The Supreme Court yesterday issued a 7-2 ruling in The Andy
Warhol Foundation v. Goldsmith, No. 21-869, finding that the
first fair use factor, namely the "purpose and character"
of the Andy Warhol Foundation's (the "Foundation")
commercial licensing of Warhol's "Orange Prince" to
publishing giant Condé Nast weighed against the Foundation.
As the opinion did not consider the remaining fair use factors,
this opinion affirmed the Second Circuit's finding that the
Foundation's use was not a fair one. Slip Op. at 2.
Writing for the majority, Justice Sotomayor wrote that "the
first fair use factor... focuses on whether an allegedly infringing
use has a further purpose or different character, which is a matter
of degree, and the degree of difference must be weighed against
other considerations, like commercialism." Slip Op. at 12.
Justice Sotomayor went on to explain that new expression is not in
itself dispositive of the first fair use factor, and that
accordingly, Goldsmith's photograph and the Foundation's
copying use of the photograph share the substantially same purpose
in their use in magazine stories; further, the use by the
Foundation of "Orange Prince" was commercial in nature.
Slip Op. at 12. Even though "Orange Prince" adds new
expression to the photograph, therefore, the first fair use factor
favors Goldsmith. Slip Op. at 13.
The case dates back to 1984, when a professional photographer named
Lynn Goldsmith granted the magazine Vanity Fair a limited license
for a one-time use of her photograph of Prince for Andy Warhol to
use in creating an illustration for a story they were running about
Prince. Slip Op. at 3-4. In 2016, following Prince's death,
Vanity Fair's parent company Condé Nast sought
permission from the Foundation to reuse the 1984 illustration, and
instead elected to use another image from Warhol's Prince
Series images, rendered in the color orange. Goldsmith only learned
about the existence of the Prince Series in 2016 when she saw
"Orange Prince" on the cover of Vanity Fair that year.
Slip Op. at 5. After asserting her rights, the Foundation sued
Goldsmith in the Southern District of New York for declaratory
judgment of noninfringement or, in the alternative, fair use.
Goldsmith counterclaimed copyright infringement.
The District Court granted the Foundation summary judgment on its
fair use defense. Andy Warhol Found. for the Visual Arts, Inc.
v. Goldsmith, 382 F. Supp. 3d 312 (S.D.N.Y. 2019). In 2021, on
appeal, the Second Circuit reversed the District Court and remanded
the case, finding all fair use factors to weigh in favor of
Goldsmith, and also indicating that the Prince Series works were
substantially similar to Goldsmith's photograph. Andy
Warhol Found. for the Visual Arts, Inc. v. Goldsmith, 992 F.3d
99 (2d Cir. 2021). The Supreme Court granted the Foundation's
petition for certiorari on the question of whether the
transformative nature of the Prince Series established fair use
because the works "convey a different meaning or message
than...[Goldsmith's] photograph." Slip Op. at 12.
To begin, the Court notes the "balancing act" of the
Copyright Act and the fair use defense, citing Twentieth
Century Music Corp. v. Aiken, which indicated that the
Copyright Act "reflects a balance of competing claims upon the
public interest: Creative work is to be encouraged and rewarded but
private motivation must ultimately serve the cause of promoting
broad availability of literature, music, and the other arts."
Slip. Op. at 13 (citing 422 U.S. 151, 156 (1975)). The remainder of
the opinion delves only into the first fair use factor, namely
"the purpose and character of the use, including whether such
use of a commercial nature or is for nonprofit educational
purposes." 17 U.S.C. §107(1).
The Court emphasizes that the first fair use factor is a
"matter of degree" and considers "whether and to
what extent" the use at issue has a purpose or character
different from the original." Slip Op. at 15-16. "The
larger the difference, the more likely the first factor weighs in
favor of a fair use. The smaller the difference, the less
likely." Slip Op. at 16. The Court notes that the first fair
use factor takes into account whether a work is commercial as
opposed to nonprofit. Slip Op. at 18. While a commercial nature of
a use will not be dispositive, it will be relevant to a
determination of the first fair use factor. Slip Op. at 18. Second,
the first fair use factor relates to the justification for the
use—where the use has a distinct purpose, it will further the
goal of copyright "to promote the progress of science and the
artists, without diminishing the incentive to create." Slip
Op. at 18. On the other hand, a use that shares the purpose of a
copyrighted work may be considered a substitute for the original
work, which may ultimately undermine the goal of copyright. Slip
Op. at 19. The Court focuses, therefore, on the idea that the first
fair use factor is a matter of degree, where the degree of
difference between the works should be balanced against the
commercial nature of the allegedly infringing use, and if the
infringing work and the secondary use share the same or a highly
similar purpose, then there must be some further justification for
the copying—otherwise, the first factor is likely to weigh
against fair use. Slip Op. at 20.
The Court held that the purpose of the licensing by the Foundation
of "Orange Prince" to Condé Nast was the same as
that of the original work—they are both portraits of Prince
used alongside magazine articles about Prince. Slip Op. at 22-23.
The Court also deemed the use of "Orange Prince" to be
commercial in nature, because, of course, the Foundation licensed
"Orange Prince" to Condé Nast for $10,000. Slip
Op. at 24. Given the identical purpose and commercial use of the
secondary work, the Court concluded that the first fair use factor
weighed against the Foundation. The Court also disagreed with the
Foundation's argument that the licensing of "Orange
Prince" constituted a "transformative" purpose
because the silkscreen image created a new meaning or message in
the work, and constituted a commentary on celebrity, specifically
"the dehumanizing nature of celebrity." Slip Op. at 28.
Rather, the Court noted that the purpose of the secondary work was
to "illustrate a magazine about Prince with a portrait of
Prince." Slip Op at 33. In sum, the Court affirmed the Second
Circuit's finding that this factor weighed again the Foundation
and in favor of Goldsmith.
The Court took pains to make clear that its opinion took no stance
on "the creation, display or sale of any of the original
Prince Series works." Slip Op. at 21. Nor did the Court opine
on the question of whether the Foundation's use was in fact
infringing, or whether the Foundation's commercial licensing
ultimately constituted fair use, beyond affirming the Second
Circuit's holding.
In a concurring opinion, Justice Gorsuch, joined by Justice
Jackson, wrote that because the actual uses of the original and
secondary works overlapped, the Foundation's use was
effectively a "commercial substitute" for Goldsmith's
use. Concurrence at 2, 4. The concurrence also noted that an
author's intent has been and continues to be irrelevant to a
determination of fair use and accordingly, the subjective
"artistic purpose" of an underlying work has no bearing
on the determination. Concurrence at 3.
Justice Kagan, joined by Chief Justice Roberts, filed a fiery
dissenting opinion, previewed in contentious footnotes and comments
in the majority opinion. The dissent noted that the
Foundation's silkscreen "dramatically alter[ed] an
existing photograph," Dissent at 1, arguing that by focusing
so heavily on the commercial nature of the Foundation's license
and not accounting for the aesthetics and details of the actual
work, the majority "leaves our first-factor inquiry in
shambles," Dissent at 3. The dissenting opinion focuses on
Warhol's artistry, statement, and place in the history of art
to argue that the Foundation's use is sufficiently
transformative so as to constitute a fair use, Dissent at 5-9,
noting that the majority effectively "stymies and
suppresses" creative endeavors that copyright law intends to
foster, Dissent at 30-32.
As with many fair use cases, the devil is in the details, and we
will continue to monitor developments in the copyright
landscape.
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