ANSWER: YES, FAIR USE!

Sigh. Read the opinion here. To see the problem again, you can find it here. You can find the offending brochure here.
The court’s analysis isn’t easy to follow, but here it is, along with my comments:

  • Factor 1: Purpose and Character of the Use: The court found this factor to favor fair use. The brochure’s purpose was to promote the conference, and the photograph’s purpose on the brochure was to “provide a factual depiction of Indianapolis.” Because you wouldn’t know it was in Indianapolis without a picture of its skyline? And no one could be bothered to just go take one? By contrast, the court reasoned, Mr. Bell’s purpose is to sell copies of the photograph. Oh, no, no, no. A photograph’s “purpose” isn’t to be sold, even if it’s for sale, no more than a novel’s purpose is to make lots of money. This photograph’s purpose to artistically present Indianapolis’ skyline. And the photograph’s purpose on the brochure was to … show the Indianapolis skyline, in an visually pleasing way. The skyline is more than just factual: it’s meant to give the otherwise dry and boring brochure a little visual interest. Otherwise, it would be adding nothing to the brochure, since it’s already clear where the conference will be held.
  • Factor 1A: Transformativeness. The court found the use transformative (I think). The court appears to regard the writing on the brochure’s use of the photograph as transformative. She also thinks it’s significant that it’s the only photograph on the brochure that’s transformed at all. Which is true! But also completely irrelevant!
  • Factor 1B: Commercial use. The court found the use to be non-commercial because the Non-profit is a non-profit and doesn’t make a profit from the conference. True, but the Non-profit charged a fee for a reason: to defray costs (and increase membership). Come on. The use is commercial. Maybe not that commercial, but the photograph was chosen to make the brochure look better, and the brochure was designed to promote a conference. The court reasoned that, because the Non-profit didn’t actually sell the brochure itself, the brochure was non-commercial. By that logic, if I use your work on a print advertisement without permission, that’s not a commercial use because I don’t sell the print advertisement itself.
  • Factor 2: Expressiveness of the Underlying Work. The court forgot about this factor. Sorry. I think the photograph is expressive enough that this factor should weigh against fair use. But there’s a deep and abiding prejudice against photographs because they depict factual things. And some photographs are truly almost purely factual7E.g., a hasty or accidental photograph that luckily captures an important event and is thus valued for what it happens to depict than any creative choices the photographer made. But almost any photograph—and especially professional ones—are made with aesthetics in mind: framing, shutter speed, angle, lighting, those sorts of things. Mr. Bell’s photograph certainly qualifies.
  • Factor 3: Amount and Substantiality of the Use. The court admits that the brochure uses the entirety of the photograph. The court doesn’t care. Instead, the court points out that the photograph only takes up a fraction of the brochure. Which is completely backwards.
  • Factor 4: Effect on the Market. The court found this factor weighed in favor of fair use because the brochure was in a different market from the Indianapolis Nighttime Skyline photograph. Besides, the text superimposed over the photograph (in the brochure) ruined the photograph so no one would ever use that version. Well, true, but straight-up piracy isn’t the only way to have an effect on the market. Another way is to fail to pay a license fee for a work that was available for licensing. As other courts would explain, this is the sort of thing that, if done routinely, would undermine the market for the underlying work.

My conclusion: no, it’s not fair use. It’s not really even all that close. I hate to say it because I’m sure the Non-profit does really good things and makes things better.
Listen, I get why judges are bending over backward—and into pretzels—to find fair use. These cases are annoying. The damages on this one is, what, maybe $1000? The judge in this case had personally overseen more than one such case brought by Mr. Bell,8Where she awarded him $150,000—the maximum—on a default judgment!] so she knows that this one is just one of many.9Major shout-out to the Paul B. Overhauser’s Indiana Intellectual Property Law News![/ref]
Yet, getting these things wrong is bad. One day, the case won’t be worth $1000. It’ll be worth $1 million. And cases like this will encourage defendants to think they can take things off the internet without paying and get away with it. And not all of those defendants will be sympathetic. And, although district court cases are by nature non-precedential, they will influence other courts to expand fair use beyond its appropriate bounds.
Fair use is really, really hard. Courts are going to be inconsistent regarding borderline cases. That’s just the nature of the beast.
But these are easy cases. And courts are willing themselves to get them wrong because they don’t like them, and (in this case) they like the defendants.
What should the court have done? My suggestion: she should have denied the Non-profit’s motion for summary judgment, granted Mr. Powell’s (which she did10She performed a very careful 11th Amendment analysis to find that Mr. Powell was merely acting—if at all—as an agent of an arm of the State of Indiana and thus immune to copyright actions.), and then granted Mr. Bell’s as against the Non-profit, then awarded him $750 (the minimum) and no attorney’s fees, but maybe award Mr. Powell his attorney’s fees. That’ll teach overzealous copyright plaintiffs to bring penny-ante cases into crowded dockets, without distorting copyright law.11Maybe have a factual hearing on whether the use was “innocent,” with the possibility of reducing the award to $250?
Worried about non-profits? First, many have plenty of money to pay creators and have the option of asking the creator to donate a license: at least give the creator the choice. Second, “nonprofit educational institutions, libraries, and archives” are not liable for statutory damages for reproducing works.12This rule also applies to nonprofit broadcasters, but it’s limited to performance of “nondramatic literary works,” so I’m not sure I see the point. That wouldn’t have worked here, since the Non-profit wasn’t an educational institution, and it had also distributed the brochures. One could imagine some ways to expand this defense for non-profits to discourage lawsuits like this, but that would take Congressional action, and I’d like to see more general reform of statutory copyright damages.
Here’s hoping that, the next time I talk about fair use, it’s to argue that something should have been fair use. I really do love and value fair use! I’m just a little down on these “I found it on the internet” cases, and there’s been a spate of them this year for some reason.
Thanks for reading!

Rick Sanders

Rick is the litigation half of Aaron & Sanders, PLLC; and, from 2012 to 2014, an adjunct professor at Vanderbilt University Law School, where he was teaching Copyright Law. Vandy also happens to be where he got his law degree in 2000. After graduation, he practiced at a major intellectual-property law firm in Silicon Valley for a few years. He returned to Nashville in 2004, where he worked for a large Nashville firm, practicing as much intellectual-property law as he could, but also a lot of commercial law. He left that firm in 2011 to start Aaron & Sanders with Tara Aaron, so he could practice intellectual-property law full time and work with start-ups and other non-institutional clients.