By Robert Margolis, J.D.
The U.S. court of appeals in Washington, D.C., has reversed a district court’s grant of partial summary judgment to several industry standards development organizations ("SDOs") on their claims that Public.Resource.org., Inc. infringed their copyrights and trademarks by publicly disseminating SDO standards incorporated into federal, state, and local law. The appellate court found that the district court failed to properly apply both the copyright fair use doctrine and the trademark nominative fair use doctrine. The district court’s grant of summary judgment was reversed, its permanent injunction order prohibiting further publication was vacated, and the case remanded to the district court for further proceedings (American Society for Testing and Materials v. Public.Resource.org, Inc., July 17, 2018, Tatel, D.).
Underlying dispute. The district court had addressed motions and cross-motions for summary judgment brought in two separate but related cases brought by SDOs against Public Resource. In one case, the American Society for Testing and Materials ("ASTM"), National Fire Protection Association, Inc. ("NFPA"), and American Society of Heating, Refrigerating, and Air-Conditioning Engineers ("ASHRAE") (collectively "ASTM Plaintiffs"), sued Public Resource for both copyright and trademark infringement, based on Public Resource’s copying and dissemination of 257 standards developed by the ASTM plaintiffs that have been incorporated by reference into federal law. Public Resource admitted that it purchased hard copies of each standard, scanned them into PDFs, added a cover sheet, and posted them online. Public Resource also retyped the plaintiffs’ standards and posted them online. The summary judgment motion related to nine of the allegedly infringed standards.
In the other case, Plaintiffs American Educational Research Association, Inc. ("AERA"), American Psychological Association, Inc. ("APA"), and National Council on Measurement in Education, Inc. ("NCME") (collectively "AERA Plaintiffs") sued Public Resource for copyright infringement based on similar conduct with respect to one set of standards.
The parties. The ASTM Plaintiffs are not-for-profit organizations that develop private sector codes and standards for advancing public safety, ensuring compatibility across products and services, facilitating training, and spurring innovation, the district court had summarized. Similarly, the AERA Plaintiffs are not-for-profit organizations that collaboratively develop the Standards for Educational and Psychological Testing. The SDOs developed the standards at issue in the two cases, all of which were incorporated by reference into federal law. The two cases pitted the SDOs against Public Resource, a not-for-profit entity devoted to publicly disseminating legal information, to make it more "widely available."
Lower court decision. The district court granted partial summary judgment to the SDOs, agreeing with them that Public Resource’s publication of the standards did not support a fair use defense to the copyright infringement claims or a nominative fair use defense to the trademark claims. The district court enjoined further unauthorized publication of the standards. Public Resource appealed.
Fair use of copyrighted works. The appellate court addressed each of the four copyright fair use factors, and while it found reason to believe that a finding as a matter of law that Public Resource’s reproduction of at least some of the standards constitutes fair use, it deemed the better course to be remand to the district court to develop the record more fully.
Purpose of use. Public Resource argued that its use was for educational purposes, to facilitate public debate, rather than commercial purposes. The district court discounted Public Resource’s purpose, finding that the use bore commercial elements since it distributed the standards in the same commercial markets in which the SDOs distribute them for a fee. The appellate court found this to be in error. The district court failed to adequately consider the extent to which Public Resource’s distribution of the standards to the public in order to facilitate public access was a "transformative use," which would support a fair use determination. This is particularly so where the standard incorporated into law provides information necessary to comprehending one’s legal duties, the appellate court found. In addition, because each standard at issue in the case was incorporated differently into law, the analysis may be different for each and the district court did not distinguish between them in its analysis. On remand, the appellate court advised the district court to consider this factor "standard by standard and use by use."
Nature of work. Similarly, the appellate court held that the second fair use factor, the nature of the copyrighted work, required an "individual appraisal" of each standard and how it was incorporated into law. The district court found that because the standards "are vital to the advancement of scientific progress," they fell precisely within the type of expressive work that copyright law fully protects. But as the appellate court pointed out, all of the standards at issue were in some form incorporated into law, and law cannot be copyrighted. Therefore, the nature of the works at issue is at best on the outer edge of copyright’s protective sphere, the appellate court found. Against that background, an individual assessment of how each standard was incorporated into law was necessary. In instances where the standard’s incorporation by reference into law "is virtually indistinguishable from a situation in which the standard has been expressly copied into law," this factor would weigh heavily in favor of fair use. Where the incorporation does not lead to an easy substitution, "fair use is harder to justify."
Amount of use. As to the third factor, "the amount and substantiality of the portion used in relation to the copyrighted work as a whole," the appellate court held that the district court did not analyze the relevant consideration and the record was insufficiently complete for the appellate court to do anything but remand for development of a more substantial record. Because "the extent of permissible copying varies with the purpose and character of the use" and must be determined by what is reasonable in relation to the purpose of the copying, according to the Supreme Court (Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 586-87 (1994)), the district court erred by not individually considering each standard and how it was incorporated into law.
Effect of use. The fourth factor, "the effect of the use upon the potential market for or value of the copyrighted work," like the others required remand to develop a fuller record so the district court can consider the extent to which Public Resource’s making the standards available online impacts the SDOs’ markets.
Constitutional question. The appellate court left "for another day" what it deemed the "far thornier question" than fair use, about whether the SDOs’ standards retain copyright eligibility once they are incorporated by reference into law.
Nominative fair use of trademarks. ASTM had sued for trademark infringement because when Public Resource distributed copies of its technical standards, it also reproduced ASTM’s name and logo marks. Because Public Resource had modified the standards to reproduce them and "in the process, introduced errors" into the standards it publicly disseminated, ASTM argued that the distribution caused confusion as to the source, and weakened ASTM’s marks. Public Resource interposed the defense of nominative fair use, noting that its use of ASTM’s marks was for the purpose of making it clear to consumers that ASTM was the source of the standards. The district court rejected this defense without considering it, which the appellate court found to be in error. It remanded for the district court to consider nominative fair use factors, such as whether the marks were used in a way beyond what was necessary to identify ASTM as the source.
This case is No. 17-7035.
Attorneys: Michael F. Clayton (Morgan Lewis & Bockius LLP) and Allyson Newton Ho (Gibson, Dunn & Crutcher LLP) for American Society for Testing and Materials. Rose Leda Ehler (Munger, Tolles & Olson LLP) for National Fire Protection Association, Inc. Joseph Richard Wetzel (King & Spalding LLP) for American Society of Heating, Refrigerating, and Air-Conditioning Engineers, Inc. Matthew B. Becker (Fenwick & West LLP) for Public.Resource.org, Inc.
Companies: American Society for Testing and Materials; National Fire Protection Association, Inc.; American Society of Heating, Refrigerating, and Air-Conditioning Engineers; American Educational Research Association, Inc.; American Psychological Association, Inc.; National Council on Measurement in Education, Inc.; Public.Resource.org., Inc.
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