I. Introduction to The Information Society: A Case Study
How does the world change when we begin to think of everything, from software competition to the structure of the human genome, as an information issue? What problems arise? How do our conceptions of both problems and solutions change? Which of the issues presented by the study of the human genome does intellectual property address, or even recognise?
U.S. Constitution Art. I, § 8, cl. 8
James Boyle, A Politics of Intellectual Property (excerpt)
From Maps to Medicine: About the Human Genome Research Project (from the National Genome Research Institute)
The Human Genome Project: Under An International Ethical Microscope --Ethical, Legal and Social Implications (ELSI) Research (from the National Genome Research Institute)
II. Information Economics: What's Law Got to Do With It?
To understand intellectual property, one first has to understand the paradoxes inherent in the economics of information, which requires a certain amount of background reading, and then one has to understand the version of information economics that is fought out in the law.
James Boyle, "Information Economics" from "A Theory of Law and Information"
John Perry Barlow, Selling Wine Without Bottles
INTERNATIONAL NEWS SERVICE v. THE ASSOCIATED PRESS
III. Intellectual Property: Supplementary Cases
SAN FRANCISCO ARTS & ATHLETICS
TEXAS, Petitioner v. Gregory Lee JOHNSON for oral argument click here
A copyright to the Flag of the United States
LOTUS DEVELOPMENT CORPORATION, Plaintiff, Appellee, v. BORLAND INTERNATIONAL, INC
LOTUS DEVELOPMENT CORPORATION, petitioner, v. BORLAND INTERNATIONAL, INC (affirmed by an equally divided court).
Fair Use -- Copyright & the 1st Amendment.
RELIGIOUS TECHNOLOGY CENTER, Plaintiff, v. Arnaldo Pagliarina LERMA
MICHIGAN DOCUMENT SERVICES (3 judge panel)
MICHIGAN DOCUMENT SERVICES, (en banc).
Direct & Contributory Infringement OSP Liability
NETCOM ON-LINE COMMUNICATION SERVICES, INC.,
[The Congress shall have power] "To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries;"
U.S. Constitution Art. I, § 8, cl. 8.
Whenever a copyright law is made or altered, then the idiots assemble.
A Politics of Intellectual Property: Environmentalism For the
Net?
Introduction: This Article argues that we need a politics, or perhaps a political economy, of intellectual property. Using the controversy over copyright on the Net as a case-study and the history of the environmental movement as a comparison, it offers a couple of modest proposals about what such a politics might look like -- what theoretical ideas it might draw upon and what constituencies it might unite.
I
"Code is Code" - The Logic of the Information Relation
Everyone says that we are moving to an information age. Everyone says that the ownership and control of information is one of the most important forms of power in contemporary society. These ideas are so well-accepted, such cliches, that I can get away with saying them in a law review articlewithout footnote support. (For those blessedly unfamiliar with law reviews, this is a status given to only the most staggeringly obvious claims; the theory of evolution,(2) and the orbit of the earth around the sun,(3) probably would not qualify.)
Beyond the claim that the information society exists, however, there is surprisingly little theoretical work. Sadly for academics, the best social theorists of the information age are still science fiction writers and, in particular, cyberpunks -- the originators of the phrase "cyberspace" and the premier fantasists of the Net. If one wants to understand the information age, this is a good place to start.
Cyberpunk science fiction succeeded as a genre largely because it combined a particular plot
aesthetic with a particular conceptual insight. The plot aesthetic was simple; the bad boy/film noir
world of the romantic lowlife. When juxtaposed to the 2-dimensional priggishness of the normal
science fiction hero, the cigarette smoking, drugged-out petty outlaws and mirror-shaded
ninja-chicks of cyberpunk seemed rebellious, cynical and just, well, cool. The character-type is a
familiar one; James Dean could easily have played the hero of Neuromancer.(4) The conceptual
insight is not so familiar. Cyberpunk is built on the extrapolation of two principal technologies,
computers and the Web on the one hand, and genetic engineering on the other. The theme of
cyberpunk is that the information age means the homologisation of all forms of information --
whether genetic, electronic, or demographic. I grew up believing that genes had to do with
biology, petri dishes and cells and that computers had to do with punch cards and magnetic disks.
It would be hard to imagine two more disparate fields. In contrast cyberpunk sees only one issue
~ code ~ expressed in binary digits or the C's,G's, A's and T's on a gene map.
Intellectual Property is the Legal Form of the Information Age
The cyberpunk writers also offer us a legal insight. The more one moves to a world in which the message, rather than the medium, is the focus of conceptual, and economic interest, the more central does intellectual property become. Intellectual property is the legal form of the information age. Like most property regimes, our intellectual property regime will be contentious, in distributional, ideological and efficiency terms. It will have effects on market power, economic concentration and social structure. Yet, right now, we have no politics of intellectual property -- in the way that we have a politics of the environment or of tax reform. We lack a conceptual map of issues, a rough working model of costs and benefits and a functioning coalition-politics of groups unified by common interest perceived in apparently diverse situations.
Why don't we have such a politics? One reason is that with a few exceptions, the mass media coverage of the information age has been focused firmly on "cyberporn" and its potential censorship. This is rather like thinking that the most important feature of the industrial revolution was that it allowed the mass-production -- and then the regulation -- of pornographic magazines. Given the magnitude of the changes occurring, and the relatively small differences between pornography on-line and pornography anywhere else, a more trivial emblematic concern would have been hard to find. It is intellectual property, not the regulation of cyber-smut, that provides the key to the distribution of wealth, power and access in the information society. The intellectual property regime could make -- or break -- the educational, political, scientific and cultural promise of the Net. Indeed, even if our only concern were censorship, it would be perverse to concentrate exclusively on the direct criminalisation of content by governments. The digital world gives new salience to private censorship -- the control by intellectual property holders of distribution of and access to information. The recent Scientology cases are only the most obvious manifestation of this tendency.(5)
The media were not the only ones to miss the boat. Lawyers and legal academics largely followed suit. With a few exceptions, lawyers have assumed that intellectual property was an esoteric and arcane field, something that was only interesting (and comprehensible) to practitioners in the field.(6) There is some question whether this attitude was ever defensible; it certainly is not now. In terms of ideology and rhetorical structure, no less than practical economic effect, intellectual property is the legal form of the information age. It is the locus of the most important decisions in information policy. It profoundly affects the distribution of political and economic power in the digital environment. It has impacts on issues ranging from education to free speech. The "value" protected(7)by intellectual property in the world economy is in the hundreds of billions of dollars and growing all the time.
There are structural reasons why these tendencies will continue. The first crucial aspect of the current information economy is the increasing homologisation of forms of information. Think of the many ways in which it now does not make sense to distinguish between electronic and genetic information -- any more than between red books or green books. Precisely because we conceive of them as (and have the capability to treat them as) information, both present the same issues of regulation -- privacy, access, public goods problems, and so on. As a result, they have literally begun to overlap -- think of the storing (and then the sale?) of the human genome on computer disk, or of the private gene databases which add value to information developed through publicly funded research and then demand patent options as the prerequisite for access by outsiders.(8)Read about the mathematical-biological/computer-science discipline of bio-informatics, a discipline which is premised on the belief that information is information, whether the medium is a double helix or an optical disk.(9)
We are now used to the idea that Microsoft retains rights over the lines of code sitting on computer hard drives around the world. We can even produce a utilitarian justification to explain why. It is a lot stranger to think that women all over the country may carry in their bodies a string of genetic information -- brca1, the so-called breast cancer gene -- that has been patented by Myriad Genetics or that the Commerce Department tried to patent the genes of a Guyami Indian woman who possessed an abnormal resistance to leukemia.(10) From the point of view of the information economy, though, the two cases are very similar; in each case, strings of code are subject to intellectual property rights granted in the belief that they will inspire further innovation and discovery. The fact that this can be done in the face of the profound shock most people feel at the ownership of human genes is a testament to the universalizing logic of the information relation. (Whether it is also a good thing is a different question.)
The process is not simply a legal one and the overlaps go in both directions. Scan the science pages and see articles about the possibility of using DNA sequences as incredibly powerful parallel processing "computers."(11)Think of the software designers who create electronic ecologies and then use those strings of computer code which have proved themselves as survivors -- harnessing a form of "natural" selection that Darwin would have recognised but could never have imagined.(12) Put it all together and then compare this "reality" to the way that we thought about computers on the one hand and biology on the other, just twenty years ago. In the international information economy, the medium is not the message. The medium is irrelevant.
The second crucial aspect of the information economy is a corollary of the homologisation of forms of information; the decreasing proportion of product cost and intellectual attention devoted to medium (diskettes, cell-lines) rather than message (software, decoded DNA sequences). A moment's thought will show that both of these aspects will give increased importance to intellectual property. Reconceiving new areas of science, commerce and research as "information issues" simply gives us more fields in which it is likely we will spy the public goods problems that intellectual property is supposed to solve. And the diminishing portion of product cost devoted to medium rather than message means that, within any given area, the public goods problems grow all the more salient; (The price of the program rises, at least relative to the falling price of the diskette onto which it can be copied.)
When I say that we lack a politics of intellectual property, I don't mean to imply that this is the
only type of "information politics" -- more like the most neglected. Look at the recent past. From
the net roots campaign against the Communications Decency Act to the titanic industry lobbying
over the Telecommunication Bill in which the CDA was embedded, there have been many
moments of political struggle and agitation over digital commerce and communications
regulation.(13) There have been conferences, both Polyannish and despairing, over the use of the
Net by non profit groups, and thoughtful warnings of the dangers posed by disparate access to
information technologies. These are serious points; the issue of access in particular. But in most
cases, they are isolated applications to a new technology of a familiar political worldview or
calculation of self-interest. Libertarians don't want newspapers censored; their attitude to the Net
is the same (though the interactive quality of the technology, and the proprietary feeling that
novelty gives first adopters have certainly given more people a stake in the protection of the
system.) Non-profit groups have to adjust to changes in communications technology, just like
changes in tax law, or the regulation of lobbying. Communications conglomerates have an attitude
towards bandwidth that seems indistinguishable from most commercial entities' attitude towards
publicly held real estate; rationally enough, they want more, they want it free (ideally, they want it
subsidised) and they want to be able to exploit it without strings. The left sees a resource with
new importance -- access to information technology -- and makes about it the points that it makes
about access to health care or education.(14) I don't mean to minimise these concerns, and certainly
don't want to make the claim that they are somehow less fundamental than the ones I describe
here. But I do think that, precisely because of their comfortable familiarity, they miss some of
thedifferences in the politics of the information age, the ideas we have not thought about so often
or so well.
The Human Genome Project is an ambitious effort to understand the hereditary instructions that make each of us unique. The goal of this effort is to find the location of the 100,000 or so human genes and to read the entire genetic script, all 3 billion bits of information, by the year 2005.
Even before it is complete, the Human Genome Project promises to transform both biology and medicine. Our genes orchestrate the development of a single-celled egg into a fully formed adult. Genes influence not only what we look like but what diseases we may eventually get. Understanding the complete set of genes, known as the human genome, will shed light on the mysteries of how a baby develops. It also promises to usher in an era of molecular medicine, with precise new approaches to the diagnosis, treatment, and prevention of disease. In short, the international Human Genome Project, which involves hundreds of scientists worldwide, is an investigation of ourselves. Launched in 1990, the project is supported in the United States by the National Institutes of Health and the Department of Energy.
Our genes are made of DNA, a long, threadlike molecule coiled inside our cells. Within the cell nucleus, the DNA is packaged into 23 pairs of chromosomes. Each chromosome, in turn, carries thousands of genes arrayed like beads on a string. Genes, which are simply short segments of DNA, are packets of instructions that tell cells how to behave. They do so by specifying the instructions for making particular proteins. The hereditary instructions are written in a four-letter code, with each letter corresponding to one of the chemical constituents of DNA: A, G, C, T. Genes are, in essence, the "paragraphs" in this DNA language, with a certain sequence of As, Gs, Cs, and Ts constituting a recipe for a specific protein. If the DNA language becomes garbled or a word is misspelled, the cell may make the wrong protein, or too much or too little of the right one-- mistakes that often result in disease. In some cases, such as sickle cell anemia, just a single misplaced letter is sufficient to cause the disease.
Errors in our genes are responsible for an estimated 3000 to 4000 clearly hereditary diseases, including Huntington's disease, cystic fibrosis, neurofibromatosis, Duchenne muscular dystrophy, and many others. What's more, altered genes are now known to play a part in cancer, heart disease, diabetes, and many other common diseases. In these more common and complex disorders, genetic alterations increase a person's risk of developing that disorder. The disease itself results from the interaction of such genetic predispositions and environmental factors, including diet and lifestyle.
The Human Genome Project will develop tools to identify the genes involved in both rare and common diseases over the next 15 or 20 years. Such discoveries, in turn, are likely to bring improvements in the early detection and treatment of disease and new approaches to prevention. Once the molecular basis of a disease is revealed, scientists have a far better chance of defeating it. One approach is to design highly targeted drugs that act on the cause, not merely the symptoms, of disease. Another is to correct or replace the altered gene through gene therapy. Even before that, however, gene discovery can lead to predictive tests that can tell a person's likelihood of getting a disease long before symptoms appear. In some cases, preventive actions can then be undertaken that may avert the disease entirely or else detect it at its earliest stages, when treatment is more likely to be successful.
The Human Genome Project is designed to speed this process once and for all by providing new tools and techniques that will enable scientists to find genes quickly and efficiently. The first of these tools are maps of each chromosome. One type of map, called a genetic map, consists of thousands of landmarks--short, distinctive pieces of DNA--more or less evenly spaced along the chromosomes. Now very detailed, this map should enable researchers to pinpoint the location of a gene between any two markers. Another important step is to create what are called physical maps of each chromosome, a process that is also well under way. Physical maps consist of overlapping pieces of DNA spanning an entire chromosome. Once these maps are complete, investigators can localize a gene to a particular region of a chromosome by using a genetic map and then can simply go to the freezer, where the DNA for the physical map is stored, and pick out that piece to study rather than searching through the chromosomes all over again.
The ultimate goal of the Genome Project is to decode, letter by letter, the exact sequence of all 3 billion nucleotide bases that make up the human genome. It will be a daunting task. Before plunging into massive sequencing, researchers from numerous fields--biology, physics, engineering, and computer science, to name a few--are developing automated technologies to reduce the time and cost of sequencing. Once the human genome sequence is completed, attention can shift from the job of finding genes, which will then simply be a matter of scanning a computer database, to understanding them.
In its first 5 years alone, the Human Genome Project has already had a profound effect. Thanks to tools emerging from the project, the pace of gene discovery has nearly quadrupled. The gene involved in cystic fibrosis, the most common lethal hereditary disease among Caucasians, was identified in 1989; already, a diagnostic test is available to identify gene carriers among high-risk families, and the first human gene therapy efforts are under way in federally approved clinical trials. In early 1994, scientists discovered two genes involved in a hereditary form of colon cancer. An estimated 1 million Americans carry misspelled copies of these genes, which give them a 70% to 80% likelihood of developing colon cancer. Now that the genes are in hand, a simple blood test to detect those high-risk individuals is not far off. This test will open the door to preventive strategies that promise to greatly reduce deaths from this disease (see below).
The newfound ability to probe our genes, however, can be a double- edged sword. For some diseases, for instance, our ability to detect the nonfunctional gene has outpaced our ability to do anything about the disease it causes. Huntington disease is a case in point. Although a predictive test for high-risk families has been available for years, only a minority of these individuals has decided to be tested. The reason? There is no way to cure or prevent Huntington's disease, and some individuals would rather live the uncertainty than with the knowledge that they will be struck, sometime in midlife, with a fatal disease. And what might happen if a health insurance company or a potential employer learns that an individual is destined to develop Huntington disease--might that person be denied coverage or a job?
Because of such concerns, the Human Genome Project has, since its inception, devoted about 5% of its budget to research aimed at anticipating and resolving the ethical, legal, and social issues likely to arise from this research. This is one of the first times scientists have begun to explore the potential consequences of their research before a crisis had arisen. With careful attention to these ethical quandaries, and adequate safeguards when necessary, society can reap the full benefits of the Human Genome Project.
" Not so long ago, recalls author Robert Cook-Deegan, a grant reviewer at the National Institutes
of Health (NIH) dismissed the automated DNA sequencer as a $100,000 paperweight." That
attitude is now dead and buried: Automated sequencers have not only gained respect, they've
taken over like the sorcerer's apprentice, churning out a flood of high-quality genetic data. They.
have also caused a revolution in biology, and, it seems, a crisis at the U.S. Patent and Trademark
Office (PTO).
Last month, PTO Commissioner Bruce Lehman called for help, inviting outside experts to suggest
ways of managing the flood of DNA sequences in new patent applications. While some academic
researchers have been signing a pledge not to patent raw DNA sequences (Science, 26 April, p.
477), companies that specialize in sequencing DNA - chiefly Incyte Pharmaceuticals of Palo Alto,
California, and Human Genome Sciences (HGS) of Rockville, Maryland - have been channeling
data from their mechanized processes into the PTO at a torrential rate. Unless changes are made,
PTO official John Doll projects it could take a single senior staffer more than 90 years to examine
the DNA sequences already in the queue." Eliot Marshall, Patent Office Faces 90-year
Backlog. (Patent Applications for DNA Sequences) Science Friday, May 3, 1996 Vol. 272,
No. 5262, ISSN: 0036-8075, p. 643
BODY: This document was prepared by the ELSI Research Planning and Evaluation Group (ERPEG)to illustrate more fully the breadth and complexity of the ELSI goals. Each goal statement is accompanied by examples of possible research questions and education activities. These examples are meant only to give a flavor of the possible issues to be addressed, and are not, in any sense, exhaustive or comprehensive.
a. Examine the issues surrounding the completion of the human DNA sequence and the study of human genetic variation.
Examples of Research Questions and Education Activities:
What strategies should be used to balance the needs for privacy and safety of individuals and groups with the scientific goals of creating resources for DNA sequencing and human variation research? (e.g. How should research participants be informed about the fact that they may not be able to remain anonymous given the availability of their DNA sequence?)
Will the discovery of DNA polymorphisms influence current concepts of race and ethnicity? (e.g. How will individuals and groups respond to potential challenges to or affirmations of their racial and/or ethnic self-identification, based on new genetic information?)
What new concerns are being raised by the commercialization and patenting of DNA sequence information in the public, academic and private sectors? (e.g. What are the implications of domestic and international policies for the ownership of DNA sequence information?)
What are the most effective strategies for educating health professionals, policy makers, the media, students, and the public regarding the interpretation and use of information about genetic variation?b. Examine issues raised by the integration of genetic technologies and information into health care and public health activities.Examples of Research Questions and Education Activities:What are the clinical and societal implications of identifying common polymorphisms that predict disease susceptibility or resistance? (e.g. Will genetic testing promote risky behavior in persons found to be genetically resistant to particular pathogens, such as HIV, or environmental hazards, such as cigarette smoke?)What are the potential risks and benefits of integrating genetic testing for complex diseases, behaviors, and other traits into health care? (e.g. What are the individual and social implications of developing pharmacologic treatments that are tailored to patients' genotypes?)What are the most effective strategies for integrating genetic information and technologies into clinical settings in ways that help practitioners see health and disease in a genetic context and what will be the ethical, legal and social consequences of their increasing availability and use? (e.g. How will individuals be benefited or harmed by the integration of genetic information into individual medical records, managed care organization records, and public health registries?)Will the availability of genetic information influence provider practice, change patient behavior, reduce morbidity and mortality, and/or reduce health care costs?What factors influence: who develops and regulates new reproductive genetic technologies; which technologies are incorporated into medical practice; and which technologies are accepted or rejected by the public? (e.g. What issues may arise as a result of the development and use of germ-line gene therapies? How might the availability of these therapies affect concepts of disability?)What are the best strategies for educating health care providers, patients and the general public about the use of genetic information and technologies? (e.g. What are the most effective mechanisms for educating providers, patients and the public about the uncertainties inherent in genetic risk information?)c. Examine issues raised by the integration of knowledge about genomics and gene- environment interactions into non-clinical settings. Examples of Research Questions and Education Activities:What are appropriate and inappropriate uses of genetic testing in the employment setting? (e.g. Are there conditions under which it might be ethical and/or legal to use genetic testing to identify those employees who may have a susceptibility to workplace hazards? What implications does the Americans with Disabilities Act have for such testing?)What issues emerge from the collection, storage and use of blood and other tissue samples, including collections by the military, civil and criminal justice systems, commercial entities, and federal and state public health agencies?What are the implications of obtaining genetic information for use in adoption proceedings and establishment of child custody and child support?What are the implications of potential commercial applications resulting from the availability of genetic information about individuals and groups? (e.g. Should commercial companies have access to personal genetic data for targeted product marketing?)What are the potential uses and abuses of genetic information in educational settings? (e.g. Is placement of students on the basis of genetic data any more or less beneficial or harmful than tracking on the basis of traditional categories or classifications?)d. Explore ways in which new genetic knowledge may interact with a variety of philosophical, theological, and ethical perspectives. Examples of Research Questions and Education Activities:Will continuing research in molecular biology and functional genomics affect how individuals and society view the relationship of humans to one another and to the rest of the living world? (e.g. As new genetic technologies and information provide additional support for the central role of evolution in shaping the human species, how will society accommodate the challenges that this may pose to traditional religious and cultural views of humanity?)What are the implications of behavioral genetics for traditional notions of personal, social and legal responsibility? (e.g. What role will the discovery of putative genetic predispositions to violent behavior play in criminal prosecutions?)What are the implications of genetic enhancement technologies for conceptions of humanity? (e.g. What ethical or theological challenges might be posed by the ability to alter the genetic makeup of future generations?)e. Explore how socioeconomic factors and concepts of race and ethnicity influence the use and interpretation of genetic information, the utilization of genetic services, and the development of policy.Examples of Research Questions and Education Activities:How are individual views about the value of genetic research, the importance of access to genetic services, and the meaning and relevance of genetic information affected by concepts of race and ethnicity and by socioeconomic factors? (e.g. How have past misuses of genetic science and information influenced perceptions of genetic research and services among individuals from diverse communities and groups?)How is the impact of genetic testing in clinical and non-clinical settings affected by concepts of race and ethnicity and other social or economic factors? (e.g. Will particular communities and groups be more vulnerable to employment discrimination based on genotype?)In what ways are access to, and use of, genetic information and services affected by ethnicity, race, or socioeconomic status?What are the most effective strategies to ensure that genetic counseling and other genetic services are culturally sensitive and relevant?
(Excerpted, without notes -- for complete text, click here.)
James Boyle
Originally published in 80 Calif. L. Rev. 1413
IV
The Economics of Information
As usual, information has not one role, but many. The analytical structure of microeconomics
includes the concept of "perfect" information-meaning free, complete, instantaneous, and
universally available-as one of the defining features of the perfect market.(70)At the same time, the
actual market structure of contemporary society depends on information being a commodity-
costly, partial, and deliberately restricted in its availability. To put it briefly, perfect information is
a defining conceptual element of the analytical structure used to analyze markets driven by the
absence of information, in which imperfect information is actually a commodity.(71) If an analogy
is needed, imagine a theology that postulates ubiquitous God-given manna-food from heaven-in
its vision of the heavenly city, but otherwise assumes that virtue and hard work are both
maximized under conditions of scarcity. Now use that theology as the basis for a practical
discussion of the ethics of food shortages.(72)
This basic theoretical aporia(73)explains the weakness of much economic analysis of information
regimes. My point is not that the reality is more complicated than the abstraction. That would be a
critique of all abstractions, and abstractions are necessary to life. My claim is that information is a
problem case for that specific set of abstractions we call economic theory, that it can and must be
represented within the theory in two conflicting ways, and that certain concrete problems follow
as a result. Some economists believe that these problems can be solved by changing the level of
analysis- from perfect to imperfect markets, from imperfect information as commodity to
imperfect information as transaction cost to perfect information as component of the analytical
structure-just as Russell and Whitehead believed that they could banish paradoxes from
mathematics by segregating the component parts of the paradox on different levels of analysis.
Godel's Theorem convinced mathematicians of the impossibility of getting rid of this pattern of
circularity, recursive definition, and self-swallowing analysis. Sadly, with some notable exceptions
that I shall discuss in a moment, economists seem to have avoided any comparable moment of
professional modesty.(74)
The first manifestation of this paradox in information economics is the fact that the requirements
of "motivation" and those of "efficiency" seem contradictory.(75) For example, if markets are to be
efficient, the prices must perfectly reflect available information. Yet information is costly to
obtain. If prices perfectly reflect available information, with no part of the price going to the
producer of the information, then there is no incentive to produce more information. To postulate
efficiency in the production of information we must assume away the incentive necessary to
produce. To postulate the incentive is to make efficiency impossible. It looks like a classic
paradox. This is not an observation confined to those skeptical of information economics, some of
the most sophisticated economists writing in the area have acknowledged this problem: "There is
a fundamental conflict between the efficiency with which markets spread information and the
incentives to acquire information."(76)Are property rights in information a transaction cost that
impedes the full and efficient circulation of information? It might seem obvious that they are.
After all, perfect information is one of the elements of the perfect market. If information can be
commodified, then a host of transaction costs are introduced into information flow and a limited
monopoly is granted in the midst of a system supposedly based on competition.(77)
Yet the picture changes when information is viewed not as an element within the theoretical
structure of the economic system, but rather as a commodity produced and distributed according
to the rules of that system. In fact, most economic analysis of information takes this "commodity
perspective."(78) From that perspective, the goal of the analysis is to discover the level of property
rights that will produce the optimal level of production. Take the classic case of International
News Service v. Associated Press.(79)Associated Press (AP) operated a news-gathering service. An
international network of correspondents and wire services provided news which was printed in the
AP papers. Unfortunately for AP, International News Service (INS), which operated a far less
expansive news-gathering apparatus, made a practice of free riding on AP's efforts. INS
employees would gather news from AP's noticeboards and from early editions of its East Coast
newspapers and would then reprint the news, often taking advantage of the time differential
between the east and west coasts.
The INS case raises a difficult question for economic analysis. One line of rhetoric and analysis
indicates that we should secure to producers the fruits of their labors, and thus induce them to
produce more. Without some legally protected interest in the news it gathers, AP will presumably
be under a competitive disadvantage. News will become a "public goods problem." Unable to
exclude its competitors from the fruits of its efforts, AP will be driven to cut back its
news-gathering activities-as will all the other newspapers. Thus, though consumers might be
willing to pay for a higher level of news gathering, it will be impractical for any individual
newspaper to provide such a service. Put this way, the majority's creation of a legally protected
interest in freedom from unfair competition in news gathering is the perfect solution to the public
goods problem. By allowing commodification, it ensures continued production and avoids the
prisoner's dilemmas set up by the alternative regime.
Yet one cannot solve the problems of economic analysis merely by adopting the commodity
perspective-leaving perfect competition and information efficiency concerns aside. The problem of
the free flow of information reappears within the new model. For example, should we approach
the question of "fair use" in copyright through the lens of the commodity perspective? If we do
so, will we only tolerate limitations on intellectual property rights when those limitations are
necessary to minimize transaction costs or accomplish well-defined public goals? The most
sophisticated scholarly analysis takes this approach.(80) Consequently, it tries to preserve incentives
for creators, even establishing a typology of "fair uses"-assigning or denying property rights in
part according to whether those uses would tend to reduce the reward available to the
author.(81)Yet the analysis largely ignores the opposite perspective, that of the efficient flow of
information. If we switch the perspective, we see that one important purpose of "fair use" law is
to make sure that future creators have available to them an adequate supply of raw materials.
From this perspective, too many "incentives" could convert the public domain into a fallow
landscape of private plots.
To their credit, some economic analysts have attempted to reconcile the two perspectives. Thus,
for example, Landes and Posner describe copyright as constructed by the tension between the
need to grant legally protected interests to authors in order to motivate them and the need to limit
the rights of authors so as to allow future creators legal access to the raw materials they
need.(82)This seems reasonable enough, but it also leaves them dangerously close to the mushy
"balancing" analysis from which economics was supposed to provide surcease. At the same time,
the aporiareappears in the question of classification within the theory. For instance, how are we
to classify a telephone directory of agents and publishing houses or an index price measure in a
futures market in books? Is the former-the information necessary to make the market
run-something that should be freely available? Is the latter a commodity in which the creators
must be able to claim a legitimate intellectual property right if we are to encourage continued
production of information? Or is it exactly the other way around?(83)
My argument is not merely that analysts are concentrating too much on motivating creators and
not enough on the free flow of information. I am claiming that a change in the focus of the
analysis does not dispose of these difficulties; it merely reverses their "polarity." There are issues
that economists tend to analyze by thinking of information as information rather than as a
commodity-for example, the discussion of the efficient capital market hypothesis. Yet, as some
economists have pointed out, unless the questions of commodification and incentive are worked
into the analysis, the theory ends in paradox as soon as the slightest costs or imperfections are
introduced into it. The best example comes from Grossman and Stiglitz's description of the
self-destructing futures market.
[W]henever there are differences in beliefs that are not completely arbitraged, there is an incentive
to create a market. (Grossman, 1977, analyzed a model of a storable commodity whose spot price
did not reveal all information because of the presence of noise. Thus traders were left with
differences in beliefs about the future price of the commodity. This led to the opening of a futures
market. But then uninformed traders had two prices revealing information to them, implying the
elimination of noise.) But, because differences in beliefs are themselves endogenous, arising out of
expenditure on information and the informativeness of the price system, the creation of markets
eliminates the differences of beliefs which gave rise to them, and thus causes those markets to
disappear. . . .
Thus we could argue as soon as the assumptions of the conventional perfect capital markets
model are modified to allow even a slight amount of information imperfection and a slight cost of
information, the traditional theory becomes untenable....
. . . [B]ecause information is costly, prices cannot perfectly reflect the information which is
available, since if it did, those who spent resources to obtain it would receive no compensation.(84)
Switching perspectives again, we might think that commodification is the answer. A futures
market produces information-in the form of the price of futures contracts. We do not normally
think of price as a public good, but it seems to fit all of the criteria. In this case, it is a valuable
commodity that takes considerable effort to create and is available thereafter at a marginal cost
near zero.(85) If we wish to eliminate the public goods problem, the answer might be to commodify
the price measure-to assert an intellectual property right in the price output of the market-in order
to prevent others from gaining free access to the information. Yet if there is one thing that
microeconomics cannot justify treating as a public good, surely it is price.
If all of this seems like an Alice-in-Wonderland conclusion, it is worth considering the case of
Board of Trade v. Dow Jones & Co.,(86)in which the court recognized that Dow Jones had a
"proprietary interest in its indexes and averages which vests it with the exclusive right to license
their use for trading in stock index futures contracts."(87)The court pointed out, however, that
"[t]he extent of defendant's monopoly would be limited, for as defendant points out, there are an
infinite number of stock market indexes which could be devised."(88)The Dow case does not go as
far as the "secret stock market" I proposed half-jokingly, but it does exemplify the ineradicable
tension between the notion of perfect information and frictionless markets and the notion of
commodification and property rights.
This internal tension in the analysis always leaves open the question whether a particular issue is
to be classed as a public goods problem for which the remedy is commodification,(89)or a
monopoly of information problem for which the remedy is unfettered competition.(90) The problem
of classification is not merely an empirical one. Even the existence of precise empirical evidence
(of a kind currently unavailable for any area of information regulation except, arguably, stock
market prices) would not, alone, reveal the right answer unless we had also decided on what level
of generality the analysis was to be undertaken. In Feist Publications v. Rural Telephone Service
Co.,(91) for example, the Supreme Court denied copyright protection to the compilers of a white
pages phone directory. The logic of the analysis I just applied to the INS case might seem to
indicate that it was necessary to give the compilers of the directory some protection. After all,
directories raise classic public goods problems. The cost of creation is high, yet it is possible at
minimal extra cost for additional users to enjoy the same unit of the good thus created. In other
words, it is expensive to make and cheap to copy. The Court was not disposed to agree. Partly by
means of doctrinal line- drawing (copyright rather than unfair competition) and partly by means of
definitional fiat (telephone directories are not original, so in that sense nothing truly new is being
created), the Court moved away from the "sweat of the brow" theory and denied the compilers
copyright protection.
At first, it appears that the Feist opinion has nothing to tell us about economic analysis. On closer
inspection, it becomes apparent that the Court was not so much rejecting the commodity
perspective as it was changing the level of generality of the analysis. From Justice O'Connor's
perspective, it was the structure of copyright law as a whole that strikes the right balance between
the need to reward producers and the need to maintain competition and the free flow of
information. Since copyright law as a whole allows the commodification of expression but not the
ideas or facts which that expression contains, and since the Court finds this particular arrangement
of facts to be "unoriginal," no legally protected interest can be recognized. It is only once this
prior decision about the level of generality has been made that the questions of efficiency and
incentive can intelligibly be posed.
For all of these reasons, economic analysis of information regimes is extraordinarily indeterminate.
A person reading the confident statements of legal scholars about the superior efficiency of the
patent regime over the copyright regime,(92) or the economic inefficiency of insider trading
regulation(93)and of the law of fraud,(94) would be surprised to find that economists cannot agree
over the basic question of whether, in the absence of commodification, there will be under- or
over-investment in the production of information. Kenneth Arrow takes a position that seems to
support the Court's result in INS. He argues that without property rights, too little information
will be produced, because producers of information will not be able to capture its true
value.(95)Fama and Laffer, on the other hand, argue that too much information will be generated,
because some information will be produced only in order to gain a temporary advantage in
trading, thus redistributing wealth but not achieving greater allocative efficiency.(96)In other
words, in the absence of information property rights, there may be inefficient investment of social
resources in activities that merely slice the pie up differently, rather than making it bigger.
Hirshleifer gives a similar analysis of patent law, ending with the conclusion that patent law may
be either a necessary incentive for the production of inventions or an unnecessary legal monopoly
in information that overcompensates an inventor who has already had the opportunity to trade on
the information implied by his or her discovery.(97)It is hard to think of a more fundamental
uncertainty.(98)
It is my argument in this Article that much contemporary economic analysis conceals these
tensions, aporias, and empirically unverifiable assumptions by relying unconsciously on the notion
of the romantic author. I have tried to show that most issues in information economics could be
portrayed (in the absence of more detailed empirical information) as either public goods problems
for which the state has wisely chosen the remedy of commodification in order to avoid
underproduction or as potential monopolies in which intolerable transaction costs are introduced
into the free flow of information. In later Parts, I will argue that this choice is often concealed by
an implicit reliance on the author notion, a reliance that tends to push the analysis towards the
incentives/commodity vision of information. This could have serious negative consequences since
it will lead analysts (and governments) to support a greater commodification of information than
is actually warranted. Such a discourse could also be used cynically to protect existing
information monopolies. Economists would be mainly concerned by the possible efficiency losses
implicit in such a result. In the Conclusion, I argue that there are also profound distributional
issues which should concern us-particularly if we believe that information is becoming one of the
primary resources in the international economy.
So much for the theory. What about the facts? The empirical evidence, of which there is
surprisingly little, seems to justify these conclusions, or at least to cast doubt on current
assumptions about the level of international intellectual property protection necessary to promote
research and innovation. A historical, statistical study of the effect of patent protection on the
development of drugs in both developed and developing countries from 1950 to 1989 found:
[T]he existence of a patenting system is not a prerequisite for inventions.
. . . .
The relationship between patent systems and their influence on the inventive capacity of
developed countries was also tested. Two different tests using Yule's coefficient showed
conclusively that, for those countries in which nearly all inventions are made, the relationship is
not significant.
. . .The hypothesis that the number of inventions would increase along with the world-wide
increase in patent systems was also considered, but it was concluded that there is no significant
relationship between these two variables, either in the United States or in the world at large.(99)
The certainty of these conclusions warrants some skepticism. A small correlation (Yule's
association coefficient = 0.15) between patent protection and invention was observed in
developed countries.(100)As the authors observe, there is a much more significant correlation
between economic development and invention (Yule's association coefficient = 0.94).(101)Yet when
the question is what level of intellectual property rights to maintain domestically, the latter
correlation is of dubious relevance-at least for developed countries. On the other hand, the
absence of a strong correlation between patent and invention is significant, and the study certainly
tends to undermine the claims made by the developed world that a stronger international regime
of intellectual property is necessary to encourage innovation.
Finally, while all such studies warrant methodological skepticism, the studies that support
intellectual property protection seem even more problematic. One study estimated that without
patent protection sixty-five percent of new drugs produced by the U.S. pharmaceutical industry
would not have reached the market.(102) The analysis was based, however, on data supplied by the
pharmaceutical industry in response to a questionnaire on the impact of patent protection on
research and development. The problems with such a method are fairly obvious.
In another context, the paradoxes and empirical uncertainties of economic analysis might be of
mainly theoretical interest. In discussions of information, they are of immediate practical relevance
to almost every issue. In part this is because economists-to their great credit-have been in the
forefront of attempts to treat information holistically.(103)Another reason may lie in the perception
that information issues are somehow more "intangible." Escaping more easily from the absolutist,
formalist, and physicalist notions of tangible property, information has historically seemed more
amenable to a utilitarian calculus.(104)Consequently, these issues are often debated in economic
terms-both inside and outside the academy. When the U.S. Trade Representative argued that the
General Agreement on Trade and Tariffs (GATT) should be used to pressure other countries to
increase their levels of intellectual property protection, she turned to the language of necessary
economic incentives, rather than to the labor theory of property or the language of natural
rights.(105)Once again, the simplistic claim arises that more protection of intellectual property
means more innovation and invention.
There is another reason that economics shapes the debate of information issues. Neoclassical price
theory is not only the most sophisticated utilitarian language available, but also the one whose
disciplinary assumptions-consumer sovereignty, exogenous preferences, and so on-best reflect a
liberal vision of the production, distribution, and exchange of information.(106)The "marketplace of
ideas" is more than just a random metaphor: it is an accurate summation of many of the
assumptions that our society brings to the discussion of information issues. In a moment, I will
argue that this metaphor brings still more problems in its wake.
If microeconomics has become one of the most attractive languages in which to discuss questions
of information, then it is almost inevitable that the specific blindnesses(107) of economic analysis
will be replicated in information policy. Thus, to the particular difficulties of the economic analysis
of information are added the more general difficulties of the economic analysis of law-baseline
problems, wealth effects, and so on. These have been analyzed elsewhere, so I will not dwell on
them here.
To sum up, there are at least two types of theoretical problems in microeconomic analysis of
information. The first stems from the contradictory roles that information plays in the market and
in microeconomic theory- information as both perfect and imperfect, property rights in
information as both necessary incentives and dubious transaction costs, and so on. The second
type of problem stems from the conflict between the assumptions of microeconomic analysis and
actual social behavior. For example, when poor schoolchildren are convinced by relentless
advertising and peer pressure that they "need" hugely expensive basketball shoes, even a staunch
advocate of liberal economics may begin to doubt both the descriptive accuracy and prescriptive
fairness of an unswerving application of the norms of "consumer sovereignty" and "exogenous
preferences."(108)
What conclusions do we draw from the combination of these two theoretical problems? The
pessimistic conclusion would be that one of the most influential ways we have to discuss issues of
information is a theory so indeterminate that it frequently functions as a Rorschach blot for
dominant social beliefs and the prejudices of the analyst. At the same time, this theory tends
structurally to undervalue issues of power and inequality.
Call that the pessimistic conclusion. Is there an optimistic one? My answer would be a guarded
"maybe." It is a good idea to focus on incentives to production, on transaction costs, and on the
problems created by the presence or absence of legally protected interests. It is certainly a good
idea to try to discover actual effects of a particular regime of information regulation. By and large,
economists have not actually done this, but at least they have talked about it. The tendency of
economic analysis to go at least one layer below reified doctrinal concepts is also to be welcomed.
One could imagine a type of information economics that was sensitive to baseline errors,
offer-asking problems, and wealth effects, that questioned the reality of exogenous preferences,
and that openly acknowledged the tension between perfect information and "information as
commodity." If this economics also paid more attention than is currently fashionable to the
diminishing marginal utility of wealth, I, for one, would be pleased.
If all of these things were done, what epistemological status and practical effect would
information economics have? It would be a little less imperial, a lot more modest, and much more
empirical. Its conclusions would be more carefully hedged than they are now, and it would openly
declare its partiality-the inherent prejudices of any utilitarian, efficiency, or welfare- maximizing
calculus and the political consequences of the distinction between allocation and distribution.
To some, this judgment may seem strange in light of my claims that information economics is
beset by a basic paradox or aporia. If the discipline is truly paradoxical, surely it is useless?-no
matter how chastened its conclusions. The answer, I think, is that economics is only useless if one
makes a particular positivist and scientistic set of assumptions about the kind of knowledge a
theory has to provide in order to qualify as a theory. Admittedly, both professional economists
and economic analysts of law-and not merely those from the Chicago school-sound in their more
expansive moments as if they subscribe to those assumptions. But that is no reason for the rest of
us to do so. Neoclassical price theory is a valuable tool which enriches our understanding of the
world. Like all theoretical system it has blind spots and moments of formal "undecidability." Used
with an awareness of its paradoxes and its blind spots, an awareness of the unconscious process of
interpretive construction that conceals its indeterminacy, it would nevertheless be a valuable
theoretical tool. Seen this way, economics would be a spur to concentrate on incentives and
information flow, to worry about perverse motivations and unintended consequences. It would, in
short, be more a rough- and-ready set of analytical techniques and reminders than a Newtonian
science.
Whether or not this is the economics we should have, it is not the economics we have at the moment. With a few significant exceptions, we have an economics more like my pessimistic picture-an aporetic discipline which, as I hope to show in the rest of this Article, often conceals its indeterminacy through romance. To understand the origins of that romance, we must first look at the liberal conception of property...... END Of EXCERPT
The Economy of Mind on the Global Net
by John Perry Barlow"
If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of everyone, and the receiver cannot dispossess himself of it. Its peculiar character, too, is that no one possesses the less, because every other possesses the whole of it. He who receives an idea from me, receives instruction himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should freely spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature, when she made them, like fire, expansible over all space, without lessening their density at any point, and like the air in which we breathe, move, and have our physical being, incapable of confinement or exclusive appropriation. Inventions then cannot, in nature, be a subject of property."
--Thomas Jefferson
Throughout the time I've been groping around Cyberspace, there has remained unsolved an immense conundrum which seems to be at the root of nearly every legal, ethical, governmental, and social vexation to be found in the Virtual World. I refer to the problem of digitized property.
The riddle is this: if our property can be infinitely reproduced and instantaneously distributed all over the planet without cost, without our knowledge, without its even leaving our possession, how can we protect it? How are we going to get paid for the work we do with our minds? And, if we can't get paid, what will assure the continued creation and distribution of such work?
Since we don't have a solution to what is a profoundly new kind of challenge, and are apparently unable to delay the galloping digitization of everything not obstinately physical, we are sailing into the future on a sinking ship.
This vessel, the accumulated canon of copyright and patent law, was developed to convey forms and methods of expression entirely different from the vaporous cargo it is now being asked to carry. It is leaking as much from within as without.
Legal efforts to keep the old boat floating are taking three forms: a frenzy of deck chair rearrangement, stern warnings to the passengers that if she goes down, they will face harsh criminal penalties, and serene, glassy-eyed denial.
Intellectual property law cannot be patched, retrofitted, or expanded to contain the gasses of digitized expression any more than real estate law might be revised to cover the allocation of broadcasting spectrum. (Which, in fact, rather resembles what is being attempted here.) We will need to develop an entirely new set of methods as befits this entirely new set of circumstances.
Most of the people who actually create soft property--the programmers, hackers, and Net surfers--already know this. Unfortunately, neither the companies they work for nor the lawyers these companies hire have enough direct experience with immaterial goods to understand why they are so problematic. They are proceeding as though the old laws can somehow be made to work, either by grotesque expansion or by force. They are wrong.
The source of this conundrum is as simple as its solution is complex. Digital technology is detaching information from the physical plane, where property law of all sorts has always found definition.
Throughout the history of copyrights and patents, the proprietary assertions of thinkers have been focused not on their ideas but on the expression of those ideas. The ideas themselves, as well as facts about the phenomena of the world, were considered to be the collective property of humanity. One could claim franchise, in the case of copyright, on the precise turn of phrase used to convey a particular idea or the order in which facts were presented.
The point at which this franchise was imposed was that moment when the "word became flesh" by departing the mind of its originator and entering some physical object, whether book or widget. The subsequent arrival of other commercial media besides books didn't alter the legal importance of this moment. Law protected expression and, with few (and recent) exceptions, to express was to make physical.
Protecting physical expression had the force of convenience on its side. Copyright worked well because, Gutenberg notwithstanding, it was hard to make a book. Furthermore, books froze their contents into a condition which was as challenging to alter as it was to reproduce. Counterfeiting or distributing counterfeit volumes were obvious and visible activities, easy enough to catch somebody in the act of doing. Finally, unlike unbounded words or images, books had material surfaces to which one could attach copyright notices, publisher's marques, and price tags.
Mental to physical conversion was even more central to patent. A patent, until recently, was either a description of the form into which materials were to be rendered in the service of some purpose or a description of the process by which rendition occurred. In either case, the conceptual heart of patent was the material result. If no purposeful object could be rendered due to some material limitation, the patent was rejected. Neither a Klein bottle nor a shovel made of silk could be patented. It had to be a thing and the thing had to work.
Thus the rights of invention and authorship adhered to activities in the physical world. One didn't get paid for ideas but for the ability to deliver them into reality. For all practical purposes, the value was in the conveyance and not the thought conveyed.
In other words, the bottle was protected, not the wine.
Now, as information enters Cyberspace, the native home of Mind, these bottles are vanishing. With the advent of digitization, it is now possible to replace all previous information storage forms with one meta-bottle: complex--and highly liquid--patterns of ones and zeros.
Even the physical/digital bottles to which we've become accustomed, floppy disks, CD-ROM's, and other discrete, shrink-wrappable bit-packages, will disappear as all computers jack in to the global Net. While the Internet may never include every single CPU on the planet, it is more than doubling every year and can be expected to become the principal medium of information conveyance if, eventually, the only one.
Once that has happened, all the goods of the Information Age--all of the expressions once contained in books or film strips or records or newsletters--will exist either as pure thought or something very much like thought: voltage conditions darting around the Net at the speed of light, in conditions which one might behold in effect, as glowing pixels or transmitted sounds, but never touch or claim to "own" in the old sense of the word.
Some might argue that information will still require some physical manifestation, such as its magnetic existence on the titanic hard disks of distant servers, but these are bottles which have no macroscopically discrete or personally meaningful form.
Some will also argue that we have been dealing with unbottled expression since the advent of radio, and they would be right. But for most of the history of broadcast, there was no convenient way to capture soft goods from the electromagnetic ether and reproduce them in anything like the quality available in commercial packages. Only recently has this changed and little has been done legally or technically to address the change.
Generally, the issue of consumer payment for broadcast products was irrelevant. The consumers themselves were the product. Broadcast media were supported either by selling the attention of their audience to advertisers, using government to assess payment through taxes, or the whining mendicancy of annual donor drives.
All of the broadcast support models are flawed. Support either by advertisers or government has almost invariably tainted the purity of the goods delivered. Besides, direct marketing is gradually killing the advertiser support model anyway.
Broadcast media gave us a another payment method for a virtual product in the royalties which broadcasters pay songwriters through such organizations as ASCAP and BMI. But, as a member of ASCAP, I can assure you this is not a model which we should emulate. The monitoring methods are wildly approximate. There is no parallel system of accounting in the revenue stream. It doesn't really work. Honest.
In any case, without our old methods of physically defining the expression of ideas, and in the absence of successful new models for non-physical transaction, we simply don't know how to assure reliable payment for mental works. To make matters worse, this comes at a time when the human mind is replacing sunlight and mineral deposits as the principal source of new wealth.
Furthermore, the increasing difficulty of enforcing existing copyright and patent laws is already placing in peril the ultimate source of intellectual property, the free exchange of ideas.
That is, when the primary articles of commerce in a society look so much like speech as to be indistinguishable from it, and when the traditional methods of protecting their ownership have become ineffectual, attempting to fix the problem with broader and more vigorous enforcement will inevitably threaten freedom of speech.
The greatest constraint on your future liberties may come not from government but from corporate legal departments laboring to protect by force what can no longer be protected by practical efficiency or general social consent.
Furthermore, when Jefferson and his fellow creatures of The Enlightenment designed the system which became American copyright law, their primary objective was assuring the widespread distribution of thought, not profit. Profit was the fuel which would carry ideas into the libraries and minds of their new republic. Libraries would purchase books, thus rewarding the authors for their work in assembling ideas, which otherwise "incapable of confinement" would then become freely available to the public. But what is the role of libraries in the absense of books? How does society now pay for the distribution of ideas if not by charging for the ideas themselves?
