American Society for Testing and Materials v.
Public.Resource.Org, Inc., No. 17-7035 (D.C. Cir. Jul. 17, 2018)
The panel, citing “serious constitutional concerns,” vacated
the district court’s finding of trademark and copyright infringement based on
PRO’s copying of privately drafted standards that have been incorporated into
law in various jurisdictions. Finding
errors in the district court’s dual fair use analyses, the court left for
another day “the far thornier question of whether standards retain their
copyright after they are incorporated by reference into law.” The court also left it to the district court
to re-apply copyright fair use after further factfinding, and to determine how
to apply nominative fair use.
Incorporation into law varies across jurisdictions, as do
the legal consequences thereof, across thousands of technical standards (over
1200 ASTM standards in the CFR alone).
Some incorporated standards define legal obligations, while others are “mere
references” that “have no direct legal effect on any private party’s conduct,”
and there are others in the middle, e.g. that trigger agency obligations or
establish eligibility for federal programs. The court of appeals disagreed with the
district court’s blanket treatment of standards for fair use purposes, thus
allowing it to avoid the larger constitutional question for some or perhaps all
of the infringement claims.
Treating this case as one involving fair use rather than
copyrightability also “limits the economic consequences that might result from
the [plaintiff] SDOs losing copyright—which they repeatedly emphasize would
jeopardize the continued development of high-quality standards—by allowing
copying only where it serves a public end rather than permitting competitors to
merely sell duplicates at a lower cost.”
And it avoids difficult questions about what happens, for example, when
a newer version of a standard becomes incorporated—would older versions regain
any lost copyright? If necessary, these
issues might have to be reached on a fuller record.
Fair use: The district court found that the purpose of PRO’s
copying was “for the direct purpose of undermining [the SDOs’] ability to raise
revenue.” The record didn’t support that conclusion: “by all accounts, PRO
distributed these standards for the purpose of educating the public about the
specifics of governing law.” Further, the district court failed to consider
each standard on its own facts. This
might not require individual factual development as to each standard, but
rather might allow for groupings that are fair use-relevant.
As for the commerciality of the use, the district court
found that PRO’s use had commercial elements because it distributed identical
standards in the same consumer market.
This was too broad a definition of commerciality. [Happy sigh.]
Although PRO’s copies might serve as substitutes, “little, if anything,
in the record indicates that PRO stands to profit from its reproduction.” Even
if distributing the standards is part of PRO’s fundraising appeal, “that hardly
rises to the level of making this a ‘commercial’ use.” [Happier sigh.]
As a general matter, freely distributing standards
incorporated by reference into law furthers the purposes of fair use. Transformativeness
is important, and format change isn’t transformation for these purposes, but a
purpose to facilitate public access could be transformative without altering
the original work. (Citing A.V. ex rel. Vanderhye v. iParadigms, LLC, 562 F.3d
630 (4th Cir. 2009), and Swatch Group Management Services Ltd. v. Bloomberg
L.P., 756 F.3d 73 (2d Cir. 2014)).
Exact copying can be important to understand, say, one’s
legal obligations, and where this is so, “this factor would weigh heavily in
favor of permitting a nonprofit seeking to inform the public about the law to reproduce
in full the relevant portions of that particular standard.” For example, federal law’s incorporation of
ASTM specifications to “dictate” whether a retailer of diesel fuel needs to
provide additional fuel labels likely favors PRO’s copying, while using ASTM
standards as a reference procedure for determining whether gasoline without ethanol
has an “[e]vaporated initial boiling point” of “75- 95[°F],” likely doesn’t. Copying the version that is incorporated in
federal law is also likely to be favored over copying a later edition that is not so incorporated (though the court doesn’t
here discuss copying prior versions so
that the public can see what’s changed over time—something of particular interest
as this administration dumps ever more once-public information down the memory
hole).
“[W]here knowing the content of an incorporated standard
might help inform one’s understanding of the law but is not essential to
complying with any legal duty, the nature of PRO’s use might be less
transformative and its wholesale copying, in turn, less justified” because
paraphrase or summary might be adequate to serve the purpose. [Would paraphrase avoid an infringement claim
based on structure, sequence, and organization? The court seems to assume the
answer is yes, and I think it should, but I’m not confident it would.
