Fair Use Protects Copyright Holder of Unauthorized Parody

The Second Circuit began its opinion with its intriguing ruling:

The primary question presented is whether an unauthorized work that makes ‘fair use’ of its source material may itself be protected by copyright.

We hold, for substantially the reasons stated by the United States District Court for the Southern District of New York (Thomas P. Griesa, Judge), that, if the creator of an unauthorized work stays within the bounds of fair use and adds sufficient originality, she may claim protection under the Copyright Act, 17 U.S.C. § 103, for her original contributions.

Jaime Keeling wrote Point Break Live! (PBL), a parody stage adaption of Point Break, a 1991 action movie starring Keanu Reeves and Patrick Swayze.  Since PBL is a parody, Keeling borrowed heavily from Point Break, the movie, but then added her own jokes, props and theatrical devices to create an interactive, irreverent theatrical experience.  Keeling did not receive a license from the copyright owners of the Point Break movie to create her stage play, thus creating an unlicensed parody.

Eve Hars, owner of New Rock Theater Productions, LLC, executed a production agreement with Keeling to stage a two month production run of PBL.  During that two month run, Hars consulted an entertainment attorney and the copyright owners of the Point Break movie screenplay.  Hars concluded that Keeling did not own any rights to the PBL parody play.  Hars sought to renegotiate the production contract with Keeling to continue to stage PBL without paying Keeling further.  Keeling refused to renegotiate, threaten suit and registered a copyright in PBL.  Hars and New Rock proceeded to stage PBL performances for four years without paying Keeling or receiving her authorization.

Keeling sued Hars and New Rock for copyright infringement.  Hars brought a motion for summary judgment, arguing that an unauthorized derivative work is not entitled to copyright protection as a matter of law.  The district court denied the motion, “ruling that a parody that makes ‘fair use’ of another copyrighted work may contain sufficient originality to merit copyright protection itself.”  (Opinion pdf page 5). 

A five day jury trial took place in December 2012.  The jury trial focused on whether PBL is a parody and if it is a parody, whether the parody is a fair use.  The jury found in Keeling’s favor that Keeling’s use of the Point Break motion picture material was fair use in the way of a parody, that Keeling solely owns the copyright to PBL and that Hars and New Rock infringed Keeling’s copyright.  The jury awarded Keeling $250,000.

The right to prepare derivative works belongs to the author of the original work, i.e., the work that the derivative work is based on.  Unauthorized derivative works are therefore infringing works in most cases.  However, fair use places limits on the exclusive rights of the copyright owner of the original work.  Fair use is not copyright infringement.  Fair use is an unauthorized use for a purpose such as criticism, comment, news reporting, teaching, scholarship or research.  Parody is considered a form of comment or criticism.

Hars argued that an unauthorized derivative work such as PBL can never receive independent copyright protection, even if the use is a fair use.  The Second Circuit disagreed, stating that “the mere fact that a litigant’s unauthorized creations are derivative works is in itself, of course, no bar to copyrightability.” (Opinion pdf page 15).

Though copyright protection expressly may extend to derivative works employing preexisting material in which copyright subsists, the statute cautions that protection does not extend to any part of the work in which such material has been used unlawfully. If, however, a work employs preexisting copyrighted material lawfully—as in the case of a fair use—nothing in the statute prohibits the extension of the independent copyright protection promised by Section 103.  A close reading of the statute therefore makes plain that an unauthorized but lawful fair use employing preexisting copyrighted material may itself merit copyright protection. It is not the invocation of fair use that provides the work copyright protection, and perhaps thinking so has created some confusion on the part of the defendant. It is the originality of the derivative work that makes it protectable, and fair use serves only to render lawful the derivative work, such that it may acquire—as would other lawful derivative works—such protection.

(Opinion pdf pages 13 – 14).

The Second Circuit agreed with the district court’s holding in Keeling’s favor on this issue.

Although the consent of the copyright owner—here, the rightsholder in the Hollywood screenplay Point Break—had not been obtained by Keeling, her resulting parody PBL was lawful under the doctrine of fair use, and accordingly, it could be copyrighted.

Accordingly, we agree with the District Court’s holding that, when a derivative work’s unauthorized use of preexisting material is fair use and the work contains sufficient originality, its author may claim copyright protection under § 103 for her original creative contributions.

(Opinion pdf page 15).

Hars also argued that Keeling’s original contributions to the PBL derivative work consisted solely of non-copyrightable stage directions and theatrical devices and that PBL could not receive copyright protection on that basis.  The Second Circuit ruled against Hars on this point, too.

As the District Court properly found, copyright law protects not only the individual elements themselves, but the creative choices made in selecting and arranging even uncopyrightable elements. Indeed, the Copyright Act itself explicitly protects ‘compilations,’ and a long line of case law confirms that copyright covers compilations of raw data or facts, elements which are not themselves protectable, so long as the compilation itself (including the arrangement of those elements) possesses some minimal degree of creativity, no matter how crude, humble or obvious.  The Supreme Court has made clear that even a telephone directory may be copyrighted if its non‐copyrightable factual elements are arranged with the requisite minimal degree of originality.  Keeling’s original contributions to PBL clearly exceed this creativity threshold.

(Opinion pdf pages 16- 17).

Keeling’s originality in selecting, coordinating and arranging the individually unprotectable stage directions and theatrical devices created new, protectable parodic meaning.

This case is Keeling v. Hars, No. 13‐694‐cv, Second Circuit Court of Appeals.

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