Additionally complicating the matter is the fact that along with the physical bottles in which intellectual property protection has resided, digital technology is also erasing the legal jurisdictions of the physical world, and replacing them with the unbounded and perhaps permanently lawless seas of Cyberspace.
In Cyberspace, there are not only no national or local boundaries to contain the scene of a crime and determine the method of its prosecution, there are no clear cultural agreements on what a crime might be. Unresolved and basic differences between European and Asian cultural assumptions about intellectual property can only be exacerbated in a region where many transactions are taking place in both hemispheres and yet, somehow, in neither.
Even in the most local of digital conditions, jurisdiction and responsibility are hard to assess. A group of music publishers filed suit against Compuserve this fall for it having allowed its users to upload musical compositions into areas where other users might get them. But since Compuserve cannot practically exercise much control over the flood of bits which pass between its subscribers, it probably shouldn't be held responsible for unlawfully "publishing" these works.
Notions of property, value, ownership, and the nature of wealth itself are changing more
fundamentally than at any time since the Sumerians first poked cuneiform into wet clay and called
it stored grain. Only a very few people are aware of the enormity of this shift and fewer of them
are lawyers or public officials.
Those who do see these changes must prepare responses for the legal and social confusion which will erupt as efforts to protect new forms of property with old methods become more obviously futile, and, as a consequence, more adamant.
>From Swords to Writs to Bits
Humanity now seems bent on creating a world economy primarily based on goods which take no material form. In doing so, we may be eliminating any predictable connection between creators and a fair reward for the utility or pleasure others may find in their works.
Without that connection, and without a fundamental change in consciousness to accommodate its loss, we are building our future on furor, litigation, and institutionalized evasion of payment except in response to raw force. We may return to the Bad Old Days of property.
Throughout the darker parts of human history, the possession and distribution of property was a largely military matter. "Ownership" was assured those with the nastiest tools, whether fists or armies, and the most resolute will to use them. Property was the divine right of thugs.
By the turn of the First Millennium A.D., the emergence of merchant classes and landed gentry forced the development of ethical understandings for the resolution of property disputes. In the late Middle Ages, enlightened rulers like England's Henry II began to codify this unwritten "common law" into recorded canons. These laws were local, but this didn't matter much as they were primarily directed at real estate, a form of property which is local by definition. And which, as the name implied, was very real.
This continued to be the case as long as the origin of wealth was agricultural, but with dawning of the Industrial Revolution, humanity began to focus as much on means as ends. Tools acquired a new social value and, thanks to their own development, it became possible to duplicate and distribute them in quantity.
To encourage their invention, copyright and patent law were developed in most western countries. These laws were devoted to the delicate task of getting mental creations into the world where they could be used--and enter the minds of others--while assuring their inventors compensation for the value of their use. And, as previously stated, the systems of both law and practice which grew up around that task were based on physical expression.
Since it is now possible to convey ideas from one mind to another without ever making them physical, we are now claiming to own ideas themselves and not merely their expression. And since it is likewise now possible to create useful tools which never take physical form. we have taken to patenting abstractions, sequences of virtual events, and mathematical formulae--the most un-real estate imaginable.
In certain areas, this leaves rights of ownership in such an ambiguous condition that once again property adheres to those who can muster the largest armies. The only difference is that this time the armies consist of lawyers.
Threatening their opponents with the endless Purgatory of litigation, over which some might prefer death itself, they assert claim to any thought which might have entered another cranium within the collective body of the corporations they serve. They act as though these ideas appeared in splendid detachment from all previous human thought. And they pretend that thinking about a product is somehow as good as manufacturing, distributing, and selling it.
What was previously considered a common human resource, distributed among the minds and libraries of the world, as well as the phenomena of nature herself, is now being fenced and deeded. It is as though a new class of enterprise had arisen which claimed to own air and water.
What is to be done? While there is a certain grim fun to be had in it, dancing on the grave of copyright and patent will solve little, especially when so few are willing to admit that the occupant of this grave is even deceased and are trying to up by force what can no longer be upheld by popular consent.
The legalists, desperate over their slipping grip, are vigorously trying to extend it. Indeed, the United States and other proponants of GATT are making are making adherance to to our moribund systems of intellectual property protection a condition of membership in the marketplace of nations. For example, China will be denied Most Favored nation trading status unless they agree to uphold a set of cuturally alien principles which are no longer even sensibly applicable in their country of origin.
In a more perfect world, we'd be wise to declare a moratorium on litigation, legislation, and international treaties in this area until we had a clearer sense of the terms and conditions of enterprise in Cyberspace. Ideally, laws ratify already developed social consensus. They are less the Social Contract itself than a series of memoranda expressing a collective intent which has emerged out of many millions of human interactions.
Humans have not inhabited Cyberspace long enough or in sufficient diversity to have developed a Social Contract which conforms to the strange new conditions of that world. Laws developed prior to consensus usually serve the already established few who can get them passed and not society as a whole.
To the extent that either law or established social practice exists in this area, they are already in dangerous disagreement. The laws regarding unlicensed reproduction of commercial software are clear and stern...and rarely observed. Software piracy laws are so practically unenforceable and breaking them has become so socially acceptable that only a thin minority appears compelled, either by fear or conscience, to obey them.
I sometimes give speeches on this subject, and I always ask how many people in the audience can honestly claim to have no unauthorized software on their hard disks. I've never seen more than ten percent of the hands go up.
Whenever there is such profound divergence between the law and social practice, it is not society that adapts. And, against the swift tide of custom, the Software Publishers' current practice of hanging a few visible scapegoats is so obviously capricious as to only further diminish respect for the law.
Part of the widespread popular disregard for commercial software copyrights stems from a legislative failure to understand the conditions into which it was inserted. To assume that systems of law based in the physical world will serve in an environment which is as fundamentally different as Cyberspace is a folly for which everyone doing business in the future will pay.
As I will discuss in the next segment, unbounded intellectual property is very different from physical property and can no longer be protected as though these differences did not exist. For example, if we continue to assume that value is based on scarcity, as it is with regard to physical objects, we will create laws which are precisely contrary to the nature of information, which may, in many cases, increase in value with distribution.
The large, legally risk-averse institutions most likely to play by the old rules will suffer for their compliance. The more lawyers, guns, and money they invest in either protecting their rights or subverting those of their opponents, the more commercial competition will resemble the Kwakiutl Potlatch Ceremony, in which adversaries competed by destroying their own possessions. Their ability to produce new technology will simply grind to a halt as every move they make drives them deeper into a tar pit of courtroom warfare.
Faith in law will not be an effective strategy for high tech companies. Law adapts by continuous increments and at a pace second only to geology in its stateliness. Technology advances in the lunging jerks, like the punctuation of biological evolution grotesquely accelerated. Real world conditions will continue to change at a blinding pace, and the law will get further behind, more profoundly confused. This mismatch is permanent.
Promising economies based on purely digital products will either be born in a state of paralysis, as appears to be the case with multimedia, or continue in a brave and willful refusal by their owners to play the ownership game at all.
In the United States one can already see a parallel economy developing, mostly among small fast moving enterprises who protect their ideas by gettin g into the marketplace quicker then their larger competitors who base their protection on fear and litigation.
Perhaps those who are part of the problem will simply quarantine themselves in court while those who are part of the solution will create a new society based, at first, on piracy and freebooting. It may well be that when the current system of intellectual property law has collapsed, as seems inevitable, that no new legal structure will arise in its place.
But something will happen. After all, people do business. When a currency becomes meaningless, business is done in barter. When societies develop outside the law, they develop their own unwritten codes, practices, and ethical systems. While technology may undo law, technology offers methods for restoring creative rights.
A Taxonomy of Information
It seems to me that the most productive thing to do now is to look hard into the true nature of what we're trying to protect. How much do we really know about information and its natural behaviors?
What are the essential characteristics of unbounded creation? How does it differ from previous
forms of property? How many of our assumptions about it have actually been about its containers
rather than their mysterious contents? What are its different species and how does each of them
lend itself to control? What technologies will be useful in creating new virtual bottles to replace
the old physical ones?
Of course, information is, by its nature, intangible and hard to define. Like other such deep phenomena as light or matter, it is a natural host to paradox. And as it is most helpful to understand light as being both a particle and a wave, an understanding of information may emerge in the abstract congruence of its several different properties which might be described by the following three statements:
Information is an activity.
Information is a life form.
Information is a relationship.
In the following section, I will examine each of these.
I. INFORMATION IS AN ACTIVITY
Information Is a Verb, Not a Noun.
Freed of its containers, information is obviously not a thing. In fact, it is something which happens in the field of interaction between minds or objects or other pieces of information.
Gregory Bateson, expanding on the information theory of Claude Shannon, said, "Information is a
difference which makes a difference." Thus, information only really exists in the É [delta]. The
making of that difference is an activity within a relationship. Information is an action which
occupies time rather than a state of being which occupies physical space, as is the case with hard
goods. It is the pitch, not the baseball, the dance, not the dancer.
Information Is Experienced, Not Possessed
Even when it has been encapsulated in some static form like a book or a hard disk, information is still something which happens to you as you mentally decompress it from its storage code. But, whether it's running at gigabits per second or words per minute, the actual decoding is a process which must be performed by and upon a mind, a process which must take place in time.
There was a cartoon in the Bulletin of Atomic Scientists a few years ago which illustrated this point beautifully. In the drawing, a holdup man trains his gun on the sort of bespectacled fellow you'd figure might have a lot of information stored in his head. "Quick," orders the bandit, "Give me all your ideas."
Information Has To Move
Sharks are said to die of suffocation if they stop swimming, and the same is nearly true of
information. Information which isn't moving ceases to exist as anything but potential...at least
until it is allowed to move again. For this reason, the practice of information hoarding, common in
bureaucracies, is an especially wrong-headed artifact of physically-based value systems.
Information is Conveyed by Propagation, Not Distribution
The way in which information spreads is also very different from the distribution of physical goods. It moves more like something from nature than from a factory. It can concatenate like falling dominos or grow in the usual fractal lattice, like frost spreading on a window, but it cannot be shipped around like widgets, except to the extent that it can be contained in them. It doesn't simply move on. It leaves a trail of itself everywhere it's been.
The central economic distinction between information and physical property is the ability of
information to be transferred without leaving the possession of the original owner. If I sell you my
horse, I can't ride him after that. If I sell you what I know, we both know it.
II. INFORMATION IS A LIFE FORM
Information wants to be free.
Stewart Brand is generally credited with this elegant statement of the obvious, recognizing both the natural desire of secrets to be told and the fact that they might be capable of possessing something like a "desire" in the first place.
English Biologist and Philosopher Richard Dawkins proposed the idea of "memes," self-replicating, patterns of information which propagate themselves across the ecologies of mind, saying they were like life forms.
I believe they are life forms in every respect but a basis in the carbon atom. They self-reproduce, they interact with their surroundings and adapt to them, they mutate, they persist. Like any other life form they evolve to fill the possibility spaces of their local environments, which are, in this case the surrounding belief systems and cultures of their hosts, namely, us.
Indeed, the sociobiologists like Dawkins make a plausible case that carbon-based life forms are
information as well, that, as the chicken is an egg's way of making another egg, the entire
biological spectacle is just the DNA molecule's means of copying out more information strings
exactly like itself.
Information Replicates into the Cracks of Possibility
Like DNA helices, ideas are relentless expansionists, always seeking new opportunities for lebensraum. And, as in carbon-based nature, the more robust organisms are extremely adept at finding new places to live. Thus, just as the common housefly has insinuated itself into practically every ecosystem on the planet, so has the meme of "life after death" found a niche in most minds, or psycho-ecologies.
The more universally resonant an idea or image or song , the more minds it will enter and remain
within. Trying to stop the spread of a really robust piece of information is about as easy as
keeping killer bees South of the Border. The stuff just leaks.
Information Wants To Change
If ideas and other interactive patterns of information are indeed life forms, they can be expected to evolve constantly into forms which will be more perfectly adapted to their surroundings. And, as we see, they are doing this all the time.
But for a long time, our static media, whether carvings in stone, ink on paper, or dye on celluloid, have strongly resisted the evolutionary impulse, exalting as a consequence the author's ability to determine the finished product. But, as in an oral tradition, digitized information has no "final cut."
Digital information, unconstrained by packaging, is a continuing process more like the metamorphosing tales of prehistory than anything which will fit in shrink wrap. From the Neolithic to Gutenberg, information was passed on, mouth to ear, changing with every re-telling (or re-singing). The stories which once shaped our sense of the world didn't have authoritative versions. They adapted to each culture in which they found themselves being told.
Because there was never a moment when the story was frozen in print, the so-called "moral" right of storytellers to keep the tale their own was neither protected nor recognized. The story simply passed through each of them on its way to the next, where it would assume a different form. As we return to continuous information, we can expect the importance of authorship to diminish. Creative people may have to renew their acquaintance with humility.
But our system of copyright makes no accomodation whatever for expressions which don't at some point become "fixed" nor for cultural expressions which lack a specific author or inventor.
Jazz improvizations, standup comedy routines, mime performances, developing monologues, and unrecorded broadcast transmissions all lack the Constitutional requirement of fixation as a "writing". Without being fixed by a point of publicatoin the liquid works of the future will all look more like these continuously adapting and changing forms and will therefore exist beyond the reach of copyright.
Copyright expert Pamela Samuelson tells of having attended a conference last year convened around the fact that Western countries may legally appropriate the music, designs, and biomedical lore of aboriginal people without compensation to their tribe of origin since that tribe is not an "author" or "inventor."
But soon most information will be generated collaboratively by the cyber-tribal hunter-gatherers of Cyberspace. Our arrogant legal dismissal of the rights of "primitives" will be back to haunt us soon.
Information is Perishable
With the exception of the rare classic, most information is like farm produce. Its quality degrades rapidly both over time and in distance from the source of production. But even here, value is highly subjective and conditional. Yesterday's papers are quite valuable to the historian. In fact, the older they are, the more valuable they become. On the other hand, a commodities broker might consider news of an event which is more than an hour old to have lost any relevance.
III. INFORMATION IS A RELATIONSHIP
Meaning Has Value and Is Unique to Each Case
In most cases, we assign value to information based on its meaningfulness. The place where information dwells, the holy moment where transmission becomes reception, is a region which has many shifting characteristics and flavors depending on the relationship of sender and receiver, the depth of their interactivity.
Each such relationship is unique. Even in cases where the sender is a broadcast medium, and no response is returned, the receiver is hardly passive. Receiving information is often as creative an act as generating it.
The value of what is sent depends entirely on the extent to which each individual receiver has the receptors...shared terminology, attention, interest, language, paradigm...necessary to render what is received meaningful.
Understanding is a critical element increasingly overlooked in the effort to turn information into a commodity. Data may be any set of facts, useful or not, intelligible or inscrutable, germane or irrelevant. Computers can crank out new data all night long without human help, and the results may be offered for sale as information. They may or may not actually be so. Only a human being can recognize the meaning which separates information from data.
In fact, information, in the economic sense of the word, consists of data which have been passed
through a particular human mind and found meaningful within that mental context. One fella's
information is all just data to someone else. If you're an anthropologist, my detailed charts of
Tasaday kinship patterns might be critical information to you. If you're a banker from Hong Kong,
they might barely seem to be data.
Familiarity Has More Value Than Scarcity,
With physical goods, there is a direct correlation between scarcity and value. Gold is more valuable than wheat, even though you can't eat it. While this is not always the case, the situation with information is usually precisely the reverse. Most soft goods increase in value as they become more common. Familiarity is an important asset in the world of information. It may often be the case that the best thing you can do to raise the demand for your product is to give it away.
While this has not always worked with shareware, it could be argued that there is a connection between the extent to which commercial software is pirated and the amount which gets sold. Broadly pirated software, such as Lotus 1-2-3 or WordPerfect, becomes a standard and benefits from Law of Increasing Returns based on familiarity.
In regard to my own soft product, rock and roll songs, there is no question that the band I write them for, the Grateful Dead, has increased its popularity enormously by giving them away. We have been letting people tape our concerts since the early seventies, but instead of reducing the demand for our product, we are now the largest concert draw in America, a fact which is at least in part attributable to the popularity generated by those tapes.
True, I don't get any royalties on the millions of copies of my songs which have been extracted from concerts, but I see no reason to complain. The fact is, no one but the Grateful Dead can perform a Grateful Dead song, so if you want the experience and not its thin projection, you have to buy a ticket from us. In other words, our intellectual property protection derives from our being the only real-time source of it.
Exclusivity Has Value
The problem with a model which turns the physical scarcity/value ratio on its head is that sometimes the value of information is very much based on its scarcity. Exclusive possession of certain facts makes them more useful. If everyone knows about conditions which might drive a stock price up, the information is valueless.
But again, the critical factor is usually time. It doesn't matter if this kind of information eventually becomes ubiquitous. What matters is being among the first who possess it and act on it. While potent secrets usually don't stay secret, they may remain so long enough to advance the cause of their original holders.
Point of View and Authority Have Value
In a world of floating realities and contradictory maps, rewards will accrue to those commentators whose maps seem to fit their territory snugly, based on their ability to yield predictable results for those who use them.
In aesthetic information, whether poetry or rock 'n' roll, people are willing to buy the new product of an artist, sight-unseen, based on their having been delivered a pleasurable experience by previous work.
Reality is an edit. People are willing to pay for the authority of those editors whose filtering point
of view seems to fit best. And again, point of view is an asset which cannot be stolen or
duplicated. No one but Esther Dyson sees the world as she does and the handsome fee she
charges for her newsletter is actually for the privilege of looking at the world through her unique eyes.
Time Replaces Space
In the physical world, value depends heavily on possession, or proximity in space. One owns that material which falls inside certain dimensional boundaries and the ability to act directly, exclusively, and as one wishes upon what falls inside those boundaries is the principal right of ownership. And of course there is the relationship between value and scarcity, a limitation in space.
In the virtual world, proximity in time is a value determinant. An informational product is generally more valuable the closer the purchaser can place himself to the moment of its expression, a limitation in time. Many kinds of information degrade rapidly with either time or reproduction. Relevance fades as the territory they map changes. Noise is introduced and bandwidth lost with passage away from the point where the information is first produced.
Thus, listening to a Grateful Dead tape is hardly the same experience as attending a Grateful Dead concert. The closer one can get to the headwaters of an informational stream, the better his changes of finding an accurate picture of reality in it. In an era of easy reproduction, the informational abstractions of popular experiences will propagate out from their source moments to reach anyone who's interested. But it's easy enough to restrict the real experience of the desirable event, whether knock-out punch or guitar lick, to those willing to pay for being there.
The Protection of Execution
In the hick town I come from, they don't give you much credit for just having ideas. You are judged by what you can make of them. As things continue to speed up, I think we see that execution is the best protection for those designs which become physical products. Or, as Steve Jobs once put it, "Real artists ship." The big winner is usually the one who gets to the market first (and with enough organizational force to keep the lead).
But, as we become fixated upon information commerce, many of us seem to think that originality
alone is sufficient to convey value, deserving, with the right legal assurances, of a steady wage. In
fact, the best way to protect intellectual property is to act on it. It's not enough to invent and
patent, one has to innovate as well. Someone claims to have patented the microprocessor before
Intel. Maybe so. If he'd actually started shipping microprocessors before Intel, his claim would
seem far less spurious.
Information as Its Own Reward
It is now a commonplace to say that money is information. With the exception of Krugerands, crumpled cab-fare, and the contents of those suit-cases which drug lords are reputed to carry, most of the money in the informatized world is in ones and zeros. The global money supply sloshes around the Net, as fluid as weather. It is also obvious, as I have discussed, that information has become as fundamental to the creation of modern wealth as land and sunlight once were.
What is less obvious is the extent to which information is acquiring intrinsic value, not as a means to acquisition but as the object to be acquired. I suppose this has always been less explicitly the case. In politics and academia, potency and information have always been closely related.
However, as we increasingly buy information with money, we begin to see that buying information with other information is simple economic exchange without the necessity of converting the product into and out of currency. This is somewhat challenging for those who like clean accounting, since, information theory aside, informational exchange rates are too squishy to quantify to the decimal point.
Nevertheless, most of what a middle class American purchases has little to do with survival. We buy beauty, prestige, experience, education, and all the obscure pleasures of owning. Many of these things can not only be expressed in non-material terms, they can be acquired by non-material means.
And then there are the inexplicable pleasures of information itself, the joys of learning, knowing, and teaching. The strange good feeling of information coming into and out of oneself. Playing with ideas is a recreation which people must be willing to pay a lot for, given the market for books and elective seminars. We'd likely spend even more money for such pleasures if there weren't so many opportunities to pay for ideas with other ideas.
This explains much of the collective "volunteer" work which fills the archives, newsgroups, and databases of the Internet. Its denizens are not working for 'nothing," as is widely believed. Rather they are getting paid in something besides money. It is an economy which consists almost entirely of information.
This may become the dominant form of human trade, and if we persist in modeling economics on
a strictly monetary basis, we may be gravely misled.
Getting Paid in Cyberspace
How all the foregoing relates to solutions to the crisis in intellectual property is something I've barely started to wrap my mind around. It's fairly paradigm-warping to look at information through fresh eyes--to see how very little it is like pig iron or pork bellies, to imagine the tottering travesties of case law we will stack up if we go on treating it legally as though it were.
As I've said, I believe these towers of outmoded boilerplate will be a smoking heap sometime in the next decade and we mind miners will have no choice but to cast our lot with new systems that work.
I'm not really so gloomy about our prospects as readers of this jeremiad so far might conclude. Solutions will emerge. Nature abhors a vacuum and so does commerce.
Indeed, one of the aspects of the electronic frontier which I have always found most appealing--and the reason Mitch Kapor and I used that phrase in naming our foundation--is the degree to which it resembles the 19th Century American West in its natural preference for social devices which emerge from it conditions rather than those which are imposed from the outside.
Until the west was fully settled and "civilized" in this century, order was established according to an unwritten Code of the West which had the fluidity of etiquette rather than the rigidity of law. Ethics were more important than rules. Understandings were preferred over laws, which were, in any event, largely unenforceable.
I believe that law, as we understand it, was developed to protect the interests which arose in the two economic "waves" which Alvin Toffler accurately identified in The Third Wave. The First Wave was agriculturally based and required law to order ownership of the principal source of production, land. In the Second Wave, manufacturing became the economic mainspring, and the structure of modern law grew around the centralized institutions which needed protection for their reserves of capital, manpower, and hardware.
Both of these economic systems required stability. Their laws were designed to resist change and to assure some equability of distribution within a fairly static social framework. The possibility spaces had to be constrained to preserve the predictability necessary to either land stewardship or capital formation.
In the Third Wave we have now entered, information to a large extent replaces land, capital, and hardware, and as I have detailed in the preceding section, information is most at home in a much more fluid and adaptable environment. The Third Wave is likely to bring a fundamental shift in the purposes and methods of law which will affect far more than simply those statutes which govern intellectual property.
The "terrain" itself--the architecture of the Net--may come to serve many of the purposes which could only be maintained in the past by legal imposition. For example, it may be unnecessary to constitutionally assure freedom of expression in an environment which, in the words of my fellow EFF co-founder John Gilmore, "treats censorship as a malfunction" and re-routes proscribed ideas around it.
Similar natural balancing mechanisms may arise to smooth over the social discontinuities which previously required legal intercession to set right. On the Net, these differences are more likely to be spanned by a continuous spectrum which connects as much as it separates.
And, despite their fierce grip on the old legal structure, companies which trade in information are likely to find that in their increasing inability to deal sensibly with technological issues, the courts will not produce results which are predictable enough to be supportive of long-term enterprise. Every litigation becomes like a game of Russian roulette, depending on the depth the presiding judge's clue-impairment.
Uncodified or adaptive "law," while as "fast, loose, and out of control" as other emergent forms, is probably more likely to yield something like justice at this point. In fact, one can already see in development new practices to suit the conditions of virtual commerce. The life forms of information are evolving methods to protect their continued reproduction.
For example, while all the tiny print on a commercial diskette envelope punctiliously requires much of those who would open it, there are, as I say, few who read those provisos, let alone follow them to the letter. And yet, the software business remains a very healthy sector of the American economy.
Why is this? Because people seem to eventually buy the software they really use. Once a program becomes central to your work, you want the latest version of it, the best support, the actual manuals, all privileges which are attached to ownership. Such practical considerations will, in the absence of working law, become more and more important in important in getting paid for what might easily be obtained for nothing.
I do think that some software is being purchased in the service of ethics or the abstract awareness that the failure to buy it will result in its not being produced any longer, but I'm going to leave those motivators aside. While I believe that the failure of law will almost certainly result in a compensating re-emergence of ethics as the ordering template of society, this is a belief I don't have room to support here.
Instead, I think that, as in the case cited above, compensation for soft products will be driven primarily by practical considerations, all of them consistent with the true properties of digital information, where the value lies in it, and how it can be both manipulated and protected by technology.
While the conundrum remains a conundrum, I can begin to see the directions from which
solutions may emerge, based in part on broadening those practical solutions which are already in practice.
Relationship and Its Tools
I believe one idea is central to understanding liquid commerce: Information economics, in the absence of objects, will be based more on relationship than possession.
One existing model for the future conveyance of intellectual property is real time performance, a medium currently used only in theater, music, lectures, stand-up comedy and pedagogy. I believe the concept of performance will expand to include most of the information economy from multi-casted soap operas to stock analysis. In these instances, commercial exchange will be more like ticket sales to a continuous show than the purchase of discrete bundles of that which is being shown.
The other model, of course, is service. The entire professional class--doctors, lawyers, consultants, architects, etc.--are already being paid directly for their intellectual property. Who needs copyright when you're on a retainer?
In fact, this model was applied to much of what is now copyrighted until the late 18th Century. Before the industrialization of creation, writers, composers, artists, and the like produced their products in the private service of patrons. Without objects to distribute in a mass market, creative people will return to a condition somewhat like this, except that they will serve many patrons, rather than one.
We can already see the emergence of companies which base their existence on supporting and enhancing the soft property they create rather than selling it by the shrink-wrapped piece or embedding it in widgets.
Trip Hawkins' new company for creating and licensing multimedia tools, 3DO, is an example of what I'm talking about. 3DO doesn't intend to produce any commercial software or consumer devices. Instead, they will act as a kind of private standards setting body, mediating among software and device creators who will be their licensees. They will provide a point of commonalty for relationships between a broad spectrum of entities.
In any case, whether you think of yourself as a service provider or a performer, the future protection of your intellectual property will depend on your ability to control your relationship to the market--a relationship which will most likely live and grow over a period of time.
The value of that relationship will reside in the quality of performance, the uniqueness of your
point of view, the validity of your expertise, its relevance to your market, and, underlying
everything, the ability of that market to access your creative services swiftly, conveniently, and interactively.
Interaction and Protection
Direct interaction will provide a lot of intellectual property protection in the future, and, indeed, it already has. No one knows how many software pirates have bought legitimate copies of a program after calling its publisher for technical support and being asked for some proof of purchase, but I would guess the number is very high.
The same kind of controls will be applicable to "question and answer" relationships between authorities (or artists) and those who seek their expertise. Newsletters, magazines, and books will be supplemented by the ability of their subscribers to ask direct questions of authors.
Interactivity will be a billable commodity even in the absence of authorship. As people move into the Net and increasingly get their information directly from its point of production, unfiltered by centralized media, they will attempt to develop the same interactive ability to probe reality which only experience has provided them in the past. Live access to these distant "eyes and ears" will be much easier to cordon than access to static bundles of stored but easily reproducible information.
In most cases, control will be based on restricting access to the freshest, highest bandwidth information. It will be a matter of defining the ticket, the venue, the performer, and the identity of the ticket holder, definitions which I believe will take their forms from technology, not law.
In most cases, the defining technology will be cryptography.
Crypto Bottling
Cryptography, as I've said perhaps too many times, is the "material" from which the walls, boundaries--and bottles--of Cyberspace will be fashioned.
Of course there are problems with cryptography or any other purely technical method of property protection. It has always appeared to me that the more security you hide your goods behind, the more likely you are to turn your sanctuary into a target. Having come from a place where people leave their keys in their cars and don't even have keys to their houses, I remain convinced that the best obstacle to crime is a society with its ethics intact.
While I admit that this is not the kind of society most of us live in, I also believe that a social over-reliance on protection by barricades rather than conscience will eventually wither the latter by turning intrusion and theft into a sport, rather than a crime. This is already occurring in the digital domain as is evident in the activities of computer crackers.
Furthermore, I would argue that initial efforts to protect digital copyright by copy protection contributed to the current condition in which most otherwise ethical computer users seem morally untroubled by their possession of pirated software.
Instead of cultivating among the newly computerized a sense of respect for the work of their fellows, early reliance on copy protection led to the subliminal notion that cracking into a software package somehow "earned" one the right to use it. Limited not by conscience but by technical skill, many soon felt free to do whatever they could get away with. This will continue to be a potential liability of the encryption of digitized commerce.
Furthermore, it's cautionary to remember that copy protection was rejected by the market in most areas. Many of the upcoming efforts to use cryptography-based protection schemes will probably suffer the same fate. People are not going to tolerate much which makes computers harder to use than they already are without any benefit to the user.
Nevertheless, encryption has already demonstrated a certain blunt utility. New subscriptions to various commercial satellite TV services sky-rocketed recently after their deployment of more robust encryption of their feeds. This, despite a booming backwoods trade in black decoder chips conducted by folks who'd look more at home running moonshine than cracking code.
Another obvious problem with encryption as a global solution is that once something has been unscrambled by a legitimate licensee, it may be openly available to massive reproduction.
In some instances, reproduction following decryption may not be a problem. Many soft products degrade sharply in value with time. It may be that the only real interest in some such products will be among those who have purchased the keys to immediacy.
Furthermore, as software becomes more modular and distribution moves online, it will begin to metamorphose in direct interaction with its user base. Discontinuous upgrades will smooth into a constant process of incremental improvement and adaptation, some of it man-made and some of it arising through genetic algorithms. Pirated copies of software may become too static to have much value to anyone.
Even in cases such as images, where the information is expected to remain fixed, the unencrypted file could still be interwoven with code which could continue to protect it by a wide variety of means.
In most of the schemes I can project, the file would be "alive" with permanently embedded software which could "sense" the surrounding conditions and interact with them, For example, it might contain code which could detect the process of duplication and cause it to self-destruct.
Other methods might give the file the ability to "phone home" through the Net to its original owner. The continued integrity of some files might require periodic "feeding" with digital cash from their host, which they would then relay back to their authors.
Of course files which possess the independent ability to communicate upstream sound uncomfortably like the Morris Internet Worm. "Live" files do have a certain viral quality. And serious privacy issues would arise if everyone's computer were packed with digital spies.
The point is that cryptography will enable a lot of protection technologies which will develop rapidly in the obsessive competition which has always existed between lock-makers and lock-breakers.
But cryptography will not be used simply for making locks. It is also at the heart of both digital signatures and the afore-mentioned digital cash, both of which I believe will be central to the future protection of intellectual property.
I believe that the generally acknowledged failure of the shareware model in software had less to do with dishonesty than with the simple inconvenience of paying for shareware. If the payment process can be automated, as digital cash and signature will make possible, I believe that soft product creators will reap a much higher return from the bread they cast upon the waters of Cyberspace.
Moreover, they will be spared much of the overhead which presently adheres to the marketing, manufacture, sales, and distribution of information products, whether those products are computer programs, books, CD's, or motion pictures. This will reduce prices and further increase the likelihood of non-compulsory payment.
But of course there is a fundamental problem with a system which requires, through technology, payment for every access to a particular expression. It defeats the original Jeffersonian purpose of seeing that ideas were available to everyone regardless of their economic station. I am not comfortable with a model which will restrict inquiry to the wealthy.
An Economy of Verbs
The future forms and protections of intellectual property are densely obscured from the entrance to the Virtual Age. Nevertheless, I can make (or reiterate) a few flat statements which I earnestly believe won't look too silly in fifty years.
In the absence of the old containers, almost everything we think we know about intellectual property is wrong. We are going to have to unlearn it. We are going to have to look at information as though we'd never seen the stuff before.
The protections which we will develop will rely far more on ethics and technology than on law.
Encryption will be the technical basis for most intellectual property protection. (And should, for this and other reasons, be made more widely available.)
The economy of the future will be based on relationship rather than possession. It will be continuous rather than sequential.
And finally, in the years to come, most human exchange will be virtual rather than physical, consisting not of stuff but the stuff of which dreams are made. Our future business will be conducted in a world made more of verbs than nouns.
Ojo Caliente, New Mexico, October 1, 1992
New York, New York, November 6, 1992
Brookline, Massachusetts, November 8, 1992
New York, New York, November 15, 1993
San Francisco, California, November 20, 1993
Pinedale, Wyoming, November 24-30, 1993
New York, New York, December 13-14, 1993
This expression has lived and grown to this point over the time period and in the places detailed above. Despite its print publication here, I expect it will continue to evolve in liquid form, possibly for years.
The thoughts in it have not been "mine" alone but have assembled themselves in a field of interaction which has existed between myself and numerous others, to whom I am grateful. They particularly include: Pamela Samuelson, Kevin Kelly, Mitch Kapor, Mike Godwin, Stewart Brand, Mike Holderness, Miram Barlow, Danny Hillis, Trip Hawkins, and Alvin Toffler.
However, I should note in honesty that when Wired sends me a check for having temporarily "fixed" it on their pages, I alone will cash it...
INTERNATIONAL NEWS SERVICE v. THE ASSOCIATED PRESS
SUPREME COURT OF THE UNITED STATES
28 U.S. 215; 63 L. Ed. 211; 39 S. Ct. 68; 2 A.L.R. 293
Argued May 2, 3, 1918
December 23, 1918
OPINIONBY: PITNEY
OPINION: [*229] [***69] [**216] MR. JUSTICE PITNEY delivered the opinion of the court.
The parties are competitors in the gathering and distribution of news and its publication for profit in newspapers throughout the United States. The Associated Press, which was complainant in the District Court, is a cooperative organization, incorporated under the Membership Corporations Law of the State of New York, its members being individuals who are either proprietors or representatives [**217] of about 950 daily newspapers published in all parts of the United States. That a corporation may be organized under that act for the purpose of gathering news for the use and benefit of its members and for publication in newspapers owned or represented by them, is recognized by an amendment enacted in 1901 (Laws N.Y. 1901, c. 436). Complainant gathers in all parts of the world, by means of various instrumentalities of its own, by exchange with its members, and by other appropriate means, news and intelligence of current and recent events of interest to newspaper readers and distributes it daily to its members for publication in their newspapers. The cost of the service, amounting approximately to $ 3,500,000 per annum, is assessed upon the members and becomes a part of their costs of operation, to be recouped, presumably with profit, through [*230] the publication of their several newspapers. Under complainant's by-laws each member agrees upon assuming membership that news received through complainant's service is received exclusively for publication in a particular newspaper, language, and place specified in the certificate of membership, that no other use of it shall be permitted, and that no member shall furnish or permit anyone in his employ or connected with his newspaper to furnish any of complainant's news in advance of publication to any person not a member. And each member is required to gather the local news of his district and supply it to the Associated Press and to no one else.
Defendant is a corporation organized under the laws of the State of New Jersey, whose business is the gathering and selling of news to its customers and clients, consisting of newspapers published throughout the United States, under contracts by which they pay certain amounts at stated times for defendant's service. It has wide-spread news-gathering agencies; the cost of its operations amounts, it is said, to more than $ 2,000,000 per annum; and it serves about 400 newspapers located in the various cities of the United States and abroad, a few of which are represented, also, in the membership of the Associated Press.
The parties are in the keenest competition between themselves in the distribution of news throughout the United States; and so, as a rule, are the newspapers that they serve, in their several districts.
Complainant in its bill, defendant in its answer, have set forth in almost identical terms the rather obvious circumstances and conditions under which their business is conducted. The value of the service, and of the news furnished, depends upon the promptness of transmission, as well as upon the accuracy and impartiality of the news; it being essential that the news be transmitted to members or subscribers as early or earlier than similar information can be furnished to competing newspapers [*231] by other news services, and that the news furnished by each agency shall not be furnished to newspapers which do not contribute to the expense of gathering it. And further, to quote from the answer: "Prompt knowledge and publication of world-wide news is essential to the conduct of a modern newspaper, and by reason of the enormous expense incident to the gathering and distribution of such news, the only practical way in which a proprietor of a newspaper can obtain the same is, either through cooperation with a considerable number of other newspaper proprietors in the work of collecting and distributing such news, and the equitable division with them of the expenses thereof, or by the purchase of such news from some existing agency engaged in that business."
The bill was filed to restrain the pirating of complainant's news by defendant in three ways: First, by bribing employees of newspapers published by complainant's members to furnish Associated Press news to defendant before publication, for transmission by telegraph and telephone to defendant's clients for publication by them; Second, by [***70] inducing Associated Press members to violate its by-laws and permit defendant to obtain news before publication; and Third, by copying news from bulletin boards and from early editions of complainant's newspapers and selling this, either bodily or after rewriting it, to defendant's customers.
The District Court, upon consideration of the bill and answer, with voluminous affidavits on both sides, granted a preliminary injunction under the first and second heads; but refused at that stage to restrain the systematic practice admittedly pursued by defendant, of taking news bodily from the bulletin boards and early editions of complainant's newspapers and selling it as its own. The court expressed itself as satisfied that this practice amounted to unfair trade, but as the legal question was [*232] one of first impression it considered that the allowance of an injunction should await the outcome of an appeal. 240 Fed. Rep. 983, 996. Both parties having appealed, the Circuit Court of Appeals sustained the injunction [**218] order so far as it went, and upon complainant's appeal modified it and remanded the cause with directions to issue an injunction also against any bodily taking of the words or substance of complainant's news until its commercial value as news had passed away. 245 Fed. Rep. 244, 253. The present writ of certiorari was then allowed. 245 U.S. 644.
The only matter that has been argued before us is whether defendant may lawfully be restrained from appropriating news taken from bulletins issued by complainant or any of its members, or from newspapers published by them, for the purpose of selling it to defendant's clients. Complainant asserts that defendant's admitted course of conduct in this regard both violates complainant's property right in the news and constitutes unfair competition in business. And notwithstanding the case has proceeded only to the stage of a preliminary injunction, we have deemed it proper to consider the underlying questions, since they go to the very merits of the action and are presented upon facts that are not in dispute. As presented in argument, these questions are: 1. Whether there is any property in news; 2. Whether, if there be property in news collected for the purpose of being published, it survives the instant of its publication in the first newspaper to which it is communicated by the news-gatherer; and 3. Whether defendant's admitted course of conduct in appropriating for commercial use matter taken from bulletins or early editions of Associated Press publications constitutes unfair competition in trade.
The federal jurisdiction was invoked because of diversity of citizenship, not upon the ground that the suit arose under the copyright or other laws of the United [*233] States. Complainant's news matter is not copyrighted. It is said that it could not, in practice, be copyrighted, because of the large number of dispatches that are sent daily; and, according to complainant's contention, news is not within the operation of the copyright act. Defendant, while apparently conceding this, nevertheless invokes the analogies of the law of literary property and copyright, insisting as its principal contention that, assuming complainant has a right of property in its news, it can be maintained (unless the copyright act be complied with) only by being kept secret and confidential, and that upon the publication with complainant's consent of uncopyrighted news by any of complainant's members in a newspaper or upon a bulletin board, the right of property is lost, and the subsequent use of the news by the public or by defendant for any purpose whatever becomes lawful.
A preliminary objection to the form in which the suit is brought may be disposed of at the outset. It is said that the Circuit Court of Appeals granted relief upon considerations applicable to particular members of the Associated Press, and that this was erroneous because the suit was brought by complainant as a corporate entity, and not by its members; the argument being that their interests cannot be protected in this proceeding any more than the individual rights of a stockholder can be enforced in an action brought by the corporation. From the averments of the bill, however, it is plain that the suit in substance was brought for the benefit of complainant's members, and that they would be proper parties, and, except for their numbers, perhaps necessary parties. Complainant is a proper party to conduct the suit as representing their interest; and since no specific objection, based upon the want of parties, appears to have been made below, we will treat the objection as waived. See Equity Rules 38, 43, 44.
[*234] In considering the general question of property in news matter, it is necessary to recognize its dual character, distinguishing between the substance of the information and the particular form or collocation of words in which the writer has communicated it.
No doubt news articles often possess a literary quality, and are the subject of literary property at the common law; nor do we question that such an article, as a literary production, is the subject of copyright by the terms of the act as it now stands. In an early case at the circuit Mr. Justice Thompson held in effect that a newspaper was not within the protection of the copyright acts of 1790 and 1802 (Clayton v. Stone, 2 Paine, 382; 5 Fed. Cas. No. 2872). But the present act is broader; it provides that the works for which copyright may be secured shall include "all the writings of an author," and specifically mentions [***71] "periodicals, including newspapers." Act of March 4, 1909, c. 320, @@ 4 and 5, 35 Stat. 1075, 1076. Evidently this admits to copyright a contribution to a newspaper, notwithstanding it also may convey news; and such is [**219] the practice of the copyright office, as the newspapers of the day bear witness. See Copyright Office Bulletin No. 15 (1917), pp. 7, 14, 16-17.
But the news element -- the information respecting current events contained in the literary production -- is not the creation of the writer, but is a report of matters that ordinarily are publici juris; it is the history of the day. It is not to be supposed that the framers of the Constitution, when they empowered Congress "to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries" (Const., Art I, @ 8, par. 8), intended to confer upon one who might happen to be the first to report a historic event the exclusive right for any period to spread the knowledge of it.
We need spend no time, however, upon the general [*235] question of property in news matter at common law, or the application of the copyright act, since it seems to us the case must turn upon the question of unfair competition in business. And, in our opinion, this does not depend upon any general right of property analogous to the common-law right of the proprietor of an unpublished work to prevent its publication without his consent; nor is it foreclosed by showing that the benefits of the copyright act have been waived. We are dealing here not with restrictions upon publication but with the very facilities and processes of publication. The peculiar value of news is in the spreading of it while it is fresh; and it is evident that a valuable property interest in the news, as news, cannot be maintained by keeping it secret. Besides, except for matters improperly disclosed, or published in breach of trust or confidence, or in violation of law, none of which is involved in this branch of the case, the news of current events may be regarded as common property. What we are concerned with is the business of making it known to the, in which both parties to the present suit are engaged. That business consists in maintaining a prompt, sure, steady, and reliable service designed to place the daily events of the world at the breakfast table of the millions at a price that, while of trifling moment to each reader, is sufficient in the aggregate to afford compensation for the cost of gathering and distributing it, with the added profit so necessary as an incentive to effective action in the commercial world. The service thus performed for newspaper readers is not only innocent but extremely useful in itself, and indubitably constitutes a legitimate business. The parties are competitors in this field; and, on fundamental principles, applicable here as elsewhere, when the rights or privileges of the one are liable to conflict with those of the other, each party is under a duty so to conduct its own business as not unnecessarily or unfairly to injure [*236] that of the other. Hitchman Coal & Coke Co. v. Mitchell, 245 U.S. 229, 254.
Obviously, the question of what is unfair competition in business must be determined with particular reference to the character and circumstances of the business. The question here is not so much the rights of either party as against the public but their rights as between themselves. See Morison v. Moat, 9 Hare, 241, 258. And although we may and do assume that neither party has any remaining property interest as against the public in uncopyrighted news matter after the moment of its first publication, it by no means follows that there is no remaining property interest in it as between themselves. For, to both of them alike, news matter, however little susceptible of ownership or dominion in the absolute sense, is stock in trade, to be gathered at the cost of enterprise, organization, skill, labor, and money, and to be distributed and sold to those who will pay money for it, as for any other merchandise. Regarding the news, therefore, as but the material out of which both parties are seeking to make profits at the same time and in the same field, we hardly can fail to recognize that for this purpose, and as between them, it must be regarded as quasi property, irrespective of the rights of either as against the public.
In order to sustain the jurisdiction of equity over the controversy, we need not affirm any general and absolute property in the news as such. The rule that a court of equity concerns itself only in the protection of property rights treats any civil right of a pecuniary nature as a property right (In re Sawyer, 124 U.S. 200, 210; In re Debs, 158 U.S. 564, 593); and the right to acquire property by honest labor or the conduct of a lawful business is as much entitled to protection as the right to guard property already acquired. Truax v. Raich, 239 U.S. 33, 37-38; [**220] Brennan v. United Hatters, 73 N.J.L. 729, 742; [*237] Barr v. Essex Trades Council, 53 N.J. Eq. 101. It is this right that furnishes the basis of the jurisdiction in the ordinary case of unfair competition.
The question, whether one who has gathered general information or news at pains and expense for the purpose of subsequent publication through the press has such an interest [***72] in its publication as may be protected from interference, has been raised many times, although never, perhaps, in the precise form in which it is now presented.
Board of Trade v. Christie Grain & Stock Co., 198 U.S. 236, 250, related to the distribution of quotations of prices on dealings upon a board of trade, which were collected by plaintiff and communicated on confidential terms to numerous persons under a contract not to make them public. This court held that, apart from certain special objections that were overruled, plaintiff's collection of quotations was entitled to the protection of the law; that, like a trade secret, plaintiff might keep to itself the work done at its expense, and did not lose its right by communicating the result to persons, even if many, in confidential relations to itself, under a contract not to make it public; and that strangers should be restrained from getting at the knowledge by inducing a breach of trust.
In National Tel. News Co. v. Western Union Tel. Co., 119 Fed. Rep. 294, the Circuit Court of Appeals for the Seventh Circuit dealt with news matter gathered and transmitted by a telegraph company, and consisting merely of a notation of current events having but a transient value due to quick transmission and distribution; and, while declaring that this was not copyrightable although printed on a tape by tickers in the offices of the recipients, and that it was a commercial not a literary product, nevertheless held that the business of gathering and communicating the news -- the service of purveying it -- was a legitimate business, meeting a distinctive commercial want and adding to the facilities of the business [*238] world, and partaking of the nature of property in a sense that entitled it to the protection of a court of equity against piracy.
Other cases are cited, but none that we deem it necessary to mention.
Not only do the acquisition and transmission of news require elaborate organization and a large expenditure of money, skill, and effort; not only has it an exchange value to the gatherer, dependent chiefly upon its novelty and freshness, the regularity of the service, its reputed reliability and thoroughness, and its adaptability to the public needs; but also, as is evident, the news has an exchange value to one who can misappropriate it.
The peculiar features of the case arise from the fact that, while novelty and freshness form so important an element in the success of the business, the very processes of distribution and publication necessarily occupy a good deal of time. Complainant's service, as well as defendant's, is a daily service to daily newspapers; most of the foreign news reaches this country at the Atlantic seaboard, principally at the City of New York, and because of this, and of time differentials due to the earth's rotation, the distribution of news matter throughout the country is principally from east to west; and, since in speed the telegraph and telephone easily outstrip the rotation of the earth, it is a simple matter for defendant to take complainant's news from bulletins or early editions of complainant's members in the eastern cities and at the mere cost of telegraphic transmission cause it to be published in western papers issued at least as early as those served by complainant. Besides this, and irrespective of time differentials, irregularities in telegraphic transmission on different lines, and the normal consumption of time in printing and distributing the newspaper, result in permitting pirated news to be placed in the hands of defendant's readers sometimes simultaneously with the service [*239] of competing Associated Press papers, occasionally even earlier.
Defendant insists that when, with the sanction and approval of complainant, and as the result of the use of its news for the very purpose for which it is distributed, a portion of complainant's members communicate it to the general public by posting it upon bulletin boards so that all may read, or by issuing it to newspapers and distributing it indiscriminately, complainant no longer has the right to control the use to be made of it; that when it thus reaches the light of day it becomes the common possession of all to whom it is accessible; and that any purchaser of a newspaper has the right to communicate the intelligence which it contains to anybody and for any purpose, even for the purpose of selling it for profit to newspapers published for [**221] profit in competition with complainant's members.
The fault in the reasoning lies in applying as a test the right of the complainant as against the public, instead of considering the rights of complainant and defendant, competitors in business, as between themselves. The right of the purchaser of a single newspaper to spread knowledge of its contents gratuitously, for any legitimate purpose not unreasonably interfering with complainant's right to make merchandise of it, may be admitted; but to transmit that news for commercial use, in competition with complainant -- which is what defendant has done and seeks to justify -- is a very different matter. In doing this defendant, by its very act, admits that it is taking material that has been acquired by complainant as the result of organization and the expenditure of labor, skill, and money, and which is salable by complainant for money, and that defendant in appropriating it and selling it as its own is endeavoring to reap where it has not sown, and by disposing of it to newspapers that are competitors of complainant's members is appropriating to itself the harvest [*240] of those who have sown. Stripped of all disguises, the process amounts to an unauthorized interference [***73] with the normal operation of complainant's legitimate business precisely at the point where the profit is to be reaped, in order to divert a material portion of the profit from those who have earned it to those who have not; with special advantage to defendant in the competition because of the fact that it is not burdened with any part of the expense of gathering the news. The transaction speaks for itself, and a court of equity ought not to hesitate long in characterizing it as unfair competition in business.
