ignore a copyright whenever it determines the underlying work contains material of possible public importance. Indeed, we do not suppose that appellants would embrace their own defense theory if another litigant sought to apply it to the ABC evening news. ⁶

Moreover, we must recognize that ABC's use of Champion was not motivated solely by its beneficence. While the fact that ABC sought to profit financially from its telecasts of the Olympics "does not, standing alone, deprive . . . (ABC) of the fair use defense," Meeropol, supr...