Query also how much room there is to rephrase a reference procedure for
determining an initial boiling point; that sounds a little merger-y to me.] Purpose has to be assessed use by use, even
though that may be difficult.
Factor two: “All of the works at issue here fall at the
factual end of the fact-fiction spectrum, which counsels in favor of finding
fair use.” But the district court found
that because technical standards “are vital to the advancement of scientific
progress in the U.S.,” they are “exactly the type of expressive work that
warrants full protection under . . . the Copyright Act.” If these were “ordinary
technical standards used for no public purpose,” the court of appeals might
have agreed. [Though it shouldn’t have! Patent and copyright are different, and
“science” now means something very different than it did in “Science and Useful
Arts.”] But these standards have all, in
some capacity, been incorporated by reference into law, and, “the express text of
the law falls plainly outside the realm of copyright protection.” Standards
incorporated by reference into law are thus, “at best, at the outer edge of ‘copyright’s
protective purposes,’” though just how far at the edge depends on the degree of
incorporation, as above.
Factor three: Must be considered standard by standard, in
light of PRO’s purpose. “If PRO limits
its copying to only what is required to fairly describe the standard’s legal
import, this factor would weigh strongly in favor of finding fair use here,
especially given that precision is ten-tenths of the law.” So where specific provisions are incorporated
into law, maybe you can only copy those provisions [and I presume any
provisions required to understand those provisions—the court of appeals doesn’t
mention cross-references, but given its discussion, definitional and other
foundational provisions would have to be fair game as well]. Where the law refers generally to a standard’s
specifications, by contrast, a greater amount of copying would be allowed. “And
where the incorporation merely makes reference to an external standard, but
that standard does not govern any conduct, perhaps the copier’s purpose could
be achieved with only a paraphrase or a summary.”
Factor four: first, the district court erred in presuming market
harm based on PRO’s [nonexistent] commercial purpose. The record didn’t show
how serious any adverse impact on the SDOs’ market might be. On remand, the district court should consider
that (1) the SDOs already make copies of their standards freely available
online (in “controlled reading rooms”), presumably “without entirely
cannibalizing sales of their standards.”
How much additional harm could PRO’s copying cause? (2) The market harm question has to be
addressed with reference to the legal alternatives—that is, if PRO were only to
reproduce the portions of a longer standard that were actually incorporated
into law, “would there still be a vibrant market for the standards in their
entirety?” [There are a couple of ways to read this, but I think one significant
point is this: suppose that partial copying had the same effect on the market
as full copying. Given that such partial
copying is fair use, then the marginal market impact of PRO’s infringing use would
be zero. Of course, partial copying
might not have the same effect on the market.]
(3) What’s up with derivative works?
Because SDOs routinely update their standards, “in many cases, the
edition PRO posts to the internet—and, indeed, the one incorporated into the law—is
long outdated.” Does PRO’s copying of old standards harm the market for
updated, unincorporated editions? If the
SDOs are to be believed, the primary purpose of technical standards is “to have
them used by private industry and other non- governmental users to address
technical issues or problems,” indicating that “market demand for the most
up-to-date standards would be resilient.”
Does the SDOs’ ability to market derivatives provide an adequate
incentive to continue producing standards even with PRO’s copying? Even after Veeck v. Southern Building Code
Congress International, Inc., 293 F.3d 791 (5th Cir. 2002), the successor SDO
remains profitable both through sales of codes and of “program services,
including consulting, certification, and training.”
Ultimately, genuine issues of material fact precluded
summary judgment on copyright fair use.
Judge Katsas concurred to emphasize that law cannot be
copyrighted and that the majority opinion was pretty clear that “[W]here a
particular standard is incorporated as a binding legal obligation, and where
the defendant has done nothing more than disseminate it, the Court leaves little
doubt that the dissemination amounts to fair use.”
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Rebecca Tushnet 