The underlying principle is much the same as that which lies at the base of the equitable theory of consideration in the law of trusts -- that he who has fairly paid the price should have the beneficial use of the property. Pom. Eq. Jur., @ 981. It is no answer to say that complainant spends its money for that which is too fugitive or evanescent to be the subject of property. That might, and for the purposes of the discussion we are assuming that it would, furnish an answer in a common-law controversy. But in a court of equity, where the question is one of unfair competition, if that which complainant has acquired fairly at substantial cost may be sold fairly at substantial profit, a competitor who is misappropriating it for the purpose of disposing of it to his own profit and to the disadvantage of complainant cannot be heard to say that it is too fugitive or evanescent to be regarded as property. It has all the attributes of property necessary for determining that a misappropriation of it by a competitor is unfair competition because contrary to good conscience.
The contention that the news is abandoned to the public for all purposes when published in the first newspaper is untenable. Abandonment is a question of intent, and the entire organization of the Associated Press negatives such a purpose. The cost of the service would be prohibitive if the reward were to be so limited. No single [*241] newspaper, no small group of newspapers, could sustain the expenditure. Indeed, it is one of the most obvious results of defendant's theory that, by permitting indiscriminate publication by anybody and everybody for purposes of profit in competition with the news-gatherer, it would render publication profitless, or so little profitable as in effect to cut off the service by rendering the cost prohibitive in comparison with the return. The practical needs and requirements of the business are reflected in complainant's by-laws which have been referred to. Their effect is that publication by each member must be deemed not by any means an abandonment of the news to the world for any and all purposes, but a publication for limited purposes; for the benefit of the readers of the bulletin or the newspaper as such; not for the purpose of making merchandise of it as news, with the result of depriving complainant's other members of their reasonable opportunity to obtain just returns for their expenditures.
It is to be observed that the view we adopt does not result in giving to complainant the right to monopolize either the gathering or the distribution of the news, or, without complying with the copyright act, to prevent the reproduction of its news articles; but only postpones participation by complainant's competitor in the processes of distribution and reproduction of news that it has not gathered, and only to the extent necessary to prevent that competitor from reaping the fruits of complainant's efforts and expenditure, to the partial exclusion of complainant, and in violation of the principle that underlies the maxim sic utere tuo, etc.
It is said that the elements of unfair competition are lacking because there is no attempt by defendant to palm off its [**222] goods as those of the complainant, characteristic of the most familiar, if not the most typical, cases of unfair competition. Howe Scale Co. v. Wyckoff, Seamans & Benedict, 198 U.S. 118, 140. But we cannot concede that [*242] the right to equitable relief is confined to that class of cases. In the present case the fraud upon complainant's rights is more direct and obvious. Regarding news matter as the mere material from which these two competing parties are endeavoring to make money, and treating it, therefore, as quasi property for the purposes of their business because they are both selling it as such, defendant's conduct differs from the ordinary case of unfair competition in trade principally in this that, instead of selling its own goods as those of complainant, it substitutes misappropriation in the place of misrepresentation, and sells complainant's goods as its own.
Besides the misappropriation, there are elements of imitation, of false pretense, in defendant's practices. The device of rewriting complainant's news articles, frequently resorted to, carries its own comment. The habitual failure to give credit to complainant for that which is taken is significant. Indeed, the entire system of appropriating complainant's news and transmitting it as a commercial product to defendant's clients and patrons amounts to a false representation to them and to their newspaper readers that the news transmitted is the result of defendant's own investigation in the field. But these elements, although accentuating the wrong, are not the essence of it. It is something more than the advantage of celebrity of which complainant is being deprived.
The doctrine of unclean hands is invoked as a bar to relief; it being insisted that defendant's practices against which complainant seeks an injunction are not different from the practice attributed to complainant, of utilizing defendant's news published by its subscribers. At this point it becomes [***74] necessary to consider a distinction that is drawn by complainant, and, as we understand it, was recognized by defendant also in the submission of proofs in the District Court, between two kinds of use that may be made by one news agency of news taken from the [*243] bulletins and newspapers of the other. The first is the bodily appropriation of a statement of fact or a news article, with or without rewriting, but without independent investigation or other expense. This form of pirating was found by both courts to have been pursued by defendant systematically with respect to complainant's news, and against it the Circuit Court of Appeals granted an injunction. This practice complainant denies having pursued, and the denial was sustained by the finding of the District Court. It is not contended by defendant that the finding can be set aside, upon the proofs as they now stand. The other use is to take the news of a rival agency as a "tip" to be investigated, and if verified by independent investigation the news thus gathered is sold. This practice complainant admits that it has pursued and still is willing that defendant shall employ.
Both courts held that complainant could not be debarred on the ground of unclean hands upon the score of pirating defendant's news, because not shown to be guilty of sanctioning this practice.
As to securing "tips" from a competing news agency, the District Court (240 Fed. Rep. 991, 995), while not sanctioning the practice, found that both parties had adopted it in accordance with common business usage, in the belief that their conduct was technically lawful, and hence did not find in it any sufficient ground for attributing unclean hands to complainant. The Circuit Court of Appeals (245 Fed. Rep. 247) found that the tip habit, though discouraged by complainant, was "incurably journalistic," and that there was "no difficulty in discriminating between the utilization of 'tips' and the bodily appropriation of another's labor in accumulating and stating information."
We are inclined to think a distinction may be drawn between the utilization of tips and the bodily appropriation of news matter, either in its original form or after [*244] rewriting and without independent investigation and verification; whatever may appear at the final hearing, the proofs as they now stand recognize such a distinction; both parties avowedly recognize the practice of taking tips, and neither party alleges it to be unlawful or to amount to unfair competition in business. In a line of English cases a somewhat analogous practice has been held not to amount to an infringement of the copyright of a directory or other book containing compiled information. In Kelly v. Morris, L.R. 1 Eq. 697, 701, 702, Vice Chancellor Sir William Page Wood (afterwards Lord Hatherly), dealing with such a case, said that defendant was "not entitled to take one word of the information [**223] previously published without independently working out the matter for himself, so as to arrive at the same result from the same common sources of information, and the only use that he can legitimately make of a previous publication is to verify his own calculations and results when obtained." This was followed by Vice Chancellor Giffard in Morris v. Ashbee, L.R. 7 Eq. 34, where he said: "In a case such as this no one has a right to take the results of the labour and expense incurred by another for the purposes of a rival publication, and thereby save himself the expense and labour of working out and arriving at these results by some independent road." A similar view was adopted by Lord Chancellor Hatherly and the former Vice Chancellor, then Giffard, L.J., in Pike v. Nicholas, L.R. 5 Ch. App. Cas. 251, and shortly afterwards by the latter judge in Morris v. Wright, L.R. 5 Ch. App. Cas. 279, 287, where he said, commenting upon Pike v. Nicholas: "It was a perfectly legitimate course for the defendant to refer to the plaintiff's book, and if, taking that book as his guide, he went to the original authorities and compiled his book from them, he made no unfair or improper use of the plaintiff's book; and so here, if the fact be that Mr. Wright used the plaintiff's [*245] book in order to guide himself to the persons on whom it would be worth his while to call, and for no other purpose, he made a perfectly legitimate use of the plaintiff's book."
A like distinction was recognized by the Circuit Court of Appeals for the Second Circuit in Edward Thompson Co. v. American Law Book Co., 122 Fed. Rep. 922, and in West Publishing Co. v. Edward Thompson Co., 176 Fed. Rep. 833, 838.
In the case before us, in the present state of the pleadings and proofs, we need go no further than to hold, as we do, that the admitted pursuit by complainant of the practice of taking news items published by defendant's subscribers as tips to be investigated, and, if verified, the result of the investigation to be sold -- the practice having been followed by defendant also, and by news agencies generally -- is not shown to be such as to constitute an unconscientious or inequitable attitude towards its adversary so as to fix upon complainant the taint of unclean hands, and debar it on this ground from the relief to which it is otherwise entitled.
There is some criticism of the injunction that was directed by the District Court upon the going down of the mandate from the Circuit Court of Appeals. In brief, it restrains any taking or gainfully using of the complainant's [***75] news, either bodily or in substance, from bulletins issued by the complainant or any of its members, or from editions of their newspapers, "until its commercial value as news to the complainant and all of its members has passed away." The part complained of is the clause we have italicized; but if this be indefinite, it is no more so than the criticism. Perhaps it would be better that the terms of the injunction be made specific, and so framed as to confine the restraint to an extent consistent with the reasonable protection of complainant's newspapers, each in its own area and for a specified time after its [*246] publication, against the competitive use of pirated news by defendant's customers. But the case presents practical difficulties; and we have not the materials, either in the way of a definite suggestion of amendment, or in the way of proofs, upon which to frame a specific injunction; hence, while not expressing approval of the form adopted by the District Court, we decline to modify it at this preliminary stage of the case, and will leave that court to deal with the matter upon appropriate application made to it for the purpose.
The decree of the Circuit Court of Appeals will be
Affirmed.
MR. JUSTICE CLARKE took no part in the consideration or decision of this case.
CONCURBY: HOLMES
CONCUR: MR. JUSTICE HOLMES:
When an uncopyrighted combination of words is published there is no general right to forbid other people repeating them -- in other words there is no property in the combination or in the thoughts or facts that the words express. Property, a creation of law, does not arise from value, although exchangeable -- a matter of fact. Many exchangeable values may be destroyed intentionally without compensation. Property depends upon exclusion by law from interference, and a person is not excluded from using any combination of words merely because someone has used it before, even if it took labor and genius to make it. If a given person is to be prohibited from making the use of words that his neighbors are free to make some other ground must be found. One such ground is vaguely expressed in the phrase unfair trade. This means that the words are repeated by a competitor in business in such a way as [**224] to convey a misrepresentation that materially injures the person who first used them, by appropriating credit of some kind [*247] which the first user has earned. The ordinary case is a representation by device, appearance, or other indirection that the defendant's goods come from the plaintiff. But the only reason why it is actionable to make such a representation is that it tends to give the defendant an advantage in his competition with the plaintiff and that it is thought undesirable that an advantage should be gained in that way. Apart from that the defendant may use such unpatented devices and uncopyrighted combinations of words as he likes. The ordinary case, I say, is palming off the defendant's product as the plaintiff's, but the same evil may follow from the opposite falsehood -- from saying, whether in words or by implication, that the plaintiff's product is the defendant's, and that, it seems to me, is what has happened here.
Fresh news is got only by enterprise and expense. To produce such news as it is produced by the defendant represents by implication that it has been acquired by the defendant's enterprise and at its expense. When it comes from one of the great news-collecting agencies like the Associated Press, the source generally is indicated, plainly importing that credit; and that such a representation is implied may be inferred with some confidence from the unwillingness of the defendant to give the credit and tell the truth. If the plaintiff produces the news at the same time that the defendant does, the defendant's presentation impliedly denies to the plaintiff the credit of collecting the facts and assumes that credit to the defendant. If the plaintiff is later in western cities it naturally will be supposed to have obtained its information from the defendant. The falsehood is a little more subtle, the injury a little more indirect, than in ordinary cases of unfair trade, but I think that the principle that condemns the one condemns the other. It is a question of how strong an infusion of fraud is necessary to turn a flavor into a poison. The does seems to me strong [*248] enough here to need a remedy from the law. But as, in my view, the only ground of complaint that can be recognized without legislation is the implied misstatement, it can be corrected by stating the truth; and a suitable acknowledgment of the source is all that the plaintiff can require. I think that within the limits recognized by the decision of the Court the defendant should be enjoined from publishing news obtained from the Associated Press for hours after publication by the plaintiff unless it gives express credit to the Associated Press; the number of hours and the form of acknowledgment to be settled by the District Court.
MR. JUSTICE McKENNA concurs in this opinion.
DISSENT: MR. JUSTICE BRANDEIS dissenting.
There are published in the United States about 2,500 daily papers. n1 More than 800 of them are supplied with domestic and foreign news of general interest by the Associated Press -- a corporation without capital stock [***76] which does not sell news or earn or seek to earn profits, but serves merely as an instrumentality by means of which these papers supply themselves at joint expense with such news. Papers not members of the Associated Press depend for their news of general interest largely upon agencies organized for profit. n2 Among these agencies [*249] is the International News Service which supplies news to about 400 subscribing papers. It has, like the Associated Press, bureaus and correspondents in this and foreign countries; and its annual expenditure in gathering and distributing news is about $ 2,000,000. Ever since its organization in 1909, it has included among the sources from which it gathers news, copies (purchased in the open market) of early editions of some papers published by members of the Associated Press and the bulletins publicly posted by them. These items, which constitute but a small part of the news transmitted to its subscribers, are generally verified by the International News Service before transmission; but frequently items are transmitted without verification; and occasionally even without being re-written. In no case is the fact disclosed that [**225] such item was suggested by or taken from a paper or bulletin published by an Associated Press member.
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n1 See American Newspaper Annual and Directory (1918), pp. 4, 10, 1193-1212.
n2 The Associated Press, by Frank B. Noyes, Sen. Doc. No. 27, 63d Cong., 1st sess. In a brief filed in this court by counsel for the Associated Press the number of its members is stated to be 1030. Some members of the Associated Press are also subscribers to the International News Service.
Strictly the member is not the publishing concern, but an individual who is the sole or part owner of a newspaper, or an executive officer of a company which owns one. By-laws, Article II, @ 1.
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No question of statutory copyright is involved. The sole question for our consideration is this: Was the International News Service properly enjoined from using, or causing to be used gainfully, news of which it acquired knowledge by lawful means (namely, by reading publicly posted bulletins or papers purchased by it in the open market) merely because the news had been originally gathered by the Associated Press and continued to be of value to some of its members, or because it did not reveal the source from which it was acquired?
The "ticker" cases, the cases concerning literary and artistic compositions, and cases of unfair competition were relied upon in support of the injunction. But it is admitted that none of those cases affords a complete analogy with that before us. The question presented for decision is new; and it is important.
News is a report of recent occurrences. The business of the news agency is to gather systematically knowledge [*250] of such occurrences of interest and to distribute reports thereof. The Associated Press contended that knowledge so acquired is property, because it costs money and labor to produce and because it has value for which those who have it not are ready to pay; that it remains property and is entitled to protection as long as it has commercial value as news; and that to protect it effectively the defendant must be enjoined from making, or causing to be made, any gainful use of it while it retains such value. An essential element of individual property is the legal right to exclude others from enjoying it. If the property is private, the right of exclusion may be absolute; if the property is affected with a public interest, the right of exclusion is qualified. But the fact that a product of the mind has cost its producer money and labor, and has a value for which others are willing to pay, is not sufficient to ensure to it this legal attribute of property. The general rule of law is, that the noblest of human productions -- knowledge, truths ascertained, conceptions, and ideas -- become, after voluntary communication to others, free as the air to common use. Upon these incorporeal productions the attribute of property is continued after such communication only in certain classes of cases where public policy has seemed to demand it. These exceptions are confined to productions which, in some degree, involve creation, invention, or discovery. But by no means all such are endowed with this attribute of property. The creations which are recognized as property by the common law are literary, dramatic, musical, and other artistic creations; and these have also protection under the copyright statutes. The inventions and discoveries upon which this attribute of property is conferred only by statute, are the few comprised within the patent law. There are also many other cases in which courts interfere to prevent curtailment of plaintiff's enjoyment of incorporeal productions; and in which the [*251] right to relief is often called a property right, but is such only in a special sense. In those cases, the plaintiff has no absolute right to the protection of his production; he has merely the qualified right to be protected as against the defendant's acts, because of the special relation in which the latter stands or the wrongful method or means employed in acquiring the knowledge or the manner in which it is used. Protection of this character is afforded where the suit is based upon breach of contract or of trust or upon unfair competition.
The knowledge for which protection is sought in the case at bar is not of a kind upon which the law has heretofore conferred the attributes of property; nor is the manner of its acquisition or use nor the purpose to which it is applied, such as has heretofore been recognized as entitling a plaintiff to relief.
First: Plaintiff's principal reliance was upon the "ticker" cases; but they do not support [***77] its contention. The leading cases on this subject rest the grant of relief, not upon the existence of a general property right in news, but upon the breach of a contract or trust concerning the use of news communicated; and that element is lacking here. In Board of Trade v. Christie Grain & Stock Co., 198 U.S. 236, 250, the court said the Board "does not lose its rights by communicating the result [the quotations] to persons, even if many, in confidential relations to itself, under a contract not to make it public, and strangers to the trust will be restrained from getting at the knowledge by inducing a breach of trust and using knowledge obtained by such a breach." And it is also stated there, (page 251): "Time is of the essence in matters like this, and it fairly may be said that, if the contracts with the plaintiff are kept, the information will not [**226] become public property until the plaintiff has gained its reward." The only other case in this court which relates to this subject is Hunt v. N.Y. Cotton Exchange, 205 U.S. [*252] 322. While the opinion there refers the protection to a general property right in the quotations, the facts are substantially the same as those in the Christie Case, which is the chief authority on which the decision is based. Of the cases in the lower federal courts and in the state courts it may be said, that most of them too can, on their facts, be reconciled with this principle, though much of the language of the courts cannot be. n1 In spite of anything that may appear in these cases to the contrary it seems that the true principle is stated in the Christie Case, that the collection of quotations "stands like a trade secret." And in Dr. Miles Medical Co v. Park & Sons Co., 220 U.S. 373, 402, this court says of a trade secret: "Any one may use it who fairly, by analysis and experiment, discovers it. But the complainant is entitled to be protected against invasion of its right in the process by fraud or by breach of trust or contract." See John D. Park & Sons Co. v. Hartman, 153 Fed. Rep. 24, 29.
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n1 Board of Trade of City of Chicago v. Tucker, 221 Fed. Rep. 305; Board of Trade of City of Chicago v. Price, 213 Fed. Rep. 336; McDearmott Commission Co. v. Board of Trade of City of Chicago, 146 Fed. Rep. 961; Board of Trade of City of Chicago v. Cella Commission Co., 145 Fed. Rep. 28; National Tel. News Co. v. Western Union Tel. Co., 119 Fed. Rep. 294; Illinois Commission Co. v. Cleveland Tel. Co., 119 Fed. Rep. 301; Board of Trade of Chicago v. Hadden-Krull Co., 109 Fed. Rep. 705; Cleveland Tel. Co. v. Stone, 105 Fed. Rep. 794., Board of Trade of City of Chicago v. Thomson Commission Co., 103 Fed. Rep. 902; Kiernan v. Manhattan Quotation Telegraph Co., 50 How. Pr. 194. The bill in F.W. Dodge Co. v. Construction Information Co., 183 Mass. 62, was expressly based on breach of contract or of trust. It has been suggested that a board of trade has a right of property in its quotations because the facts reported originated in its exchange. The point has been mentioned several times in the cases, but no great importance seems to have been attached to it.
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The leading English case, Exchange Telegraph Co. v. Gregory & Co., [1896] 1 Q.B. 147, is also rested clearly upon a breach of contract or trust, although there is some [*253] reference to a general property right. The later English cases seem to have rightly understood the basis of the decision, and they have not sought to extend it further than was intended. Indeed, we find the positive suggestion in some cases that the only ground for relief is the manner in which knowledge of the report of the news was acquired. n1
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n1 In Exchange Telegraph Co., Ltd., v. Howard, 22 Times Law Rep. 375, 377, it is intimated that it would be perfectly permissible for the defendant to take the score from a newspaper supplied by the plaintiff and publish it. And it is suggested in Exchange Telegraph Co., Ltd., v. Central News, Ltd., [1897] 2 Ch. 48, 54, that there are sources from which the defendant might be able to get the information collected by the plaintiff and publish it without committing any wrong. Copinger, Law or Copyright, 5th ed., p. 35, explains the Gregory Case on the basis of the breach of confidence involved. Richardson, Law of Copyright, p. 39, also inclines to put the case "on the footing of implied confidence."
If the news involved in the case at bar had been posted in violation of any agreement between the Associated Press and its members, questions similar to those in the "ticker" cases might have arisen. But the plaintiff does not contend that the posting was wrongful or that any papers were wrongfully issued by its subscribers. On the contrary it is conceded that both the bulletins and the papers were issued in accordance with the regulations of the plaintiff. Under such circumstances, for a reader of the papers purchased in the open market, or a leader of the bulletins publicly posted, to procure and use gainfully, information therein contained, does not involve inducing anyone to commit a breach either of contract or of trust, or committing or in any way abetting a breach of confidence.
Second: Plaintiff also relied upon the cases which hold that the common-law right of the producer to prohibit copying is not lost by the private circulation of a literary composition, the delivery of lecture, the exhibition [*254] of a painting, or the performance of a dramatic or musical composition. n1 These [***78] cases rest upon the ground that the common [**227] law recognizes such productions as property which, despite restricted communication, continues until there is a dedication to the public under the copyright statutes or otherwise. But they are inapplicable for two reasons. (1) At common law, as under the copyright acts, intellectual productions are entitled to such protection only if there is underneath something evincing the mind of a creator or originator, however modest the requirement. The mere record of isolated happenings, whether in words or by photographs not involving artistic skill, are denied such protection. n2 (2) At common law, as under the copyright acts, the element in intellectual productions which secures such protection is not the knowledge, truths, ideas, or emotions which the composition expresses, but the form or sequence in which they are expressed; that is, "some new collocation of visible or audible points, -- of lines, colors, sounds, or [*255] words." See White-Smith Music Co. v. Apollo Co., 209 U.S. 1, 19; Kalem Co. v. Harper Brothers, 222 U.S. 55, 63. An author's theories, suggestions, and speculations, or the systems, plans, methods, and arrangements of an originator, derive no such protection from the statutory copyright of the book in which they are set forth.; n1 and they are likewise denied such protection at common law. n2
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n1 Ferris v. Frohman, 223 U.S. 424; American Tobacco Co. v. Werckmeister, 207 U.S. 284, 299; Universal Film Mfg. Co. v. Copperman, 218 Fed. Rep. 577; Werckmeister v. American Lithographic Co., 134 Fed. Rep. 321; Drummond v. Altemus, 60 Fed. Rep. 338; Boucicault v. Hart, 13 Blatchf. 47; Fed. Cas. No. 1692; Crowe v. Aiken, 2 Biss. 208; Fed. Cas. No. 3441; Boucicault v. Fox, 5 Blatchf. 87; Fed. Cas. No. 1691; Bartlett v. Crittenden, 5 McLean, 32; Fed. Cas. No. 1076; Bartlette v. Crittenden, 4 McLean, 300; Fed. Cas. No. 1082; Tompkins v. Halleck, 133 Mass. 32; Aronson v. Baker, 43 N.J. Eq. 365; Caird v. Sime, L.R. 12 App. Cas. 326; Nicols v. Pitman, L.R. 26 Ch. D. 374; Abernethy v. Hutchinson, 3 L.J. (O.S.) Ch. 209; Turner v. Robinson, 10 Ir. Eq. Rep. 121.
n2 Compare Bleistein v. Donaldson Lithograping Co., 188 U.S. 239, 250; Higgins v. Keuffel, 140 U.S. 428, 432., Burrow-Giles Lithorgraphic Co. v. Sarony, 111 U.S. 53, 58-60., Baker v. Selden, 101 U.S. 99, 105, 106; Chayton v. Stone, 2 Paine, 382; Fed. Cas. No. 2872; National Tel. News Co. v. Western Union Tel. Co., 119 Fed. Rep. 294, 296-298; Banks Law Pub. Co. v. Lawyers' Co-operative Pub. Co., 169 Fed. Rep. 386, 391.
n1 Baker v. Selden, 101 U.S. 99; Perris v. Hexamer, 99 U.S. 674; Barnes v. Miner, 122 Fed. Rep. 480, 491; Burnell v. Chown, 69 Fed. Rep. 993; Tate v. Fullbrook, [1908] 1 K.B. 821; Chilton v. Progress Printing & Publishing Co., [1985] 2 Ch. 29, 34; Kendrick & Co. v. Lawrence & Co., L.R. 25 Q.B.D. 99; Pike v. Nicholas, L.R. 5 Ch. App. 251.
n2 Bristol v. Equitable Life Assurance Society 132 N.Y. 264; Haskins v. Ryan, 71 N.J. Eq. 575.
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That news is not property in the strict sense is illustrated by the case of Sports and General Press Agency, Ltd., v. "Our Dogs" Publishing Co., Ltd., [1916] 2 K.B. 880, where the plaintiff, the assignee of the right to photograph the exhibits at a dog show, was refused an injunction against defendant who had also taken pictures of the show and was publishing them. The court said that, except in so far as the possession of the land occupied by the show enabled the proprietors to exclude people or permit them on condition that they agree not to take photographs (which condition was not imposed in that case), the proprietors had no exclusive right to photograph the show and could therefore grant no such right. And, it was further stated that, at any rate, no matter what conditions might be imposed upon those entering the grounds, if the defendant had been on top of a house or in some position where he could photograph the show without interfering with the physical property of the plaintiff, the plaintiff would have no right to stop him. If, when the plaintiff creates the event recorded, he is not entitled to the exclusive first publication of the [*256] news (in that case a photograph) of the event, no reason can be shown why he should be accorded such protection as to events which he simply records and transmits to other parts of the world, though with great expenditure of time and money.
Third: If news be treated as possessing the characteristics not of a trade secret, but of literary property, then the earliest issue of a paper of general circulation or the earliest public posting of [**228] a bulletin which embodies such news would, under the established rules governing literary property, operate as a publication, and all property in the news would then cease. Resisting this conclusion, plaintiff relied upon the cases which hold that uncopyrighted intellectual and artistic property survives private circulation or a restricted publication; and it contended that in each issue of each paper, a restriction is to be implied that the news shall not be used gainfully in competition with the Associated Press or any of its members. There is no basis for such an implication. But it is also well settled that where the publication is in fact a general one, even express words of restriction upon use are inoperative. In other words, a general publication is effective to dedicate literary property to the public, regardless of the actual intent of its owner. n1 In the cases dealing with lectures, dramatic and musical performances, and art exhibitions, n2 upon which plaintiff relied, there was no general publication in print comparable to the issue of daily newspapers or the unrestricted public posting of bulletins. The principles governing those cases differ more or less in application, if not in theory, from the principles governing the issue of printed copies; [*257] and in so far as they [***79] do differ, they have no application to the case at bar.
n1 Jewelers' Mercantile Agency v. Jewelers' Publishing Co., 155 N.Y. 241; Wagner v. Conried, 125 Fed. Rep. 798, 801., Larrowe-Loisette v. O'Loughlin, 88 Fed. Rep. 896.
n2 See cases in note 1, p. 254, supra; Richardson, Law of Copyright, p. 128.
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Fourth: Plaintiff further contended that defendant's practice constitutes unfair competition, because there is "appropriation without cost to itself of values created by" the plaintiff; and it is upon this ground that the decision of this court appears to be based. To appropriate and use for profit, knowledge and ideas produced by other men, without making compensation or even acknowledgment, may be inconsistent with a finer sense of propriety; but, with the exceptions indicated above, the law has heretofore sanctioned the practice. Thus it was held that one may ordinarily make and sell anything in any form, may copy with exactness that which another has produced, or may otherwise use his ideas without his consent and without the payment of compensation, and yet not inflict a legal injury; n1 and that ordinarily one is at perfect liberty to find out, if he can be lawful means, trade secrets of another, however valuable, and then use the knowledge so acquired gainfully, although it cost the original owner much in effort and in money to collect or produce.n2
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n1 Flagg Manufacturing Co. v. Holway, 178 Massachusetts, 83; Bristol v. Equitable Life Assurance Society, 132 N.Y. 264; Keystone Type Foundry v. Portland Publishing Co., 186 Fed. Rep. 690.
n2 Chadwick v. Covell, 151 Massachusetts, 190; Tabor v. Hoffman, 118 N.Y. 30, 36; James v. James, L.R. 13 Eq. 421. Even when knowledge is compiled, as in a dictionary, and copyrighted, the suggestions and sources therein may be freely used by a later compiler. The copyright protection merely prevents his taking the ultimate data while avoiding the labor and expense involved in compiling them. Pike v. Nicholas, L.R. 5 Ch. App. 251; Morris v. Wright, L.R. 5 Ch. App. 279; Edward Thompson Co. v. American Law Book Co., 122 Fed. Rep. 922; West Pub. Co. v. Edward Thompson Co., 176 Fed. Rep. 833. It is assumed that in the absence of copyright, the data compiled could be freely used. See Morris v. Ashbee, L.R. 7 Eq. 34, 40. Compare also Chilton v. Progress Printing & Publishing Co., [1895] Ch. 29.
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[*258] Such taking and gainful use of a product of another which, for reasons of public policy, the law has refused to endow with the attributes of property, does not become unlawful because the product happens to have been taken from a rival and is used in competition with him. The unfairness in competition which hitherto has been recognized by the law as a basis for relief, lay in the manner or means of conducting the business; and the manner or means held legally unfair, involves either fraud or force or the doing of acts otherwise prohibited by law. In the "passing off" cases (the typical and mostcommon case of unfair competition), the wrong consists in fraudulently representing by word or act that defendant's goods are those of plaintiff. See Hanover Milling Co. v. Metcalf, 240 U.S. 403, 412-413. In the other cases, the diversion of trade was effected through physical or moral coercion, or by inducing breaches of contract or of trust or by enticing away employees. In some others, called cases of simulated competition, relief was granted because defendant's purpose was [**229] unlawful; namely, not competition but deliberate and wanton destruction of plaintiff's business. n1
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n1 "Trust Laws & Unfair Competition" (U.S. Bureau of Corporations, March 15, 1915), pp. 301-331, 332-461; Nims, Unfair Competition & Trade-Marks, c. XIX; Sperry & Hutchinson Co. v. Pommer, 199 Fed. Rep. 309, 314; Racine Paper Goods Co. v. Dittgen, 171 Fed. Rep. 631; Schonwald v. Ragains, 32 Oklahoma, 223; Attorney General v. National Cash Register Co., 182 Michigan, 99; Witkop & Holmes Co. v. Great Atlantic & Pacific Tea Co., 124 N.Y. Supp. 956, 958; Dunshee v. Standard Oil Co., 152 Iowa, 618; Tuttle v. Buck, 107 Minnesota, 145.
The cases of Fonotipia, Limited, v. Badley, 171 Fed. Rep. 951, and Prest-O-Lite Co. v. Davis, 209 Fed. Rep. 917, which were strongly relied upon by the plaintiff, contain expressions indicating rights possibly broad enough to sustain the injunction in the case at bar; but both cases involve elements of "passing off." See also Prest-O-Lite Co. v. Davis, 215 Fed. Rep. 349; Searchlight Gas Co. v. Prest-O-Lite Co., 215 Fed. Rep. 692; Prest-O-Lite Co. v. H.W. Bogen, Inc., 209 Fed. Rep. 915; Prest-O-Lite Co. v. Avery Lighting Co., 161 Fed. Rep. 648. In Prest-O-Lite Co. v. Auto Acetylene Light Co., 191 Fed. Rep. 90, the bill was dismissed on the ground that no deception was shown.
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[*259] That competition is not unfair in a legal sense, merely because the profits gained are unearned, even if made at the expense of a rival, is shown by many cases besides those referred to above. He who follows the pioneer into a new market, or who engages in the manufacture of an article newly introduced by another, seeks profits due largely to the labor and expense of the first adventurer; but the law sanctions, indeed encourages, the pursuit.n1 He who makes a city known through his product, must submit to sharing the resultant trade with others who, perhaps for that reason, locate there later. Canal Co. v. Clark, 13 Wall. 311; Elgin National Watch Co. v. Illinois Watch Co., 179 U.S. 665, 673. He who has made his name a guaranty of quality, protests in vain when another with the same name engages, perhaps for that reason, in the same lines of business; provided, precaution is taken to prevent the public from being deceived into the belief that what he is selling was made by his competitor. One bearing a name made famous by another is permitted to enjoy the unearned benefit which necessarily flows from such use, even though the use proves harmful to him who gave the name value. Brown Chemical Co. v. Meyer, 139 U.S. 540, 544; Howe [***80] Scale Co. v. Wyckoff, Seamans & Benedict, 198 U.S. 118; Donnell v. Herring-Hall-Marvin Safe Co., 208 U.S. 267; Waterman Co. v. Modern Pen Co., 235 U.S. 88. See Saxlehner v. Wagner, 216 U.S. 375.
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n1 Magee Furnace Co. v. Le Barron, 127 Massachusetts, 115; Ricker v. Railway, 90 Maine, 395, 403.
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The means by which the International News Service obtains news gathered by the Associated Press is also clearly unobjectionable. It is taken from papers bought in the open market or from bulletins publicly posted. [*260] No breach of contract such as the court considered to exist in Hitchman Coal & Coke Co. v. Mitchell, 245 U.S. 229, 254; or of trust such as was present in Morison v. Moat, 9 Hare, 241; and neither fraud nor force, is involved. The manner of use is likewise unobjectionable. No reference is made by word or by act to the Associated Press, either in transmitting the news to subscribers or by them in publishing it in their papers. Neither the International News Service nor its subscribers is gaining or seeking to gain in its business a benefit from the reputation of the Associated Press. They are merely using its product without making compensation. See Bamforth v. Douglass Post Card & Machine Co., 158 Fed. Rep. 355; Tribune Co. of Chicage v. Associated Press, 116 Fed. Rep. 126. That, they have a legal right to do; because the product is not property, and they do not stand in any relation to the Associated Press, either of contract or of trust, which otherwise precludes such use. The argument is not advanced by characterizing such taking and use a misappropriation.
It is also suggested, that the fact that defendant does not refer to the Associated Press as the source of the news may furnish a basis for the relief. But the defendant and its subscribers, unlike members of the Associated Press, were under no contractual obligation to disclose the source of the news; and there is no rule of law requiring acknowledgment to be [**230] made where uncopyrighted matter is reproduced. The International News Service is said to mislead its subscribers into believing that the news transmitted was originally gathered by it and that they in turn mislead their readers. There is, in fact, no representation by either of any kind. Sources of information are sometimes given because required by contract; sometimes because naming the source gives authority to an otherwise incredible statement; and sometimes the source is named because the agency does not wish to take the [*261] responsibility itself of giving currency to the news. But no representation can properly be implied from omission to mention the source of information except that the International News Service is transmitting news which it believes to be credible.
Nor is the use made by the International News Service of the information taken from papers or bulletins of Associated Press members legally objectionable by reason of the purpose for which it was employed. The acts here complained of were not done for the purpose of injuring the business of the Associated Press. Their purpose was not even to divert its trade, or to put it at a disadvantage by lessening defendant's necessary expenses. The purpose was merely to supply subscribers of the International News Service promptly with all available news. The suit is, as this court declares, in substance one brought for the benefit of the members of the Associated Press, who would be proper, and except for their number perhaps necessary, parties; and the plaintiff conducts the suit as representing their interest. It thus appears that the protection given by the injunction is not actually to the business of the complainant news agency; for this agency does not sell news nor seek to earn profits, but is a mere instrumentality by which 800 or more newspapers collect and distribute news.
It is these papers severally which are protected; and the protection afforded is not from competition of the defendant, but from possible competition of one or more of the 400 other papers which receive the defendant's service. Furthermore, the protection to these Associated Press members consists merely in denying to other papers the right to use, as news, information which, by authority of all concerned, had theretofore been given to the public by some of those who joined in gathering it; and to which the law denies the attributes of property. There is in defendant's purpose nothing on which to base a claim for relief.
[*262] It is further said that, while that for which the Associated Press spends its money is too fugitive to be recognized as property in the common-law courts, the defendant cannot be heard to say so in a court of equity, where the question is one of unfair competition. The case presents no elements of equitable title or of breach of trust. The only possible reason for resort to a court of equity in a case like this is that the remedy which the law gives is inadequate. If the plaintiff has no legal cause of action, the suit necessarily fails. Levy v. Walker, L.R. 10 Ch. D. 436, 449. There is nothing in the situation of the parties which can estop the defendant from saying so.
Fifth: The great development of agencies now furnishing country-wide distribution of news, the vastness of our territory, and improvements in the means of transmitting intelligence, have made it possible for a news agency or newspapers to obtain, without paying compensation, the fruit of another's efforts and to use news so obtained [***81] gainfully in competition with the original collector. The injustice of such action is obvious. But to give relief against it would involve more than the application of existing rules of law to new facts. It would require the making of a new rule in analogy to existing ones. The unwritten law possesses capacity for growth; and has often satisfied new demands for justice by invoking analogies or by expanding a rule or principle. This process has been in the main wisely applied and should not be discontinued. Where the problem is relatively simple, as it is apt to be when private interests only are involved, it generally proves adequate. But with the increasing complexity of society, the public interest tends to become omnipresent; and the problems presented by new demands for justice cease to be simple. Then the creation or recognition by courts of a new private right may work serious injury to the general public, unless the [*263] boundaries of the right are definitely established and wisely guarded. In order to reconcile the new private right with the public interest, it may be necessary to prescribe limitations and rules for its enjoyment; and also to provide administrative machinery for enforcing the rules. It is largely for this reason that, in the effort to meet the [**231] many new demands for justice incident to a rapidly changing civilization, resort to legislation has latterly been had with increasing frequency.
The rule for which the plaintiff contends would effect an important extension of property rights and a corresponding curtailment of the free use of knowledge and of ideas; and the facts of this case admonish us of the danger involved in recognizing such a property right in news, without imposing upon news-gatherers corresponding obligations. A large majority of the newspapers and perhaps half the newspaper readers of the United States are dependent for their news of general interest upon agencies other than the Associated Press. The channel through which about 400 of these papers received, as the plaintiff alleges, "a large amount of news relating to the European war of the greatest importanceand of intense interest to the newspaper reading public" was suddenly closed. The closing to the International News Service of these channels for foreign news (if they were closed) was due not to unwillingness on its part to pay the cost of collecting the news, but to the prohibitions imposed by foreign governments upon its securing news from their respective countries and from using cable or telegraph lines running therefrom. For aught that appears, this prohibition may have been wholly undeserved; and at all events the 400 papers and their readers may be assumed to have been innocent. For aught that appears, the International News Service may have sought then to secure temporarily by arrangement with the Associated Press the latter's foreign news service. For aught that [*264] appears, all of the 400 subscribers of the International News Service would gladly have then become members of the Associated Press, if they could have secured election thereto. n1 It is possible, also, that a large part of the readers of these papers were so situated that they could not secure prompt access to papers served by the Associated Press. The prohibition of the foreign governments might as well have been extended to the channels through which news was supplied to the more than a thousand other daily papers in the United States not served by the Associated Press; and a large part of their readers may also be so located that they can not procure prompt access to papers served by the Associated Press.
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n1 According to the by-laws of the Associated Press no one can be elected a member without the affirmative vote of at least four-fifths of all the members of the corporation or the vote of the directors. Furthermore, the power of the directors to admit anyone to membership may be limited by a right of protest to be conferred upon individual members. See By-laws, Article III, @ 6. "The members of this Corporation may, by an affirmative vote of seven-eighths of all the members, confer upon a member (with such limitations as may be at the time prescribed) a right of protest against the admission of new members by the Board of Directors. The right of protest, within the limits specified at the time it is conferred, shall empower the member holding it to demand a vote of the members of the Corporation on all applications for the admission of new members within the district for which it is conferred except as provided in Section 2 of this Article."
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A legislature, urged to enact a law by which one news agency or newspaper may prevent appropriation of the fruits of its labors by another, would consider such facts and possibilities and others which appropriate enquiry might disclose. Legislators might conclude that it was impossible to put an end to the obvious injustice involved in such appropriation of news, without opening the door to other evils, greater than that sought to be remedied. Such appears to have been the opinion of our Senate which reported unfavorably a bill to give news a few [*265] hours' protection; n1 and which ratified, on February [***82] 15, 1911, the convention adopted at the Fourth International American Conference; n2 [**232] and such was evidently the view also of the signatories to the Internatinal Copyright Union Of November 13, 1908; n3 as both these conventions expressly exclude news from copyright protection.
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n1 Senate Bill No. 1728, 48th Cong., 1st sess. The bill provides:
"That any daily or weekly newspaper, or any association of daily or weekly newspapers, published in the United States or any of the Territories thereof, shall have the sole right to print, issue, and sell, for the term of eight hours, dating from the hour of going to press, the contents of said daily or weekly newspaper, or the collected news of said newspaper association, exceeding one hundred words.
"Sec. 2. That for any infringement of the copyright granted by the first section of this act the party injured may sue in any court of competent jurisdiction and recover in any proper action the damages sustained by him from the person making such infringement, together with the costs of suit."
It was reported on April 18, 1884, by the Committee on the Library, without amendment, and that it ought not to pass. Journal of the Senate, 48th Cong., 1st sess., p. 548. No further action was apparently taken on the bill.
When the copyright legislation of 1909, finally enacted as Act of March 4, 1909, c. 320, 35 Stat. 1075, was under consideration, there was apparently no attempt to include news among the subjects of copyright. Arguments before the Committees on Patents of the Senate and House of Representatives on Senate Bill No. 6330 and H. R. Bill No. 19853, 59th Cong., 1st sess., June 6, 7, 8, and 9, and December 7, 8, 10, and 11, 1906; Hearings on Pending Bills to Amend and Consolidate Acts Respecting Copyright, March 26, 27 and 28, 1908.
n2 38 Stat. 1785, 1789, Article 11.
n3 Bowker, Copyright: Its History and its Law, pp. 330, 612, 613. See the similar provisions in the Berne Convention (1886) and the Paris Convention (1896). Id., pp. 612, 613.
In 1898 Lord Herschell introduced in Parliament a bill, @ 11 of which provides: "Copyright in respect of a newspaper shall apply only to such parts of the newspaper as are compositions of an original literary character, to original illustrations therein, and to such news and information as have been specially and independently obtained." (Italics ours.) House of Lords, Sessional Papers, 1898, vol. 3, Bill No. 21. Birrell, Copyright in Books, p. 210. But the bill was not enacted, and in the English law as it now stands there is no provision giving even a limited copyright in news as such. Act of December 16, 1911, 1 and 2 Geo. V. c. 46.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[*266] Or legislators dealing with the subject might conclude, that the right to news values should be protected to the extent of permitting recovery of damages for any unauthorized use, but that protection by injunction should be denied, just as courts of equity ordinarily refuse (perhaps in the interest of free speech) to restrain actionable libels, n1 and for other reasons decline to protect by injunction mere political rights; n2 and as Congress has prohibited courts from enjoining the illegal assessment or collection of federal taxes. n3 If a legislature concluded to recognize property in published news to the extent of permitting recovery at law, it might, with a view to making the remedy more certain and adequate, provide a fixed measure of damages, as in the case of copyright infringement.n4
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n1 Boston Diatite Co. v. Florence Mfg. Co., 114 Massachusetts, 69; Prudential Assurance Co. v. Knott, L.R. 10 Ch. App. 142.
n2 Giles v. Harris, 189 U.S. 475. Compare Swafford v. Templeton, 185 U.S. 487; Green v. Mills, 69 Fed. Rep. 852, 859.
n3 Revised Statutes, @ 3224; Snyder v. Marks, 109 U.S. 189; Dodge v. Osborn, 240 U.S. 118.
n4 Act of March 4, 1909, @ 25, c. 320, 35 Stat. 1075, 1081, provides as to the liability for the infringement of a copyright, that, "in the case of a newspaper reproduction of a copyrighted photograph such damages shall not exceed the sum of two hundred dollars nor be less than the sum of fifty dollars"; and that in the case of infringement of a copyrighted newspaper the damages recoverable shall be one dollar for every infringing copy, but shall not be less than $ 250 nor more than $ 5,000.
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Or again, a legislature might conclude that it was unwise to recognize even so limited a property right in published news as that above indicated; but that a news agency should, on some conditions, be given full protection [*267] of its business; and to that end a remedy by injunction as well as one for damages should be granted, where news collected by it is gainfully used without permission. If a legislature concluded, (as at least one court has held, New York & Chicago Grain & Stock Exchange v. Board of Trade, 127 Illinois, 153) that under certain circumstances news-gathering is a business affected with a public interest, it might declare that, in such cases, news should be protected against appropriation, only if the gatherer assumed the obligation of supplying it, at reasonable rates and without discrimination, to all papers which applied therefor. If legislators reached that conclusion, they would probably go further, and prescribe the conditions under which and the extent to which the protection should be afforded; and they might also provide the administrative machinery necessary for ensuring to the public, the press, and the news agencies, full enjoyment of the rights so conferred.
Courts are ill-equipped to make the investigations which should precede a determination of the
limitations which should be set upon any property right in news or of the circumstances under
which news gathered by a private agency should be deemed affected with a public interest. Courts
would be powerless to prescribe the detailed regulations essential to full enjoyment of the rights
conferred or to introduce the machinery required for enforcement of such regulations.
Considerations such as these [**233] should lead us to decline to establish a new rule of law in
the effort to redress a newly-disclosed wrong, although the propriety of some remedy appears to
be clear.
III
Supplementary Cases on Intellectual Property
Intellectual Property & the Constitution
Congressional Power -- The Trademark Cases
100 U.S. 82
10 Otto 82, 25 L.Ed. 550
TRADE-MARK CASES.
UNITED STATES
v.
STEFFENS;
UNITED STATES
v.
WITTEMANN;
UNITED STATES
v.
JOHNSON.
Supreme Court of the United States
October Term, 1879
THE first two cases were brought here on certificates of division in opinion between the judges of the Circuit Court of the United States for the Southern District of New York. The last was brought here on a certificate of division on opinion between the judges of the Circuit Court of the United States for the Southern District of Ohio.
Steffens was indicted under the fourth and fifth sections of an act of Congress entitled 'An Act to punish the counterfeiting of trade-marks and the sale or dealing in of counterfeit trade-mark goods,' approved Aug. 14, 1876, 19 Stat. 141.
The first count in the indictment charges him with knowingly and wilfully having in his possession counterfeits and colorable imitations of the trade- marks of G. H. Mumm & Co., of Rheims, France, manufacturers and sellers of champagne wine.
The second count charges him with knowingly and wilfully selling counterfeited representations and colorable imitations of the trade-mark of said G. H. Mumm & Co.*83
***
***
MR. JUSTICE MILLER delivered the opinion of the court.
The three cases whose titles stand at the head of this opinion are criminal prosecutions for violations of what is known as the trade-mark legislation of Congress. The first two are indictments in the southern district of New York, and the last is an information in the southern district of Ohio. In all of them the judges of the circuit courts in which they are pending have certified to a difference of opinion on what is substantially the same question; namely, are the acts of Congress on the subject *92of trade-marks founded on any rightful authority in the Constitution of the United States?
The entire legislation of Congress in regard to trade-marks is of very recent origin. It is first seen in sects. 77 to 84, inclusive, of the act of July 8, 1870, entitled 'An Act to revise, consolidate, and amend the statutes relating to patents and copyrights.' 16 Stat. 198. The part of this act relating to trade-marks is embodied in chap. 2, tit. 60, sects. 4937 to 4947, of the Revised Statutes.
It is sufficient at present to say that they provide for the registration in the Patent Office of any device in the nature of a trade-mark to which any person has by usage established an exclusive right, or which the person so registering intends to appropriate by that act to his exclusive use; and they make the wrongful use of a trade-mark, so registered, by any other person, without the owner's permission, a cause of action in a civil suit for damages. Six years later we have the act of Aug. 14, 1876 (19 Stat. 141), punishing by fine and imprisonment the fraudulent use, sale, and counterfeiting of trade- marks registered in pursuance of the statutes of the United States, on which the informations and indictments are founded in the cases before us.
The right to adopt and use a symbol or a device to distinguish the goods or property made or sold by the person whose mark it is, to the exclusion of use by all other persons, has been long recognized by the common law and the chancery courts of England and of this country, and by the statutes of some of the States. It is a property right for the violation of which damages may be recovered in an action at law, and the continued violation of it will be enjoined by a court of equity, with compensation for past infringement. This exclusive right was not created by the act of Congress, and does not now depend upon it for its enforcement. The whole system of trade-mark property and the civil remedies for its protection existed long anterior to that act, and have remained in full force since its passage.
There propositions are so well understood as to require neither the citation of authorities nor an elaborate argument to prove them.*93
As the property in trade-marks and the right to their exclusive use rest on the laws of the States, and, like the great body of the rights of person and of property, depend on them for security and protection, the power of Congress to legislate on the subject, to establish the conditions on which these rights shall be enjoyed and exercised, the period of their duration, and the legal remedies for their enforcement, if such power exist at all, must be found in the Constitution of the United States, which is the source of all powers that Congress can lawfully exercise.
In the argument of these cases this seems to be conceded, and the advocates for the validity of the acts of Congress on this subject point to two clauses of the Constitution, in one or in both of which, as they assert, sufficient warrant may be found for this legislation.
The first of these is the eighth clause of sect. 8 of the first article. That section, manifestly intended to be an enumeration of the powers expressly granted to Congress, and closing with the declaration of a rule for the ascertainment of such powers as are necessary by way of implication to carry into efficient operation those expressly given, authorizes Congress, by the clause referred to, 'to promote the progress of science and useful arts, by securing for limited times, to authors and inventors, the exclusive right to their respective writings and discoveries.'
As the first and only attempt by Congress to regulate the right of trade-marks is to be found in the act of July 8, 1870, to which we have referred, entitled 'An Act to revise, consolidate, and amend the statutes relating to patents and copyrights,' terms which have long since become technical, as referring, the one to inventions and the other to the writings of authors, it is a reasonable inference that this part of the statute also was, in the opinion of Congress, an exercise of the power found in that clause of the Constitution. It may also be safely assumed that until a critical examination of the subject in the courts became necessary, it was mainly if not wholly to this clause that the advocates of the law looked for its support.
Any attempt, however, to identify the essential characteristics of a trade- mark with inventions and discoveries in the *94 arts and sciences, or with the writings of authors, will show that the effort is surrounded with insurmountable difficulties.
The ordinary trade-mark has no necessary relation to invention or discovery. The trade-mark recognized by the common law is generally the growth of a considerable period of use, rather than a sudden invention. It is often the result of accident rather than design, and when under the act of Congress it is sought to establish it by registration, neither originality, invention, discovery, science, nor art is in any way essential to the right conferred by that act. If we should endeavor to classify it under the head of writings of authors, the objections are equally strong. In this, as in regard to inventions, originality is required. And while the word writings may be liberally construed, as it has been, to include original designs for engravings, prints, &c., it is only such as are original, and are founded in the creative powers of the mind. The writings which are to be protected are the fruits of intellectual labor, embodied in the form of books, prints, engravings, and the like. The trade-mark may be, and generally is, the adoption of something already in existence as the distinctive symbol of the party using it. At common law the exclusive right to it grows out of its use, and not its mere adoption. By the act of Congress this exclusive right attaches upon registration. But in neither case does it depend upon novelty, invention, discovery, or any work of the brain. It requires no fancy or imagination, no genius, no laborious thought. It is simply founded on priority of appropriation. We look in vain in the statute for any other qualification or condition. If the symbol, however plain, simple, old, or well-known, has been first appropriated by the claimant as his distinctive trade-mark, he may by registration secure the right to its exclusive use. While such legislation may be a judicious aid to the common law on the subject of trade-marks, and may be within the competency of legislatures whose general powers embrace that class of subjects, we are unable to see any such power in the constitutional provision concerning authors and inventors, and their writings and discoveries.
The other clause of the Constitution supposed to confer the requisite authority on Congress is the third of the same section, *95 which, read in connection with the granting clause, is as follows: 'The Congress shall have power to regulate commerce with foreign nations, and among the several States, and with the Indian tribes.'
The argument is that the use of a trade-mark--that which alone gives it any value--is to identify a particular class or quality of goods as the manufacture, produce, or property of the person who puts them in the general market for sale; that the sale of the article so distinguished is commerce; that the trade-mark is, therefore, a useful and valuable aid or instrument of commerce, and its regulation by virtue of the clause belongs to Congress, and that the act in question is a lawful exercise of this power.
Every species of property which is the subject of commerce, or which is used or even essential in commerce, is not brought by this clause within the control of Congress. The barrels and casks, the bottles and boxes in which alone certain articles of commerce are kept for safety and by which their contents are transferred from the seller to the buyer, do not thereby become subjects of congressional legislation more than other property. Nathan v. Louisiana, 8 How. 73. In Paul v. Virginia (8 Wall. 168), this court held that a policy of insurance made by a corporation of one State on property situated in another, was not an article of commerce, and did not come within the purview of the clause we are considering. 'They are not,' says the court, 'commodities to be shipped or forwarded from one State to another, and then put up for sale.' On the other hand, in Almy v. State of California (24 How. 169), it was held that a stamp duty imposed by the legislature of California on bills of lading for gold and silver transported from any place in that State to another out of the State, was forbidden by the Constitution of the United States, because such instruments being a necessity to the transaction of commerce, the duty was a tax upon exports.
The question, therefore, whether the trade-mark bears such a relation to commerce in general terms as to bring it within congressional control, when used or applied to the classes of commerce which fall within that control, is one which, in the present case, we propose to leave undecided. We adopt this *96 course because when this court is called on in the course of the administration of the law to consider whether an act of Congress, or of any other department of the government, is within the constitutional authority of that department, a due respect for a co-ordinate branch of the government requires that we shall decide that it has transcended its powers only when that is so plain that we cannot avoid the duty.
In such cases it is manifestly the dictate of wisdom and judicial propriety to decide no more than is necessary to the case in hand. That such has been the uniform course of this court in regard to statutes passed by Congress will readily appear to any one who will consider the vast amount of argument presented to us assailing them as unconstitutional, and he will count, as he may do on his fingers, the instances in which this court has declared an act of Congress void for want of constitutional power.
Governed by this view of our duty, we proceed to remark that a glance at the commerce clause of the Constitution discloses at once what has been often the subject of comment in this court and out of it, that the power of regulation there conferred on Congress is limited to commerce with foreign nations, commerce among the States, and commerce with the Indian tribes. While bearing in mind the liberal construction, that commerce with foreign nations means commerce between citizens of the United States and citizens and subjects of foreign nations, and commerce among the States means commerce between the individual citizens of different States, there still remains a very large amount of commerce, perhaps the largest, which, being trade or traffic between citizens of the same State, is beyond the control of Congress.
When, therefore, Congress undertakes to enact a law, which can only be valid as a regulation of commerce, it is reasonable to expect to find on the face of the law, or from its essential nature, that it is a regulation of commerce with foreign nations, or among the several States, or with the Indian tribes. If not so limited, it is in excess of the power of Congress. If its main purpose be to establish a regulation applicable to all trade, to commerce at all points, especially if it be apparent that it is designed to govern the commerce wholly between citizens of *97 the same State, it is obviously the exercise of a power not confided to Congress.
We find no recognition of this principle in the chapter on trade-marks in the Revised Statutes. We would naturally look for this in the description of the class of persons who are entitled to register a trade-mark, or in reference to the goods to which it should be applied. If, for instance, the statute described persons engaged in a commerce between the different States, and related to the use of trade-marks in such commerce, it would be evident that Congress believed it was acting under the clause of the Constitution which authorizes it to regulate commerce among the States. So if, when the trade-mark has been registered, Congress had protected its use on goods sold by a citizen of one State to another, or by a citizen of a foreign State to a citizen of the United States, it would be seen that Congress was at least intending to exercise the power of regulation conferred by that clause of the Constitution. But no such idea is found or suggested in this statute.
***
It has been suggested that if Congress has power to regulate trade-marks used in commerce with foreign nations and among the several States, these statutes shall be held valid in that class of cases, if no further. To this there are two objections: First, the indictments in these cases do not show that the trade-marks which are wrongfully used were trade-marks used in that kind of commerce. Secondly, while it may be true that when one part of a statute is valid and constitutional, and another part is unconstitutional and void, the court may enforce the valid part where they are distinctly separable so that each can stand alone, it is not within the judicial province to give to the words used by Congress a narrower meaning than they are manifestly intended to bear in order that crimes may be punished which are not described in language that brings them within the constitutional power of that body. **
Intellectual Property & the Constitution
1st & 5th Amendments
107 S.Ct. 2971
97 L.Ed.2d 427, 55 USLW 5061, 3 U.S.P.Q.2d 1145
(Cite as: 483 U.S. 522, 107 S.Ct. 2971)
SAN FRANCISCO ARTS & ATHLETICS, INC. and Thomas F. Waddell, Petitioners
v.
UNITED STATES OLYMPIC COMMITTEE and International Olympic Committee.
No. 86-270.
Supreme Court of the United States
Argued March 24, 1987.
Decided June 25, 1987.
Justice POWELL delivered the opinion of the Court.
In this case, we consider the scope and constitutionality of a provision of the Amateur Sports Act of 1978, 36 U.S.C. §§ 371-396, that authorizes the United States Olympic Committee to prohibit certain commercial and promotional uses of the word "Olympic."
Petitioner San Francisco Arts & Athletics, Inc. (SFAA), is a nonprofit California corporation. [FN1] The SFAA originally sought to incorporate under the name "Golden Gate Olympic Association," but was told by the California Department of Corporations that the word "Olympic" could not appear in a corporate title. App. 95. After its incorporation in 1981, the SFAA nevertheless began to promote the "Gay Olympic Games," using those words on its letterheads and mailings and in local newspapers. Ibid. The games were to be a 9-day event to begin in August 1982, in San Francisco, California. The SFAA expected athletes from hundreds of cities in this country and from cities all over the world. Id., at 402. The Games were to open with a ceremony "which will rival the traditional Olympic Games." Id., at 354. See id., at 402, 406, 425. A relay of over 2,000 runners would carry a torch from New York City across the country to Kezar Stadium in San Francisco. Id., at 98, 355, 357, 432. The final runner would enter the stadium with the "Gay Olympic Torch" and light the "Gay Olympic Flame." Id., at 357. The ceremony would continue with the athletes marching in uniform into the stadium behind their respective city flags. Id., at 354, 357, 402, 404, 414. Competition was to occur in 18 different contests, with the winners receiving gold, silver, and bronze medals. Id., at 354-355, 359, 407, 410. To cover the cost of the planned Games, the SFAA sold T-shirts, buttons, bumper stickers, and other merchandise bearing the title "Gay Olympic Games." Id., at 67, 94, 107, 113-114, 167, 360, 362, 427-428. [FN2]
FN1. The SFAA's president, Dr. Thomas F. Waddell, is also a petitioner.
FN2. The 1982 athletic event ultimately was held under the name "Gay Games I." App. 473. A total of 1,300 men and women from 12 countries, 27 States, and 179 cities participated. Id., at 475. The "Gay Games II" were held in 1986 with approximately 3,400 athletes participating from 17 countries. Brief for Respondents 8. The 1990 "Gay Games" are scheduled to occur in Vancouver, B.C. Ibid.
*526 Section 110 of the Amateur Sports Act (Act), 92 Stat. 3048, 36 U.S.C. § 380, grants respondent United States Olympic Committee (USOC) [FN3] the right to prohibit certain commercial and promotional uses of the word "Olympic" and various Olympic symbols. [FN4] In late December 1981, the executive *527 **2976 director of the USOC wrote to the SFAA, informing it of the existence of the Amateur Sports Act, and requesting that the SFAA immediately terminate use of the word "Olympic" in its description of the planned Games. The SFAA at first agreed to substitute the word "Athletic" for the word "Olympic," but, one month later, resumed use of the term. The USOC became aware that the SFAA was still advertising its Games as "Olympic" through a newspaper article in May 1982. In August, the USOC brought suit in the Federal District Court for the Northern District of California to enjoin the SFAA's use of the word "Olympic." The District Court granted a temporary restraining order and then a preliminary injunction. The Court of Appeals for the Ninth Circuit affirmed. After further proceedings, the District Court granted the USOC summary judgment and a permanent injunction.
FN3. The International Olympic Committee is also a respondent.
FN4. Section 110 of the Act, as set forth in 36 U.S.C. § 380, provides:
"Without the consent of the [USOC], any person who uses for the purpose of trade, to induce the sale of any goods or services, or to promote any theatrical exhibition, athletic performance, or competition--
"(1) the symbol of the International Olympic Committee, consisting of 5 interlocking rings;
"(2) the emblem of the [USOC], consisting of an escutcheon having a blue chief and vertically extending red and white bars on the base with 5 interlocking rings displayed on the chief;
"(3) any trademark, trade name, sign, symbol, or insignia falsely representing association with, or authorization by, the International Olympic Committee or the [USOC]; or
"(4) the words 'Olympic', 'Olympiad', 'Citius Altius Fortius', or any combination or simulation thereof tending to cause confusion, to cause mistake, to deceive, or to falsely suggest a connection with the [USOC] or any Olympic activity;
"shall be subject to suit in a civil action by the [USOC] for the remedies provided in the Act of July 5, 1946 (60 Stat. 427; popularly known as the Trademark Act of 1946 [Lanham Act] ) [15 U.S.C. § 1051 et seq.]
.***
The Court of Appeals affirmed the judgment of the District Court. 781 F.2d 733 (1986). It found that the Act granted the USOC exclusive use of the word "Olympic" without requiring the USOC to prove that the unauthorized use was confusing and without regard to the defenses available to an entity sued for a trademark violation under the Lanham Act, 60 Stat. 427, as amended, 15 U.S.C. § 1051 et seq. It did not reach the SFAA's contention that the USOC enforced its rights in a discriminatory manner, because the court found that the USOC is not a state actor bound by the constraints of the Constitution. The court also found that the USOC's "property righ[t] [in the word 'Olympic' and its associated *528 symbols and slogans] can be protected without violating the First Amendment." 781 F.2d, at 737. The court denied the SFAA's petition for rehearing en banc. Three judges dissented, finding that the panel's interpretation of the Act raised serious First Amendment issues. 789 F.2d 1319, 1326 (1986).
We granted certiorari, 479 U.S. 913, 107 S.Ct. 312, 93 L.Ed.2d 286 (1986), to review the issues of statutory and constitutional interpretation decided by the Court of Appeals. We now affirm.
******
*531 III
This Court has recognized that "[n]ational protection of trademarks is desirable ... because trademarks foster competition and the maintenance of quality by securing to the producer the benefits of good reputation."
***
[3][4][5] The protection granted to the USOC's use of the Olympic words and symbols differs from the normal trademark protection in two respects: the USOC need not prove that a contested use is likely to cause confusion, and an unauthorized user of the word does not have available the normal statutory defenses. [FN6] The SFAA argues, in effect, that the differences between the Lanham Act and § 110 are of constitutional dimension. First, the SFAA contends that the word "Olympic" is a generic [FN7] word that could not gain trademark protection under the Lanham Act. The SFAA argues that this *532 prohibition is constitutionally required and thus that the First Amendment prohibits Congress from granting a trademark in the word "Olympic." Second, the SFAA argues that the First Amendment prohibits Congress from granting exclusive use of a word absent a requirement that the authorized user prove that an unauthorized use is likely to cause confusion. We address these contentions in turn.
FN6. The user may, however, raise traditional equitable defenses, such as laches. See Brief for Respondents 20, n. 17.
FN7. A common descriptive name of a product or service is generic. Because a generic name by definition does not distinguish the identity of a particular product, it cannot be registered as a trademark under the Lanham Act. See §§ 2, 14(c), 15 U.S.C. §§ 1052, 1064(c). See also 1 J. McCarthy, Trademarks and Unfair Competition § 12:1, p. 520 (1984).
A
This Court has recognized that words are not always fungible, and that the suppression of particular words "run[s] a substantial risk of suppressing ideas in the process." Cohen v. California, 403 U.S. 15, 26, 91 S.Ct. 1780, 1788, 29 L.Ed.2d 284 (1971). The SFAA argues that this principle**2979prohibits Congress from granting the USOC exclusive control of uses of the word "Olympic," a word that the SFAA views as generic. [FN8] Yet this recognition always has been balanced against the principle that when a word acquires value "as the result of organization and the expenditure of labor, skill, and money" by an entity, that entity constitutionally may obtain a limited property right in the word. International News Service v. Associated Press, 248 U.S. 215, 239, 39 S.Ct. 68, 72, 63 L.Ed. 211 (1918). See Trade-Mark Cases, 100 U.S. (10 Otto) 82, 92, 25 L.Ed. 550 (1879).
FN8. This grant by statute of exclusive use of distinctive words andsymbols by Congress is not unique. Violation of some of these statutes may result in criminal penalties. See, e.g., 18 U.S.C. § 705 (veterans' organizations); § 706 (American National Red Cross); § 707 (4-H Club); § 711 ("Smokey Bear"); § 711a ("Woodsy Owl"). See also FTC v. A.P.W. Paper Co., 328 U.S. 193, 66 S.Ct. 932, 90 L.Ed. 1165 (1946) (reviewing application of Red Cross statute). Others, like the USOC statute, provide for civil enforcement. See, e.g., 36 U.S.C. § 18c (Daughters of the American Revolution); § 27 (Boy Scouts); § 36 (Girl Scouts); § 1086 (Little League Baseball); § 3305 (1982 ed., Supp. III) (American National Theater and Academy).
[6] There is no need in this case to decide whether Congress ever could grant a private entity exclusive use of a generic word. Congress reasonably could conclude that the commercial*533and promotional value of the word "Olympic" was the product of the USOC's "own talents and energy, the end result of much time, effort, and expense." Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 575, 97 S.Ct. 2849, 2857, 53 L.Ed.2d 965 (1977). The USOC, together with respondent International Olympic Committee (IOC), have used the word "Olympic" at least since 1896, when the modern Olympic Games began. App. 348. Baron Pierre de Coubertin of France, acting pursuant to a government commission, then proposed the revival of the ancient Olympic Games to promote international understanding. D. Chester, The Olympic Games Handbook 13 (1975). De Coubertin sought to identify the "spirit" of the ancient Olympic Games that had been corrupted by the influence of money and politics. See M. Finley & H. Pleket, The Olympic Games: The First Thousand Years 4 (1976). [FN9] De Coubertin thus formed the IOC, that has established elaborate rules and procedures for the conduct of the modern Olympics. See Olympic Charter, Rules 26-69 (1985). In addition, these rules direct every national committee to protect the use of the Olympic flag, symbol, flame, and motto from unauthorized use. Id., Bye-laws to Rules 6 and 53. [FN10] Under the IOC *534Charter, the USOC is the national olympic committee for the United States with the sole authority to represent **2980 the United States at the Olympic Games. [FN11] Pursuant to this authority, the USOC has used the Olympic words and symbols extensively in this country to fulfill its object under the Olympic Charter of "ensur[ing] the development and safeguarding of the Olympic Movement and sport." Id., Rule 24.
***
[7] The history of the origins and associations of the word "Olympic" demonstrates the meritlessness of the SFAA's contention that Congress simply plucked a generic word out of the English vocabulary and grantedits exclusive use to the USOC. Congress reasonably could find that since 1896, the word "Olympic" has acquired what in trademark law is known as a secondary meaning-- it "has become distinctive of [the USOC's] goods in commerce." Lanham Act, § 2(f), 15 U.S.C. § 1052(f). See Park 'N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S., at 194, 105 S.Ct., at 661. The right to adopt and use such a word "to distinguish the goods or property [of] the person whose mark it is, to the exclusion of use by all other persons, has been long recognized." Trade-Mark Cases, supra, 100 U.S. (10 Otto), at 92. Because Congress reasonably could conclude that the USOC has distinguished the word "Olympic" through its own efforts, Congress' decision to grant the USOC a limited property right in the word "Olympic" falls*535 within the scope of trademark law protections, and thus certainly within constitutional bounds.
B
[8] Congress also acted reasonably when it concluded that the USOC should not be required to prove that an unauthorized use of the word "Olympic" is likely to confuse the public. [FN12] To the extent that § 110 applies to uses "for the purpose of trade [or] to induce the sale of any goods or services," 36 U.S.C. § 380(a), its application is to commercial speech. Commercial speech "receives a limited form of First Amendment protection." Posadas de Puerto Rico Assoc. v. Tourism Company of Puerto Rico, 478 U.S. 328, 340, 106 S.Ct. 2968, 2976, 92 L.Ed.2d 266 (1986); Central Hudson Gas & Electric Corp. v. Public Service Comm'n of New York, 447 U.S. 557, 562-563, 100 S.Ct. 2343, 2349-2350, 65 L.Ed.2d 341 (1980). Section 110 also allows the USOC to prohibit the use of "Olympic" for promotion of theatrical and athletic events. Although many of these promotional uses will be commercial speech, some uses may go beyond the "strictly business" context. See Friedman v. Rogers, 440 U.S. 1, 11, 99 S.Ct. 887, 895, 59 L.Ed.2d 100 (1979). In this case, the SFAA claims that its use of the word "Olympic" was intended to convey a political statement about the status of homosexuals in society. [FN13] Thus, the SFAA claims that in this case § 110 suppresses political speech.
FN12. To the extent that § 110 regulates confusing uses, it is withinnormal trademark bounds. The Government constitutionally may regulate "deceptive or misleading" commercial speech. Virginia Pharmacy Bd. v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 771, 96 S.Ct. 1817, 1830, 48 L.Ed.2d 346 (1976); Friedman v. Rogers, 440 U.S. 1, 9-10, 99 S.Ct. 887, 893-894, 59 L.Ed.2d 100 (1979).
FN13. According to the SFAA's president, the Gay Olympic Games would have offered three "very important opportunities":
"1) To provide a healthy recreational alternative to a suppressed minority.
"2) To educate the public at large towards a more reasonable characterization of gay men and women.
"3) To attempt, through athletics, to bring about a positive and gradual assimilation of gay men and women, as well as gays and non-gays, and to diminish the ageist, sexist and racist divisiveness existing in all communities regardless of sexual orientation." App. 93.
His expectations "were that people of all persuasions would be drawn to the event because of its Olympic format and that its nature of 'serious fun' would create a climate of friendship and co-operation[;] false images and misconceptions about gay people would decline as a result of a participatory [sic ] educational process, and benefit ALL communities." Id., at 93-94. He thought "[t]he term 'Olympic' best describe[d] [the SFAA's] undertaking" because it embodied the concepts of "peace, friendship and positive social interaction." Id., at 99.
*536 [9] **2981 By prohibiting the use of one word for particular purposes, neither Congress nor the USOC has prohibited the SFAA from conveying its message. The SFAA held its athletic event in its planned format under the names "Gay Games I" and "Gay Games II" in 1982 and 1986, respectively. See n. 2, supra. Nor is it clear that § 110 restricts purely expressive uses of the word "Olympic." [FN14] Section 110 restricts only the manner in which the SFAA may convey its message. The restrictions on expressive speech properly are characterized as incidental to the primary congressional purpose of encouraging and rewarding the USOC's activities. [FN15] The appropriate *537 inquiry is thus whether the incidental restrictions on First Amendment freedoms are greater than necessary to further a substantial governmental interest. United States v. O'Brien, 391 U.S. 367, 377, 88 S.Ct. 1673, 1679, 20 L.Ed.2d 672 (1968). [FN16]
FN14. One court has found that § 110 does not prohibit the use of the Olympic logo of five interlocking rings and the Olympic torch on a poster expressing opposition to the planned conversion of the Olympic Village at Lake Placid, New York, into a prison. The court found that the use of the symbols did not fit the commercial or promotional definition of uses in § 110. Stop the Olympic Prison v. United States Olympic Committee, 489 F.Supp. 1112, 1118-1121 (SDNY 1980).
FN15. Justice BRENNAN finds the Act unconstitutionally overbroad. But on its face, it applies primarily to commercial speech, to which the application of the overbreadth doctrine is highly questionable. See Ohralik v. Ohio State Bar Assn., 436 U.S. 447, 462, n. 20, 98 S.Ct. 1912, 1921, n. 20, 56 L.Ed.2d 444 (1978) (citing Bates v. State Bar of Arizona, 433 U.S. 350, 380, 97 S.Ct. 2691, 2707, 53 L.Ed.2d 810 (1977)). There is no basis in the record to believe that the Act will be interpreted or applied to infringe significantly on noncommercial speech rights. The application of the Act to the SFAA is well within constitutional bounds, and the extent to which the Act may be read to apply to noncommercial speech is limited. We find no "realistic danger that the statute itself will significantly compromise recognized First Amendment protections of parties not before the Court." City Council of Los Angeles v. Taxpayers for Vincent, 466 U.S. 789, 801, 104 S.Ct. 2118, 2126, 80 L.Ed.2d 772 (1984). Accordingly, we decline to apply the overbreadth doctrine to this case.
FN16. A restriction on nonmisleading commercial speech may be justified if the government's interest in the restriction is substantial, directly advances the government's asserted interest, and is no more extensive than necessary to serve the interest. Central Hudson Gas & Electric Corp. v. Public Service Comm'n of New York, 447 U.S. 557, 566, 100 S.Ct. 2343, 2351, 65 L.Ed.2d 341 (1980). Both this test and the test for a time, place, or manner restriction under O'Brien require a balance between the governmental interest and the magnitude of the speech restriction. Because their application to these facts is substantially similar, they will be discussed together.
One reason for Congress to grant the USOC exclusive control of the word "Olympic," as with other trademarks, is to ensure that the USOC receives the benefit of its own efforts so that the USOC will have an incentive to continue to produce a "quality product," that, in turn, benefits the public. See 1 J. McCarthy, Trademarks and Unfair Competition § 2:1, pp. 44-47 (1984). But in the special circumstance of the USOC, Congress has a broader public interest in promoting, through the activities of the USOC, the participation of amateur athletes from the United States in "the great four-yearly sport festival, the Olympic Games." Olympic Charter, Rule 1 (1985). The USOC's goal under the Olympic Charter, Rule 24(B), is to further the Olympic movement, that has as its aims: "to promote the development of those physical and moral qualities which are the basis of sport"; "to educate young people through sport in a spirit of better understanding between each other and of friendship, thereby helping to build a better and more peaceful world"; and "to spread the Olympic principles throughout the world, thereby creating international goodwill." Id., Rule 1. See also id., Rule 11 (aims of the IOC). Congress' interests in promoting the USOC's activities include these purposes as well as those *538 specifically enumerated in**2982 the USOC's charter. [FN17] Section 110 directly advances these governmental interests by supplying the USOC with the means to raise money to support *539 the Olympics and encourages the USOC's activities by ensuring that it will receive the benefits of its efforts.
***
[10] The restrictions of § 110 are not broader than Congress reasonably could have determined to be necessary to further these interests. Section 110 primarily applies to all uses of the word "Olympic" to induce the sale of goods or services. Although the Lanham Act protects only against confusing uses, Congress' judgment respecting a certain word is not so limited. Congress reasonably could conclude that most commercial uses of the Olympic words and symbols are likely to be confusing. It also could determine that unauthorized uses, even if not confusing, nevertheless may harm the USOC by lessening the distinctiveness and thus the commercial value of the marks. See Schechter, The Rational Basis of Trademark Protection, 40 Harv.L.Rev. 813, 825 (1927) (one injury to a trademark owner may be "the gradual whittling away or dispersion of the identity and hold upon the public mind of the mark or name" by nonconfusing uses).
[11] In this case, the SFAA sought to sell T-shirts, buttons, bumper stickers, and other items, all emblazoned with the title "Gay Olympic Games." The possibility for confusion as to sponsorship is obvious. Moreover, it is clear that the SFAA sought to exploit the "commercial magnetism," see Mishawaka Rubber & Woolen Mfg. Co. v. S.S. Kresge Co., 316 U.S. 203, 205, 62 S.Ct. 1022, 1024, 86 L.Ed. 1381 (1942), of the word given value by the USOC. There is no question that this unauthorized use could undercut the USOC's efforts to use, and sell the right to use, the word in the future, since much of the word's value comes from its limited use. Such an adverse effect on the USOC's activities is **2983 directly contrary to Congress' interest. *540 Even though this protection may exceed the traditional rights of a trademark owner in certain circumstances, the application of the Act to this commercial speech is not broader than necessary to protect the legitimate congressional interest and therefore does not violate the First Amendment.
[12][13] Section 110 also extends to promotional uses of the word "Olympic," even if the promotion is not to induce the sale of goods. Under § 110, the USOC may prohibit purely promotional uses of the word only when the promotion relates to an athletic or theatrical event. The USOC created the value of the word by using it in connection with an athletic event. Congress reasonably could find that use of the word by other entities to promote an athletic event would directly impinge on the USOC's legitimate right of exclusive use. The SFAA's proposed use of the word is an excellent example. The "Gay Olympic Games" were to take place over a 9-day period and were to be held in different locations around the world. They were to include a torch relay, a parade with uniformed athletes of both sexes divided by city, an "Olympic anthem" and "Olympic Committee," and the award of gold, silver, and bronze medals, and were advertised under a logo of three overlapping rings. All of these features directly parallel the modern-day Olympics, not the Olympic Games that occurred in ancient Greece. [FN18] The image the SFAA*541 sought to invoke was exactly the image carefully cultivated by the USOC. The SFAA's expressive use of the word cannot be divorced from the value the USOC's efforts have given to it. The mere fact that the SFAA claims an expressive, as opposed to a purely commercial, purpose does not give it a First Amendment right to "appropriat[e] to itself the harvest of those who have sown." International News Service v. Associated Press, 248 U.S., at 239-240, 39 S.Ct., at 72. [FN19] The USOC's right to prohibit use of the word "Olympic" in the promotion of athletic events is at the core of its legitimate property right. [FN20]
*****
FN19. The SFAA claims a superior right to the use of the word "Olympic" because it is a nonprofit corporation and its athletic event was not organized for the primary purpose of commercial gain. But when the question is the scope of a legitimate property right in a word, the SFAA's distinction is inapposite. As this Court has noted in the analogous context of "fair use" under the Copyright Act:
"The crux of the profit/nonprofit distinction is not whether the sole motive of the use is monetary gain but whether the user stands to profit from exploitation of the [protected] material without paying the customary price." Harper & Row Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 562, 105 S.Ct. 2218, 2231, 85 L.Ed.2d 588 (1985).
Here, the SFAA's proposed use of the word "Olympic" was a clear attempt to exploit the imagery and goodwill created by the USOC.
FN20. Although a theatrical production is not as closely related to the primary use of the word by the USOC as is an athletic event, Congress reasonably could have found that when the word "Olympic" is used to promote such a production, it would implicate the value given to the word by the USOC.
*542 **2984 IV
[14] The SFAA argues that even if the exclusive use granted by § 110 does not violate the First Amendment, the USOC's enforcement of that right is discriminatory in violation of the Fifth Amendment. [FN21] The fundamental inquiry is whether the USOC is a governmental actor to whom the prohibitions of the Constitution apply. [FN22] The USOC is a "private corporation*543 established under Federal law." 36 U.S.C. § 1101(46). [FN23] In the Act, Congress granted the USOC a corporate charter, § 371, imposed certain requirements on the USOC, [FN24] and provided for some USOC funding through exclusive use of the Olympic words and symbols, § 380, and through direct grants. [FN25]
FN21. The SFAA invokes the Fourteenth Amendment for its discriminatory enforcement claim. The Fourteenth Amendment applies to actions by a State. The claimed association in this case is between the USOC and the Federal Government. Therefore, the Fourteenth Amendment does not apply. The Fifth Amendment, however, does apply to the Federal Government and contains an equal protection component. Bolling v. Sharpe, 347 U.S. 497, 499, 74 S.Ct. 693, 694, 98 L.Ed. 884 (1954). "This Court's approach to Fifth Amendment equal protection claims has ... been precisely the same as to equal protection claims under the Fourteenth Amendment." Weinberger v. Wiesenfeld, 420 U.S. 636, 638, n. 2, 95 S.Ct. 1225, 1228, n. 2, 43 L.Ed.2d 514 (1975). See Buckley v. Valeo, 424 U.S. 1, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976) (per curiam ). The Petitioners raised the issue of discriminatory enforcement in their petition for certiorari, and both petitioners and respondents have briefed the issue fully. Accordingly, we address the claim as one under the Fifth Amendment.
FN22. Because we find no governmental action, we need not address the merits of the SFAA's discriminatory enforcement claim. We note, however, that the SFAA's claim of discriminatory enforcement is far from compelling. As of 1982 when this suit began, the USOC had brought 22 oppositions to trademark applications and one petition to cancel. App. 61. For example, the USOC successfully prohibited registration of the mark "Golden Age Olympics." Id., at 383. The USOC also litigated numerous suits prior to bringing this action, prohibiting use of the Olympic words and symbols by such entities as the National Amateur Sports Foundation, id., at 392, a shoe company, id., at 395, the International Federation of Body Builders, id., at 443, and a bus company, id., at 439. Since 1982, the USOC has brought a number of additional suits against various companies and the March of Dimes Birth Defects Foundation, id., at 437, and Brief for Respondents 41, n. 58. The USOC has authorized the use of the word "Olympic" to organizations that sponsor athletic competitions and events for handicapped persons ("Special Olympics") and for youth ("Junior Olympics" and "Explorer Olympics"). App. 33, 181. Both of these uses directly relate to a purpose of the USOC established by its charter. See 36 U.S.C. §§ 374(7), (13), reprinted supra, at 2981, n. 17. The USOC has not consented to any other uses of the word in connection with athletic competitions or events. App. 33.
The USOC necessarily has discretion as to when and against whom it files opposition to trademark applications, and when and against whom it institutes suits. The record before us strongly indicates that the USOC has acted strictly in accord with its charter and that there has been no actionable discrimination.
FN23. As such, the USOC is listed with 69 other federally created private corporations such as the American Legion, Big Brothers--Big Sisters of America, Daughters of the American Revolution, Veterans of Foreign Wars of the United States, the National Academy of Sciences, and the National Ski Patrol System, Inc. 36 U.S.C. § 1101. It hardly need be said that if federally created private corporations were to be viewed as governmental rather than private actors, the consequences would be far reaching. Apart from subjecting these private entities to suits under the equal protection component of the Due Process Clause of the Fifth Amendment, presumably--by analogy--similar types of nonprofit corporations established under state law could be viewed as governmental actors subject to such suits under the Equal Protection Clause of the Fourteenth Amendment.
FN24. For example, the USOC may amend its constitution only after providing an opportunity for notice and hearing, § 375(b); the USOC must allow for reasonable representation in its membership of certain groups, § 376(b); the USOC must remain nonpolitical, § 377; and the USOC must report on its operations and expenditures of grant moneys to Congress each year, § 382a.
****
*546 [19] **2986 Most fundamentally, this Court has held that a government "normally can be held responsible for a private decision only when it has exercised coercive power or has provided such significant encouragement, either overt or covert, that the choice must in law be deemed to be that of the [government]." Blum v. Yaretsky, supra, 457 U.S., at 1004, 102 S.Ct., at 2786; Rendell-Baker v. Kohn, supra, 457 U.S. at 840, 102 S.Ct., at 2771. See Flagg Bros., Inc. v. Brooks, 436 U.S. 149, 166, 98 S.Ct. 1729, 1738, 56 L.Ed.2d 185 (1978); Jackson v. Metropolitan Edison Co., supra, 419 U.S., at 357, 95 S.Ct., at 456; Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 173, 92 S.Ct. 1965, 1971, 32 L.Ed.2d 627 (1972); Adickes v. S.H. Kress & Co., 398 U.S. 144, *547 170, 90 S.Ct. 1598, 1615, 26 L.Ed.2d 142 (1970). The USOC's choice of how to enforce its exclusive right to use the word "Olympic" simply is not a governmental decision. [FN28] There is no evidence that the Federal Government coerced or encouraged the USOC in the exercise of its right. At most, the Federal Government, by failing to supervise the USOC's use of its rights, can be said to exercise "[m]ere approval of or acquiescence in the initiatives" of the USOC. Blum v. Yaretsky, 457 U.S., at 1004-1005, 102 S.Ct., at 2785-2786. This is not enough to make the USOC's actions those of the Government. Ibid. See Flagg Bros., Inc. v. Brooks, supra, 436 U.S., at 164-165, 98 S.Ct., at 1737-1738; Jackson v. Metropolitan Edison Co., 419 U.S., at 357, 95 S.Ct., at 456. [FN29] Because the USOC is not a governmental**2987actor, the SFAA's claim that the USOC has enforced its rights in a discriminatory manner must fail. [FN30]
FN28. In fact, the Olympic Charter provides that the USOC "must be autonomous and must resist all pressures of any kind whatsoever, whether of a political, religious or economic nature." Rule 24.
FN29. For all of the same reasons indicated above, we reject the SFAA's argument that the United States Government should be viewed as a "joint participant" in the USOC's efforts to enforce its right to use the word "Olympic." See Burton v. Wilmington Parking Authority, 365 U.S. 715, 725, 81 S.Ct. 856, 861, 6 L.Ed.2d 45 (1961). The SFAA has failed to demonstrate that the Federal Government can or does exert any influence over the exercise of the USOC's enforcement decisions. Absent proof of this type of "close nexus between the [Government] and the challenged action of the [USOC]," the challenged action may not be "fairly treated as that of the [Government] itself." Jackson v. Metropolitan Edison Co., 419 U.S., at 351, 95 S.Ct., at 453.
FN30. In their petition for certiorari, petitioners argued only that because the USOC is a "state actor" it is prohibited from "selecting among diverse potential users of the word 'Olympic', based upon speech- suppressing and invidiously discriminatory motives." Pet. for Cert. i. The SFAA now argues that under Shelley v. Kraemer, 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161 (1948), the District Court's entry of the injunction prohibiting the SFAA's use of the word "Olympic" constitutes governmental action sufficient to require a constitutional inquiry into the USOC's motivation in seeking the injunction. This new theory of governmental action is not fairly encompassed within the questions presented and thus is not properly before the Court. See this Court's Rule 21.1(a).
*548 V
Accordingly, we affirm the judgment of the Court of Appeals for the Ninth Circuit.
It is so ordered.
Justice O'CONNOR, with whom Justice BLACKMUN joins, concurring in part and dissenting in part.
I agree with the Court's construction of § 110 of the Amateur Sports Act, 92 Stat. 3048, 36 U.S.C. § 380, and with its holding that the statute is "within constitutional bounds." Ante, at 2980. Therefore, I join Parts I through III of the Court's opinion. But largely for the reasons explained by Justice BRENNAN in Part I-B of his dissenting opinion, I believe the United States Olympic Committee and the United States are joint participants in the challenged activity and as such are subject to the equal protection provisions of the Fifth Amendment. Accordingly, I would reverse the Court of Appeals' finding of no Government action and remand the case for determination of petitioners' claim of discriminatory enforcement.
Justice BRENNAN, with whom Justice MARSHALL joins, dissenting.
The Court wholly fails to appreciate both the congressionally created interdependence between the United States Olympic Committee (USOC) and the United States, and the significant extent to which § 110 of the Amateur Sports Act of 1978, 36 U.S.C. § 380, infringes on noncommercial speech. I would find that the action of the USOC challenged here is Government action, and that § 110 is both substantially overbroad and discriminates on the basis of content. I therefore dissent.
I
For two independent reasons, the action challenged here constitutes Government action. First, the USOC performs important governmental functions and should therefore be considered a governmental actor. Second, there exists "a *549 sufficiently close nexus between the [Government] and the challenged action" of the USOC that "the action of the latter may be fairly treated as that of the [Government] itself." Jackson v. Metropolitan Edison Co., 419 U.S. 345, 351, 95 S.Ct. 449, 453, 42 L.Ed.2d 477 (1974).
A
Examination of the powers and functions bestowed by the Government upon the USOC makes clear that the USOC must be considered a Government actor. It is true, of course, that the mere "fact '[t]hat a private entity performs a function which serves the public does not make its acts [governmental]' " in nature. Ante, at 2984-2985 (quoting Rendell-Baker v. Kohn, 457 U.S. 830, 842, 102 S.Ct. 2764, 2772, 73 L.Ed.2d 418 (1982) (emphasis added)). Such a definition, which might cover "all ... regulated businesses providing arguably essential goods and services," would sweep too broadly. Jackson, supra, 419 U.S., at 354, 95 S.Ct., at 455.
The Court has repeatedly held, however, that "when private individuals or groups are endowed by the State with powers or functions governmental in nature, they become agencies or instrumentalities of the **2988State and subject to its constitutional limitations." Evans v. Newton, 382 U.S. 296, 299, 86 S.Ct. 486, 488, 15 L.Ed.2d 373 (1966) (emphasis added). See Terry v. Adams, 345 U.S. 461, 73 S.Ct. 809, 97 L.Ed. 1152 (1953) (private political association and its elections constitute state action); Marsh v. Alabama, 326 U.S. 501, 66 S.Ct. 276, 90 L.Ed. 265 (1946) (privately owned "company town" is a state actor). Moreover, a finding of government action is particularly appropriate when the function performed is "traditionally the exclusive prerogative" of government. Jackson v. Metropolitan Edison Co., supra, 419 U.S., at 353, 95 S.Ct., at 455. Patently, Congress has endowed the USOC with traditional governmental powers that enable it to perform a governmental function. [FN1
]***
C
A close examination of the USOC and the Government thus reveals a unique interdependence between the two. Although at one time amateur sports was a concern merely of private entities, and the Olympic Games an event of significance only to individuals with a particular interest in athletic competition, that era is passed. In the Amateur Sports Act of 1978, Congress placed the power and prestige of the United States Government behind a single, central sports organization. Congress delegated to the USOC functions*560that Government actors traditionally perform--the representation of the Nation abroad and the administration of all private organizations in a particular economic sector. The representation function is of particular significance here, in my view, because an organization that need not adhere to the Constitution cannot meaningfully represent this Nation. The Government is free, of course, to "privatize" some functions it would otherwise perform. But such privatization ought not automatically release those who perform Government functions from constitutional obligations.
****
FN18. Section 110 of the Amateur Sports Act, 36 U.S.C. § 380, provides in part:
"Without the consent of the [USOC], any person who uses for the purpose of trade, to induce the sale of any goods or services, or to promote any theatrical exhibition, athletic performance, or competition--
* * *
"(3) any trademark, trade name, sign, symbol, or insignia falsely representing association with, or authorization by, the International Olympic Committee or the [USOC]; or "(4) the words 'Olympic ', 'Olympiad', 'Citius Altius Fortius', or any combination or simulation thereof tending to cause confusion, to cause mistake, to deceive, or to falsely suggest a connection with the [USOC] or any 'Olympic activity;
"shall be subject to suit in a civil action by the [USOC] for the remedies provided in the Act of July 5, 1946 (60 Stat. 427; popularly known as the Trademark Act of 1946 [Lanham Act, 15 U.S.C. § 1051 et seq.] )" (emphases added).
FN19. In the Court's view, § 110(a)(4) does not necessarily extend to purely expressive speech. Ante, at 2980, and n. 14.
I disagree. The statute is overbroad on its face because it is susceptible of application to a substantial amount of noncommercial speech, and vests the USOC with unguided discretion to approve and disapprove others' noncommercial use of "Olympic." Moreover, by eliminating even noncommercial uses of a particular word, it unconstitutionally infringes on the SFAA's right to freedom of expression. The Act also restricts speech in a way that is not content neutral. The Court's justifications of these infringements on First Amendment rights are flimsy. The statute cannot be characterized as a mere regulation of the "manner" of speech, and does not serve any Government purpose that would not effectively be protected by giving the USOC a standard commercial trademark. Therefore, as construed by the Court, § 110(a)(4) cannot withstand the First Amendment challenge presented by petitioners.
A
The USOC has held a trademark in the word "Olympic" since 1896, ante, at 7, and § 110(a)(3) of the Amateur Sports *562 Act perpetuates the USOC's protection against infringement of its trademarks. To be more than statutory surplusage, then, § 110(a)(4) must provide something more than a normal trademark. Thus, the Court finds that § 110(a)(4) grants to the USOC a novel and expansive word-use authority. [FN20] In my view, the Act, as interpreted by the Court, is substantially overbroad, violating the First Amendment because it prohibits "a substantial amount of constitutionally protected conduct." Hoffman Estates v. The Flipside, Hoffman Estates, Inc., 455 U.S. 489, 494, 102 S.Ct. 1186, 1191, 71 L.Ed.2d 362 (1982). The Amateur Sports Act is substantially overbroad in two respects. First, it grants the USOC the remedies of a commercial trademark to regulate the use of the word "Olympic," but refuses to interpret the Act to incorporate the defenses to trademark infringement**2995provided in the Lanham Act. These defenses are essential safeguards which prevent trademark power from infringing upon constitutionally protected speech. Second, the Court construes § 110(a)(4) to grant the USOC unconstitutional authority to prohibit use of "Olympic" in the "promotion of theatrical and athletic events," even if the promotional activities are noncommercial or expressive. Ante, at ----. [FN21]
FN20. The legislative history of the Act is consistent with its plain language and indicates that Congress granted word-use authority beyond the power to enforce a trademark. Congress' purpose was to give the USOC authority "to protect certain symbols, emblems, trademarks, tradenames and words by civil action." H.R.Rep. No. 95-1627, p. 10 (1978), U.S.Code Cong. & Admin.News 1978, p. 7483 (emphasis added). Significantly, throughout the House Report, Congress refers to the USOC's authority over the use of "Olympic" as a matter separate from the USOC's authority to enforce its trademarks. See, e.g., id., at 6, 7, 10, 15, 37-38, U.S.Code Cong. & Admin.News 1978, pp. 7479, 7480, 7483, 7488, 7495, 7496. Nowhere in the legislative history is there any hint that Congress equated the USOC's word-use authority over "Olympic" with its trademark power.
FN21. In interpreting the Amateur Sports Act, the Court selectively incorporates sections of the Lanham Act. Although the Court refuses to incorporate 15 U.S.C. § 1066 (requirement of consumer confusion) and § 1115 (statutory defenses), it does appear to incorporate § 1127. Ante, at 2978. This latter section limits the scope of trademark protection to a word "used by a manufacturer or merchant to identify and distinguish his goods, including a unique product, from those manufactured or sold by others." 15 U.S.C. § 1127 (1982 ed., Supp. III). The Court does not explain, however, the inconsistency between the definition of trademark protection in § 1127 (which limits protection to commercial uses) and the scope of the protection that § 110(a)(4) grants the USOC (including the noncommercial promotion of athletic and theatrical events).
*563 1
The first part of § 110 prohibits use of the word "Olympic" "for the purpose of trade" or "to induce the sale of any goods or services." There is an important difference between the word-use authority granted by this portion of § 110 and a Lanham Act trademark: the former primarily affects noncommercial speech, [FN22] while the latter does not. [FN23]
FN22. As the District Court recognized: "You're saying something that I have trouble with. You're talking Trademark Act and trademark law, trademark policies and philosophies of this country. But we have a unique situation here which takes it out of the typical trademark-type of litigation. [Section 110 of the Amateur Sports Act] imposes civil liability ... upon any person who uses [the word "Olympic"] without U.S.O.C. consent to promote any athletic performance or competition....
"... The plaintiffs here are seeking to enforce a law ... which creates a unique and different situation...." App. 265-266.
FN23. See Friedman v. Rogers, 440 U.S. 1, 11, 99 S.Ct. 887, 895, 59 L.Ed.2d 100 (1979) (trademark protections only extend to "strictly business" matters and involve "a form of commercial speech and nothing more"). In no trademark case that the Court has considered have we permitted trademark protection to ban a substantial amount of noncommercial speech. See, e.g., Park 'N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 201, 105 S.Ct. 658, 665, 83 L.Ed.2d 582 (1985) (Lanham Act provisions prevent "commercial monopolization" of descriptive language in the public domain).
Charitable solicitation and political advocacy by organizations such as SFAA [FN24] may in part consist of commercial *564 speech regulated by trademark law, but the expressive element of such speech has been sheltered from unconstitutional harm by Lanham Act defenses. Without them, the Amateur Sports Act prohibits a substantial amount of noncommercial speech.
FN24. The SFAA engages in political advocacy and charitable solicitation, activities that are protected by the First Amendment. See Schaumburg v. Citizens for a Better Environment, 444 U.S. 620, 632, 100 S.Ct. 826, 833, 63 L.Ed.2d 73 (1980) (charitable solicitation by an organization committed to political advocacy "involve[s] a variety of speech interests-- communication of information, the dissemination and propagation of views and ideas, and the advocacy of causes--that are within the protection of the First Amendment"). It is chartered as a nonprofit, educational organization whose purpose is to inform the general public about the "gay movement" and "to diminish the ageist, sexist and racist divisiveness existing in all communities regardless of sexual orientation." App. 93, 102. The SFAA solicited charitable donations and distributed T-shirts, buttons, and posters using the word "Olympic."
Trademark protection has been carefully confined to the realm of commercial speech by two important limitations in the Lanham Act. First, the danger of substantial regulation of noncommercial speech is diminished by denying enforcement of a trademark against uses of words that are not likely "to cause confusion, to cause mistake, or to deceive." See 15 U.S.C. § 1066. Confusion occurs when consumers make an incorrect mental association between the involved commercial products or their producers. See E. Vandenburgh, Trademark **2996 Law and Procedure § 5.20, p. 139 (2d ed. 1968). In contrast, § 110(a)(4) regulates even nonconfusing uses of "Olympic." For example, it may be that while SFAA's use of the word "Olympic" would draw attention to certain similarities between the "Gay Olympic Games" and the "Olympic Games," its use might nevertheless not confuse consumers. Because § 110 does not incorporate the requirement that a defendant's use of the word be confusing to consumers, it regulates an extraordinary range of noncommercial speech. [FN25]
FN25. In its complaint, the USOC included a cause of action under § 14330 of the California Business and Professional Code (1987), which protects trademark holders against uses which dilute the value of their trademark. App. 7-14. The USOC has not explained, however, why the remedies provided by the California dilution statute are insufficient.
It is worth noting that, although some state dilution statutes do not require proof of actual confusion, they do impose other limitations that are not imposed by § 110. "The dilution doctrine cannot and should not be carried to the extreme of forbidding use of a trademark on any and all products and services, however remote from the owner's usage." 2 J. McCarthy, Trademarks and Unfair Competition § 24:16, p. 229 (2d ed. 1984); see also 1 J. Gilson, Trademark Protection and Practice § 5.05[9], p. 5-42 (1986). Only "strong" trademarks are protected by dilution statutes, and the plaintiff's trademark must not previously have been diluted by others. 2 McCarthy, supra, § 24:14, p. 224; E. Vandenburgh, Trademark Law and Procedure § 5.20, p. 150 (2d ed. 1968). It is generally necessary to show similarity between trademarks and a "likelihood" of confusion. See 1 Gilson, supra, § 5.05[9], p. 5-42. Moreover, state dilution statutes do not generally apply to descriptive, nontrademark uses of words.
*565 The fair-use defense also prevents the award of a trademark from regulating a substantial amount of noncommercial speech. See 15 U.S.C. § 1115(b)(4). The Lanham Act allows "the use of the name, term, or device ... which is descriptive of and used fairly and in good faith only to describe to users the goods or services of such party." Ibid. [FN26] Again, a wide array of noncommercial speech may be characterized as merely descriptive of the goods or services of a party, and thus not intended to propose a commercial transaction. For example, the SFAA's description of its community services appears to be regulated by § 110, although the main purpose of such speech may be to educate the public about the social and political views of the SFAA. Congress' failure to incorporate this important defense in § 110(a)(4) confers an unprecedented right on the USOC. See Park 'N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 200-201, 105 S.Ct. 658, 664-665, 83 L.Ed.2d 582 (1985) (noting that fair-use doctrine assists in preventing the "unprecedented" creation of "an exclusive right to use language that is descriptive of a product"). [FN27]
FN26. It is important to note that even after a trademark has acquired secondary meaning, it may be used in a good-faith descriptive manner under the Lanham Act. See 1 McCarthy, supra, § 11:16, p. 475.
FN27. One commentator has described the First Amendment significance of this Lanham Act defense with respect to the regulation of commercial speech: "Virginia [State Board of ] Pharmacy [v. Virginia Citizens Consumer Council ] [425 U.S. 748, 96 S.Ct. 1817, 48 L.Ed.2d 346 (1976) ] and the underlying policies in favor of free commercial speech are closely parallel to those which apply to the branch of trademark law dealing with descriptive words and phrases. The same or very similar policies have been followed for more than a half century by courts and legislatures applying the rule of trademark law that descriptive words and terms cannot be monopolized as trademarks.... Without such availability, fair and open competition might be impaired, the available vocabulary of descriptive words would be reduced, advertisers could not freely describe their products, and the public might be deprived of information necessary to make purchase decisions.... If the court finds ... that defendant is using the term in a purely descriptive manner, it presumably can support its holding by reliance on the Virginia Pharmacy doctrine and policies." 1 Gilson, supra, § 5.09[5], pp. 5-88 to 5-89 (footnotes omitted).
*566 In sum, while the USOC's trademark of "Olympic" allows the USOC to regulate use of the word in the "strictly business" context, the USOC's authority under § 110(a)(4) to regulate nonconfusing and good-faith descriptive uses of the word "Olympic" grants the USOC discretion to**2997prohibit a substantial amount of noncommercial speech. Section 110(a)(4) is therefore substantially overbroad. See Secretary of State of Md. v. Joseph H. Munson Co., 467 U.S. 947, 959, 104 S.Ct. 2839, 2848, 81 L.Ed.2d 786 (1984); Schaumburg v. Citizens for a Better Environment, 444 U.S. 620, 632, 100 S.Ct. 826, 833, 63 L.Ed.2d 73 (1980).
2
A key Lanham Act requirement that limits the impact of trademarks on noncommercial speech is the rule that a trademark violation occurs only when an offending trademark is applied to commercial goods and services. See 15 U.S.C. §§ 1066 and 1127. The Amateur Sports Act is not similarly qualified. Section 110(a)(4) "allows the USOC to prohibit the use of 'Olympic' for promotion of theatrical and athletic events," [FN28] even if such uses "go beyond the 'strictly business' *567 context." Ante, at 2980; see also ante, at 2983 (statute extends to promotional uses "even if the promotion is not to induce the sale of goods"). [FN29] This provision necessarily regulates only noncommercial speech, since every possible commercial use of the word "Olympic" is regulated by preceding sections of the statute. [FN30]
FN28. Noncommercial promotion may include critical reviews of theatrical performances, anticipatory notices and descriptions in the media of athletic competitions, and distribution of educational literature describing the sociopolitical reasons for holding the public events. See Central Hudson Gas & Elec. Corp. v. Public Service Comm'n, 447 U.S. 557, 580, 100 S.Ct. 2343, 2358, 65 L.Ed.2d 341 (1980) (STEVENS, J., concurring in judgment) (promotional advertising encompasses more than commercial speech). For example, in response to the injunction, the SFAA excised the use of "Olympic" from its promotional and educational literature, cautioned its phone operators to refrain from using the term, and advised media representatives not to use this word in conjunction with articles about the cultural and athletic events sponsored by the SFAA. App. 88-92, 94-115.
FN29. Before concluding that the incidental regulation of some expressive speech is justified, ante, at 2983, the Court states that it is not clear that § 110 restricts purely expressive uses of "Olympic," ante, at 2980-2981. Such vagueness suggests that the Amateur Sports Act dangerously chills even purely expressive speech. In the instant case, a local newspaper organization excised "Olympic" from an edition in response to the imposed injunction. App. 89. See also n. 28, supra.
FN30. Every commercial use of "Olympic" is regulated under passages of the statute which precede this part of § 110. The USOC is authorized to regulate use of the word as a trademark under § 110(a)(3). All remaining commercial uses of "Olympic" not regulated by that subsection are governed by § 110(a)(4)'s authorization of the USOC to control the use of "Olympic" by "any person ... for the purpose of trade" or "to induce the sale of any goods or services." Consistent with the Court's interpretation, this authorization gives the USOC the right to Lanham Act remedies, even if SFAA's use of "Olympic" is noncommercial, nonconfusing, and merely descriptive.
While the USOC has unquestioned authority to enforce its "Olympic" trademark against the SFAA, § 110(a)(4) gives it additional authority to regulate a substantial amount of noncommercial speech that serves to promote social and political ideas. The SFAA sponsors a number of nonprofit-making theatrical and athletic events, including concerts, film screenings, and plays. [FN31] These public events are aimed at educating the public about society's alleged discrimination based on *568 sexual orientation, age, sex, and nationality. App. 93-99. In conjunction with these events, the SFAA distributes literature describing the meaning of the Gay Olympic Games. References to "Olympic" in this literature were deleted in response to the injunction, because of § 110's application to the promotion of athletic and theatrical events. Id., at 88- 89, 94, 97.
FN31. The SFAA's amateur athletic events include competition by age-groups with mixed genders in some sports to promote a climate of competition that emphasizes personal improvement rather than winning, and promotes goodwill toward all ages, sexes, and races. App. 98.
3
Thus, contrary to the belief of the Court, § 110 may prohibit a substantial amount of noncommercial speech, and is therefore unconstitutionally overbroad. Schaumburg **2998 v. Citizens for a Better Environment, supra, 444 U.S., at 632, 100 S.Ct., at 833. This overbreadth is particularly significant in light of the unfettered discretion the Act affords to the USOC to prohibit other entities from using the word "Olympic." Given the large number of such users, [FN32] this broad discretion creates the potential for significant suppression of protected speech. "[A] law subjecting the exercise of First Amendment freedoms to the prior restraint of a license, without narrow, objective, and definite standards to guide the licensing authority, is unconstitutional." Shuttlesworth v. Birmingham, 394 U.S. 147, 150-151, 89 S.Ct. 935, 938, 22 L.Ed.2d 162 (1969). See also Niemtko v. Maryland, 340 U.S. 268, 272, 71 S.Ct. 325, 327, 95 L.Ed. 267 (1951). "Proof of an abuse of power in the particular case has never been deemed a requisite for attack on the constitutionality of a statute purporting to license the dissemination of ideas." Thornhill v. Alabama, 310 U.S. 88, 97, 60 S.Ct. 736, 741, 84 L.Ed. 1093 (1940). This broad discretion, with its potential for abuse, also renders § 110 unconstitutionally overbroad on its face.
FN32. See Brief for Respondents 40-41. In Los Angeles and Manhattan alone, there are over 200 enterprises and organizations listed in the telephone directories whose names start with the word "Olympic." 789 F.2d 1319, 1323 (CA9 1986) (Kozinski, J., dissenting).
B
The Court concedes that "some" uses of "Olympic" prohibited under § 110 may involve expressive speech. Ante, at *569 2980. But it contends that "[b]y prohibiting the use of one word for particular purposes, neither Congress nor the USOC has prohibited the SFAA from conveying its message.... Section 110 restricts only the manner in which the SFAA may convey its message." Ante, at 2981 (emphasis added). Section 110(a)(4) cannot be regarded as a mere time, place, and manner statute, however. By preventing the use of the word "Olympic," the statute violates the First Amendment by prohibiting dissemination of a message for which there is no adequate translation.
In Cohen v. California, 403 U.S. 15, 91 S.Ct. 1780, 29 L.Ed.2d 284 (1971), we rejected the very notion advanced today by the Court when considering the censorship of a single four-letter expletive:
"[W]e cannot indulge the facile assumption that one can forbid particular words without also running a substantial risk of suppressing ideas in the process. Indeed, governments might soon seize upon the censorship of particular words as a convenient guise for banning the expression of unpopular views. We have been able ... to discern little social benefit that might result from running the risk of opening the door to such grave results." Id., at 26, 91 S.Ct., at 1787-1788.
The Amateur Sports Act gives a single entity exclusive control over a wide range of uses of a word with a deep history in the English language and Western culture. Here, the SFAA intended, by use of the word "Olympic," to promote a realistic image of homosexual men and women that would help them move into the mainstream of their communities. As Judge Kozinski observed in dissent in the Court of Appeals, just as a jacket reading "I Strongly Resent the Draft" would not have conveyed Cohen's message, so a title such as "The Best and Most Accomplished Amateur Gay Athletes Competition" would not serve as an adequate translation of petitioners' message. 789 F.2d 1319, 1321 (CA9 1986). Indeed, because individual words carry "a life and force of their own," translations never fully capture the sense *570of the original. [FN33] The First Amendment protects**2999 more than the right to a mere translation. By prohibiting use of the word "Olympic," the USOC substantially infringes upon the SFAA's right to communicate ideas.
FN33. James Boyd White has written:
"When we look at particular words, it is not their translation into statements of equivalence that we should seek but an understanding of the possibilities they represent for making and changing the world.... Such words do not operate in ordinary speech as restatable concepts but as words with a life and force of their own. They cannot be replaced with definitions, as though they were parts of a closed system, for they constitute unique resources, of mixed fact and value, and their translation into other terms would destroy their nature. Their meaning resides not in their reducibility to other terms but in their irreducibility.... They operate indeed in part as gestures, with a meaning that cannot be restated." J. White, When Words Lose Their Meaning 11 (1984).
C
The Amateur Sports Act also violates the First Amendment because it restricts speech in a way that is not content neutral. A wide variety of groups apparently wish to express particular sociopolitical messages through the use of the word "Olympic," but the Amateur Sports Act singles out certain of the groups for favorable treatment. As the Court observes, ante, at 2984, n. 22, Congress encouraged the USOC to allow the use of "Olympic" in athletic competitions held for youth ("Junior Olympics" and "Explorer Olympics") and handicapped persons ("Special Olympics"), 36 U.S.C. § 374(13), while leaving to the USOC's unfettered discretion the question whether other groups may use it. See, e.g., USOC v. Golden Age Olympics, Inc., Opposition No. 62,426 (Patents and Trademarks Comm'n, June 4, 1981) (reprinted in App. 383) (denial of use of "Olympic" to senior citizens group); USOC v. International Federation of Body Builders, 219 USPQ 353 (DC 1982) (denial of use to organization promoting body-building).
The statute thus encourages the USOC to endorse particular noncommercial messages, while prohibiting others. Such *571 a scheme is unacceptable under the First Amendment. [FN34] "[A]bove all else, the First Amendment means that government has no power to restrict expression because of its message, its ideas, its subject matter, or its content." Police Department of Chicago v. Mosley, 408 U.S. 92, 95, 92 S.Ct. 2286, 2290, 33 L.Ed.2d 212 (1972). See also Regan v. Time, Inc., 468 U.S. 641, 648-649, 104 S.Ct. 3262, 3266-3267, 82 L.Ed.2d 487 (1984) (holding that Government determination of publishability of photographs based on whether message is "newsworthy or educational" constitutes content-based discrimination in violation of First Amendment).
FN34. Due to the particular meaning of "Olympic," the suppression of the use of the word has its harshest impact on those groups that may benefit most from its use, such as those with debilitating birth defects, see USOC v. March of Dimes Birth Defects Foundation, No. CA 83-539 (Colo., July 1, 1983), and the aged, see USOC v. Golden Age Olympics, Inc., Opposition No. 62,426. Cf. Virginia Pharmacy Bd. v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 763, 96 S.Ct. 1817, 1826, 48 L.Ed.2d 346 (1976).
D
Even if § 110(a)(4) may fairly be characterized as a statute that directly regulates only commercial speech, its incidental restrictions on First Amendment freedoms are greater than necessary to further a substantial Government interest. The sole Government interest proffered for giving the USOC sweeping powers over the use of "Olympic" is the desire to provide a financial subsidy to the USOC. Brief for Respondents 24. At minimum, it is necessary to consider whether the USOC's interest in use of the word "Olympic" could not adequately be protected by rights coextensive with those in the Lanham Act, or by some other restriction on use of the word.
In the absence of § 110(a)(4), the USOC would have authority under the Lanham Act to enforce its "Olympic" trademark against commercial uses of the word that might cause*572consumer confusion and a loss of the mark's distinctiveness. [FN35] There is no evidence in the record that this authority is insufficient to protect the USOC from economic harm. The record and the legislative history are barren of proof or**3000conclusion that noncommercial, nonconfusing, and nontrademark use of "Olympic" in any way dilutes or weakens the USOC's trademark. See Stop The Olympic Prison v. United States Olympic Committee, 489 F.Supp. 1112, 1123 (SDNY 1980) (dismissing USOC's dilution claim because no actual proof of such injury). No explanation is offered, for instance, as to how the use of "Olympic" in theatrical events in conjunction with a disclaimer "not associated with [the USOC]" harms the economic force of the trademark. See Brief for Petitioners 12. The Court contends that § 110 may prohibit uses of "Olympic" because it protects an "image carefully cultivated by the USOC." Ante, at 2983. Again, there is no proof in the record that the Lanham Act inadequately protects the USOC's commercial interest in its image or that the SFAA has harmed the USOC's image by its speech. [FN36]
FN35. In this litigation, the USOC filed causes of action under the Lanham Act, the Amateur Sports Act, and the California dilution statute. App. 7- 14.
FN36. Nor is there any evidence that SFAA's expressive speech caused economic or reputational harm to the USOC's image. In Spence v. Washington, 418 U.S. 405, 94 S.Ct. 2727, 41 L.Ed.2d 842 (1974), a State asserted a similar interest in the integrity of America's flag as " 'an unalloyed symbol of our country,' " and contended that there is a substantial Government interest in "preserving the flag as 'an important symbol of nationhood and unity.' " Id., at 421, 94 S.Ct., at 2735. The Court considered whether a State could withdraw "a unique national symbol from the roster of materials that may be used as a background for communications." Id., at 423, 94 S.Ct., at 2736 (REHNQUIST, J., dissenting). It reviewed a state law that limited the use of the American flag and forbade the public exhibition of a flag that was distorted or marked. Id., at 407, 422, 94 S.Ct., at 2728, 2736. The appellant was convicted for violating the statute by displaying the flag upside down in the window of his apartment with a peace symbol attached to it. Eight Members of the Court held that the statute was unconstitutional as applied to appellant's activity. "There was no risk that appellant's acts would mislead viewers into assuming that the Government endorsed his viewpoint," and "his message was direct, likely to be understood, and within the contours of the First Amendment." Id., at 414-415, 94 S.Ct., at 2732. The Court concluded that since the state interest was not "significantly impaired," the conviction violated the First Amendment. Id., at 415, 94 S.Ct., at 2732. Similarly, in this case, the SFAA's primary purpose was to convey a political message that is nonmisleading and direct. This message, like the symbolic speech in Spence, is protected by the First Amendment.
*573 Language, even in a commercial context, properly belongs to the public, unless the Government's asserted interest is substantial, and unless the limitation imposed is no more extensive than necessary to serve that interest. See ante, at 2981, n. 16; see also Park 'N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S., at 215, n. 21, 105 S.Ct., at 672, n. 21 (STEVENS, J., dissenting), citing Otto Roth & Co. v. Universal Foods Corp., 640 F.2d 1317, 1320 (CCPA 1981) (recognizing importance of "free use of the language" in commercial speech context). [FN37] The Lanham Act is carefully crafted to prevent commercial monopolization of language that otherwise belongs in the public domain. See Park 'N Fly, Inc., supra, 469 U.S. at 200-201, 105 S.Ct., at 664-665. [FN38] The USOC demonstrates no need for additional protection. In my view, the SFAA therefore is entitled to use the word "Olympic" in a nonconfusing and nonmisleading manner in the noncommercial promotion of a theatrical or athletic event, absent proof of resultant harm to the USOC.
FN37. See also Bada Co. v. Montgomery Ward & Co., 426 F.2d 8, 11 (CA9) ("[O]ne competitor will not be permitted to impoverish the language of commerce by preventing his fellows from fairly describing their own goods"), cert. denied, 400 U.S. 916, 91 S.Ct. 174, 27 L.Ed.2d 155 (1970).
FN38. The Lanham Act "provides national protection of trademarks in order to secure to the owner of the mark the goodwill of his business and to protect the ability of consumers to distinguish among competing producers." Park 'N Fly, Inc., 469 U.S., at 198, 105 S.Ct., at 663.
I dissent.
The 1st Amendment & "Venerated Objects"
109 S.Ct. 2533
105 L.Ed.2d 342, 57 USLW 4770
(Cite as: 491 U.S. 397, 109 S.Ct. 2533)
TEXAS, Petitioner v. Gregory Lee JOHNSON.
No. 88-155.
Supreme Court of the United States
Argued March 21, 1989.
Decided June 21, 1989.
Defendant was convicted in the County Criminal Court No. 8, Dallas County, John C. Hendrik, J., of desecration of venerated object, and he appealed.
*399 Justice BRENNAN delivered the opinion of the Court.
After publicly burning an American flag as a means of political protest, Gregory Lee Johnson was convicted of desecrating a flag in violation of Texas law. This case presents the question whether his conviction is consistent with the First Amendment. We hold that it is not.
*****
We never before have held that the Government may ensure that a symbol be used to express only one view of that symbol or its referents. Indeed, in Schacht v. United States, we invalidated a federal statute permitting an actor portraying a member of one of our Armed Forces to " 'wear the uniform of that armed force if the portrayal does not tend to discredit that armed force.' " 398 U.S., at 60, 90 S.Ct., at 1557, quoting 10 U.S.C. § 772(f). This proviso, we held, "which leaves Americans free to praise the war in Vietnam but can send persons like Schacht to prison for opposing it, cannot survive in a country which has the First Amendment." Id., at 63, 90 S.Ct., at 1559.
We perceive no basis on which to hold that the principle underlying our decision in Schacht does not apply to this case. To conclude that the government may permit **2547 designated symbols to be used to communicate only a limited set of messages would be to enter territory having no discernible or defensible boundaries. Could the government, on this theory, prohibit the burning of state flags? Of copies of the Presidential seal? Of the Constitution? In evaluating these choices under the First Amendment, how would we decide which symbols were sufficiently special to warrant this unique status? To do so, we would be forced to consult our own political preferences, and impose them on the citizenry, in the very way that the First Amendment forbids us to do. See Carey v. Brown, 447 U.S., at 466-467, 100 S.Ct., at 2293-2294.
************
Chief Justice REHNQUIST, with whom Justice WHITE and Justice O'CONNOR join, dissenting.
****
Only two Terms ago, in San Francisco Arts & Athletics, Inc. v. United States Olympic Committee, 483 U.S. 522, 107 S.Ct. 2971, 97 L.Ed.2d 427 (1987), the Court held that Congress could grant exclusive use of the word "Olympic" to the United States Olympic Committee. The Court thought that this "restrictio [n] on expressive speech properly [was] characterized as incidental to the primary congressional purpose of encouraging and rewarding the USOC's activities." Id., at 536, 107 S.Ct., at 2981. As the Court stated, "when a word [or symbol] acquires value 'as the result of organization and the expenditure of labor, skill, and money' by an entity, that entity constitutionally may obtain a limited property right in the word [or symbol]." Id., at 532, 107 S.Ct., at 2974, quoting International News Service v. Associated Press, 248*430U.S. 215, 239, 39 S.Ct. 68, 72, 63 L.Ed. 211 (1918). Surely Congress or the States may recognize a similar interest in the flag.
******
Surely one of the high purposes of a democratic society is to legislate against conduct that is regarded as evil and profoundly offensive to the majority of people--whether it be murder, embezzlement, pollution, or flag burning.**** Uncritical extension of constitutional protection to the burning of the flag risks the frustration of the very purpose for which organized governments are instituted. The Court decides that the American flag is just another symbol, about which not only must opinions pro and con be tolerated, but for which the most minimal public respect may not be enjoined. The government may conscript men into the Armed Forces where they must fight and perhaps die for the flag, but the government may not prohibit the public burning of the banner under which they fight. I would uphold the Texas statute as applied in this case.
102d CONGRESS
1st Session
H. R. 2723
To grant the United States a copyright to the Flag of the United States and to impose criminal
penalties for the destruction of a copyrighted Flag.
IN THE HOUSE OF REPRESENTATIVES
Mr. TORRICELLI introduced the following bill; which was referred to the Committee on the
Judiciary A BILL
To grant the United States a copyright to the Flag of the United States and to impose criminal
penalties for the destruction of a copyrighted Flag.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
The United States is hereby granted a copyright to the Flag of the United States.
The United States hereby grants a license to any person to manufacture in the United States the Flag of the United States, and to sell and distribute such Flag.
Any Flag of the United States may only be displayed in accordance with chapter 1 of title 4, United States Code, (relating to the Flag of the United States) and the joint resolution entitled `Joint Resolution to codify and emphasize existing rules and customs pertaining to the display and use of the flag of the United States of America', approved June 22, 1942 (36 U.S.C. 174-178).
(a) IN GENERAL- Whoever burns or otherwise mutilates a Flag of the United States shall be
punished as follows:
(1) If the damage to such Flag exceeds $100, by a fine of not more than $10,000 or imprisonment
for not more than 10 years, or both.
(2) If the damage to such Flag does not exceed $100, by a fine of not more than $1,000 or
imprisonment for not more than one year, or both.
(b) EXCEPTION- Subsection (a) shall not apply with respect to whoever destroys a Flag of the United States in accordance with section 4 of the joint resolution referred to in section 3.
As used in this Act--
(1) the term `Flag of the United States' means a rectangular design which consists of 13 horizontal
stripes, alternate red and white, with a union of 50 white stars in a blue field, and which the
average person, upon seeing such design, may believe without deliberation to represent the Flag
of the United States of America; and
(2) the term `United States', when used in the geographical sense, means the 50 States, the
District of Columbia, the Commonwealth of Puerto Rico, any possession of the United States, the
Commonwealth of the Northern Mariana Islands, and the Trust Territory of the Pacific Islands.
1st Amendment -- Prior Restraint
604 F.2d 200
203 U.S.P.Q. 161, 5 Media L. Rep. 1814
DALLAS COWBOYS CHEERLEADERS, INC., Plaintiff-Appellee,
v.
PUSSYCAT CINEMA, LTD. and Michael Zaffarano, Defendants-Appellants.
No. 950, Docket 79-7179.
United States Court of Appeals,
Second Circuit.
Argued April 6, 1979.
Decided Aug. 14, 1979.
Plaintiff in this trademark infringement action is Dallas Cowboys Cheerleaders, Inc., a wholly owned subsidiary of the Dallas Cowboys Football Club, Inc. Plaintiff employs thirty-six women who perform dance and cheerleading routines at Dallas Cowboys football games. The cheerleaders have appeared frequently on television programs and make commercial appearances at such public events as sporting goods shows and shopping center openings. In addition, plaintiff licenses others to manufacture and distribute posters, calendars, T-shirts, and the like depicting Dallas Cowboys Cheerleaders in their uniforms. These products have enjoyed nationwide commercial success, due largely to the national exposure the Dallas Cowboys Cheerleaders have received through the news and entertainment media. Moreover, plaintiff has expended large amounts of money to acquaint the public with its uniformed cheerleaders and earns substantial revenue from their commercial appearances.
At all the football games and public events where plaintiff's cheerleaders appear and on all commercial items depicting the cheerleaders, the women are clad in plaintiff's distinctive uniform. The familiar outfit consists of white vinyl boots, white shorts, a white belt decorated with blue stars, a blue bolero blouse, and a white vest decorated with three blue stars on each side of the front and a white fringe around the bottom. In this action plaintiff asserts that it has a trademark in its uniform and that defendants have infringed and diluted that trademark in advertising and exhibiting "Debbie Does Dallas."
Pussycat Cinema, Ltd., is a New York corporation which owns a movie theatre in New York City; Zaffarano is the corporation's sole stockholder. In November 1978 the Pussycat Cinema began to show "Debbie Does Dallas," a gross and revolting sex film whose plot, to the extent that there is one, involves a cheerleader at a fictional high school, Debbie, who has been selected to become a "Texas Cowgirl." [FN1] In order to *203raise enough money to send Debbie, and eventually the entire squad, to Dallas, the cheerleaders perform sexual services for a fee. The movie consists largely of a series of scenes graphically depicting the sexual escapades of the "actors". In the movie's final scene Debbie dons a uniform strikingly similar to that worn by the Dallas Cowboys Cheerleaders and for approximately twelve minutes of film footage engages in various sex acts while clad or partially clad in the uniform. Defendants advertised the movie with marquee posters depicting Debbie in the allegedly infringing uniform and containing such captions as "Starring Ex Dallas Cowgirl Cheerleader Bambi Woods" and "You'll do more than cheer for this X Dallas Cheerleader." [FN2] Similar advertisements appeared in the newspapers.
FN1. The official appellation of plaintiff's cheerleaders is "Dallas Cowboys Cheerleaders", but the district court found that plaintiff also has a trademark in the names "Dallas Cowgirls" and "Texas Cowgirls" which have been made popular by the media.
FN2. Bambi Woods, the woman who played the role of Debbie, is not now and never has been a Dallas Cowboys Cheerleader.
Plaintiff brought this action alleging trademark infringement under section 43(a) of the Lanham Act (15 U.S.C. s 1125(a)), unfair competition, and dilution of trademark in violation of section 368-d of the New York General Business Law. The district court, in its oral opinion of February 13, 1979, found that "plaintiff ha(d) succeeded in proving by overwhelming evidence the merits of each one of its contentions." Defendants challenge the validity of all three claims.
[1][2][3][4] A preliminary issue raised by defendants is whether plaintiff has a valid trademark in its cheerleader uniform.[FN3] Defendants argue that the uniform is a purely functional item necessary for the performance of cheerleading routines and that it therefore is not capable of becoming a trademark. We do not quarrel with defendants' assertion that a purely functional item may not become a trademark. See In re Honeywell, Inc., 532 F.2d 180, 182-83 (C.C.P.A.1976). However, we do not agree that all of characteristics of plaintiff's uniform serve only a functional purpose or that, because an item is in part incidentally functional, it is necessarily precluded from being designated as a trademark. Plaintiff does not claim a trademark in all clothing designed and fitted to allow free movement while performing cheerleading routines, but claims a trademark in the particular combination of colors and collocation of decorations that distinguish plaintiff's uniform from those of other squads.[FN4] Cf. Socony Vacuum Oil Co. v. Rosen, 108 F.2d 632, 636 (6th Cir. 1940); John Wright, Inc. v. Casper Corp., 419 F.Supp. 292, 317 (E.D.Pa.1976). It is well established that, if the design of an item is nonfunctional and has acquired secondary meaning,[FN5] the design may become a trademark even if the item itself is functional. Ives Laboratories, Inc. v. Darby Drug Co., 601 F.2d 631, 642 (2d Cir. 1979); Truck Equipment Service Co. v. Fruehauf Corp., 536 F.2d 1210, 1215 (8th Cir.), Cert. denied, 429 U.S. 861, 97 S.Ct. 164, 50 L.Ed.2d 139 (1976). Moreover, when a feature of the construction of the item is arbitrary, the feature may become a trademark even though it serves a useful purpose. In *204 re Deister Concentrator Co., 289 F.2d 496, 506, 48 C.C.P.A. 952 (1961); Fotomat Corp. v. Cochran, 437 F.Supp. 1231 (D.Kan.1977). Thus, the fact that an item serves or performs a function does not mean that it may not at the same time be capable of indicating sponsorship or origin, particularly where the decorative aspects of the item are nonfunctional. See In re Penthouse International Ltd., 565 F.2d 679, 681 (Cust. & Pat.App.1977). See also In re World's Finest Chocolate, Inc., 474 F.2d 1012 (Cust. & Pat.App.1973). In the instant case the combination of the white boots, white shorts, blue blouse, and white star- studded vest and belt is an arbitrary design which makes the otherwise functional uniform trademarkable. [FN6]
FN3. At present plaintiff does not have a registered trademark or service mark in its uniform. However, plaintiff still may prevail if it establishes that it has a common law trademark or service mark. See Boston Professional Hockey Association v. Dallas Cap & Emblem Mfg., Inc., 510 F.2d 1004, 1010 (5th Cir.), Cert. denied, 423 U.S. 991, 96 S.Ct. 408, 46 L.Ed.2d 312 (1975); New York General Business Law s 368- d. Whether plaintiff's uniform is considered as a trademark or a service mark, the standards for determining infringement are the same. West &Co. v. Arica Institute, Inc., 557 F.2d 338, 340 n. 1 (2d Cir. 1977).
FN4. Plaintiff's design imparts a western flavor appropriate for a Texas cheerleading squad. The design is in no way essential to the performance of cheerleading routines and to that extent is not a functional aspect of the uniform.
FN5. Secondary meaning is "(t)he power of a name or other configuration to symbolize a particular business, product or company . . . ." Ideal Toy Corp. v. Kenner Products Division of General Mills Fun Group, Inc., 443 F.Supp. 291, 305 n. 14 (S.D.N.Y.1977). There is no dispute in this case that plaintiff's uniform is universally recognized as the symbol of the Dallas Cowboys Cheerleaders.
FN6. Although color alone is not capable of becoming a trademark, a combination of colors together with a distinctive arbitrary design may serve as a trademark. Quabaug Rubber Co. v. Fabiano Shoe Co., 567 F.2d 154, 161 (1st Cir. 1977).
*****
Having found that plaintiff has a trademark in its uniform, we must determine whether the depiction of the uniform in "Debbie Does Dallas" violates that trademark. The district court found that the uniform worn in the movie and shown on the marquee closely resembled plaintiff's uniform and that the public was likely to identify it as plaintiff's uniform. Our own comparison of the two uniforms convinces us that the district court was correct,[FN7] and defendants do not seriously contend that the uniform shown in the movie is not almost identical with plaintiff's.
***
[8][9][10] Defendants assert that the copyright doctrine of "fair use" should be held applicable to trademark infringement actions and that we should apply the doctrine to sanction their use of a replica of plaintiff's uniform. Fair use is "a 'privilege in others than the owner of a copyright to use the copyrighted material in a reasonable manner without his consent . . . .' " Rosemont Enterprises, Inc. v. Random *206 House, Inc., 366 F.2d 303, 306 (2d Cir. 1966) (quoting Ball, The Law of Copyright and Literary Property 260 (1944)), Cert. denied, 385 U.S. 1009, 87 S.Ct. 714, 17 L.Ed.2d 546 (1967). The fair use doctrine allows adjustments of conflicts between the first amendment and the copyright laws, See 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), and is designed primarily to balance "the exclusive rights of a copyright holder with the public's interest in dissemination of information affecting areas of universal concern, such as art, science and industry." Id. at 94. It is unlikely that the fair use doctrine is applicable to trademark infringements; [FN9] however, we need not reach that question. Although, as defendants assert, the doctrine of fair use permits limited copyright infringement for purposes of parody, See Berlin v. E. C. Publications, Inc., 329 F.2d 541 (2d Cir. 1964), Cert. denied, 379 U.S. 822, 85 S.Ct. 46, 13 L.Ed.2d 33 (1965), defendants' use of plaintiff's uniform hardly qualifies as parody or any other form of fair use. See Walt Disney Productions v. Mature Pictures Corp., 389 F.Supp. 1397, 1398 (S.D.N.Y.1975).
FN9. Because the primary purpose of the trademark laws is to protect the public from confusion, See W. E. Basset Co. v. Revlon, Inc., 354 F.2d868, 871 (2d Cir. 1966), it would be somewhat anomalous to hold that the confusing use of another's trademark is "fair use". See also Truck Equipment Service Co. v. Fruehauf Corp., supra, 536 F.2d at 1215.
[11][12] Nor does any other first amendment doctrine protect defendants' infringement of plaintiff's trademark. That defendants' movie may convey a barely discernible message [FN10] does not entitle them to appropriate plaintiff's trademark in the process of conveying that message. See Interbank Card Association v. Simms, 431 F.Supp. 131 (M.D.N.C.1977); Edgar Rice Burroughs, Inc. v. Manns Theatres, 195 U.S.P.Q. 159 (C.D.Cal.1976); Coca-Cola Co. v. Gemini Rising, Inc., supra, 346 F.Supp. at 1191. Plaintiff's trademark is in the nature of a property right, See Hanover Milling Co. v. Metcalf, 240 U.S. 403, 413, 36 S.Ct. 357, 60 L.Ed. 713 (1915); Alfred Dunhill of London, Inc. v. Dunhill Tailored Clothes, Inc., 293 F.2d 685, 692, 49 C.C.P.A. 730 (1961), Cert. denied, 369 U.S. 864, 82 S.Ct. 1030, 8 L.Ed.2d 84 (1962), and as such it need not "yield to the exercise of First Amendment rights under circumstances where adequate alternative avenues of communication exist." Lloyd Corp. v. Tanner, 407 U.S. 551, 567, 92 S.Ct. 2219, 2228, 33 L.Ed.2d 31 (1972). Because there are numerous ways in which defendants may comment on "sexuality in athletics" without infringing plaintiff's trademark, the district court did not encroach upon their first amendment rights in granting a preliminary injunction. See Walt Disney Productions v. Air Pirates, 581 F.2d 751, 758-59 (9th Cir. 1978); Reddy Communications, Inc. v. Environmental Action Foundation, 199 U.S.P.Q. 630, 634 (D.D.C.1977).
FN10. The question whether "Debbie Does Dallas" is obscene is not before us.
[13][14] For similar reasons, the preliminary injunction did not constitute an unconstitutional "prior restraint". This is not a case of government censorship, but a private plaintiff's attempt to protect its property rights. The propriety of a preliminary injunction where such relief is sought is so clear that courts have often issued an injunction without even mentioning the first amendment. See, e. g., Gilliam v. American Broadcasting Cos., 538 F.2d 14 (2d Cir. 1976); Edgar Rice Burroughs, Inc. v. Manns Theatres, supra, 195 U.S.P.Q. 159. The prohibition of the Lanham Act is content neutral, Cf. Schacht v. United States, 398 U.S. 58, 90 S.Ct. 1555, 26 L.Ed.2d 44 (1970), and therefore does not arouse the fears that trigger the application of constitutional "prior restraint" principles.
****
1st Amendment -- The Public Domain
989 F.2d 1512
26 U.S.P.Q.2d 1362, 21 Media L. Rep. 1330
Vanna WHITE, Plaintiff-Appellant,
v.
SAMSUNG ELECTRONICS AMERICA, INC.; David Deutsch Associates, Defendants-
Appellees.
No. 90-55840.
United States Court of Appeals,
Ninth Circuit.
March 18, 1993.
Prior report: 971 F.2d 1395.
Before GOODWIN, PREGERSON and ALARCON, Circuit Judges.
The panel has voted unanimously to deny the petition for rehearing. Circuit Judge Pregerson has voted to reject the suggestion for rehearing en banc, and Circuit Judge Goodwin so recommends. Circuit Judge Alarcon has voted to accept the suggestion for rehearing en banc.
The full court has been advised of the suggestion for rehearing en banc. An active judge requested a vote on whether to rehear the matter en banc. The matter failed to receive a majority of the votes of the nonrecused active judges in favor of en banc consideration. Fed.R.App.P. 35.
The petition for rehearing is DENIED and the suggestion for rehearing en banc is REJECTED.
KOZINSKI, Circuit Judge, with whom Circuit Judges O'SCANNLAIN and KLEINFELD join, dissenting from the order rejecting the suggestion for rehearing en banc.
I
Saddam Hussein wants to keep advertisers from using his picture in unflattering contexts. [FN1] Clint Eastwood doesn't want tabloids to write about him. [FN2] Rudolf Valentino's heirs want to control his film biography. [FN3] The Girl Scouts don't want their image soiled by association with certain activities. [FN4] George Lucas wants to keep Strategic Defense Initiative fans from calling it "Star Wars." [FN5] Pepsico doesn't want singers to use the word "Pepsi" in their songs. [FN6] Guy Lombardo wants an exclusive*1513property right to ads that show big bands playing on New Year's Eve. [FN7] Uri Geller thinks he should be paid for ads showing psychics bending metal through telekinesis. [FN8] Paul Prudhomme, that household name, thinks the same about ads featuring corpulent bearded chefs. [FN9] And scads of copyright holders see purple when their creations are made fun of. [FN10]
FN1. See Eben Shapiro, Rising Caution on Using Celebrity Images, N.Y. Times, Nov. 4, 1992, at D20 (Iraqi diplomat objects on right of publicity grounds to ad containing Hussein's picture and caption "History has shown what happens when one source controls all the information").
FN2. Eastwood v. Superior Court, 149 Cal.App.3d 409, 198 Cal.Rptr. 342 (1983).
FN3. Guglielmi v. Spelling-Goldberg Prods., 25 Cal.3d 860, 160 Cal.Rptr. 352, 603 P.2d 454 (1979) (Rudolph Valentino); see also Maheu v. CBS, Inc., 201 Cal.App.3d 662, 668, 247 Cal.Rptr. 304 (1988) (aide to Howard Hughes). Cf. Frank Gannon, Vanna Karenina, in Vanna Karenina and Other Reflections (1988) (A humorous short story with a tragic ending. "She thought of the first day she had met VR__SKY. How foolish she had been. How could she love a man who wouldn't even tell her all the letters in his name?").
FN4. Girl Scouts v. Personality Posters Mfg., 304 F.Supp. 1228 (S.D.N.Y.1969) (poster of a pregnant girl in a Girl Scout uniform with the caption "Be Prepared").
FN5. Lucasfilm Ltd. v. High Frontier, 622 F.Supp. 931 (D.D.C.1985).
FN6. Pepsico Inc. claimed the lyrics and packaging of grunge rocker Tad Doyle's "Jack Pepsi" song were "offensive to [it] and [ ...] likely to offend [its] customers," in part because they "associate [Pepsico] and its Pepsi marks with intoxication and drunk driving." Deborah Russell, Doyle Leaves Pepsi Thirsty for Compensation, Billboard, June 15, 1991, at 43. Conversely, the Hell's Angels recently sued Marvel Comics to keep it from publishing a comic book called "Hell's Angel," starring a character of the same name. Marvel settled by paying $35,000 to charity and promising never to use the name "Hell's Angel" again in connection with any of its publications. Marvel, Hell's Angels Settle Trademark Suit, L.A. Daily J., Feb. 2, 1993, § II, at 1.
Trademarks are often reflected in the mirror of our popular culture. See Truman Capote, Breakfast at Tiffany's (1958); Kurt Vonnegut, Jr., Breakfast of Champions (1973); Tom Wolfe, The Electric Kool-Aid Acid Test (1968) (which, incidentally, includes a chapter on the Hell's Angels); Larry Niven, Man of Steel, Woman of Kleenex, in All the Myriad Ways (1971); Looking for Mr. Goodbar (1977); The Coca-Cola Kid (1985) (using Coca-Cola as a metaphor for American commercialism); The Kentucky Fried Movie (1977); Harley Davidson and the Marlboro Man (1991); The WonderYears (ABC 1988-present) ("Wonder Years" was a slogan of Wonder Bread); Tim Rice & Andrew Lloyd Webber, Joseph and the Amazing Technicolor Dream Coat (musical).
Hear Janis Joplin, Mercedes Benz, on Pearl (CBS 1971); Paul Simon, Kodachrome, on There Goes Rhymin' Simon (Warner 1973); Leonard Cohen, Chelsea Hotel, on The Best of Leonard Cohen (CBS 1975); Bruce Springsteen, Cadillac Ranch, on The River (CBS 1980); Prince, Little Red Corvette, on 1999 (Warner 1982); dada, Dizz Knee Land, on Puzzle (IRS 1992) ("I just robbed a grocery store--I'm going to Disneyland / I just flipped off President George--I'm going to Disneyland"); Monty Python, Spam, on The Final Rip Off (Virgin 1988); Roy Clark, Thank God and Greyhound [You're Gone], on Roy Clark's Greatest Hits Volume I (MCA 1979); Mel Tillis, Coca- Cola Cowboy, on The Very Best of (MCA 1981) ("You're just a Coca-Cola cowboy / You've got an Eastwood smile and Robert Redford hair ...").
Dance to Talking Heads, Popular Favorites 1976-92: Sand in the Vaseline (Sire 1992); Talking Heads, Popsicle, on id. Admire Andy Warhol, Campbell's Soup Can. Cf. REO Speedwagon, 38 Special, and Jello Biafra of the Dead Kennedys.
The creators of some of these works might have gotten permission from the trademark owners, though it's unlikely Kool-Aid relished being connected with LSD, Hershey with homicidal maniacs, Disney with armed robbers, or Coca-Cola with cultural imperialism. Certainly no free society can demand that artists get such permission.
FN7. Lombardo v. Doyle, Dane & Bernbach, Inc., 58 A.D.2d 620, 396 N.Y.S.2d 661 (1977).
FN8. Geller v. Fallon McElligott, No. 90-Civ-2839 (S.D.N.Y. July 22, 1991) (involving a Timex ad).
FN9. Prudhomme v. Procter & Gamble Co., 800 F.Supp. 390 (E.D.La.1992).
FN10. E.g., Acuff-Rose Music, Inc. v. Campbell, 972 F.2d 1429 (6th Cir.1992); Cliffs Notes v. Bantam Doubleday Dell Publishing Group, Inc., 886 F.2d 490 (2d Cir.1989); Fisher v. Dees, 794 F.2d 432 (9th Cir.1986); MCA, Inc. v. Wilson, 677 F.2d 180 (2d Cir.1981); Elsmere Music, Inc. v. NBC, 623 F.2d 252 (2d Cir.1980); Walt Disney Prods. v. The Air Pirates, 581 F.2d 751 (9th Cir.1978); Berlin v. E.C. Publications, Inc., 329 F.2d 541 (2d Cir.1964); Lowenfels v. Nathan, 2 F.Supp. 73 (S.D.N.Y.1932).
Something very dangerous is going on here. Private property, including intellectual property, is essential to our way of life. It provides an incentive for investment and innovation; it stimulates the flourishing of our culture; it protects the moral entitlements of people to the fruits of their labors. But reducing too much to private property can be bad medicine. Private land, for instance, is far more useful if separated from other private land by public streets, roads and highways. Public parks, utility rights-of- way and sewers reduce the amount of land in private hands, but vastly enhance the value of the property that remains.
So too it is with intellectual property. Overprotecting intellectual property is as harmful as underprotecting it. Creativity is impossible without a rich public domain. Nothing today, likely nothing since we tamed fire, is genuinely new: Culture, like science and technology, grows by accretion, each new creator building on the works of those who came before. Overprotection stifles the very creative forces it's supposed to nurture. [FN11]
FN11. See Wendy J. Gordon, A Property Right in Self Expression: Equality and Individualism in the Natural Law of Intellectual Property, 102 Yale L.J. 1533, 1556-57 (1993).
*1514 The panel's opinion is a classic case of overprotection. Concerned about what it sees as a wrong done to Vanna White, the panel majority erects a property right of remarkable and dangerous breadth: Under the majority's opinion, it's now a tort for advertisers to remind the public of a celebrity. Not to use a celebrity's name, voice, signature or likeness; not to imply the celebrity endorses a product; but simply to evoke the celebrity's image in the public's mind. This Orwellian notion withdraws far more from the public domain than prudence and common sense allow. It conflicts with the Copyright Act and the Copyright Clause. It raises serious First Amendment problems. It's bad law, and it deserves a long, hard second look.
II
Samsung ran an ad campaign promoting its consumer electronics. Each ad depicted a Samsung product and a humorous prediction: One showed a raw steak with the caption "Revealed to be health food. 2010 A.D." Another showed Morton Downey, Jr. in front of an American flag with the caption "Presidential candidate. 2008 A.D." [FN12] The ads were meant to convey--humorously--that Samsung products would still be in use twenty years from now.
FN12. I had never heard of Morton Downey, Jr., but I'm told he's sort of like Rush Limbaugh, but not as shy.
The ad that spawned this litigation starred a robot dressed in a wig, gown and jewelry reminiscent of Vanna White's hair and dress; the robot was posed next to a Wheel-of-Fortune-like game board. See Appendix. The caption read "Longest-running game show. 2012 A.D." The gag here, I take it, was that Samsung would still be around when White had been replaced by a robot.
Perhaps failing to see the humor, White sued, alleging Samsung infringed her right of publicity by "appropriating" her "identity." Under California law, White has the exclusive right to use her name, likeness, signature and voice for commercial purposes. Cal.Civ.Code § 3344(a); Eastwood v. Superior Court, 149 Cal.App.3d 409, 417, 198 Cal.Rptr. 342, 347 (1983). But Samsung didn't use her name, voice or signature, and it certainly didn't use her likeness. The ad just wouldn't have been funny had it depicted White or someone who resembled her--the whole joke was that the game show host(ess) was a robot, not a real person. No one seeing the ad could have thought this was supposed to be White in 2012.
The district judge quite reasonably held that, because Samsung didn't use White's name, likeness, voice or signature, it didn't violate her right of publicity. 971 F.2d at 1396-97. Not so, says the panel majority: The California right of publicity can't possibly be limited to name and likeness. If it were, the majority reasons, a "clever advertising strategist" could avoid using White's name or likeness but nevertheless remind people of her with impunity, "effectively eviscerat[ing]" her rights. To prevent this "evisceration," the panel majority holds that the right of publicity must extend beyond name and likeness, to any "appropriation" of White's "identity"-- anything that "evoke[s]" her personality. Id. at 1398-99.
III
But what does "evisceration" mean in intellectual property law? Intellectual property rights aren't like some constitutional rights, absolute guarantees protected against all kinds of interference, subtle as well as blatant. [FN13] They cast no penumbras, emit no emanations: The very point of intellectual property laws is that they protect only against certain specific kinds of appropriation. I can't publish unauthorized copies of, say, Presumed Innocent; I can't make a movie out of it. But I'm *1515perfectly free to write a book about an idealistic young prosecutor on trial for a crime he didn't commit. [FN14] So what if I got the idea from Presumed Innocent? So what if it reminds readers of the original? Have I "eviscerated" Scott Turow's intellectual property rights? Certainly not. All creators draw in part on the work of those who came before, referring to it, building on it, poking fun at it; we call this creativity, not piracy. [FN15]
FN13. Cf., e.g., Guinn v. United States, 238 U.S. 347, 364-65, 35 S.Ct. 926, 931, 59 L.Ed. 1340 (1915) (striking down grandfather clause that was a clear attempt to evade the Fifteenth Amendment).
FN14. It would be called "Burden of Going Forward with the Evidence," and the hero would ultimately be saved by his lawyer's adept use of Fed.R.Evid. 301.
FN15. In the words of Sir Isaac Newton, "[i]f I have seen further it is by standing on [the shoulders] of Giants." Letter to Robert Hooke, Feb. 5, 1675/1676.
Newton himself may have borrowed this phrase from Bernard of Chartres, who said something similar in the early twelfth century. Bernard in turn may have snatched it from Priscian, a sixth century grammarian. See Lotus Dev. Corp. v. Paperback Software Int'l, 740 F.Supp. 37, 77 n. 3 (D.Mass.1990).
The majority isn't, in fact, preventing the "evisceration" of Vanna White's existing rights; it's creating a new and much broader property right, a right unknown in California law. [FN16] It's replacing the existing balance between the interests of the celebrity and those of the public by a different balance, one substantially more favorable to the celebrity. Instead of having an exclusive right in her name, likeness, signature or voice, every famous person now has an exclusive right to anything that reminds the viewer of her. After all, that's all Samsung did: It used an inanimate object to remind people of White, to "evoke [her identity]." 971 F.2d at 1399. [FN17]
FN16. In fact, in the one California case raising the issue, the three state Supreme Court Justices who discussed this theory expressed serious doubts about it. Guglielmi v. Spelling-Goldberg Prods., 25 Cal.3d 860, 864 n. 5, 160 Cal.Rptr. 352, 355 n. 5, 603 P.2d 454, 457 n. 5 (1979) (Bird, C.J., concurring) (expressing skepticism about finding a property right to a celebrity's "personality" because it is "difficult to discern any easily applied definition for this amorphous term").
Neither have we previously interpreted California law to cover pure "identity." Midler v. Ford Motor Co., 849 F.2d 460 (9th Cir.1988), and Waits v. Frito-Lay, Inc., 978 F.2d 1093 (9th Cir.1992), dealt with appropriation of a celebrity's voice. See id. at 1100-01 (imitation of singing style, rather than voice, doesn't violate the right of publicity).
Motschenbacher v. R.J. Reynolds Tobacco Co., 498 F.2d 821 (9th Cir.1974), stressed that, though the plaintiff's likeness wasn't directly recognizable by itself, the surrounding circumstances would have made viewers think the likeness was the plaintiff's. Id. at 827; see also Moore v. Regents of the Univ. of Cal., 51 Cal.3d 120, 138, 271 Cal.Rptr. 146, 157, 793 P.2d 479, 490 (1990) (construing Motschenbacher as "hold [ing] that every person has a proprietary interest in his own likeness").
FN17. Some viewers might have inferred White was endorsing the product, but that's a different story. The right of publicity isn't aimed at or limited to false endorsements, Eastwood v. Superior Court, 149 Cal.App.3d 409, 419-20, 198 Cal.Rptr. 342, 348 (1983); that's what the Lanham Act is for.
Note also that the majority's rule applies even to advertisements that unintentionally remind people of someone. California law is crystal clear that the common-law right of publicity may be violated even by unintentional appropriations. Id. at 417 n. 6, 198 Cal.Rptr. at 346 n. 6; Fairfield v. American Photocopy Equipment Co., 138 Cal.App.2d 82, 87, 291 P.2d 194 (1955).
Consider how sweeping this new right is. What is it about the ad that makes people think of White? It's not the robot's wig, clothes or jewelry; there must be ten million blond women (many of them quasi-famous) who wear dresses and jewelry like White's. It's that the robot is posed near the "Wheel of Fortune" game board. Remove the game board from the ad, and no one would think of Vanna White. See Appendix. But once you include the game board, anybody standing beside it--a brunette woman, a man wearing women's clothes, a monkey in a wig and gown--would evoke White's image, precisely the way the robot did. It's the "Wheel of Fortune" set, not the robot's face or dress or jewelry that evokes White's image. The panel is giving White an exclusive right not in what she looks like or who she is, but in what she does for a living. [FN18]
FN18. Once the right of publicity is extended beyond specific physical characteristics, this will become a recurring problem: Outside name, likeness and voice, the things that most reliably remind the public of celebrities are the actions or roles they're famous for. A commercial with an astronaut setting foot on the moon would evoke the image of Neil Armstrong. Any masked man on horseback would remind people (over a certain age) of Clayton Moore. And any number of songs--"My Way," "Yellow Submarine," "Like a Virgin," "Beat It," "Michael, Row the Boat Ashore," to name only a few--instantly evoke an image of the person or group who made them famous, regardless of who is singing.
See also Carlos V. Lozano, West Loses Lawsuit over Batman TV Commercial, L.A. Times, Jan. 18, 1990, at B3 (Adam West sues over Batman-like character in commercial); Nurmi v. Peterson, 10 U.S.P.Q.2d 1775, 1989 WL 407484 (C.D.Cal.1989) (1950s TV movie hostess "Vampira" sues 1980s TV hostess "Elvira"); text accompanying notes 7-8 (lawsuits brought by Guy Lombardo, claiming big bands playing at New Year's Eve parties remind people of him, and by Uri Geller, claiming psychics who can bend metal remind people of him). Cf. Motschenbacher, where the claim was that viewers would think plaintiff was actually in the commercial, and not merely that the commercial reminded people of him.
*1516 This is entirely the wrong place to strike the balance. Intellectual property rights aren't free: They're imposed at the expense of future creators and of the public at large. Where would we be if Charles Lindbergh had an exclusive right in the concept of a heroic solo aviator? If Arthur Conan Doyle had gotten a copyright in the idea of the detective story, or Albert Einstein had patented the theory of relativity? If every author and celebrity had been given the right to keep people from mocking them or their work? Surely this would have made the world poorer, not richer, culturally as well as economically. [FN19]
FN19. See generally Gordon, supra note 11; see also Michael Madow, Private Ownership of Public Image: Popular Culture and Publicity Rights, 81 Cal.L.Rev. 125, 201-03 (1993) (an excellent discussion).
This is why intellectual property law is full of careful balances between what's set aside for the owner and what's left in the public domain for the rest of us: The relatively short life of patents; the longer, but finite, life of copyrights; copyright's idea-expression dichotomy; the fair use doctrine; the prohibition on copyrighting facts; the compulsory license of television broadcasts and musical compositions; federal preemption of overbroad state intellectual property laws; the nominative use doctrine in trademark law; the right to make soundalike recordings. [FN20] All of these diminish an intellectual property owner's rights. All let the public use something created by someone else. But all are necessary to maintain a free environment in which creative genius can flourish.
FN20. See 35 U.S.C. § 154 (duration of patent); 17 U.S.C. §§ 302- 305 (duration of copyright); 17 U.S.C. § 102(b) (idea-expression dichotomy); 17 U.S.C. § 107 (fair use); Feist Pubs., Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, ----, 111 S.Ct. 1282, 1288, 113 L.Ed.2d 358 (1991) (no copyrighting facts); 17 U.S.C. §§ 115, 119(b) (compulsory licenses); Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 109 S.Ct. 971, 103 L.Ed.2d 118 (1989) (federal preemption); New Kids on the Block v. News America Publishing, Inc., 971 F.2d 302, 306-308 (9th Cir.1992) (nominative use); 17 U.S.C. § 114(b) (soundalikes); accord G.S. Rasmussen & Assocs. v. Kalitta Flying Serv., Inc., 958 F.2d 896, 900 n. 7 (9th Cir.1992); Daniel A. Saunders, Comment, Copyright Law's Broken Rear Window, 80 Cal.L.Rev. 179, 204-05 (1992). But see Midler v. Ford Motor Co., 849 F.2d 460 (9th Cir.1988).
The intellectual property right created by the panel here has none of these essential limitations: No fair use exception; no right to parody; no idea- expression dichotomy. It impoverishes the public domain, to the detriment of future creators and the public at large. Instead of well-defined, limited characteristics such as name, likeness or voice, advertisers will now have to cope with vague claims of "appropriation of identity," claims often made by people with a wholly exaggerated sense of their own fame and significance. See pp. 1512-13 & notes 1-10 supra. Future Vanna Whites might not get the chance to create their personae, because their employers may fear some celebrity will claim the persona is too similar to her own. [FN21] The public will be robbed of parodies of celebrities, and *1517 our culture will be deprived of the valuable safety valve that parody and mockery create.
FN21. If Christian Slater, star of "Heathers," "Pump up the Volume," "Kuffs," and "Untamed Heart"--and alleged Jack Nicholson clone--appears in a commercial, can Nicholson sue? Of 54 stories on LEXIS that talk about Christian Slater, 26 talk about Slater's alleged similarities to Nicholson. Apparently it's his nasal wisecracks and killer smiles, St. Petersburg Times, Jan. 10, 1992, at 13, his eyebrows, Ottawa Citizen, Jan. 10, 1992, at E2, his sneers, Boston Globe, July 26, 1991, at 37, his menacing presence, USA Today, June 26, 1991, at 1D, and his sing-song voice, Gannett News Service, Aug. 27, 1990 (or, some say, his insinuating drawl, L.A. Times, Aug. 22, 1990, at F5). That's a whole lot more than White and the robot had in common.
Moreover, consider the moral dimension, about which the panel majority seems to have gotten so exercised. Saying Samsung "appropriated" something of White's begs the question: Should White have the exclusive right to something as broad and amorphous as her "identity"? Samsung's ad didn't simply copy White's schtick--like all parody, it created something new. [FN22] True, Samsung did it to make money, but White does whatever she does to make money, too; the majority talks of "the difference between fun and profit," 971 F.2d at 1401, but in the entertainment industry fun is profit. Why is Vanna White's right to exclusive for-profit use of her persona--a persona that might not even be her own creation, but that of a writer, director or producer-- superior to Samsung's right to profit by creating its own inventions? Why should she have such absolute rights to control the conduct of others, unlimited by the idea-expression dichotomy or by the fair use doctrine?
FN22. Cf. New Kids on the Block v. News America Publishing, Inc., 971 F.2d 302, 307 n. 6 (9th Cir.1992) ("Where the infringement is small in relation to the new work created, the fair user is profiting largely from his own creative efforts rather than free-riding on another's work.").
To paraphrase only slightly Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340, ---- - ----, 111 S.Ct. 1282, 1289-90, 113 L.Ed.2d 358 (1991), it may seem unfair that much of the fruit of a creator's labor may be used by others without compensation. But this is not some unforeseen byproduct of our intellectual property system; it is the system's very essence. Intellectual property law assures authors the right to their original expression, but encourages others to build freely on the ideas that underlie it. This result is neither unfair nor unfortunate: It is the means by which intellectual property law advances the progress of science and art. We give authors certain exclusive rights, but in exchange we get a richer public domain. The majority ignores this wise teaching, and all of us are the poorer for it. [FN23]
FN23. The majority opinion has already earned some well-deserved criticisms on this score. Stephen R. Barnett, In Hollywood's Wheel of Fortune, Free Speech Loses a Turn, Wall St. J., Sept. 28, 1992, at A14; Stephen R. Barnett, Wheel of Misfortune for Advertisers: Ninth Circuit Misreads the Law to Protect Vanna White's Image, L.A. Daily J., Oct. 5, 1992, at 6; Felix H. Kent, California Court Expands Celebrities' Rights, N.Y.L.J., Oct. 30, 1992, at 3 ("To speak of the 'evisceration' of such a questionable common law right in a case that has probably gone the farthest of any case in any court in the United States of America is more than difficult to comprehend"); Shapiro, supra note 1 ("A fat chef? A blond robot in an evening gown? How far will this go?" (citing Douglas J. Wood, an advertising lawyer)). See also Mark Alan Stamaty, Washingtoon, Wash. Post, Apr. 5, 1993, at A21.
IV
The panel, however, does more than misinterpret California law: By refusing to recognize a parody exception to the right of publicity, the panel directly contradicts the federal Copyright Act. Samsung didn't merely parody Vanna White. It parodied Vanna White appearing in "Wheel of Fortune," a copyrighted television show, and parodies of copyrighted works are governed by federal copyright law.
Copyright law specifically gives the world at large the right to make "fair use" parodies, parodies that don't borrow too much of the original. Fisher v. Dees, 794 F.2d 432, 435 (9th Cir.1986). Federal copyright law also gives the copyright owner the exclusive right to create (or license the creation of) derivative works, which include parodies that borrow too much to qualify as "fair use." See Acuff-Rose Music, Inc. v. Campbell, 972 F.2d 1429, 1434-35 (6th Cir.1992). [FN24] When Mel Brooks, for instance, decided to parody Star Wars, he *1518 had two options: He could have stuck with his fair use rights under 17 U.S.C. § 107, or he could have gotten a license to make a derivative work under 17 U.S.C. § 106(b) from the holder of the Star Wars copyright. To be safe, he probably did the latter, but once he did, he was guaranteed a perfect right to make his movie. [FN25]
FN24. How much is too much is a hotly contested question, but one thing is clear: The right to make parodies belongs either to the public at large or to the copyright holder, not to someone who happens to appear in the copyrighted work.
FN25. See Spaceballs (1987). Compare Madonna: Truth or Dare (1991) with Medusa: Dare to Be Truthful (1991); Loaded Weapon I (1993) with Lethal Weapon (1987); Young Frankenstein (1974) with Bride of Frankenstein (1935).
The majority's decision decimates this federal scheme. It's impossible to parody a movie or a TV show without at the same time "evok[ing]" the "identit[ies]" of the actors. [FN26] You can't have a mock Star Wars without a mock Luke Skywalker, Han Solo and Princess Leia, which in turn means a mock Mark Hamill, Harrison Ford and Carrie Fisher. You can't have a mock Batman commercial without a mock Batman, which means someone emulating the mannerisms of Adam West or Michael Keaton. See Carlos V. Lozano, West Loses Lawsuit over Batman TV Commercial, L.A. Times, Jan. 18, 1990, at B3 (describing Adam West's right of publicity lawsuit over a commercial produced under license from DC Comics, owner of the Batman copyright). [FN27] The public's right to make a fair use parody and the copyright owner's right to license a derivative work are useless if the parodist is held hostage by every actor whose "identity" he might need to "appropriate."
FN26. 17 U.S.C. § 301(b)(1) limits the Copyright Act's preemptive sweep to subject matter "fixed in any tangible medium of expression," but White's identity--her look as the hostess of Wheel of Fortune--is definitely fixed: It consists entirely of her appearances in a fixed, copyrighted TV show. See Baltimore Orioles v. Major League Baseball Players Ass'n, 805 F.2d 663, 675 & n. 22 (7th Cir.1986).
FN27. Cf. Lugosi v. Universal Pictures, 25 Cal.3d 813, 827-28, 160 Cal.Rptr. 323, 331-32, 603 P.2d 425, 433-34 (1979) (Mosk, J., concurring) (pointing out that rights in characters should be owned by the copyright holder, not the actor who happens to play them); Baltimore Orioles, 805 F.2d at 674-79 (baseball players' right of publicity preempted by copyright law as to telecasts of games).
Our court is in a unique position here. State courts are unlikely to be particularly sensitive to federal preemption, which, after all, is a matter of first concern to the federal courts. The Supreme Court is unlikely to consider the issue because the right of publicity seems so much a matter of state law. That leaves us. It's our responsibility to keep the right of publicity from taking away federally granted rights, either from the public at large or from a copyright owner. We must make sure state law doesn't give the Vanna Whites and Adam Wests of the world a veto over fair use parodies of the shows in which they appear, or over copyright holders' exclusive right to license derivative works of those shows. In a case where the copyright owner isn't even a party-- where no one has the interests of copyright owners at heart--the majority creates a rule that greatly diminishes the rights of copyright holders in this circuit.
V
The majority's decision also conflicts with the federal copyright system in another, more insidious way. Under the dormant Copyright Clause, state intellectual property laws can stand only so long as they don't "prejudice the interests of other States." Goldstein v. California, 412 U.S. 546, 558, 93 S.Ct. 2303, 2310, 37 L.Ed.2d 163 (1973). A state law criminalizing record piracy, for instance, is permissible because citizens of other states would "remain free to copy within their borders those works which may be protected elsewhere." Id. But the right of publicity isn't geographically limited. A right of publicity created by one state applies to conduct everywhere, so long as it involves a celebrity domiciled in that state. If a Wyoming resident creates an ad that features a California domiciliary's name or likeness, he'll be subject to California right of publicity law even if he's careful to keep the ad from being shown in California. See Acme Circus Operating Co. v. Kuperstock, 711 F.2d 1538, 1540 (11th Cir.1983); Groucho Marx Prods. v. Day and Night Co., 689 F.2d 317, 320 (2d Cir.1982); see*1519also Factors Etc. v. Pro Arts, 652 F.2d 278, 281 (2d Cir.1981).
The broader and more ill-defined one state's right of publicity, the more it interferes with the legitimate interests of other states. A limited right that applies to unauthorized use of name and likeness probably does not run afoul of the Copyright Clause, but the majority's protection of "identity" is quite another story. Under the majority's approach, any time anybody in the United States--even somebody who lives in a state with a very narrow right of publicity--creates an ad, he takes the risk that it might remind some segment of the public of somebody, perhaps somebody with only a local reputation, somebody the advertiser has never heard of. See note 17 supra (right of publicity is infringed by unintentional appropriations). So you made a commercial in Florida and one of the characters reminds Reno residents of their favorite local TV anchor (a California domiciliary)? Pay up.
This is an intolerable result, as it gives each state far too much control over artists in other states. No California statute, no California court has actually tried to reach this far. It is ironic that it is we who plant this kudzu in the fertile soil of our federal system.
VI
Finally, I can't see how giving White the power to keep others from evoking her image in the public's mind can be squared with the First Amendment. Where does White get this right to control our thoughts? The majority's creation goes way beyond the protection given a trademark or a copyrighted work, or a person's name or likeness. All those things control one particular way of expressing an idea, one way of referring to an object or a person. But not allowing any means of reminding people of someone? That's a speech restriction unparalleled in First Amendment law. [FN28]
FN28. Just compare the majority's holding to the intellectual propertylaws upheld by the Supreme Court. The Copyright Act is constitutional precisely because of the fair use doctrine and the idea-expression dichotomy, Harper & Row v. Nation Enterprises, 471 U.S. 539, 560, 105 S.Ct. 2218, 2230, 85 L.Ed.2d 588 (1985), two features conspicuously absent from the majority's doctrine. The right of publicity at issue in Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 576, 97 S.Ct. 2849, 2857-58, 53 L.Ed.2d 965 (1977), was only the right to "broadcast of petitioner's entire performance," not "the unauthorized use of another's name for purposes of trade." Id. Even the statute upheld in San Francisco Arts & Athletics, Inc. v. United States Olympic Comm., 483 U.S. 522, 530, 107 S.Ct. 2971, 2977, 97 L.Ed.2d 427 (1987), which gave the USOC sweeping rights to the word "Olympic," didn't purport to protect all expression that reminded people of the Olympics.
What's more, I doubt even a name-and-likeness-only right of publicity can stand without a parody exception. The First Amendment isn't just about religion or politics--it's also about protecting the free development of our national culture. Parody, humor, irreverence are all vital components of the marketplace of ideas. The last thing we need, the last thing the First Amendment will tolerate, is a law that lets public figures keep people from mocking them, or from "evok[ing]" their images in the mind of the public. 971 F.2d at 1399. [FN29]
FN29. The majority's failure to recognize a parody exception to the right of publicity would apply equally to parodies of politicians as of actresses. Consider the case of Wok Fast, a Los Angeles Chinese food delivery service, which put up a billboard with a picture of then-L.A. Police Chief Daryl Gates and the text "When you can't leave the office. Or won't." (This was an allusion to Chief Gates's refusal to retire despite pressure from Mayor Tom Bradley.) Gates forced the restaurant to take the billboard down by threatening a right of publicity lawsuit. Leslie Berger, He Did Leave the Office--And Now Sign Will Go, Too, L.A. Times, July 31, 1992, at B2.
See also Samsung Has Seen the Future: Brace Youself, Adweek, Oct. 3, 1988, at 26 (ER 72) (Samsung planned another ad that would show a dollar bill with Richard Nixon's face on it and the caption 'Dollar bill, 2025 A.D..,' but Nixon refused permission to use his likeness); Madow supra note 19, at 142-46 (discussing other politically and culturally charged parodies).
The majority dismisses the First Amendment issue out of hand because Samsung's ad was commercial speech. Id. at 1401 & n. 3. So what? Commercial speech may be less protected by the First Amendment than noncommercial speech, but less protected means protected nonetheless. Central *1520Hudson Gas & Elec. Corp. v. Public Serv. Comm'n, 447 U.S. 557, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980). And there are very good reasons for this. Commercial speech has a profound effect on our culture and our attitudes. Neutral-seeming ads influence people's social and political attitudes, and themselves arouse political controversy. [FN30] "Where's the Beef?" turned from an advertising catchphrase into the only really memorable thing about the 1984 presidential campaign. [FN31] Four years later, Michael Dukakis called George Bush "the Joe Isuzu of American politics." [FN32]
FN30. See, e.g., Bruce Horovitz, Nike Does It Again; Firm Targets Blacks with a Spin on "Family Values", L.A. Times, Aug. 25, 1992, at D1 ("The ad reinforces a stereotype about black fathers" (quoting Lawrence A. Johnson of Howard University)); Gaylord Fields, Advertising Awards-Show Mania: CEBA Awards Honors Black-Oriented Advertising, Back Stage, Nov. 17, 1989, at 1 (quoting the Rev. Jesse Jackson as emphasizing the importance of positive black images in advertising); Debra Kaufman, Quality of Hispanic Production Rising to Meet Clients' Demands, Back Stage, July 14, 1989, at 1 (Hispanic advertising professional stresses importance of positive Hispanic images in advertising); Marilyn Elias, Medical Ads Often Are Sexist, USA Today, May 18, 1989, at 1D ("There's lots of evidence that this kind of ad reinforces stereotypes" (quoting Julie Edell of Duke University)).
FN31. See Wendy's Kind of Commercial; "Where's the Beef" Becomes National Craze, Broadcasting, Mar. 26, 1984, at 57.
FN32. See Gregory Gordon, Candidates Look for Feedback Today, UPI, Sept. 26, 1988.
In our pop culture, where salesmanship must be entertaining and entertainment must sell, the line between the commercial and noncommercial has not merely blurred; it has disappeared. Is the Samsung parody any different from a parody on Saturday Night Live or in Spy Magazine? Both are equally profit-motivated. Both use a celebrity's identity to sell things--one to sell VCRs, the other to sell advertising. Both mock their subjects. Both try to make people laugh. Both add something, perhaps something worthwhile and memorable, perhaps not, to our culture. Both are things that the people being portrayed might dearly want to suppress. See notes 1 & 29 supra.
Commercial speech is a significant, valuable part of our national discourse. The Supreme Court has recognized as much, and has insisted that lower courts carefully scrutinize commercial speech restrictions, but the panel totally fails to do this. The panel majority doesn't even purport to apply the Central Hudson test, which the Supreme Court devised specifically for determining whether a commercial speech restriction is valid. [FN33] The majority doesn't ask, as Central Hudson requires, whether the speech restriction is justified by a substantial state interest. It doesn't ask whether the restriction directly advances the interest. It doesn't ask whether the restriction is narrowly tailored to the interest. See id. at 566, 100 S.Ct. at 2351. [FN34] These are all things the Supreme Court told us--in no uncertain terms--we must consider; the majority opinion doesn't even mention them. [FN35]
FN33. Its only citation to Central Hudson is a seeming afterthought, buried in a footnote, and standing only for the proposition that commercial speech is less protected under the First Amendment. See 971 F.2d at 1401 n. 3.
FN34. See also Board of Trustees v. Fox, 492 U.S. 469, 476-81, 109 S.Ct. 3028, 3032-35, 106 L.Ed.2d 388 (1989) (reaffirming "narrowly tailored" requirement, but making clear it's not a "least restrictive means" test).
The government has a freer hand in regulating false or misleading commercial speech, but this isn't such a regulation. Some "appropriations" of a person's "identity" might misleadingly suggest an endorsement, but the mere possibility that speech might mislead isn't enough to strip it of First Amendment protection. See Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626, 644, 105 S.Ct. 2265, 2278, 85 L.Ed.2d 652 (1985).
FN35. Neither does it discuss whether the speech restriction is unconstitutionally vague. Posadas de P.R. Assocs. v. Tourism Co., 478 U.S. 328, 347, 106 S.Ct. 2968, 2980, 92 L.Ed.2d 266 (1986).
Process matters. The Supreme Court didn't set out the Central Hudson test for its health. It devised the test because it saw lower courts were giving the First Amendment short shrift when confronted with commercial speech. See Central Hudson, 447 U.S. at 561-62, 567-68, 100 S.Ct. at 2348-49, 2352. The Central Hudson test was an attempt to constrain lower courts' discretion, to focus judges' thinking *1521 on the important issues--how strong the state interest is, how broad the regulation is, whether a narrower regulation would work just as well. If the Court wanted to leave these matters to judges' gut feelings, to nifty lines about "the difference between fun and profit," 971 F.2d at 1401, it could have done so with much less effort.
Maybe applying the test would have convinced the majority to change its mind; maybe going through the factors would have shown that its rule was too broad, or the reasons for protecting White's "identity" too tenuous. Maybe not. But we shouldn't thumb our nose at the Supreme Court by just refusing to apply its test.
VII
For better or worse, we are the Court of Appeals for the Hollywood Circuit. Millions of people toil in the shadow of the law we make, and much of their livelihood is made possible by the existence of intellectual property rights. But much of their livelihood--and much of the vibrancy of our culture--also depends on the existence of other intangible rights: The right to draw ideas from a rich and varied public domain, and the right to mock, for profit as well as fun, the cultural icons of our time.
In the name of avoiding the "evisceration" of a celebrity's rights in her image, the majority diminishes the rights of copyright holders and the public at large. In the name of fostering creativity, the majority suppresses it. Vanna White and those like her have been given something they never had before, and they've been given it at our expense. I cannot agree.
Copyrightable Subject Matter - Originality & Compilation
158 F.3d 674
1998 Copr.L.Dec. P 27,826, 48 U.S.P.Q.2d 1560
(Cite as: 158 F.3d 674)
MATTHEW BENDER & COMPANY, INC., Plaintiff,
Hyperlaw, Inc., Intervenor-Plaintiff-Appellee,
v.
WEST PUBLISHING CO. and West Publishing Corporation, Defendants-Appellants.
(West Publishing Co. I)
Docket No. 97-7910.
United States Court of Appeals,
Second Circuit.
Argued March 16, 1998.
Before: CARDAMONE and JACOBS, Circuit Judges, and SWEET, [FN*] District Judge.
Judge SWEET dissents in a separate opinion.
JACOBS, Circuit Judge:
West Publishing Co. and West Publishing Corp. (collectively "West") publish compilations of reports of judicial opinions ("case reports"). Each case report consists of the text of the judicial opinion with enhancements that for the purposes of this case can be put in two categories: (i) independently composed features, such as a syllabus (which digests and heralds the opinion's general holdings), headnotes (which summarize the specific points of law recited in each opinion), and key numbers (which categorize points of law into different legal topics and subtopics), and (ii) additions of certain factual information *677 to the text of the opinions, including parallel or alternative citations to cases, attorney information, and data on subsequent procedural history. HyperLaw, Inc. publishes compact disc-read only memory ("CD-ROM") compilations of Supreme Court and United States Court of Appeals decisions, and intervened as a plaintiff to seek a judgment declaring that the individual West case reports that are left after redaction of the first category of alterations (i.e., the independently composed features), do not contain copyrightable material. West now appeals from a judgment of the United States District Court for the Southern District of New York (Martin, J.), following a bench trial, granting declaratory judgment in favor of HyperLaw. Matthew Bender & Co. v. West Publishing Co., No. 94 Civ. 0589, 1997 WL 266972 (S.D.N.Y. May 19, 1997).
It is true that neither novelty nor invention is a requisite for copyright protection, but minimal creativity is required. Aside from its syllabi, headnotes and key numbers--none of which HyperLaw proposes to copy--West makes four different types of changes to judicial opinions that it claimed at trial are copyrightable: (i) rearrangement of information specifying the parties, court, and date of decision; (ii) addition of certain information concerning counsel; (iii) annotation to reflect subsequent procedural developments such as amendments and denials of rehearing; and (iv) editing of parallel and alternate citations to cases cited in the opinions in order to redact ephemeral and obscure citations and to add standard permanent citations (including West reporters). All of West's alterations to judicial opinions involve the addition and arrangement of facts, or the rearrangement of data already included in the opinions, and therefore any creativity in these elements of West's case reports lies in West's selection and arrangement of this information. In light of accepted legal conventions and other external constraining factors, West's choices on selection and arrangement can reasonably be viewed as obvious, typical, and lacking even minimal creativity. Therefore, we cannot conclude that the district court clearly erred in finding that those elements that HyperLaw seeks to copy from West's case reports are not copyrightable, and affirm.
BACKGROUND
West obtains the text of judicial opinions directly from courts. It alters these texts as described above to create a case report, and then publishes these case reports (first in advance sheets, then in bound volumes) in different series of "case reporters." [FN1] These case reporter series cover all state and federal courts and are collectively known as West's "National Reporter System." Two series of case reporters are at issue in this case: the Supreme Court Reporter, which contains, inter alia, all Supreme Court opinions and memorandum decisions; and the Federal Reporter, which contains, inter alia, all United States Court of Appeals opinions designated for publication, as well as tables showing the disposition of unpublished cases.
FN1. West also functions as the publisher of slip opinions--i.e., the official versions of court opinions--for the Fifth and Eleventh Circuits, and West does not claim a copyright for any alterations it makes to those slip opinions other than its syllabi, headnotes, and key numbers.
HyperLaw markets two compilations that cover approximately the same ground: Supreme Court on Disc, an annual CD-ROM disc containing opinions of the United States Supreme Court starting from 1990; and Federal Appeals on Disc, a quarterly CD-ROM disc containing nearly all opinions (published and unpublished) of the United States Courts of Appeals from January 1993 on. [FN2] Currently, HyperLaw obtains the text of the opinions directly from the courts. However, HyperLaw intends to expand its CD-ROM product to include any recent cases it could not obtain directly from the courts (and attorney information that is omitted from slip opinions by certain circuits), as well as pre-1990 Supreme Court cases and pre-1993 court of appeals cases that are cited in recent Supreme Court and court of appeals cases (so that users can jump to those cases). HyperLaw *678 intends to achieve this expansion by copying West's case reports (after redacting the syllabi, headnotes and key numbers) from the Supreme Court Reporter and the Federal Reporter. The total number of opinions HyperLaw intends to copy is unclear; but HyperLaw's President Alan Sugarman testified that in time it could reach 50 percent of Supreme Court and court of appeals decisions published by West.
FN2. The record seems to indicate that since the commencement of this suit, HyperLaw has combined these two products into one.
Following the commencement of suit by Matthew Bender & Co. in the United States District Court for the Southern District of New York seeking a judgment declaring that Bender's insertion of star pagination to West's case reporters in its CD-ROM version of judicial opinions did not infringe West's copyright, HyperLaw intervened and requested the same relief. In addition, HyperLaw sought a declaration that HyperLaw's redacted versions of West's case reports contain no copyrightable material and thus may be copied without infringement. On the star pagination issue, the district court granted summary judgment to Bender and HyperLaw, and final judgment was entered pursuant to Fed.R.Civ.P. 54(b). (We affirm that ruling in a separate opinion issued today). See Matthew Bender & Co. v. West Publ'g Co., 158 F.3d 693 (2d Cir.1998). But the district court denied summary judgment allowing HyperLaw to copy redacted versions of West's case reports, and conducted a bench trial on this issue.
The principal trial witness was Donna Bergsgaard, the manager of West's manuscript department. She specified four kinds of alterations made by West to the opinions that it publishes in the Supreme Court Reporter and Federal Reporter and that HyperLaw intends to copy: (i) the arrangement of prefatory information, such as parties, court, and date of decision; (ii) the selection and arrangement of the attorney information; (iii) the arrangement of information relating to subsequent procedural developments; and (iv) the selection of parallel and alternative citations.
Following the bench trial, the district court ruled that West's revisions to judicial opinions were merely trivial variations from the public domain works, and that West's case reports were therefore not copyrightable as derivative works. Matthew Bender & Co., 1997 WL 266972 at *4. In reaching this conclusion, the district court reviewed each type of alteration and found that "West does not have a protectible interest in any of the portions of the opinions that HyperLaw copies or intends to copy" because West's alterations lack even minimal creativity. Id.
DISCUSSION
I
***
II
[3] Works of the federal government are not subject to copyright protection; the text of judicial decisions may therefore be copied at will. 17 U.S.C. § 105. Federal judicial opinions may, however, form part of a compilation. The Copyright Act defines "compilation" as "a work formed by the collection and assembling of preexisting materials or of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship." 17 U.S.C. § 101. West has filed a certificate of copyright registration for every paperbacked advance sheet and bound permanent volume of the Supreme Court Reporter and Federal Reporter, and each certificate characterizes the copyrighted work as a "compilation." Under Feist Publications, Inc. v. Rural Telephone Serv. Co., 499 U.S. 340, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991), an infringement claim for a compilation has two elements: "(1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original." Id. at 361, 111 S.Ct. at 1296.
But HyperLaw has not signaled its intent to copy the text of every case included in particular volumes of West case reporters or the case reporters' selection and arrangement of cases; [FN3] HyperLaw's intent is to copy particular, though numerous, individual *680 case reports. HyperLaw seeks a declaratory judgment that these case reports--after removal of the syllabus, headnotes, and key numbers--contain no copyrightable material.
FN3. Whether insertion of star pagination to West's case reporters amounts to copying of West's arrangement of cases is a separate question we address in the other opinion issued today. See Matthew Bender & Co. v. West Publ'g Co., 158 F.3d at 693.
A HyperLaw contends that each case report should be analyzed as a derivative work, which is defined under the Copyright Act as, inter alia, "[a] work consisting of editorial revisions, annotations, elaborations, or other modifications which, as a whole, represent an original work of authorship." 17 U.S.C. § 101. The district court adopted this view and analyzed the individual case report as a derivative work, but found it wanting in the requisite originality. West contends that each case report is a compilation, i.e., a collection of facts that have been distinctively selected and arranged. No one claims that a case report is anything other than a derivative work or a compilation.
The House Report on the 1976 Copyright Act distinguishes between a derivative work and a compilation:
Between them the terms ... comprehend every copyrightable work that employs preexisting material or data of any kind. There is necessarily some overlapping between the two, but they basically represent different concepts. A "compilation" results from a process of selecting, bringing together, organizing, and arranging previously existing material of all kinds, regardless of whether the individual items in the material have been or ever could have been subject to copyright. A "derivative work," on the other hand, requires a process of recasting, transforming, or adapting "one or more preexisting works"; the "preexisting work" must come within the general subject matter of copyright set forth in section 102, regardless of whether it is or was ever copyrighted.
H.R.Rep. No. 94-1476, at 57 (1976), reprinted in 1976 U.S.C.C.A.N. 5659, 5670; see also 1 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 3.02, at 3-5 (1998) ("[W]hile a compilation consists merely of the selection and arrangement of pre-existing material without any internal changes in such material, a derivative work involves recasting or transformation, i.e., changes in the pre-existing material, whether or not it is juxtaposed in an arrangement with other pre-existing materials.").
We think that West's case reports have elements of both types of works. West compiles (and selects) the factual information it includes in each case report--the type of task usually involved in creating a compilation. On the other hand, West rearranges prefatory and citation information included in judicial opinions, steps that tend toward the making of a derivative work rather than a compilation. In addition, all of West's decisions are constrained by West's main project, which is to enhance the judicial opinions without altering their texts in any substantive or appreciable way.
[4] We need not categorize West's case reports as either derivative works or compilations in order to decide this case. Copyright protection is unavailable for both derivative works and compilations alike unless, when analyzed as a whole, they display sufficient originality so as to amount to an "original work of authorship." See 17 U.S.C. § 101 (defining a "derivative work", inter alia, as a work containing alterations "which, as a whole, represent an original work of authorship"); id. (defining a compilation as requiring that "the resulting work as a whole constitutes an original work of authorship"). The originality required for copyright protection is essentially the same. See Feist, 499 U.S. at 358, 111 S.Ct. at 1294 ("Originality requires only that the author make the selection or arrangement independently ... and that it display some minimal level of creativity."); L. Batlin & Son, Inc. v. Snyder, 536 F.2d 486, 490-91 (2d Cir.1976) (in banc ) ("[W]hile a copy of something in the public domain will not, if it be merely a copy, support a copyright, a distinguishable variation will. * * * [T]o support a copyright there must be at least some substantial variation, not merely a trivial variation such as might occur in the translation to a different medium."). As West and HyperLaw seemingly agree, the question presented is whether West's alterations to the case reports, when considered collectively, demonstrate sufficient originality and creativity to be copyrightable.
*681 B
[5] The district court found that the elements of the West case reports for which West seeks copyright protection lack sufficient originality or creativity to be protectable--whether considered separately or together. Because we treat the question of whether particular elements of a work demonstrate sufficient originality and creativity to warrant copyright protection as a question for the factfinder--here the judge--we will not reverse the district court's findings unless clearly erroneous. See, e.g., Victor Lalli Enters., Inc. v. Big Red Apple, Inc., 936 F.2d 671, 673 (2d Cir.1991) (per curiam ) ("Generally, we review a district court's determination of whether a work is sufficiently original to merit copyright protection under the clearly erroneous standard."); Financial Information, Inc. v. Moody's Investors Serv., Inc., 808 F.2d 204, 207-08 (2d Cir.1986) (same); see also Woods v. Bourne Co., 60 F.3d 978, 991 (2d Cir.1995) (noting that our review of originality determination is for clear error); Weissmann v. Freeman, 868 F.2d 1313, 1322 (2d Cir.1989) (holding that the district court's finding of lack of originality or variation in derivative work was reviewable for clear error). The dissent (at [page 1], footnote 1) argues that de novo review would be more appropriate, and that our precedents to the contrary are doubtful in light of Feist. Feist, however, did not address standard of review, and the clear error standard retains vitality in our precedents, both before and after Feist. In 1995, we acknowledged that the question of copyrightability entails the kind of conclusion that would often justify de novo review, but that most courts, including this Court, review for clear error. See Woods, 60 F.3d at 991 (Feinberg, J.) (citing 1 William F. Patry, Copyright Law and Practice 145 n. 106 (1994) (cataloguing cases)).
[6] The only elements of a work that are entitled to copyright protection are those that are original. See Feist, 499 U.S. at 361, 111 S.Ct. at 1296; Mid America Title Co. v. Kirk, 59 F.3d 719, 721 (7th Cir.1995). The "originality" standard requires that the work result from "independent creation" and that the author demonstrate that such creation entails a "modicum of creativity." See Feist, 499 U.S. at 346, 111 S.Ct. at 1288; see also Key Publications, Inc. v. Chinatown Today Publ'g Enters., Inc., 945 F.2d 509, 512-13 (2d Cir.1991) ("Simply stated, original means not copied, and exhibiting a minimal amount of creativity.").
[7] According to West, the required originality and creativity inhere in four elements of the case reports that HyperLaw intends to copy:
(i) the arrangement of information specifying the parties, court, and date of decision;
(ii) the selection and arrangement of the attorney information;
(iii) the arrangement of information relating to subsequent procedural developments such as amendments and denials of rehearing; and
(iv) the selection of parallel and alternative citations. [FN4]
FN4. West initially claimed some creativity in its corrections to the text of opinions, but it has abandoned this claim, presumably because these corrections either are trivial (i.e., punctuation or spelling), or else (nearly always) approved by the courts by order or informal means.
Each element either adds or rearranges preexisting facts, in themselves unprotectable, and so West is not entitled to protection for these elements of its case reports unless it demonstrates creativity in the selection or arrangement of those facts. See Feist, 499 U.S. at 348, 111 S.Ct. at 1289. Because many of the cases relating to compilations assess the creativity involved in selecting and arranging information, we look to those cases for guidance.
[8] The Copyright Act protects original and minimally creative selection of preexisting, unprotected materials (such as facts) for inclusion in a work, as well as original and creative arrangement of those materials. See Eckes v. Card Prices Update, 736 F.2d 859, 863 (2d Cir.1984) ("[S]electivity in including otherwise non-protected information can be protected expression."); 1 Nimmer, supra, § 3.04[B][2], at 3-31 ("If originally combined, a selection or arrangement of underlying materials that are themselves unoriginal*682may support copyright protection."). Feist tells us:
The compilation author typically chooses which facts to include, in what order to place them, and how to arrange the collected data so that they may be used effectively by readers. These choices as to selection and arrangement, so long as they are made independently by the compiler and entail a minimal degree of creativity, are sufficiently original that Congress may protect such compilations through the copyright laws.
Feist, 499 U.S. at 348, 111 S.Ct. at 1289 (citations omitted). [FN5] However, not every such compilation or decision on selection or arrangement is sufficiently creative to be protected.
FN5. We have previously explained that the protection of compilations "is consistent with the objectives of the copyright law ... to promote the advancement of knowledge and learning by giving authors economic incentives ... to labor on creative, knowledge-enriching works" because compilations "that devise new and useful selections and arrangements of information ... contribute to public knowledge by providing cheaper, easier, and better organized access to information." CCC Info. Servs., Inc. v. Maclean Hunter Mkt. Reports, Inc., 44 F.3d 61, 65-66 (2d Cir.1994). Without that financial incentive, such compilations would not be created. Id. at 66. Nevertheless, it is not a goal of copyright law to promote the production of compilations which lack sufficient creativity.
[9] The creative spark is missing where: (i) industry conventions or other external factors so dictate selection that any person composing a compilation of the type at issue would necessarily select the same categories of information, see, e.g., Victor Lalli Enters., 936 F.2d at 672 (charts of winning numbers in illegal gambling operations); see also Mid America Title Co., 59 F.3d at 722 (title examiner's report; "[s]electing which facts to include in this compilation of data was not a matter of discretion based on Mid America's personal judgment or taste, but instead it was a matter of convention and strict industry standards"), or (ii) the author made obvious, garden- variety, or routine selections, see Feist, 499 U.S. at 362, 111 S.Ct. at 1296 (concluding that the selection and arrangement of a white pages in which the publisher had chosen to include name, town and telephone number, and to arrange these listings in alphabetical order were entirely "typical" and "garden-variety"); BellSouth Adver. & Publ'g Corp. v. Donnelley Info. Publ'g, Inc., 999 F.2d 1436, 1444 (11th Cir.1993) (in banc ) (holding that the categories for the organization of material in a yellow pages directory lacked creativity where many of the selected headings, such as "Attorneys" or "Banks" are so obvious and many others "result from certain standard industry practices").
Thus, when it comes to the selection or arrangement of information, creativity inheres in making non-obvious choices from among more than a few options. See, e.g., Hearn v. Meyer, 664 F.Supp. 832, 847 (S.D.N.Y.1987) ("Copyright protection is afforded rarely where a fact permits only a narrow continuum or spectrum of expression."). For example, in Kregos v. Associated Press, 937 F.2d 700, 704 (2d Cir.1991), the decision to express a pitcher's performance in terms of nine statistics from "at least scores of available statistics about pitching performance available to be calculated from the underlying data and therefore thousands of combinations of data that a selector can choose to include in a pitching form" was not necessarily obvious or self-evident. We therefore concluded that the district court erred in granting summary judgment on the uncopyrightability of the pitching forms. Id. at 704-05, 711; see also American Dental Ass'n v. Delta Dental Plans Ass'n, 126 F.3d 977, 979 (7th Cir.1997) (holding taxonomy of dental procedures creative after noting that they "could be classified ... in any of a dozen different ways"). However, selection from among two or three options, or of options that have been selected countless times before and have become typical, is insufficient. Protection of such choices would enable a copyright holder to monopolize widely-used expression and upset the balance of copyright law.
[10] In sum, creativity in selection and arrangement therefore is a function of (i) the total number of options available, (ii) external factors that limit the viability of certain options and render others non-creative, and (iii) *683 prior uses that render certain selections "garden variety." See, e.g., 1 Patry, supra, at 196 ("As a general principle, the greater the amount of material from which to select, coordinate, or arrange, the more likely it is that a compilation will be protectible. On the other hand, where less material is available, it is less likely that a compilation, even if original, will be protectible, since de minimis efforts, including selections, are not subject to copyright.").
C
We proceed to assess the originality and creativity underlying the elements of West's case reports that HyperLaw seeks to copy.
1. Captions, Courts, and Date Information
[11] West claims that originality inheres in the following enhancements:
. The format of the party names--the "caption"--is standardized by capitalizing the first named plaintiff and defendant to derive a "West digest title," and sometimes the party names are shortened (e.g., when one of the parties is a union, with its local and national affiliations, West might give only the local chapter number, and then insert etc.). [FN6]
FN6. West offered as evidence at trial memoranda to its editors concerning caption alterations. Review of these memoranda demonstrates that they are simply concerned with accurate presentation of caption information. For example, they clarify the accurate family name for parties of Chinese or Spanish origin so that the editor capitalizes the proper name in the caption. They also set forth a uniform system for abbreviating certain words, which is not original or copyrightable. See, e.g., Brief English Systems, Inc. v. Owen, 48 F.2d 555, 556 (2d Cir.1931) ("There is no literary merit in a mere system of condensing written words into less than the number of letters usually used to spell them out.").
. The name of the deciding court is restyled. E.g., West changes the slip opinion title of "United States Court of Appeals for the Second Circuit" to "United States Court of Appeals, Second Circuit."
. The dates the case was argued and decided are restyled. E.g., when the slip opinion gives the date on which the opinion was "filed," West changes the word "filed" to "decided."
. The caption, court, docket number, and date are presented in a particular order, and other information provided at the beginning of some slip opinions is deleted (such as the lower court information, which appears in the West case syllabus).
We do not think that the district court committed clear error in finding that these changes are insubstantial, unoriginal, and uncreative. Reference to a case by the names of the first plaintiff and first defendant is a garden variety decision. See, e.g., The Bluebook: A Uniform System of Citation rule 10.2.1(a) (16th ed.1996) (hereinafter "The Bluebook "). The same is true of West's manner of shortening long case names. See, e.g., id. rule 10.2.1(i) ("Cite a union name exactly as given in the official reporter, except that: (i) only the smallest unit should be cited ... (ii) all craft or industry designations ... should be omitted...."). Even if these choices regarding which words to capitalize and shorten to form the West digest title were an original inspiration, we doubt the decisions to shorten the titles or capitalize certain letters would be copyrightable. See Secure Servs. Tech., Inc. v. Time & Space Processing, Inc., 722 F.Supp. 1354, 1363 n. 25 (E.D.Va.1989) ("Size of print ... is not copyrightable."); 37 C.F.R. § 202.1(a) (1998) ("Words and short phrases such as names [and] titles ... mere variations of typographic ornamentation [or] lettering" are not copyrightable.). Nor does West's overall choice concerning which procedural facts to include at the start of the case report demonstrate the requisite originality or creativity: The names of the parties, the deciding court, and the dates of argument and decision are elementary items, and their inclusion is a function of their importance, not West's judgment. Cf. Kregos, 937 F.2d at 702 (noting that "there can be no claim of a protectable interest in the categories of information concerning each day's [baseball] game," including the teams, starting pitchers, the game time, and the betting odds).
2. Attorney Information
[12] The second claimed creative element is West's selection and arrangement of attorney*684information. The Supreme Court slip opinions and some slip opinions of the courts of appeals omit some or all of the information about counsel that West compiles from the docket sheets and from other sources. For Supreme Court opinions, West lists the arguing counsel and the lawyer's city and state of practice; for court of appeals decisions, West lists the names of briefing attorneys as well as arguing attorneys, and specifies each lawyer's city and state of practice and law-firm or agency affiliation.
Here again we agree with the district court that West's decisions lack a modicum of creativity. Like the name, town and telephone number included in Feist's telephone directory, the information West includes--attorney names, firms and cities of practice--is entirely "typical" and "garden-variety." See, e.g., Skinder-Strauss Assocs. v. Massachusetts Continuing Legal Educ., Inc., 914 F.Supp. 665, 676 (D.Mass.1995) (noting that "[i]n compiling a Massachusetts directory of lawyers and judges, ... [t]he 'selection' of other directory data, including the attorney name, address, telephone and fax numbers, year of bar admission, and so forth are ... unoriginal and determined by forces external to the compiler"); cf. Key Publications, Inc. v. Chinatown Today Publ'g Enters., Inc., 945 F.2d 509, 514 (2d Cir.1991) (emphasizing the creativity inherent in designating phone-book classifications of particular interest to Chinese-Americans). In fact, most courts (this one included) provide the very same information in their slip opinions.
West's decision to provide more information about counsel in the court of appeals case reports, and less in the Supreme Court case reports does not strike a creative spark because the options available to a publisher are simply too limited. West's claim illustrates the danger of setting too low a threshold for creativity or protecting selection when there are two or three realistic options: West lists only the arguing attorneys and city of practice, while United States Law Week lists the arguing and briefing attorneys, their firm affiliations and city and state of practice. If both of these arrangements were protected, publishers of judicial opinions would effectively be prevented from providing any useful arrangement of attorney information for Supreme Court decisions that is not substantially similar to a copyrighted arrangement.
3. Subsequent History
[13] West's case reports reflect certain subsequent procedural developments, such as orders amending an opinion or denying rehearing. The district court found that West's alteration of opinions to reflect these subsequent case developments does not reflect an exercise of originality or creativity, in part because West's realistic options are limited. We cannot say that this was clear error.
In most appeals, the only subsequent development is a denial of rehearing. West's manuscript manager Bergsgaard described two possible ways to reflect this action: (i) a file line, inserted at the beginning of the case just after the date of the original decision, which simply states "rehearing denied" and the date of the denial, or (ii) a table containing the same information. West has chosen to reflect denial of rehearing via a file line. Neither this choice, nor the actual language used to reflect the denials ("rehearing denied" followed by the date), is creative or requires judgment.
As the trial testimony reflects, subsequent orders sometimes reflect more extensive changes or additions to opinions, such as amendments to the original opinion (ranging from minimal to extensive), or subsequent opinions upon denial of rehearing or in dissent from denial of rehearing or rehearing in banc. The actual text of any amendments to opinions or new opinions issued with the denial of rehearing will always be the court's. But West points to the following available options for reflecting these changes, and claims that its choice from among these options is creative: (i) printing the order in full at the end of the opinion; (ii) altering the text of the opinion to reflect the amendments; (iii) publishing the order separately from the original opinion in a different volume and cross-referencing to the original opinion; or (iv) reprinting the original opinion in full with the changes reflected in the text.
*685 Almost never will these decisions present more than one or two realistic or useful options, and almost always the choice among them will be dictated by the timing of the court action. For example, an order amending an opinion will either (i) reflect the exact locations in the opinion where changes are to be made, in which case the obvious preference is to alter the text of the opinion, or (ii) include some general language modifying the opinion, in which case the obvious preference is to print the order at the end of the text of the opinion. If the opinion has not yet gone to print in an advance sheet or a bound volume, West will actually make these changes in the original opinion. If the opinion has already been printed in the bound volume, then West (once again) has only binary options: (i) print only the order and cross-reference to the original opinion, or (ii) reprint the opinion in full, incorporating the changes and/or publishing the order at the end of the opinion. As set forth in the margin, West's exemplar confirms how little judgment is exercised even in a case with a complicated subsequent procedural history. [FN7] West also adds a file line explaining the action, but the line merely sets forth the court's action. Given the few practical options available to West, and the fact that the choice among these narrow options will be dictated by the timing and nature of the court's action, we do not think the district court clearly erred in determining that this element of West's case reports does not demonstrate sufficient creativity to be protectable.
FN7. West focuses on its case report for Roulette v. City of Seattle, decided in March 1996 and published at 78 F.3d 1425 (9th Cir.1996). In September 1996, there issued an order amending the opinion upon denial of rehearing and suggestion for rehearing in banc, and two opinions dissenting from the denial of rehearing in banc. The order amending the opinion made substantial substantive changes to the opinion, and so West decided to republish the full opinion with the changes reflected in the text at 97 F.3d 300 (9th Cir.1996). Moreover, it printed the full order (with a note indicating that the amendments to the opinion were included in the text) with the dissenting opinions at the end of the opinion. Finally, it added a file line reflecting those developments. None of these decisions demonstrates the exercise of any creativity; in fact, with the exception of the file line, all were dictated by the changes made to the opinion by the court. The Ninth Circuit did the same thing, i.e., republished the original opinion incorporating the amendments and printed the order and dissents in full following the text.
4. Parallel or Alternate Citations
[14] As the district court recognized, the element of West's case reports that raises the closest question as to creativity is West's emending of the citations, as follows:
(a) West inserts parallel citations when the judicial opinion does not, e.g., (i) for citations to Supreme Court opinions, it inserts parallel citations to United States Reports, Supreme Court Reporter, and Lawyer's Edition, (ii) for citations to a state court, West inserts parallel citations to the official reporter and West's regional reporter, and (iii) for citations to looseleaf, specialized, or electronic reporters, West inserts parallel citations to a West National Reporter System ("NRS") reporter or Westlaw (West's on-line database);
(b) West substitutes some court citations, e.g., if the court cites to a slip opinion that has been published in an NRS reporter, West will substitute a citation to the NRS reporter; and
(c) West adds citations when the opinion refers to a case by name but does not insert a citation.
The district court concluded that "[i]n most instances the determination of which parallel citations to include ... reflect[s] no level of originality," and that the "selections made tend to conform to the standard of the legal profession and appear consistent with those recommended in A Uniform System of Citation." Matthew Bender & Co., 1997 WL 266972 at *4.
We cannot find that the district court's conclusion was unreasonable. West claims that it exercises careful judgment as to which sources are most useful to legal practitioners. However, almost every one of West's decisions relating to citation alterations is inevitable, typical, dictated by legal convention, or at best binary. See 1 Patry, supra, at 196-97 ("Even where theoretically there is a large number of items to choose from, functional, commercial, or legal constraints may limit, or*686 even bar, protectibility."). And each case report exhibits only one or two decisions on how to alter citations.
West has issued a series of memoranda to its editors that contain guidelines for citation alterations (a complete list of the citational instructions is set out in the margin [FN8]). Most of West's citation guidelines need no discussion because they involve obvious, garden-variety decisions to cite to West NRS case reporters and to Westlaw whenever the court has cited to sources that are not easily accessible, such as looseleaf or daily or weekly reporter services or slip opinions; there are few options to begin with, and West's case reporters and Westlaw have the widest availability and have essentially become the standard citation to case law. See, e.g., The Bluebook, supra, at 165-225 (recommending citation to West federal and regional reporters for all federal and state courts, with the exception of the Supreme Court, for which Supreme Court Reporter is listed as a secondary cite); id. rule 10.3.1 (recommending citation to West regional reporters, and if not published therein, to a "widely used computer database" or to a "service," in that order of preference). No evaluative judgment is involved in a decision to cite to those two sources (especially given West's self-interest in including citations to its own products).
FN8. West has issued the following guidelines for citation alterations:
(1) follow certain prescribed formats for abbreviation of Rules of Civil Procedure, state rules, and statutes.
(2) add a citation to Westlaw or to an NRS case reporter for citations to certain looseleaf services when the case cannot be directly retrieved through Westlaw using the looseleaf service citation.
(3) substitute an NRS case reporter cite for 15 publications, almost all of which are daily or weekly reports or journals, including: Arizona Advance Reports, California Daily Appellate Report, 9th Circuit Daily Journal, Florida Law Weekly, Oklahoma Bar Journal, Texas Supreme Court Journal, and United States Law Week.
(4) add an NRS case reporter or Westlaw cite for 15 publications, some of which are topical publications and others of which are competitor publications, including: American Law Reports (A.L.R.), Board of Tax Appeals, Federal Sentencing Reporter, Idaho Bankruptcy Court Reports, Pennsylvania Fiduciary, and Virgin Islands Reports.
(5) for citations to cases appearing in tables in West case reporters, include a Westlaw cite if Westlaw contains the full-text of the summary order.
(6) if the court's citation indicates that a petition for certiorari has been filed and the Supreme Court has acted on the petition: (a) if the petition has been denied and the date of the denial was prior to the date the opinion was decided, add the citation for the denial of certiorari.
(b) if the petition was denied after the opinion was decided, do not add a citation for the denial of certiorari.
(c) if the petition was granted, check with the court to see if the case citation should be retained.
(7) if a court includes a short form citation for a case which has not yet been cited in full in the opinion, insert the full citation.
(8) if a court cites to a slip opinion, add the NRS case reporter citation. If this citation is unavailable prior to publication, add a Westlaw citation.
(9) add extension pages for citations if the court's NRS citation includes an extension page.
(10) change internal page references in the slip opinion to dashes so that a reporter page number can be inserted by West editors.
(11) add a Westlaw or NRS case reporter citation for public utility citations.
(12) do not remove citations in opinions to public domain citation systems in those jurisdictions that have adopted such citation systems, including the Sixth Circuit and South Dakota. (13) add a Westlaw citation when the court includes a LEXIS citation, and in certain situations, remove the LEXIS citation.
(14) add a citation for a case referenced in the text of the opinion without citation unless that case appears on a list of 300 popular case names.
(15) add parallel citations for Supreme Court decisions to United States Reports, Supreme Court Reporter, and Lawyer's Edition.
(16) add parallel citations for state court decisions to an NRS regional case reporter and the state's official reporter.
[15] As for the other guidelines, the following represent the citation decisions that receive the most emphasis by West, and that represent most, if not all, of the examples of citation alterations included in cases that West offered into evidence at trial:
. West's decision to insert a citation to the denial of certiorari only when the denial pre-dated the opinion is necessary to avoid anachronism, and is in any event a choice *687 among two or three options at most. [FN9] See, e.g., BellSouth Adver. & Publ'g Corp. v. Donnelley Info. Publ'g, Inc., 999 F.2d 1436, 1441 (11th Cir.1993) (in banc ) (holding that determination of closing date after which no changes were included in the yellow pages at issue did not demonstrate creativity in selection because "any collection of facts 'fixed in any tangible medium of expression' will by necessity have a closing date" (footnote omitted)).
FN9. Even West notes in its brief, "Every publisher has at least three options [on how to update citations in slip opinions]--to leave citations as they appear in the opinion, to update them as of the date of case-report publication, or to update them only as of the date of the original order."
. As proof of its creativity in electing to parallel-cite to United States Reports, Supreme Court Reporter, and Lawyer's Edition, West lists eight other reporters of Supreme Court opinions that do not parallel-cite to these sources, and to which West does not parallel-cite. But all of these reporters are daily or weekly updates intended to provide quick copies of the slip opinions, not to serve as research tools or permanent records, and they are not recognized as standard sources for citation in the legal profession. West's decision to omit parallel citation to those reporters requires no evaluative judgment, and the decision by the publishers of those reporters and services to omit parallel citation to the same reporters cited by West reflects the more limited purpose of those reporters rather than the creativity of West's own choice. [FN10] In the end, West decided to include every permanent record of Supreme Court opinions--i.e., it makes no "selection" at all.
FN10. West maintains a list of 300 cases deemed by West to be so well known that West will leave intact one-party references to these cases without expanding the case citation. This practice involves an undeniably creative, but minor, insight into which cases are within an ordinary lawyer's frame of reference, and the expression of that selection would be protectable. Nevertheless, West offered no evidence as to how often these cases are cited without a full citation in the judicial opinions that HyperLaw seeks to copy and we will not find infringement for what seems to be de minimis copying of protected material. Cf. Warner Bros. Inc. v. American Broad. Cos., 720 F.2d 231, 242 (2d Cir.1983) (noting that de minimis rule permits "the literal copying of a small and usually insignificant portion of the plaintiff's work").
. Nor do we see any creativity in West's decision to cite to official state reporters as well as regional NRS reporters for state court decisions. These are almost always the only two realistic choices (again, this hardly amounts to "selection"), and a decision to cite to an official reporter can hardly be said to be anything other than typical. [FN11]
FN11. West emphasizes that The Bluebook 's rule dispenses with citation to official reporters, but it ignores another Bluebook rule that practitioners cite to official state reporters for cases decided by the state in which the practitioner is filing papers. See The Bluebook, supra, rule P.3. Furthermore, another citation guide recommends citing to both the official reporter and the NRS reporter on all occasions. See The University of Chicago Manual of Legal Citation 15 (1989) ("When citing to a state case, indicate the volume and first page of the case for both the official and commercial reporters.").
One useful way to appreciate how little creativity inheres in West's citation decisions is to consider what West's competitors would have to do to avoid an infringement claim were we to find West's citation decisions copyrightable. Competitors such as HyperLaw seeking to create a useful case report would need to engage in their own original selection of parallel and alternate citations. But while some generally useful information which does not appear in West's case reports could be included (such as citations to LEXIS instead of Westlaw), most of the information a researcher would find useful (such as citations to West NRS reporters) already have been added to West's case reports; West gives few examples of other useful supplementary information. A competitor that included these alterations, notwithstanding their inclusion in West's case reports, could have no confidence that an infringement claim could be avoided, especially given our warning in Key Publications that infringement cannot be avoided by pointing to isolated differences from a copyrighted work. See Key Publications, Inc. v. Chinatown Today Publ'g Enters., Inc., 945 F.2d 509, 514 (2d *688 Cir.1991) (holding that a compilation copyright is not so "thin" as to be "anorexic," and does not allow "subsequent compilers to avoid infringement suits simply by adding a single fact to a verbatim copy of the copyrighted compilation, or omitting in the copy a single fact contained in the copyrighted compilation"). One way of saying that West's "choices" are obvious and typical is that a competitor would have difficulty creating a useful case report without using many of the same citations. Affording these decisions copyright protection could give West an effective monopoly over the commercial publication of case reports (at least those containing supplemental citations).
Nor do we think the district court erred in concluding that the combination of these citation decisions is unprotectable. West's particular decisions about which parallel citations to insert are driven in each instance by the court's decision to cite to a certain case, and thus each editorial choice is independent of the others. The cumulative effect of these citation decisions is a piling up of things that are essentially obvious or trivial (albeit helpful), each in its discrete way in its discrete spot. The whole does not disclose or express an overall creative insight or purpose, such as a set of statistics that together allow the ranking of a group of ball players, or a designation or highlighting of phone numbers that together allow the user of a phone book to enjoy an unusual or particular convenience. The combined effect of West's non-creative citation decisions cannot be said to be creative, on such a theory or any other theory that West advances. We conclude that the district court did not clearly err in deciding that West's citation alterations display insufficient creativity to be protectable.
* * *
Finally, West's overall decision to add attorney information, subsequent history, and additional citation information exhibits little, if any, creative insight; most courts already provide attorney information, and opinion accuracy mandates inclusion of subsequent history.
West's editorial work entails considerable scholarly labor and care, and is of distinct usefulness to legal practitioners. Unfortunately for West, however, creativity in the task of creating a useful case report can only proceed in a narrow groove. Doubtless, that is because for West or any other editor of judicial opinions for legal research, faithfulness to the public-domain original is the dominant editorial value, so that the creative is the enemy of the true. [FN12]
FN12. HyperLaw argues that we should apply the merger doctrine to bar the copyrightability of West's alterations to judicial opinions. The fundamental copyright principle that only the expression of an idea and not the idea itself is protectable has produced a corollary maxim that even expression is not protected in those instances where there is only one or so few ways of expressing an idea that protection of the expression would effectively accord protection to the idea itself.
Kregos v. Associated Press, 937 F.2d 700, 705 (2d Cir.1991) (citation omitted). HyperLaw claims that the idea of a case report has effectively merged with West's expression of that concept.
We decline to invoke the merger doctrine in this case. First, "[o]ur Circuit has considered this so-called 'merger' doctrine in determining whether actionable infringement has occurred, rather than whether a copyright is valid." Id.; see also CCC Info. Servs., Inc. v. Maclean Hunter Market Reports, Inc., 44 F.3d 61, 72 n. 26 (2d Cir.1994) ( "In this circuit, consideration of the merger doctrine takes place in light of the alleged copying to determine if infringement has occurred, rather than in analyzing the copyrightability of the original work."). In addition, under this approach, "if a defendant has actually copied the plaintiff's work, it is unlikely to be allowed to rely on merger to avoid liability," Kregos, 937 F.2d at 716 (Sweet, J., concurring in part and dissenting in part). HyperLaw seeks a declaratory judgment holding West's case reports non-copyrightable and allowing it actually to copy West's case reports. It therefore cannot avail itself of the merger doctrine.
Second, West's work does not constitute a "building block[ ] of understanding," which we have indicated is the type of expression to which we will consider applying the merger doctrine. See CCC Info. Servs., 44 F.3d at 71.
Our decision in this case does not mean that an editor seeking to create the most accurate edition of another work never exercises creativity. [FN13] As West argues, our decisions *689 establish a low threshold of creativity, even in works involving selection from among facts. But those cases involved the exercise of judgments more evaluative and creative than West exercises in the four elements of the case reports that HyperLaw intends to copy. For instance, in Kregos thousands of different permutations of pitching statistics were available for inclusion in the publisher's pitching chart. See Kregos, 937 F.2d at 704; see also Eckes v. Card Prices Update, 736 F.2d 859, 863 (2d Cir.1984) (baseball card guide which selected 5,000 "premium" baseball cards from among 18,000 eligible baseball cards was copyrightable). In Key Publications, we found sufficient creativity because the author of the yellow pages "excluded from the directory those businesses she did not think would remain open for very long." 945 F.2d at 513. In CCC Information Services, we found sufficient creativity in the selection of optional car features and number of years' models to be included in a used-car price compilation. 44 F.3d at 67. And in Lipton v. Nature Co., 71 F.3d 464 (2d Cir.1995), the author "selected [the terms included in the work] from numerous variations of hundreds of available terms." Id. at 470. In each of these cases, the compiler selected from among numerous choices, exercising subjective judgments relating to taste and value that were not obvious and that were not dictated by industry convention. See Mid America Title Co. v. Kirk, 59 F.3d 719, 723 (7th Cir.1995) (distinguishing cases involving exercise of subjective judgment). [FN14]
FN13. It is true that some types of editing require little creativity. See, e.g., Grove Press, Inc. v. Collectors Publication, Inc., 264 F.Supp. 603, 605 (C.D.Cal.1967) ("Plaintiff made approximately forty thousand changes from the Verlag copy in producing its edition. These changes consisted almost entirely of elimination and addition of punctuation, changes of spelling of certain words, elimination and addition of quotation marks, and correction of typographical errors. These changes required no skill beyond that of a [1967] high school English student and displayed no originality. These changes are found to be trivial."). In addition, convention and external forces may, as here, limit the practical choices available so as to eliminate any creativity. On the other hand, preparing an edition from multiple prior editions, or creating an accurate version of the missing parts of an ancient document by using conjecture to determine the probable content of the document may take a high amount of creativity. See, e.g., Abraham Rabinovich, Scholar: Reconstruction of Dead Sea Scroll Pirated, Wash. Times: Nat'l Wkly. Edition, Apr. 12, 1998, at 26 (discussing scholar's copyright infringement claim in Israeli Supreme Court relating to his reconstruction of the missing parts of a "Dead Sea Scroll" through the use of "educated guesswork" based on knowledge of the sect that authored work).
FN14. HyperLaw argues also that West has failed to comply with the requirement of 17 U.S.C. § 403 that it identify those parts of the government work in which it does not claim a copyright. Because we find that the elements of West's case reports that HyperLaw seeks to copy are not protectable, we need not reach this issue.
Similarly, in Weissmann v. Freeman, 868 F.2d 1313 (2d Cir.1989), a textual derivative-work case, we found sufficient creativity where the author of the derivative work had drawn on earlier joint works with another professor to create a document that contained the following new elements from the previous version of the document:
(1) a selection and arrangement of photo illustrations and associated captions; (2) references to recent reports in the pertinent literature; (3) selection, condensation, and description of additional source material; (4) several new textual additions; (5) substantial rearrangement of the manner and order of presentation of material contained in the parties' prior joint works; and (6) the addition of a section on "congenital disorders," a revised treatment of "chronic cholecystitis," and the incorporation of Dr. Freeman's "false positive" studies.
Id. at 1322. As this passage demonstrates, the alterations inserted in the derivative work were by no means obvious or driven by professional convention, and resulted in substantial changes to the substance and flow of the piece. No such substantial variations characterize West's case reports.
CONCLUSION
The district court did not clearly err in concluding that the elements of West's case reports that HyperLaw seeks to copy are not copyrightable. The judgment of the district court is affirmed.
SWEET, District Judge:
The key issue in this appeal is whether West's Supreme Court Reporter and Federal Reporter case reports in the context of its *690 overall reporter citation system meet the constitutional and statutory requirement of creative originality. Because the majority imposes a standard that demands significantly more than the "modicum" of originality required by Feist Publications, Inc., v. Rural Telephone Service Company, Inc., 499 U.S. 340, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991), and far more than the "non-trivial" variation required by this Court for derivative-work and compilation copyright protection, I respectfully dissent. [FN1]
FN1. Although not dispositive since I believe that the district court's determination is clearly erroneous, review should be de novo. Whether West's annotations are copyrightable requires application of the legal standard imposed by the constitution and copyright statute to the undisputed facts. To the extent prior Second Circuit opinions have reviewed issues of copyrightability for clear error, they appear inconsistent with the Supreme Court's de novo review of a similar issue in Feist (impliedly, although not expressly, reversing district court after de novo review), inconsistent with the de novo standard applied by this Court in other mixed questions in copyright law, see e.g. American Geophysical Union v. Texaco Inc., 60 F.3d 913, 918 (2d Cir.1994) (fair use is mixed question subject to de novo review); Carter v. Helmsley-Spear, Inc., 71 F.3d 77, 85 (2d Cir.1995) (work for hire status legal conclusion reviewed de novo, although factual finding of each relevant factor reviewed for clear error); Folio Impressions, Inc. v. Byer California, 937 F.2d 759, 766 (2d Cir.1991) (substantial similarity reviewed de novo since credibility not at issue), or distinguishable, see Financial Information, Inc. v. Moody's Investors Service, Inc., 808 F.2d 204, (2d Cir.1986) (noting that district court relied "on its evaluation of the credibility of witnesses--which we are ill-disposed to disturb on appeal" whereas here facts are not in dispute).
The Copyright Act protects both derivative works and compilations, and I agree with the majority that West's case reports have elements of both. The standard for copyrightability set forth in Feist, as the majority notes, is applicable whether West's editorial work is analyzed in terms of derivative work or compilation. See e.g., Atari Games Corp. v. Oman, 979 F.2d 242, 244-45 (D.C.Cir.1992) (Feist applicable to [audio-visual] compilation); 2 W. Patry, Copyright Law and Practice 1225 (1994) (Feist applicable to derivative works). Contrary to the majority's holding, however, I find that West's selection and arrangement of factual annotations to public domain judicial opinions, considered as a whole, is copyrightable.
Originality alone--whether the "author make[s] the selection or arrangement independently (i.e. without copying that selection or arrangement from another work)"--is not sufficient. Feist, 499 U.S. at 358, 111 S.Ct. 1282. The work must also "display some minimal level of creativity." Id. Creativity for copyright purposes is not a philosophical question: the "creative spark" need only pass "the narrowest and most obvious limits." See Bleistein v. Donaldson Lithographing Company, 188 U.S. 239, 251, 23 S.Ct. 298, 47 L.Ed. 460. The "modicum of creativity" requires simply that the author prove "the existence of ... intellectual production, of thought, and conception." Feist, 499 U.S. at 362, 111 S.Ct. 1282 (quoting Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53, 59-60, 4 S.Ct. 279, 28 L.Ed. 349 (1884)); see also Key Publications Inc. v. Chinatown Today Publishing Enterprises, Inc., 945 F.2d 509, 514 (2d Cir.1991). ("[D]e minimis thought withstands originality requirement").
Thus, while the majority is correct that it is "not a goal of copyright law" to encourage the creation of compilations which lack "sufficient creativity," it is well-established that the required level of creativity is "extremely low." Feist, 499 U.S. at 345, 111 S.Ct. 1282. [FN2]
FN2. Indeed, "[m]ost applications of Feist have recognized the circumscribed sphere to which its holding applies, ruling that it invalidates the copyright only in the most banal of works, such as the white pages of a phone book." 1. M. Nimmer, Copyright § 3.04[B][2], p.3-33 (footnotes omitted).
In Feist, Rural's alphabetical arrangement by surname, and selection of name, town and telephone number to include in a telephone book, was "practically inevitable." Id. at 363, 111 S.Ct. 1282. Although the facts need not be presented in an "innovative or surprising way," Rural's choice was "so mechanical or routine as to require no creativity whatsoever." Feist, 499 U.S. at 362, 111 S.Ct. 1282. Indeed, the copyright claimant in Feist had no real choice how to arrange a white pages directory, particularly given that state law prescribed the selection of data, and that only a few basic decisions were involved. Id. *691 Also significant was that only Rural possessed the underlying data. Id. at 363, 111 S.Ct. 1282.
Here, West has made choices to make its reporters and its citation system valuable. West makes dozens of multi-part, variable judgments, and there is no evidence that any of West's choices are commonplace, "practically inevitable," dictated by law, or that they follow any external guidelines. On the contrary, the record demonstrates that West makes a number of substantive, editorial choices--without court direction or approval--in determining the content and expression of its case reports. West's judgments involve assessments of "readability," clarity, completeness, availability (present and future) of sources, and other subjective considerations related to making the reports more useful.
Specifically, West asserts that originality inheres in the following aspects of its editorial process: (1) its decisions about when to add parallel citations and which parallel citations to add; (2) its substitution of "alternative citations" when its editors deem that the original citation should be improved upon in terms of usefulness, currency, or accuracy; (3) its addition of its own citations when none are provided; (4) its internal revision and correction of citations; (5) its expansion and completion of citation page references; (6) its creation, selection, and arrangement of additional text to reflect subsequent case developments; (7) its selection and arrangement of data for attorney summaries, and (8) its revision and reorganization of captions, court lines, date lines, and other prefatory material. Because these choices express thought and are not inevitable, West's annotations do not fall in the "narrow category" of works which are not copyrightable.
The fact that federal judges publish written opinions differently than West is sufficient reason to conclude that West's version requires some "thought" and is sufficiently "creative" to satisfy the modicum necessary for copyrightability. If a federal judge chooses to cite only to the United States Reporter, include minimal attorney information in his or her written opinion, or not provide a cite for a referenced case, then an alternative choice to provide parallel citations, expand attorney information, and cite the case cannot be deemed so "typical," "garden-variety," "obvious" or "inevitable" to prohibit copyrightability. Cf. Feist, 499 U.S. at 362-63, 111 S.Ct. 1282.
The majority dissects each element of West's editorial process and then extrapolates that "the cumulative effect of these citation decisions is a piling up of things that are essentially obvious or trivial (albeit helpful), each in its discrete way in its discrete spot."
West's originality, however, cannot be determined by the sum total of whatever (creativity) remains after each individual component is atomized. Indeed, this Court recently warned against the dangers of basing copyrightability analysis on an approach which isolates each element or ignores the "protectible expression within an unprotectible element." Softel, Inc. v. Dragon Medical and Scientific Communications, Inc., 118 F.3d 955, 964 (2d Cir.1997). See also 3 M. Nimmer, Copyright § 13.03[F][5], at 13-145 n.345.1 (explaining that the fact that Hamlet's soliloquy can be reduced into unprotectible words does not mean that the soliloquy as a whole lacks originality for copyright purposes).
West's selection of particular annotations for each case must be considered a whole, not individually. See Key Publications, 945 F.2d at 514 (issue is "whether the arrangement ... viewed in the aggregate, is original"). In defining a derivative work, the issue is whether "modifications" "represent an original work of authorship" must be considered "as a whole." 17 U.S.C. § 101 (emphasis added) (definition of derivative work). The same legislative command is repeated in the definition of compilations, which provides that a compilation is "a work formed by the collection and assembling of preexisting materials ... that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship." 17 U.S.C. § 101 (emphasis added). The cumulative and collective originality manifest in West's case reports satisfies the "de minimis " level needed for the work as a whole to be copyrightable. Indeed, *692 it must be assumed that the originality and the consequent utility of the West citation system is precisely the reason that Hyperlaw seeks to use West as its verbatim source.
In my view the decision of the majority is not consistent with the post- Feist case Key Publications, 945 F.2d at 509. In Key Publications, this Court held that classified directories of Chinese-American businesses was copyrightable because, among other things, plaintiff excluded enterprises she believed would not remain in business. This selection "indicates thought and creativity in the selection of businesses included." Id. at 513. If there is a modicum of originality in deciding which businesses are likely to stay open for awhile, the test is surely also met by deciding in a system designed to assist legal research for example, which sources are sufficiently useful, available, or permanent to stand alone, and which require the addition of an electronic parallel citation.
Contrary to the majority's view, the alternative factual annotations selected by West are not comparable to the cases where courts have denied copyright protection based on lack of originality. In Victor Lalli Enterprises, Inc. v. Big Red Apple, Inc., 936 F.2d 671 (2d Cir.1991), it was undisputed that the publisher's selection and arrangement of fact categories was exactly the same as that of all racing-chart publishers. Id. at 672. In Financial Information, Inc. v. Moody's Investors Service, Inc., 808 F.2d 204 (2d Cir.1986), cert. denied, 484 U.S. 820, 108 S.Ct. 79, 98 L.Ed.2d 42, it was beyond dispute that the five basic facts listed on the Daily Bond Cards were an "inevitable" choice devoid of originality. In this case, by contrast, all of West's basic choices involve subjective judgment.
In Skinder-Strauss Associates v. Massachusetts Continuing Legal Education, Inc., 914 F.Supp. 665 (D.Mass.1995), the court held that the legal directory is copyrightable "as a whole," and therefore the question was substantial similarity, not copyrightability. Id. at 677. Although the Skinder- Strauss court held that individual elements, such as a calendar of Christian and Jewish holidays, were not copyrightable, here West does not seek copyrightability of individual facts, but rather seeks to prevent verbatim copying of the case report as a whole.
The copyright granted West is thin, but it is sufficient to protect against the verbatim digital copying proposed by Hyperlaw. This result protects the advancement of science and the arts, while not permitting Hyperlaw to undermine any incentive for West to annotate judicial opinions selectively. If West's competitors were authorized to scan West's editorial enhancements systematically and, in effect, to copy its citation system, the economic incentive to engage in this kind of original and productive enterprise would largely evaporate.
There is no danger here that granting West's copyright protection to its annotations provides them a monopoly over the "idea" of publishing judicial opinions. When the number of ways data can be organized is so limited that its expression merges with the idea, copyright may be denied. However, here "there are a sufficient number of ways of expressing the idea ... to preclude a ruling that the idea has merged into its expression." Kregos v. Associated Press, 937 F.2d 700 (2d Cir.1991). In Kregos, this Court held that "the past performances of baseball pitchers can be measured by a variety of statistics," and is copyrightable. Here, too, opinions can be, and are, written with a variety of citation combinations and other facts either included or not. This case is not like Matthew Bender & Co. v. Kluwer Law Book Publishers, Inc., 672 F.Supp. 107 (S.D.N.Y.1987), where the court concluded that the categories in the plaintiff's chart (amount, case, plaintiff event, injury, and relevant data) are "the only sensible ones which could have been used to compile the data." Id. at 112.
To the extent that the West selection of factual annotation may seem obvious to anyone familiar with legal sources, it may be because of West's success in the market. [FN3] *693 There is no support for the proposition that West's success in achieving an "industry standard" citation arrangement obligates them to donate the material to the public domain. Cf. BellSouth, 999 F.2d at 1444 (industry standard copied from industry association).
FN3. The contention that all of West's enhancements are trivial is somewhat ironic given that what motivates this litigation, it is assumed, is the desire to make money by copying West's valuable editorial work.
For the reasons stated, I conclude the summary judgment granted in favor of Hyperlaw should be reversed.
158 F.3d 693
1998 Copr.L.Dec. P 27,827, 48 U.S.P.Q.2d 1545
MATTHEW BENDER & COMPANY, INC., Plaintiff-Appellee,
Hyperlaw, Inc., Intervenor-Plaintiff-Appellee,
v.
WEST PUBLISHING CO.; West Publishing Corporation, Defendants-Appellants.
(West Publishing Co, II)
Docket No. 97-7430.
United States Court of Appeals,
Second Circuit.
Argued March 16, 1998.
Decided Nov. 3, 1998.
Before: CARDAMONE and JACOBS, Circuit Judges, and SWEET, [FN*] District Judge.
Judge SWEET dissents in a separate opinion.
JACOBS, Circuit Judge:
Defendants-appellants West Publishing Co. and West Publishing Corp. (collectively "West") create and publish printed compilations of federal and state judicial opinions. Plaintiff-appellee Matthew Bender & Company, Inc. and intervenor-plaintiff-appellee HyperLaw, Inc. (collectively "plaintiffs") manufacture and market compilations of judicial opinions stored on compact disc-read only memory ("CD-ROM") discs, in which opinions they embed (or intend to embed) citations that show the page location of the particular text in West's printed version of the opinions (so-called "star pagination"). [FN1] Bender and HyperLaw seek judgment declaring that star pagination will not infringe West's copyrights in its compilations of judicial opinions. West now appeals from a judgment of the United States District Court for the Southern District of New York (Martin, J.), granting summary judgment of noninfringement to Bender and partial summary judgment of noninfringement to HyperLaw. [FN2]
FN1. This cross-reference method is called "star pagination" because an asterisk and citation or page number are inserted in the text of the judicial opinion to indicate when a page break occurs in a different version of the case.
FN2. The district court granted summary judgment to HyperLaw on the star pagination issue. However, HyperLaw had sought an additional declaration that its duplication of West's version of the captions and text of judicial opinions does not infringe West's copyright. The district court denied summary judgment on that claim, and ruled for HyperLaw following a bench trial. West appeals from that decision as well and we uphold that ruling in a separate opinion issued today. See Matthew Bender & Co. v. West Publ'g Co., 158 F.3d 674 (2d Cir.1998).
West's primary contention on appeal is that star pagination to West's case reporters allows a user of plaintiffs' CD-ROM discs (by inputting a series of commands) to "perceive" West's copyright-protected arrangement of cases, and that plaintiffs' products (when star pagination is added) are unlawful copies of *696 West's arrangement. We reject West's argument for two reasons:
A. Even if plaintiffs' CD-ROM discs (when equipped with star pagination) amounted to unlawful copies of West's arrangement of cases under the Copyright Act, (i) West has conceded that specification of the initial page of a West case reporter in plaintiffs' products ("parallel citation") is permissible under the fair use doctrine, (ii) West's arrangement may be perceived through parallel citation and thus the plaintiffs may lawfully create a copy of West's arrangement of cases, (iii) the incremental benefit of star pagination is that it allows the reader to perceive West's page breaks within each opinion, which are not protected by its copyright, and (iv) therefore star pagination does not create a "copy" of any protected elements of West's compilations or infringe West's copyrights.
B. In any event, under a proper reading of the Copyright Act, the insertion of star pagination does not amount to infringement of West's arrangement of cases...........
DISCUSSION
[1][2] West's case reporters are compilations of judicial opinions. The Copyright Act defines a "compilation" as "a work formed by the collection and assembling of preexisting materials or of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship." 17 U.S.C. § 101 (1994). Compilations are copyrightable, but the copyright "extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work." 17 U.S.C. § 103 (1994). [FN8] Works of the federal government are not subject to copyright protection, 17 U.S.C. § 105 (1994), although they may be included in a compilation.
FN8. Section 103 of the Copyright Act provides:
(a) The subject matter of copyright as specified by section 102 includes compilations and derivative works, but protection for a work employing preexisting material in which copyright subsists does not extend to any part of the work in which such material has been used unlawfully.
(b) The copyright in a compilation or derivative work extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work, and does not imply any exclusive right in the preexisting material.
17 U.S.C. § 103.
Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991), is the seminal Supreme Court decision on copyrights in compilations. In Feist, the publisher of a telephone book claimed that a competitor had infringed its compilation copyright by copying some of its white pages listings. The Court clarified the scope of a copyright in compilations: "A factual compilation is eligible for copyright if it features an original selection or arrangement of facts, but the *699copyright is limited to the particular selection or arrangement. In no event may copyright extend to the facts themselves." Id. at 350-51, 111 S.Ct. at 1290. Because of this limitation on protectability, "the copyright in a factual compilation is thin. Notwithstanding a valid copyright, a subsequent compiler remains free to use the facts contained in another's publication to aid in preparing a competing work, so long as the competing work does not feature the same selection and arrangement." Id. at 349, 111 S.Ct. at 1289. The Court expressly rejected the "sweat of the brow" doctrine, which had justified the extension of copyright protection to the facts and other non- original elements of compilations on the basis of the labor invested in obtaining and organizing the information. Id. 359-60, 111 S.Ct. at 1295.
[3] Under Feist, two elements must be proven to establish infringement: "(1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original." Id. at 361, 111 S.Ct. at 1296. Bender and HyperLaw concede that West has proven the first element of infringement, i.e., that West owns a valid copyright in each of its case reporters.
[4][5][6] However, as is clear from the second Feist element, copyright protection in compilations "may extend only to those components of a work that are original to the author." Id. at 348, 111 S.Ct. at 1289. The "originality" requirement encompasses requirements both "that the work was independently created ..., and that it possesses at least some minimal degree of creativity." Id. at 345, 111 S.Ct. at 1287 (emphasis added); see also Key Publications, Inc. v. Chinatown Today Publ'g Enters., Inc., 945 F.2d 509, 512-13 (2d Cir.1991) ("Simply stated, original means not copied, and exhibiting a minimal amount of creativity."). At issue here are references to West's volume and page numbers distributed through the text of plaintiffs' versions of judicial opinions. West concedes that the pagination of its volumes--i.e., the insertion of page breaks and the assignment of page numbers--is determined by an automatic computer program, and West does not seriously claim that there is anything original or creative in that process. As Judge Martin noted, "where and on what particular pages the text of a court opinion appears does not embody any original creation of the compiler." Because the internal pagination of West's case reporters does not entail even a modicum of creativity, the volume and page numbers are not original components of West's compilations and are not themselves protected by West's compilation copyright. [FN9] See Feist, 499 U.S. at 363, 111 S.Ct. at 1297 ("As a constitutional matter, copyright protects only those constituent elements of a work that possess more than a de minimis quantum of creativity.").
FN9. The same conclusion can be arrived at using a different chain of reasoning. There is a fundamental distinction under the Copyright Act between the original work of authorship and the physical embodiment of that work in a tangible medium. See H.R.Rep. No. 94-1476, at 53 (1976), reprinted in 1976 U.S.C.C.A.N. 5659, 5666 (noting "a fundamental distinction between the 'original work' which is the product of 'authorship' and the multitude of material objects in which it can be embodied. Thus, in the sense of the [Act], a 'book' is not a work of authorship, but is a particular kind of 'copy.' Instead, the author may write a 'literary work,' which in turn can be embodied in a wide range of 'copies' and 'phonorecords'...."). The embedding of the copyrightable work in a tangible medium does not mean that the features of the tangible medium are also copyrightable. Thus, here, the original element of West's compilation, its arrangement of cases, is protectable, while the features of the physical embodiment of the work, i.e., the page numbers, are not.
Because the volume and page numbers are unprotected features of West's compilation process, they may be copied without infringing West's copyright. [FN10] However, West proffers an alternative argument based on the fact (which West has plausibly demonstrated) *700 that plaintiffs have inserted or will insert all of West's volume and page numbers for certain case reporters. West's alternative argument is that even though the page numbering is not (by itself) a protectable element of West's compilation, (i) plaintiffs' star pagination to West's case reporters embeds West's arrangement of cases in plaintiffs' CD-ROM discs, thereby allowing a user to perceive West's protected arrangement [FN11] through the plaintiffs' file-retrieval programs, and (ii) that under the Copyright Act's definition of "copies," 17 U.S.C. § 101, a work that allows the perception of a protectable element of a compilation through the aid of a machine amounts to a copy of the compilation. We reject this argument for two separate reasons. [FN12]
FN10. The dissent would extend copyright protection to all page numbers because, when inserted into a complete set of opinions appearing in West's case reporters, they reflect the arrangement of those reporters. Dissent at page 709. But such an approach would extend copyright to page numbers which do not represent an exercise of original authorship. Although the arrangement of West's cases may be copyrightable, and although complete star pagination may permit the perception of that arrangement, there is no support for extending copyright protection to an unoriginal element because when completely copied it reveals a protected element rather than copies it.
FN11. West claims that its arrangement of cases, see supra note 3, is original and worthy of copyright protection. Hyperlaw (but not Bender) argues that West's arrangement of cases in the Supreme Court Reporter and the Federal Reporter (the case reporters containing the opinions included on HyperLaw's CD-ROM discs) is insufficiently original to be copyrightable. But because we find that West's arrangement has not been copied through the insertion of star pagination to West's case reporters, we can assume without deciding that West's case reporters contain an original and copyrightable arrangement.
In addition, this opinion will not address any copying by plaintiffs of the selection of cases included in West's case reporters. First, West argued below that Bender had copied West's arrangement of cases, not its selection. Second, it is uncontested that plaintiffs' compilations include many more opinions than West's case reporters. For example, HyperLaw's second quarter 1996 CD-ROM disc contained approximately 36,000 Supreme Court and court of appeals decisions, only 22,000 of which were published by West. The selection of cases for Bender's product also differs from West's: (i) it contains many unpublished decisions not found in West's reporters, and (ii) unlike West's Federal Reporter, Federal Supplement, and Federal Rules Decisions, Bender's product includes only federal cases decided by New York courts. Accordingly, we cannot find that the selection of cases in plaintiffs' compilations is substantially similar to West's selection. See Tasini v. New York Times Co., 972 F.Supp. 804, 823 (S.D.N.Y.1997) (Sotomayor, J.) (noting that to find infringement of selection, "the subsequent work cannot differ in selection by 'more than a trivial degree' from the work that preceded it") (citing Kregos v. Associated Press, 937 F.2d 700, 710 (2d Cir.1991)).
FN12. Plaintiffs cite Banks Law Publishing Co. v. Lawyers' Co-Operative Publishing Co., 169 F. 386 (2d Cir.1909), in arguing that star pagination to case reporters is permissible, and they intimate that Banks held that the arrangement of cases cannot be copyrightable. Banks 's holding seems to have rested on the plaintiff's status as an official reporter. See id. at 389 (reprint of text of district court opinion) ("A reasonable interpretation of the statute prescribing his duties implies pagination, volumes of uniform size and reasonable thickness, together with a suitable and convenient arrangement of the cases."). True, our opinion in Banks adds that "[i]t is not necessary to discuss so much of the opinion below as deals with the question[ ] of ... the right of the official reporter to secure copyrights," id. at 391, which could imply either that our holding did not rest on the official status of the reporter but on the lack of originality in the arrangement or that the foregone analysis concerns the copyrightability of elements not dictated by statute. In any event, Bender concedes for the purpose of summary judgment that West's arrangement is sufficiently original to merit copyright protection; Banks does not assist in answering the distinct question of whether star pagination infringes the arrangement of another reporter if the arrangement of the cross-paginated work is copyrightable; and Banks preceded even the effective date of the Copyright Act of 1909. We decline to decide this case on the strength of Banks.
A
[7] West asserts an indirect infringement theory: (i) the embedding of unprotectable volume and page numbers in a CD-ROM disc (so-called "compilation markers" or "tags"), (ii) permits a user to perceive West's arrangement of cases through the aid of a machine, and (iii) this amounts to a copy of the compilation's arrangement under § 101's definition of "copies." Assuming for the moment that West has properly read the Act, i.e., that a copy of the arrangement is created when the arrangement can be perceived with the aid of a user and a machine, we think it is clear that the copy is not created by insertion of star pagination.
West concedes that insertion of parallel citations (identifying the volume and first page numbers on which a particular case appears) to West's case reporters in plaintiffs' products (as well as any other compilations of judicial opinions) is permissible under the fair use doctrine. [FN13] See West Reply Brief at 5 n.5 (noting "West's long-held position *701that parallel citation to West case reports by competitors (without additional star pagination) is a fair use under 17 U.S.C. § 107--i.e., an otherwise infringing use that, when analyzed under the § 107 factors, is deemed 'fair' "); West's Response to Bender's Rule 3(g) Statement ¶ 32, Joint Appendix at 1581; see also West Publ'g Co. v. Mead Data Central, Inc., 799 F.2d 1219, 1222 (8th Cir.1986) ("West concedes that citation to the first page of its reports is a noninfringing 'fair use' under 17 U.S.C. § 107."). West admitted at oral argument (as it did in the district court [FN14]) that these parallel citations already allow a user of plaintiffs' CD-ROM discs to perceive West's arrangement with the aid of a machine and that plaintiffs' CD-ROM discs therefore already have created a lawful "copy" of West's arrangement on their CD-ROM discs--as West defines "copy." [FN15]
...
Once the copy has thus been created through parallel citation--assuming that anyone would wish to avail themselves of the capability of perceiving this copy--the only incremental data made perceivable (through the aid of a machine) by star pagination is the location of page breaks within each judicial opinion. But since page breaks do not result from any original creation by West, their location may be lawfully copied. We therefore conclude that star pagination's volume and page numbers merely convey unprotected information, and that their duplication does not infringe West's copyright.
The opposite conclusion was reached by the district court in Oasis Publishing Co. v. West Publishing Co., 924 F.Supp. 918 (D.Minn.1996), which reasoned that the fair-use copying of parallel citation, which could be used to perceive the arrangement of cases, did not excuse copying interior pagination, which could also be used to perceive arrangement. See id. at 926. [FN16] It is true that copying under the fair use doctrine will not necessarily permit additional uses, and will not excuse additional copying that in the aggregate amounts to infringement. But a compilation has limited protectability; only the original elements of a compilation (i.e., its selection, arrangement, and coordination) are protected from copying. The insertion of parallel citations already creates a "copy" of West's arrangement (at least as West defines a copy), a copy that is permissible under the fair use doctrine. Star pagination cannot be said to create another copy of the same arrangement. Prohibiting star pagination would simply allow West to protect unoriginal elements of its compilation that have assumed importance and value. Accordingly,*702even were we to agree with West's interpretation of the Copyright Act, we would not find infringement.
FN16. The court noted:
Although with either the parallel cites or an internal cite from each case a user could sort West's cases and determine West's arrangement, the former does not utterly supplant the need for West's product while the latter does.
Conceding parallel citation to the first page of each case as a noninfringing fair use does not diminish West's copyright interest in the subsequent internal pages, which also would independently permit arrangement of the cases by sorting. Having gotten the inch under the conceded fair use of parallel citation to the first page of each case, Oasis is not thereby entitled to take the entire mile in star citation to every page.
Oasis Publ'g Co., 924 F.Supp. at 926.
B
[8] But our rejection of West's position is even more fundamental. If one browses through plaintiffs' CD-ROM discs from beginning to end, using the computer software that reads and sorts it, the sequence of cases owes nothing to West's arrangement. West's argument is that the CD-ROM discs are infringing copies because a user who manipulates the data on the CD-ROM discs could at will re-sequence the cases (discarding many of them) into the West arrangement. To state West's theory in the statutory words on which West (mistakenly) relies, each of the plaintiffs' CD-ROM discs is a "copy" because West's copyrighted arrangement is "fixed" on the disc in a way that can be "perceived ... with the aid of a machine or device." 17 U.S.C. § 101 (1994).
For reasons set forth below, we conclude that a CD-ROM disc infringes a copyrighted arrangement when a machine or device that reads it perceives the embedded material in the copyrighted arrangement or in a substantially similar arrangement. At least absent some invitation, incentive, or facilitation not in the record here, a copyrighted arrangement is not infringed by a CD-ROM disc if a machine can perceive the arrangement only after another person uses the machine to re-arrange the material into the copyrightholder's arrangement.
1. Section 101's Definition of "Copies"
West relies on the statutory definition of "copies." To establish infringement, the copyright holder must demonstrate a violation of an exclusive right. 17 U.S.C. § 501 (1994). One such right is the right "to reproduce the copyrighted work in copies or phonorecords." 17 U.S.C. § 106(1) (1994) (emphasis added). Section 101 of the Copyright Act defines "copies" as follows, the emphasis supplied on terms implicated by the analysis in this case:
"Copies" are material objects, other than phonorecords, in which a work is fixed by any method now known or later developed, and from which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device. The term "copies" includes the material object, other than the phonorecord, in which the work is first fixed.
17 U.S.C. § 101. "A work is 'fixed' in a tangible medium of expression when its embodiment in a copy ... is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration." Id. (emphasis added).
[9][10] The Copyright Act establishes a "fundamental distinction" between the original work of authorship and the material object in which that work is "fixed." See supra note 9. The sole purpose of § 101's definitions of the words "copies" and "fixed" is to explicate the "fixation" requirement, i.e., to define the material objects in which copyrightable and infringing works may be embedded and to describe the requisite fixed nature of that work within the material object. See 1 William F. Patry, Copyright Law and Practice 168 (1994) ("The two essential criteria of statutory copyright are originality and fixation."); id. at 174 (noting that the definition of "copies" is "intended to 'comprise all the material objects in which copyrightable objects are capable of being fixed' "). Under § 101's definition of "copies," a work satisfies the fixation requirement when it is fixed in a material object from which it can be perceived or communicated directly or with the aid of a machine. [FN17]
FN17. The wording of the definition is set forth in the previous paragraph of text. 17 U.S.C. § 101. The dissent argues that the first "work" in this passage references the allegedly infringing work, while the second "work" refers to the original work. Dissent at page 710. Our interpretation of the statute flows from a plain reading, under which the same meaning is attached to each reference to a "work"; there is no indication in the statute that the second "work" is intended to refer to the original work of authorship, as opposed to simply the work that is fixed in the material object.
This definition was intended to avoid the distinctions "derived from cases such as*703White-Smith Publishing Co. v. Apollo Co., 209 U.S. 1 [, 28 S.Ct. 319, 52 L.Ed. 655] (1908), under which statutory copyrightability in certain cases [had] been made to depend upon the form or medium in which the work is fixed." H.R.Rep. No. 94-1476, at 52 (1976), reprinted in 1976 U.S.C.C.A.N. 5659, 5665; see also S.Rep. No. 94-473, at 51 (1975). [FN18] In White-Smith, the Supreme Court held that a piano roll did not infringe the copyrighted music it played because its perforations were unintelligible to the eye and therefore did not amount to a "copy" of the music (which the Court defined as " 'a written or printed record of [the musical composition] in intelligible notation' "). See White-Smith Publ'g Co., 209 U.S. at 17, 28 S.Ct. at 323. There was no question in that case that the work embodied in the piano roll reproduced the original work of authorship, i.e., the piece of music; the only question was whether this reproduction met the "fixation" requirement. Thus, the definition of "copies" is intended to expand the "fixation" requirement to include material objects that embody works capable of being perceived with the aid of a machine, thereby ensuring that reproductions of copyrighted works contained on media such as floppy disks, hard drives, and magnetic tapes would meet the Copyright Act's "fixation" requirement.
FN18. In explaining the fixation requirement, the House Report states in full:
As a basic condition of copyright protection, the bill perpetuates the existing requirement that a work be fixed in a "tangible medium of expression," and adds that this medium may be one "now known or later developed," and that the fixation is sufficient if the work "can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device." This broad language is intended to avoid the artificial and largely unjustifiable distinctions, derived from cases such as White-Smith Publishing Co. v. Apollo Co., 209 U.S. 1, 28 S.Ct. 319, 52 L.Ed. 655 (1908), under which statutory copyrightability in certain cases has been made to depend upon the form or medium in which the work is fixed. Under the bill it makes no difference what the form, manner, or medium of fixation may be--whether it is in words, numbers, notes, sounds, pictures, or any other graphic or symbolic indicia, whether embodied in a physical object in written, printed, photographic, sculptural, punched, magnetic, or any other stable form, and whether it is capable of perception directly or by means of any machine or device "now known or later developed."
H.R.Rep. No. 94-1476, at 52, reprinted in 1976 U.S.C.C.A.N. 5659, 5665 (footnote omitted).
That definition--intended to clarify that a work stored on a disk or tape can be a copy of the copyrighted work even if it cannot be perceived by human senses without technological aid--means that CD-ROM discs can infringe a copyright even if the information embedded upon them is not perceptible without the aid of a CD-ROM player. In this case, however, the only fixed arrangement is the (non-West) sequence that is embedded on plaintiffs' CD-ROM discs and that appears with the aid of a machine without manipulation of the data.
To recapitulate a bit, West relies on the definition of "copies" to argue that plaintiffs' CD-ROM discs duplicate its copyrighted arrangement of cases because star pagination permits a user to "perceive" the copyrighted element "with the aid of" a computer and the FOLIO retrieval system, i.e., by manipulating the data embedded on a CD-ROM disc to retrieve the cases in the order in which they appear in the West case reporters. West's definition of a copy, as applied to a CD-ROM disc, would expand the embedded work to include all arrangements and re arrangements that could be made by a third-party user who manipulates the data on his or her own initiative. But the relevant statutory wording refers to material objects in which "a work" readable by technology "is fixed," not to another work or works that can be created, unbidden, by using technology to alter the fixed embedding of the work, by rearrangement or otherwise. The natural reading of the statute is that the arrangement of the work is the one that can be perceived by a machine without an uninvited manipulation of the data.
West cites no case which supports its interpretation of § 101's definition of "copies," [FN19] and every case we have found has*704relied upon the definition solely to ascertain whether a work has met the fixation requirement, not to determine the arrangements and rearrangements of the work fixed on the material object. See, e.g., Stenograph L.L.C. v. Bossard Assocs., Inc., 144 F.3d 96, 100 (D.C.Cir.1998) (citing § 101's definition of "copies" to "support the proposition that the installation of software onto a computer results in 'copying' within the meaning of the Copyright Act"); Stern Elecs., Inc. v. Kaufman, 669 F.2d 852, 856 (2d Cir.1982) (using § 101's definition of "copies" to determine whether an audiovisual work met the "fixation" requirement); Sega Enters. Ltd. v. Accolade, Inc., 785 F.Supp. 1392, 1396 (N.D.Cal.) (using § 101 to determine whether an intermediate copy was actionable and noting substantial similarity between intermediate copy and allegedly infringed work as the test for determining whether intermediate copy was reproduction of copyrighted work), aff'd in part and rev'd in part, 977 F.2d 1510 (9th Cir.1992).
FN19. West relies on Tasini v. New York Times Co., 972 F.Supp. 804 (S.D.N.Y.1997) (Sotomayor, J.); but that case is completely consistent with our interpretation of § 101's definition of "copies." At issue in Tasini was a collective work author's right to produce several electronic databases containing the collective work under § 201(c)'s "revision" right for collective works. The contributors to the collective works argued, inter alia, that § 201(c) did not contemplate that a computer database of the collective work could amount to a revision, arguing that because § 201(c) did not confer the right to display the copyrighted work publicly, the work could not be reproduced on a computer because "a work cannot be reproduced electronically unless it is 'displayed' on a computer screen." Id. at 816. However, the court rejected this argument, noting that the reproduction right, which is granted under § 201(c), and "which necessarily encompasses the right to create copies of that work, presupposes that such copies might be 'perceived' from a computer terminal." Id.
This statement merely affirmed that a reproduction of an original work may be found on a material object that allows the work to be perceived on a computer terminal. But it does not explain the arrangement of the "work" fixed on that copy and whether a particular copy is a reproduction of the original work. Nor did Tasini read § 101's definition of "copies" to mean that the data was arranged in any way that could be perceived by a third party with the aid of a sorting device. In fact, when the court did consider whether the work embedded on the CD-ROM was substantially similar to the original collective work, it did not refer to § 101's definition of "copies". Id. at 823-25.
2. Substantial Similarity
The question presented--whether an element of West's copyrighted work has been reproduced in a "copy"--is answered by comparing the original and the allegedly infringing works, and inquiring whether the copyrightable elements are substantially similar. Under the facts of this case, the arrangement of the "work" on plaintiffs' CD-ROM discs is the arrangement of cases that is displayed by a CD player reading the information in the order in which it is physically embedded or "fixed" in the discs and not all possible arrangements that can be perceived through the manipulation and rearrangement of the embedded data by a third party user with a machine.
[11] The Supreme Court in Feist emphasized that copyright protection for a factual compilation is "thin," and that a compilation containing the same facts or non-copyrightable elements will not infringe unless it "feature[s] the same selection and arrangement" as the original compilation. Feist, 499 U.S. at 349, 111 S.Ct. at 1289 (emphasis added); see also Key Publications, Inc. v. Chinatown Today Publ'g Enters., Inc., 945 F.2d 509, 514 (2d Cir.1991) (holding that to establish infringement, a compilation copyright holder must demonstrate "substantial similarity between those elements, and only those elements, that provide copyrightability to the allegedly infringed compilation"). To determine whether two works contain a substantially similar arrangement, courts compare the ordering of material in the two works, finding infringement only when both compilations have featured a very similar literal ordering or format. See, e.g., Lipton v. Nature Co., 71 F.3d 464, 472 (2d Cir.1995) (finding infringement of arrangement when of 25 terms contained in copyrighted work, 21 are listed in same order on allegedly infringing work); Worth v. Selchow & Righter Co., 827 F.2d 569, 573 (9th Cir.1987) (holding that alphabetical arrangement of factual entries in a trivia encyclopedia was not copied by a copyrighted game that organized the factual entries by subject matter and random arrangement on game cards); see also Jane C. Ginsburg, No "Sweat"? Copyright and Other Protection of Works of Information After Feist v. Rural Telephone, *70592 Colum.L.Rev. 338, 349 (1992) (noting that under Feist, nothing "short of extensive verbatim copying" will amount to infringement of a compilation). "If the similarity concerns only noncopyrightable elements of [a copyright holder's] work, or no reasonable trier of fact could find the works substantially similar, summary judgment is appropriate." Williams v. Crichton, 84 F.3d 581, 587 (2d Cir.1996) (internal quotation marks and citations omitted). We agree with plaintiffs and amicus United States that West fails to demonstrate the requisite substantial similarity. [FN20] West's case reporters contain many fewer cases than plaintiffs' CD-ROM discs, and are arranged according to classification such as court, date, and genre (opinions, per curiam opinions, orders, etc.), subject to certain exceptions characterized by West as features of originality, whereas plaintiffs organize their cases simply by court and date. Comparison of the works reveals that cases that appear adjacent in the West case reporters are separated on plaintiffs' products by many other cases; and even if these other cases are disregarded, the West cases included on plaintiffs' products are not in an order at all resembling West's arrangement. ...
Star pagination (in addition to revealing the page location of the text of judicial opinions) may incidentally reveal to the reader how the reader could create a copy of West's arrangement by various computer key operations; but by the same token, if the CD-ROM discs were published on paper in the same order as the cases are embedded in the CD-ROM disc, a reader so minded could assemble a "copy" of the West arrangement by use of scissors. Cf. Horgan v. Macmillan, Inc., 789 F.2d 157, 162 (2d Cir.1986) (noting that "the standard for determining copyright infringement is not whether the original could be recreated from the allegedly infringing copy, but whether the latter is 'substantially similar' to the former").
True, CD-ROM technology is different from paper, for as West points out, the arrangement of judicial opinions in a CD-ROM disc does not correspond necessarily to how the information will be displayed or printed by the user, because the file-retrieval system allows users to retrieve cases in a variety of ways. See Robert C. Denicola, Copyright in Collections of Facts: A Theory for the Protection of Nonfiction Literary Works, 81 Colum.L.Rev. 516, 531 (1981) ("[I]t is often senseless to seek in [electronic databases] a specific, fixed arrangement of data."). But having rejected West's argument under § 101, we can conclude that the arrangement of plaintiffs' work is the sequence of cases as embedded on the plaintiffs' CD-ROM discs and as displayed to the user browsing through plaintiffs' products. That sequence is not substantially similar to West's case reporters. There is no evidence that Bender and HyperLaw's case-retrieval systems allow a user to browse the cases in the West *706 arrangement without first taking steps to create that arrangement. Thus, an actionable copy of West's sequence of cases, i.e., a work with a substantially similar arrangement fixed in a tangible medium (probably a print-out of the cases), could be created by a user of the CD-ROM discs, but only by using the file-retrieval program as electronic scissors. We cannot find that plaintiffs' products directly infringe West's copyright by inserting star pagination to West's case reporters.
3. Contributory Infringement
[12] Notwithstanding the absence of substantial similarity, a database manufacturer may be liable as a contributory infringer (in certain circumstances) for creating a product that assists a user to infringe a copyright directly. West has hypothesized that users of Bender and HyperLaw's products, using star pagination and the search functions of the CD-ROM products, will retrieve and print cases in the order in which they appear in West's case reporters. See Affidavit of Michael A. Trittipo ¶ 5, Joint Appendix at 1287. A CD-ROM disc user who replicated the West compilation in that way would be an infringer. But West has failed to identify any primary infringer, other than Mr. Trittipo, West's counsel. See Cable/Home Communication Corp. v. Network Prods., Inc., 902 F.2d 829, 845 (11th Cir.1990) ("Contributory infringement necessarily must follow a finding of direct or primary infringement."); 2 Paul Goldstein, Copyright § 6.0 (1996) ( "For a defendant to be held contributorily or vicariously liable, a direct infringement must have occurred.").
[13][14] Assuming there is a class of primary infringers, then a party "who, with knowledge of the infringing activity, induces, causes, or materially contributes to the infringing conduct of another, may be held liable as a 'contributory' infringer." See Gershwin Publ'g Corp. v. Columbia Artists Management, Inc., 443 F.2d 1159, 1162 (2d Cir.1971). Two types of activities that lead to contributory liability are: (i) personal conduct that encourages or assists the infringement; and (ii) provision of machinery or goods that facilitate the infringement. See ITSI T.V. Prods., Inc. v. California Auth. of Racing Fairs, 785 F.Supp. 854, 861 n. 13 (E.D.Cal.1992). West argues that Bender and HyperLaw's sale of their CD-ROM products falls within the second category.
[15] However, as amicus United States notes, the provision of equipment does not amount to contributory infringement if the equipment is "capable of substantial noninfringing uses," including uses authorized under the fair use doctrine. See Sony Corp. of Amer. v. Universal City Studios, Inc., 464 U.S. 417, 442, 104 S.Ct. 774, 788-89, 78 L.Ed.2d 574 (1984). In determining whether liability is foreclosed by substantial noninfringing uses, the Supreme Court in Sony emphasized that the alleged contributory infringer did not influence or encourage unlawful copying with the equipment it provided. Id. at 438, 104 S.Ct. at 787; see also Cable/Home Communication Corp., 902 F.2d at 846.
C
We differ with the Eighth Circuit's opinion in West Publishing Co. v. Mead Data Central, Inc., 799 F.2d 1219 (8th Cir.1986). In that case, LEXIS (an on- line database provider) announced plans to star paginate its on-line version of cases to West case reporters. West claimed that the star pagination would allow users to page through cases as if they were reading West volumes, and in that way copied West's arrangement of cases. Id. at 1222. The court held that "West's arrangement is a copyrightable aspect of its compilation of cases, that the pagination of West's volumes reflects and expresses West's arrangement, and that MDC's intended use of West's page numbers infringes West's copyright in the arrangement." Id. at 1223. Even if it was not "possible to use LEXIS to page through cases as they are arranged in West volumes," the court said that insertion of comprehensive star pagination amounted to infringement:
Jump cites to West volumes within a case on LEXIS are infringing because they enable LEXIS users to discern the precise location in West's arrangement of the portion of the opinion being viewed....
With [LEXIS's] star pagination, consumers would no longer need to purchase West's reporters to get every aspect of West's arrangement. Since knowledge of the location of opinions and parts of opinions within West's arrangement is a large part of the reason one would purchase West's volumes, the LEXIS star pagination feature would adversely affect West's market position. "[A] use that supplants any part of the normal market for a copyrighted work would ordinarily be considered an infringement." S.Rep. No. 473, 94th Cong., 1st Sess. 65 (1975)....
*708 Id. at 1227-28; see also Oasis Publ'g Co. v. West Publ'g Co., 924 F.Supp. 918, 922-25 (D.Minn.1996) (holding that (i) West Publishing Co. had not been overruled by Feist 's disavowal of the "sweat of the brow" doctrine, and (ii) that even if it had, "the internal pagination of [West's reporter] is part of West's overall arrangement, and similarly protected").
The Eighth Circuit in West Publishing Co. adduces no authority for protecting pagination as a "reflection" of arrangement, and does not explain how the insertion of star pagination creates a "copy" featuring an arrangement of cases substantially similar to West's--rather than a dissimilar arrangement that simply references the location of text in West's case reporters and incidentally simplifies the task of someone who wants to reproduce West's arrangement of cases. It is true that star pagination enables users to locate (as closely as is useful) a piece of text within the West volume. But this location does not result in any proximate way from West's original arrangement of cases (or any other exercise of original creation) and may be lawfully copied So any damage to the marketability of West's reporters resulting from such copying is not cognizable under the Copyright Act. It is interesting that the Eighth Circuit's quotation from the Senate Report on supplanting use is drawn from the Report's discussion of the fair use doctrine, which applies only when the copyright holder has first demonstrated infringement of a protectable element of its work.
At bottom, West Publishing Co. rests upon the now defunct "sweat of the brow" doctrine. That court found that LEXIS had infringed West's copyright simply because it supplanted much of the need for West's case reporters through wholesale appropriation of West's page numbers. In reaching this conclusion, the court (i) noted that LEXIS's appropriation would deprive West of a large part of what it "[had] spent so much labor and industry in compiling," West Publ'g Co., 799 F.2d at 1227, and (ii) cited Hutchinson Telephone v. Fronteer Directory Co., 770 F.2d 128 (8th Cir.1985), see West Publ'g Co., 799 F.2d at 1228, which in turn relied on Leon v. Pacific Telephone & Telegraph Co., 91 F.2d 484 (9th Cir.1937), and Jeweler's Circular Pub Co v. Keystone Pub Co, 281 F. 83 (C.C.A.Cir.1922)--classic "sweat of the brow" cases that were overruled in Feist. Thus, the Eighth Circuit in West Publishing Co. erroneously protected West's industrious collection rather than its original creation. Because Feist undermines the reasoning of West Publishing Co., see United States v. Thomson Corp., 949 F.Supp. 907, 926 (D.D.C.1996), we decline to follow it.
CONCLUSION
We hold that Bender and HyperLaw will not infringe West's copyright by inserting star pagination to West's case reporters in their CD-ROM disc version of judicial opinions. The judgement of the district court is affirmed.
SWEET, District Judge.
I respectfully dissent.
This appeal from the grant of summary judgment in favor of the appellee Bender presents challenging issues, the extent of copyright protection for compilations under the § 501(a) and § 106(1) and (3) of Title 17, U.S.C., what constitutes copying in the electronic age, and the propriety of summary judgment in determining issues of fair use. Because the majority reaches conclusions on the first two issues, with which I disagree, and consequently failed to address the third issue, I feel required to dissent, emboldened by the holdings of the three other courts which have considered the issue, West Pub. Co. v. Mead Data Central, Inc., 616 F.Supp. 1571 (D.Minn.1985), aff'd, 799 F.2d 1219 (8th Cir.1986), cert. denied, 479 U.S. 1070, 107 S.Ct. 962, 93 L.Ed.2d 1010 (1987); Oasis Pub. Co. v. West Pub. Co., 924 F.Supp. 918 (D.Minn.1996), and reached conclusions contrary to those stated by the majority. By concluding that page numbers in the context of the West citation system are facts rather than an expression of originality the majority permits the appellee Bender and the intervenor Hyperlaw to appropriate the practical and commercial value of the West compilation.
The West page numbers which are inserted by appellee Bender in the text of each of *709 its CD-ROM disks [FN1] by star pagination result from the totality of the West compilation process which includes its concededly original and copyrightable work, i.e. attorney description, headnotes, method of citation and emending of parallel or alternate citations. These result in a compilation work with page numbers assigned mechanically. The West page numbers and the corresponding Bender and Hyperlaw star pagination are the keys which open the door to the entire West citation system which as the majority noted is an accepted, and in some instances, a required element for the citation of authorities.
FN1. Bender's CD-ROMs obtain the text of the opinions they report from Lexis, opinions which are, of course, in the public domain.
The majority initially assumes the copyrightability of the West work but cites the statement in Feist Publications, Inc., v. Rural Telephone Service Company, Inc., 499 U.S. 340, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991), that "a factual compilation is eligible for copyright if it features an original selection or arrangement of the facts, but the copyright is limited to the particular selection or arrangement. In no event may copyright extend to the facts themselves." 499 U.S. 340 at 350-51, 111 S.Ct. 1282, 113 L.Ed.2d 358, and its conclusion that the compiler's copyright is "thin" permitting a subsequent compiler to use facts "so long as the competing work does not feature the same selection and arrangement." Id. By characterizing star pagination as a fact, rather than as an essential part of the selection or arrangement the majority deprives the West pagination of its originality and consequent copyright protection.
The majority concludes that because the volume and page numbers are "unprotected features" of West's compilation process, they may be copied without infringing West's copyright. The majority reasons that, pursuant to the Copyright Act, the "embedding of the copyrightable work in a tangible medium does not mean that the features of the tangible medium are also copyrightable." Therefore, West's arrangement of cases is protectible, but the page numbers are not. The classification of page numbers as physical embodiment rather than the result of originality is the foundation stone of the majority's interpretation of the authorities dealing with the copyright statute.
In my view West's case arrangements, an essential part of which is page citations, are original works of authorship entitled to copyright protection. Comprehensive documentation of West's selection and arrangement of judicial opinions infringes the copyright in that work.
This reasoning is consistent with Feist. As discussed above, the majority notes that the compiler's copyright is "thin." Feist, 499 U.S. 340 at 350- 51, 111 S.Ct. 1282, 113 L.Ed.2d 358. Therefore, "a subsequent compiler remains free to use the facts contained in another's publication to aid in preparing a competing work, so long as the competing work does not feature the same selection and arrangement." Id. at 349, 111 S.Ct. 1282, (emphasis added). In this case, allowing plaintiffs to use the page numbers contained in West's publication enables them to feature West's same selection and arrangement. [FN2] Indeed, were it not for the ability to reproduce West's arrangement, its pagination would be of limited (if any) use.
FN2. It is immaterial that plaintiffs' products may display other arrangements as well as West's. The capability of a CD-ROM to display more than one arrangement does not make the encoding of an original selection and arrangement such as West's any less of an infringement.
It is also irrelevant that plaintiffs' products may contain material beyond West's selection and arrangement. Infringement is determined by how much of the copyright owner's work was taken, not by what else the copier's work contains. See e.g., Warner Bros., Inc. v. American Broadcasting Cos., Inc., 720 F.2d 231, 241 (2d Cir.1983).
According to Feist, "[t]he originality requirement articulated in the The Trade-Mark Cases and Burrow-Giles remains the touchstone of copyright protection today.... It is this bedrock principle of copyright that mandates the law's seemingly disparate treatment of facts and factual compilations." 499 U.S. 340 at 347, 111 S.Ct. 1282, 113 L.Ed.2d 358 (citations omitted).
..... Some of the most seminal developments in copyright law have been driven by technological change. There was a time when people questioned whether photographs, see Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53, 4 S.Ct. 279, 28 L.Ed. 349 (1884), or advertisements, see Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 23 S.Ct. 298, 47 L.Ed. 460 (1903), were copyrightable. Here again it is necessary to reconcile technology with pre-electronic principles of law. Clearly, plaintiffs' CD-ROM disks are not "copies" in the traditional sense. Yet, plaintiffs provide the ability for a user to push a button or two and obtain West's exact selection and arrangement. This technological capacity presents a new question. The majority's answer threatens to eviscerate copyright protection for compilations.
...
For these reasons I believe the grant of summary judgment granting the declaratory judgment
requested by Bender was error, and I therefore dissent from the majority's affirmance of that judgment
Copyrightable Subject Matter -- Method of Operation
49 F.3d 807
63 USLW 2565,
1995 Copr.L.Dec. P 27,367,
34 U.S.P.Q.2d 1014
LOTUS DEVELOPMENT CORPORATION, Plaintiff, Appellee, v. BORLAND
INTERNATIONAL, INC., Defendant, Appellant.
No. 93-2214.
United States Court of Appeals,
First Circuit.
Heard Oct. 6, 1994.
Decided March 9, 1995.
Before TORRUELLA, Chief Judge, BOUDIN and STAHL, Circuit Judges.
STAHL, Circuit Judge.
This appeal requires us to decide whether a computer menu command hierarchy is copyrightable
subject matter. In particular, we must decide whether, as the district court held, plaintiff-appellee
Lotus Development Corporation's copyright in Lotus 1-2-3, a computer spreadsheet program,
was infringed by defendant-appellant Borland International, Inc., when Borland copied the Lotus
1-2-3 menu command hierarchy into its Quattro and Quattro Pro computer spreadsheet
programs....
I.
Background
Lotus 1-2-3 is a spreadsheet program that enables users to perform accounting functions electronically on a computer. Users manipulate and control the program via a series of menu commands, such as "Copy," "Print," and "Quit." Users choose commands either by highlighting them on the screen or by typing their first letter. In all, Lotus 1-2-3 has 469 commands arranged into more than 50 menus and submenus.
Lotus 1-2-3, like many computer programs, allows users to write what are called "macros." By writing a macro, a user can designate a series of command choices with a single macro keystroke. Then, to execute that series of commands in multiple parts of the spreadsheet, rather than typing the whole series each time, the user only needs to type the single pre-programmed macro keystroke, causing the program to recall and perform the designated series of commands automatically. Thus, Lotus 1-2-3 macros *810shorten the time needed to set up and operate the program.
Borland released its first Quattro program to the public in 1987, after Borland's engineers had labored over its development for nearly three years. Borland's objective was to develop a spreadsheet program far superior to existing programs, including Lotus 1-2-3. In Borland's words, "[f]rom the time of its initial release ... Quattro included enormous innovations over competing spreadsheet products."
The district court found, and Borland does not now contest, that Borland included in its Quattro and Quattro Pro version 1.0 programs "a virtually identical copy of the entire 1-2-3 menu tree." Borland III, 831 F.Supp. at 212 (emphasis in original). In so doing, Borland did not copy any of Lotus's underlying computer code; it copied only the words and structure of Lotus's menu command hierarchy. Borland included the Lotus menu command hierarchy in its programs to make them compatible with Lotus 1-2-3 so that spreadsheet users who were already familiar with Lotus 1-2-3 would be able to switch to the Borland programs without having to learn new commands or rewrite their Lotus macros.
In its Quattro and Quattro Pro version 1.0 programs, Borland achieved compatibility with Lotus 1-2-3 by offering its users an alternate user interface, the "Lotus Emulation Interface." By activating the Emulation Interface, Borland users would see the Lotus menu commands on their screens and could interact with Quattro or Quattro Pro as if using Lotus 1-2-3, albeit with a slightly different looking screen and with many Borland options not available on Lotus 1-2-3. In effect, Borland allowed users to choose how they wanted to communicate with Borland's spreadsheet programs: either by using menu commands designed by Borland, or by using the commands and command structure used in Lotus 1-2-3 augmented by Borland-added commands.
Lotus filed this action against Borland in the District of Massachusetts on July 2, 1990, four days after a district court held that the Lotus 1-2-3 "menu structure, taken as a whole--including the choice of command terms [and] the structure and order of those terms," was protected expression covered by Lotus's copyrights. Lotus Dev. Corp. v. Paperback Software Int'l, 740 F.Supp. 37, 68, 70 (D.Mass.1990) ("Paperback "). [FN1] Three days earlier, on the morning after the Paperback decision, Borland had filed a declaratory judgment action against Lotus in the Northern District of California, seeking a declaration of non-infringement. On September 10, 1990, the district court in California dismissed Borland's declaratory judgment action in favor of this action.
FN1. Judge Keeton presided over both the Paperback litigation and this case.
Lotus and Borland filed cross motions for summary judgment; the district court denied both motions on March 20, 1992, concluding that "neither party's motion is supported by the record." Borland I, 788 F.Supp. at 80. The district court invited the parties to file renewed summary judgment motions that would "focus their arguments more precisely" in light of rulings it had made in conjunction with its denial of their summary judgment motions. Id. at 82. Both parties filed renewed motions for summary judgment on April 24, 1992. In its motion, Borland contended that the Lotus 1-2-3 menus were not copyrightable as a matter of law and that no reasonable trier of fact could find that the similarity between its products and Lotus 1-2-3 was sufficient to sustain a determination of infringement. Lotus contended in its motion that Borland had copied Lotus 1-2-3's entire user interface and had thereby infringed Lotus's copyrights.
On July 31, 1992, the district court denied Borland's motion and granted Lotus's motion in part. The district court ruled that the Lotus menu command hierarchy was copyrightable expression because
[a] very satisfactory spreadsheet menu tree can be constructed using different commands and a different command structure from those of Lotus 1-2- 3. In fact, Borland has constructed just such an alternate tree for use in Quattro Pro's native mode. Even if one holds the arrangement of menu commands constant, it is possible to generate literally millions of satisfactory *811 menu trees by varying the menu commands employed.
Borland II, 799 F.Supp. at 217. The district court demonstrated this by offering alternate command words for the ten commands that appear in Lotus's main menu. Id. For example, the district court stated that "[t]he 'Quit' command could be named 'Exit' without any other modifications," and that "[t]he 'Copy' command could be called 'Clone,' 'Ditto,' 'Duplicate,' 'Imitate,' 'Mimic,' 'Replicate,' and 'Reproduce,' among others." Id. Because so many variations were possible, the district court concluded that the Lotus developers' choice and arrangement of command terms, reflected in the Lotus menu command hierarchy, constituted copyrightable expression.
In granting partial summary judgment to Lotus, the district court held that Borland had infringed Lotus's copyright in Lotus 1-2-3:
[A]s a matter of law, Borland's Quattro products infringe the Lotus 1-2-3 copyright because of (1) the extent of copying of the "menu commands" and "menu structure" that is not genuinely disputed in this case, (2) the extent to which the copied elements of the "menu commands" and "menu structure" contain expressive aspects separable from the functions of the "menu commands" and "menu structure," and (3) the scope of those copied expressive aspects as an integral part of Lotus 1-2-3.
Borland II, 799 F.Supp. at 223 (emphasis in original). The court nevertheless concluded that while the Quattro and Quattro Pro programs infringed Lotus's copyright, Borland had not copied the entire Lotus 1-2-3 user interface, as Lotus had contended. Accordingly, the court concluded that a jury trial was necessary to determine the scope of Borland's infringement, including whether Borland copied the long prompts [FN2] of Lotus 1-2-3, whether the long prompts contained expressive elements, and to what extent, if any, functional constraints limited the number of possible ways that the Lotus menu command hierarchy could have been arranged at the time of its creation. See Borland III, 831 F.Supp. at 207. Additionally, the district court granted Lotus summary judgment on Borland's affirmative defense of waiver, but not on its affirmative defenses of laches and estoppel. Borland II, 799 F.Supp. at 222-23.
FN2. Lotus 1-2-3 utilizes a two-line menu; the top line lists the commands from which the user may choose, and the bottom line displays what Lotus calls its "long prompts." The long prompts explain, as a sort of "help text," what the highlighted menu command will do if entered. For example, the long prompt for the "Worksheet" command displays the submenu that the "Worksheet" command calls up; it reads "Global, Insert, Delete, Column, Erase, Titles, Window, Status, Page." The long prompt for the "Copy" command explains what function the "Copy" command will perform: "Copy a cell or range of cells." The long prompt for the "Quit" command reads, "End 1-2-3 session (Have you saved your work?)."
Prior to trial, the parties agreed to exclude the copying of the long prompts from the case; Lotus agreed not to contend that Borland had copied the long prompts, Borland agreed not to argue that it had not copied the long prompts, and both sides agreed not to argue that the issue of whether Borland had copied the long prompts was material to any other issue in the case. See Borland III, 831 F.Supp. at 208.
Immediately following the district court's summary judgment decision, Borland removed the Lotus Emulation Interface from its products. Thereafter, Borland's spreadsheet programs no longer displayed the Lotus 1-2-3 menus to Borland users, and as a result Borland users could no longer communicate with Borland's programs as if they were using a more sophisticated version of Lotus 1-2-3. Nonetheless, Borland's programs continued to be partially compatible with Lotus 1-2-3, for Borland retained what it called the "Key Reader" in its Quattro Pro programs. Once turned on, the Key Reader allowed Borland's programs to understand and perform some Lotus 1-2-3 macros. [FN3] With the Key Reader on, the Borland programs used Quattro Pro menus for display, interaction, and macro execution, except when they encountered a slash ("/") key in a macro (the starting key for any Lotus 1-2-3 *812macro), in which case they interpreted the macro as having been written for Lotus 1-2-3. Accordingly, people who wrote or purchased macros to shorten the time needed to perform an operation in Lotus 1-2-3 could still use those macros in Borland's programs. [FN4] The district court permitted Lotus to file a supplemental complaint alleging that the Key Reader infringed its copyright.
FN3. Because Borland's programs could no longer display the Lotus menu command hierarchy to users, the Key Reader did not allow debugging ormodification of macros, nor did it permit the execution of most interactive macros.
FN4. See Borland IV, 831 F.Supp. at 226-27, for a more detailed explanation of macros and the Key Reader.
The parties agreed to try the remaining liability issues without a jury. The district court held two trials, the Phase I trial covering all remaining issues raised in the original complaint (relating to the Emulation Interface) and the Phase II trial covering all issues raised in the supplemental complaint (relating to the Key Reader). At the Phase I trial, there were no live witnesses, although considerable testimony was presented in the form of affidavits and deposition excerpts. The district court ruled upon evidentiary objections counsel interposed. At the Phase II trial, there were two live witnesses, each of whom demonstrated the programs for the district court.
After the close of the Phase I trial, the district court permitted Borland to amend its answer to include the affirmative defense of "fair use." Because Borland had presented all of the evidence supporting its fair-use defense during the Phase I trial, but Lotus had not presented any evidence on fair use (as the defense had not been raised before the conclusion of the Phase I trial), the district court considered Lotus's motion for judgment on partial findings of fact. See Fed.R.Civ.P. 52(c). The district court held that Borland had failed to show that its use of the Lotus 1-2-3 menu command hierarchy in its Emulation Interface was a fair use. See Borland III, 831 F.Supp. at 208.
In its Phase I-trial decision, the district court found that "each of the Borland emulation interfaces contains a virtually identical copy of the 1-2-3 menu tree and that the 1-2-3 menu tree is capable of a wide variety of expression." Borland III, 831 F.Supp. at 218. The district court also rejected Borland's affirmative defenses of laches and estoppel. Id. at 218- 23.
In its Phase II-trial decision, the district court found that Borland's Key Reader file included "a virtually identical copy of the Lotus menu tree structure, but represented in a different form and with first letters of menu command names in place of the full menu command names." Borland IV, 831 F.Supp. at 228. In other words, Borland's programs no longer included the Lotus command terms, but only their first letters. The district court held that "the Lotus menu structure, organization, and first letters of the command names ... constitute part of the protectable expression found in [Lotus 1-2- 3]." Id. at 233. Accordingly, the district court held that with its Key Reader, Borland had infringed Lotus's copyright. Id. at 245. The district court also rejected Borland's affirmative defenses of waiver, laches, estoppel, and fair use. Id. at 235-45. The district court then entered a permanent injunction against Borland, id. at 245, from which Borland appeals.
This appeal concerns only Borland's copying of the Lotus menu command hierarchy into its Quattro programs and Borland's affirmative defenses to such copying. Lotus has not cross-appealed; in other words, Lotus does not contend on appeal that the district court erred in finding that Borland had not copied other elements of Lotus 1-2-3, such as its screen displays.
II.
Discussion
On appeal, Borland does not dispute that it factually copied the words and arrangement of the Lotus menu command hierarchy. Rather, Borland argues that it "lawfully copied the unprotectable menus of Lotus 1-2-3." Borland contends that the Lotus menu command hierarchy is not copyrightable because it is a system, method of operation, process, or procedure foreclosed from protection by 17 U.S.C. § 102(b). Borland also raises a number of affirmative defenses.
*813 A. Copyright Infringement Generally
[1][2] To establish copyright infringement, a plaintiff must prove "(1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original." Feist Publications, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361, 111 S.Ct. 1282, 1296, 113 L.Ed.2d 358 (1991); see also Data Gen. Corp. v. Grumman Sys. Support Corp., 36 F.3d 1147, 1160 n. 19 (1st Cir.1994); Concrete Mach. Co. v. Classic Lawn Ornaments, Inc., 843 F.2d 600, 605 (1st Cir.1988). To show ownership of a valid copyright and therefore satisfy Feist's first prong, a plaintiff must prove that the work as a whole is original and that the plaintiff complied with applicable statutory formalities. See Engineering Dynamics, Inc. v. Structural Software, Inc., 26 F.3d 1335, 1340 (5th Cir.1994). "In judicial proceedings, a certificate of copyright registration constitutes prima facie evidence of copyrightability and shifts the burden to the defendant to demonstrate why the copyright is not valid." Bibbero Sys., Inc. v. Colwell Sys., Inc., 893 F.2d 1104, 1106 (9th Cir.1990); see also 17 U.S.C. § 410(c); Folio Impressions, Inc. v. Byer California, 937 F.2d 759, 763 (2d Cir.1991) (presumption of validity may be rebutted).
[3][4] To show actionable copying and therefore satisfy Feist's second prong, a plaintiff must first prove that the alleged infringer copied plaintiff's copyrighted work as a factual matter; to do this, he or she may either present direct evidence of factual copying or, if that is unavailable, evidence that the alleged infringer had access to the copyrighted work and that the offending and copyrighted works are so similar that the court may infer that there was factual copying (i.e., probative similarity). Engineering Dynamics, 26 F.3d at 1340; see also Concrete Mach., 843 F.2d at 606. The plaintiff must then prove that the copying of copyrighted material was so extensive that it rendered the offending and copyrighted works substantially similar. See Engineering Dynamics, 26 F.3d at 1341.
In this appeal, we are faced only with whether the Lotus menu command hierarchy is copyrightable subject matter in the first instance, for Borland concedes that Lotus has a valid copyright in Lotus 1-2-3 as a whole [FN5] and admits to factually copying the Lotus menu command hierarchy. As a result, this appeal is in a very different posture from most copyright-infringement cases, for copyright infringement generally turns on whether the defendant has copied protected expression as a factual matter. Because of this different posture, most copyright-infringement cases provide only limited help to us in deciding this appeal. This is true even with respect to those copyright- infringement cases that deal with computers and computer software.
FN5. Computer programs receive copyright protection as "literary works." See 17 U.S.C. § 102(a)(1) (granting protection to "literary works") and 17 U.S.C. § 101 (defining "literary works" as "works ... expressed in words, numbers, or other verbal or numerical symbols or indicia, regardless of the nature of the material objects, such as books, periodicals, phonorecords, film, tapes, disks, or cards, in which they are embodied" (emphasis added)); see also H.R.Rep. No. 1476, 94th Cong., 2d Sess. 54 (1976), reprinted in 1976 U.S.C.C.A.N. 5659, 5667 ("The term 'literary works' ... includes computer data bases, and computer programs to the extent that they incorporate authorship in the programmer's expression of original ideas, as distinguished from the ideas themselves.").
B. Matter of First Impression
Whether a computer menu command hierarchy constitutes copyrightable subject matter is a matter of first impression in this court. While some other courts appear to have touched on it briefly in dicta, see, e.g., Autoskill, Inc. v. National Educ. Support Sys., Inc., 994 F.2d 1476, 1495 n. 23 (10th Cir.), cert. denied, 510 U.S. 916, 114 S.Ct. 307, 126 L.Ed.2d 254 (1993), we know of no cases that deal with the copyrightability of a menu command hierarchy standing on its own (i.e., without other elements of the user interface, such as screen displays, in issue). Thus we are navigating in uncharted waters.
Borland vigorously argues, however, that the Supreme Court charted our course more than 100 years ago when it decided Baker v. Selden, 101 U.S. 99, 25 L.Ed. 841 (1879). In Baker v. Selden, the Court held that Selden's copyright over the textbook in which he explained *814 his new way to do accounting did not grant him a monopoly on the use of his accounting system. [FN6] Borland argues:
FN6. Selden's system of double-entry bookkeeping is the now almost- universal T-accounts system.
The facts of Baker v. Selden, and even the arguments advanced by the parties in that case, are identical to those in this case. The only difference is that the "user interface" of Selden's system was implemented by pen and paper rather than by computer.
To demonstrate that Baker v. Selden and this appeal both involve accounting systems, Borland even supplied this court with a video that, with special effects, shows Selden's paper forms "melting" into a computer screen and transforming into Lotus 1-2-3.
We do not think that Baker v. Selden is nearly as analogous to this appeal as Borland claims. Of course, Lotus 1-2-3 is a computer spreadsheet, and as such its grid of horizontal rows and vertical columns certainly resembles an accounting ledger or any other paper spreadsheet. Those grids, however, are not at issue in this appeal for, unlike Selden, Lotus does not claim to have a monopoly over its accounting system. Rather, this appeal involves Lotus's monopoly over the commands it uses to operate the computer. Accordingly, this appeal is not, as Borland contends, "identical" to Baker v. Selden.
C. Altai
[5] Before we analyze whether the Lotus menu command hierarchy is a system, method of operation, process, or procedure, we first consider the applicability of the test the Second Circuit set forth in Computer Assoc. Int'l, Inc. v. Altai, Inc., 982 F.2d 693 (2d Cir.1992). [FN7] The Second Circuit designed its Altai test to deal with the fact that computer programs, copyrighted as "literary works," can be infringed by what is known as "nonliteral" copying, which is copying that is paraphrased or loosely paraphrased rather than word for word. See id. at 701 (citing nonliteral-copying cases); see also 3 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 13.03[A][1] (1993). When faced with nonliteral-copying cases, courts must determine whether similarities are due merely to the fact that the two works share the same underlying idea or whether they instead indicate that the second author copied the first author's expression. The Second Circuit designed its Altai test to deal with this situation in the computer context, specifically with whether one computer program copied nonliteral expression from another program's code.
FN7. We consider the Altai test because both parties and many of the amici focus on it so heavily. Borland, in particular, is highly critical of the district court for not employing the Altai test. Borland does not, however, indicate how using that test would have been dispositive in Borland's favor. Interestingly, Borland appears to contradict its own reasoning at times by criticizing the applicability of the Altai test.
The Altai test involves three steps: abstraction, filtration, and comparison. The abstraction step requires courts to "dissect the allegedly copied program's structure and isolate each level of abstraction contained within it." Altai, 982 F.2d at 707. This step enables courts to identify the appropriate framework within which to separate protectable expression from unprotected ideas. Second, courts apply a "filtration" step in which they examine "the structural components at each level of abstraction to determine whether their particular inclusion at that level was 'idea' or was dictated by considerations of efficiency, so as to be necessarily incidental to that idea; required by factors external to the program itself; or taken from the public domain." Id. Finally, courts compare the protected elements of the infringed work (i.e., those that survived the filtration screening) to the corresponding elements of the allegedly infringing work to determine whether there was sufficient copying of protected material to constitute infringement. Id. at 710.
In the instant appeal, we are not confronted with alleged nonliteral copying of computer code. Rather, we are faced with Borland's deliberate, literal copying of the Lotus menu command hierarchy. Thus, we must determine not whether nonliteral copying occurred in some amorphous sense, but rather whether the literal copying of the Lotus *815 menu command hierarchy constitutes copyright infringement.
[6] While the Altai test may provide a useful framework for assessing the alleged nonliteral copying of computer code, we find it to be of little help in assessing whether the literal copying of a menu command hierarchy constitutes copyright infringement. In fact, we think that the Altai test in this context may actually be misleading because, in instructing courts to abstract the various levels, it seems to encourage them to find a base level that includes copyrightable subject matter that, if literally copied, would make the copier liable for copyright infringement. [FN8] While that base (or literal) level would not be at issue in a nonliteral-copying case like Altai, it is precisely what is at issue in this appeal. We think that abstracting menu command hierarchies down to their individual word and menu levels and then filtering idea from expression at that stage, as both the Altai and the district court tests require, obscures the more fundamental question of whether a menu command hierarchy can be copyrighted at all. The initial inquiry should not be whether individual components of a menu command hierarchy are expressive, but rather whether the menu command hierarchy as a whole can be copyrighted. But see Gates Rubber Co. v. Bando Chem. Indus., Ltd., 9 F.3d 823 (10th Cir.1993) (endorsing Altai's abstraction-filtration-comparison test as a way of determining whether "menus and sorting criteria" are copyrightable).
FN8. We recognize that Altai never states that every work contains a copyrightable "nugget" of protectable expression. Nonetheless, the implication is that for literal copying, "it is not necessary to determine the level of abstraction at which similarity ceases to consist of an 'expression of ideas,' because literal similarity by definition is always a similarity as to the expression of ideas." 3 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 13.03[A](2) (1993).
D. The Lotus Menu Command Hierarchy: A "Method of Operation"
Borland argues that the Lotus menu command hierarchy is uncopyrightable because it is a system, method of operation, process, or procedure foreclosed from copyright protection by 17 U.S.C. § 102(b). Section 102(b) states: "In no case does copyright protection for an original work of authorship extend to any idea, procedure, process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is described, explained, illustrated, or embodied in such work." Because we conclude that the Lotus menu command hierarchy is a method of operation, we do not consider whether it could also be a system, process, or procedure.
[7][8][9] We think that "method of operation," as that term is used in § 102(b), refers to the means by which a person operates something, whether it be a car, a food processor, or a computer. Thus a text describing how to operate something would not extend copyright protection to the method of operation itself; other people would be free to employ that method and to describe it in their own words. Similarly, if a new method of operation is used rather than described, other people would still be free to employ or describe that method.
[10] We hold that the Lotus menu command hierarchy is an uncopyrightable "method of operation." The Lotus menu command hierarchy provides the means by which users control and operate Lotus 1-2-3. If users wish to copy material, for example, they use the "Copy" command. If users wish to print material, they use the "Print" command. Users must use the command terms to tell the computer what to do. Without the menu command hierarchy, users would not be able to access and control, or indeed make use of, Lotus 1-2-3's functional capabilities.
The Lotus menu command hierarchy does not merely explain and present Lotus 1- 2-3's functional capabilities to the user; it also serves as the method by which the program is operated and controlled. The Lotus menu command hierarchy is different from the Lotus long prompts, for the long prompts are not necessary to the operation of the program; users could operate Lotus 1-2-3 even if there were no long prompts. [FN9] The Lotus*816menu command hierarchy is also different from the Lotus screen displays, for users need not "use" any expressive aspects of the screen displays in order to operate Lotus 1-2-3; because the way the screens look has little bearing on how users control the program, the screen displays are not part of Lotus 1-2-3's "method of operation." [FN10] The Lotus menu command hierarchy is also different from the underlying computer code, because while code is necessary for the program to work, its precise formulation is not. In other words, to offer the same capabilities as Lotus 1-2-3, Borland did not have to copy Lotus's underlying code (and indeed it did not); to allow users to operate its programs in substantially the same way, however, Borland had to copy the Lotus menu command hierarchy. Thus the Lotus 1-2-3 code is not a uncopyrightable "method of operation." [FN11]
FN9. As the Lotus long prompts are not before us on appeal, we take no position on their copyrightability, although we do note that a strong argument could be made that the brief explanations they provide "merge" with the underlying idea of explaining such functions. See Morrissey v. Procter & Gamble Co., 379 F.2d 675, 678-79 (1st Cir.1967) (when the possible ways to express an idea are limited, the expression "merges" with the idea and is therefore uncopyrightable; when merger occurs, identical copying is permitted).
FN10. As they are not before us on appeal, we take no position on whether the Lotus 1-2-3 screen displays constitute original expression capable of being copyrighted.
FN11. Because the Lotus 1-2-3 code is not before us on appeal, we take no position on whether it is copyrightable. We note, however, that original computer codes generally are protected by copyright. See, e.g., Altai, 982 F.2d at 702 ("It is now well settled that the literal elements of computer programs, i.e., their source and object codes, are the subject of copyright protection.") (citing cases).
The district court held that the Lotus menu command hierarchy, with its specific choice and arrangement of command terms, constituted an "expression" of the "idea" of operating a computer program with commands arranged hierarchically into menus and submenus. Borland II, 799 F.Supp. at 216. Under the district court's reasoning, Lotus's decision to employ hierarchically arranged command terms to operate its program could not foreclose its competitors from also employing hierarchically arranged command terms to operate their programs, but it did foreclose them from employing the specific command terms and arrangement that Lotus had used. In effect, the district court limited Lotus 1-2-3's "method of operation" to an abstraction.
[11][12] Accepting the district court's finding that the Lotus developers made some expressive choices in choosing and arranging the Lotus command terms, we nonetheless hold that that expression is not copyrightable because it is part of Lotus 1-2-3's "method of operation." We do not think that "methods of operation" are limited to abstractions; rather, they are the means by which a user operates something. If specific words are essential to operating something, then they are part of a "method of operation" and, as such, are unprotectable. This is so whether they must be highlighted, typed in, or even spoken, as computer programs no doubt will soon be controlled by spoken words.
The fact that Lotus developers could have designed the Lotus menu command hierarchy differently is immaterial to the question of whether it is a "method of operation." In other words, our initial inquiry is not whether the Lotus menu command hierarchy incorporates any expression. [FN12] Rather, our initial inquiry is whether the Lotus menu command hierarchy is a "method of operation." Concluding, as we do, that users operate Lotus 1-2-3 by using the Lotus menu command hierarchy, and that the entire Lotus menu command hierarchy is essential to operating Lotus 1-2-3, we do not inquire further whether that method of operation cou