UMG RECORDINGS v. MP3.COM, INC
92 F.Supp. 2d 349, pg 556 of the Text
- Facts:
o Mp3.com was a web based service that would allow a user to access their music from anywhere at any time.
ß To do this the user had to prove that they owned the cd by one of two methods:
• Loading the cd into their computer and allowing the service to verify that they owned it or,
• Buy the cd from one of defendant’s cooperating online retailers
o To facilitate their service, defendants purchased thousands of cds, which plaintiff owned the copyrights to, and copied them onto their servers.
ß Mp3.com did this without authorization from plaintiff
o Plaintiff alleges that this copying violated their copyrights
ß The court agrees that this is a prima facie case of infringement
o Defendant in turn argues that their use is a “fair use†and thus they should not be subject tot liability.
- Issue:
o Is defendant’s use of plaintiff’s copyrighted material a fair use?
- Holding:
o No, defendant’s use of the copyrighted material is not a fair use.
- Reasoning:
o There are 4 factors that must be considered in a fair use defense:
ß 1. The purpose and character of the use
• Including whether such use is of a commercial nature or is for nonprofit educational use
ß 2. The nature of the copyrighted work
ß 3. The amount and substantiality of the portion used in relation to the copyrighted work as a whole
ß 4. The effect of the use upon the potential market for or value of the copyrighted work.
ß Other factors may be considered because fair use id an “equitable rule of reason.â€
o Regarding the first factor of the test:
ß Defendant does not deny the fact that it is using the copyrighted material for a commercial purpose
• While defendant’s service is free at the moment, its ultimate goal was to attract a sufficient enough base to draw big bucks from advertising
ß Defendant’s use is not transformative
• Defendants argue that they were providing a service for which users would not have to lug around their cds with them, and that this is transformative
o The court says no, this is not transformative because you are just letting the users carry around unauthorized copies in another medium
o Defendants are not adding anything new to the material just putting it in another form
o Regarding the second factor of the test:
ß The recordings being copied here are exactly the type of material that is intended to be protected by copyright
ß Not the stuff that is usually applicable for a fair use defense
o Regarding the third factor
ß The defendants here use the entire copyrighted work, not just a portion
• The more of the copyrighted material used, the less likely it is a fair use
o Regarding the fourth factor:
ß Defendant’s activity in this area directly affects plaintiff’s right to license their copyrighted material.
• Defendant argues that plaintiffs have not shown that they intend to enter this type of derivative market and
• Their actions only have a positive impact on plaintiffs because the user must first purchase plaintiff’s copyrighted work before they can use defendant’s service
o The court says these arguments are no good because:
ß A positive effect to plaintiffs does not allow defendants to usurp a potential market for plaintiff’s copyrighted works
ß Further, plaintiffs have expressed a desire to enter this type of market by licensing their works properly to defendants
o As to other factors of fair use, defendants argue that they are providing a useful service to users that would otherwise be fulfilled by pirates
ß Ct says copyright law is not intended to provide consumer protection or convenience, but rather it is there to protect copyright holder’s property interest
ß Further, plaintiffs have not expressed any objection to the idea of what defendants are doing. They merely want to make sure they get their fair share of the profits
o Outside of the fair use defense:
ß Defendants argue plaintiff is misusing its “dominant market share to selectively prosecute only certain parties.
• Ct says they are only exercising their valid rights as copyright holders
ß Defendants argue that plaintiff has abandoned its copyrights
• There is no evidence that plaintiffs have abandoned their copyrights
• Also, plaintiffs filed suit shortly after defendants launched their service
ß Defendants argue that plaintiff is estopped from filing this claim
• Defendants produce no evidence that they relied on any statement from plaintiff
ß Defendants try an unclean hands defense
• Defendants present no evidence of any wrong doing on the part of plaintiffs
92 F.Supp. 2d 349, pg 556 of the Text
- Facts:
o Mp3.com was a web based service that would allow a user to access their music from anywhere at any time.
ß To do this the user had to prove that they owned the cd by one of two methods:
• Loading the cd into their computer and allowing the service to verify that they owned it or,
• Buy the cd from one of defendant’s cooperating online retailers
o To facilitate their service, defendants purchased thousands of cds, which plaintiff owned the copyrights to, and copied them onto their servers.
ß Mp3.com did this without authorization from plaintiff
o Plaintiff alleges that this copying violated their copyrights
ß The court agrees that this is a prima facie case of infringement
o Defendant in turn argues that their use is a “fair use†and thus they should not be subject tot liability.
- Issue:
o Is defendant’s use of plaintiff’s copyrighted material a fair use?
- Holding:
o No, defendant’s use of the copyrighted material is not a fair use.
- Reasoning:
o There are 4 factors that must be considered in a fair use defense:
ß 1. The purpose and character of the use
• Including whether such use is of a commercial nature or is for nonprofit educational use
ß 2. The nature of the copyrighted work
ß 3. The amount and substantiality of the portion used in relation to the copyrighted work as a whole
ß 4. The effect of the use upon the potential market for or value of the copyrighted work.
ß Other factors may be considered because fair use id an “equitable rule of reason.â€
o Regarding the first factor of the test:
ß Defendant does not deny the fact that it is using the copyrighted material for a commercial purpose
• While defendant’s service is free at the moment, its ultimate goal was to attract a sufficient enough base to draw big bucks from advertising
ß Defendant’s use is not transformative
• Defendants argue that they were providing a service for which users would not have to lug around their cds with them, and that this is transformative
o The court says no, this is not transformative because you are just letting the users carry around unauthorized copies in another medium
o Defendants are not adding anything new to the material just putting it in another form
o Regarding the second factor of the test:
ß The recordings being copied here are exactly the type of material that is intended to be protected by copyright
ß Not the stuff that is usually applicable for a fair use defense
o Regarding the third factor
ß The defendants here use the entire copyrighted work, not just a portion
• The more of the copyrighted material used, the less likely it is a fair use
o Regarding the fourth factor:
ß Defendant’s activity in this area directly affects plaintiff’s right to license their copyrighted material.
• Defendant argues that plaintiffs have not shown that they intend to enter this type of derivative market and
• Their actions only have a positive impact on plaintiffs because the user must first purchase plaintiff’s copyrighted work before they can use defendant’s service
o The court says these arguments are no good because:
ß A positive effect to plaintiffs does not allow defendants to usurp a potential market for plaintiff’s copyrighted works
ß Further, plaintiffs have expressed a desire to enter this type of market by licensing their works properly to defendants
o As to other factors of fair use, defendants argue that they are providing a useful service to users that would otherwise be fulfilled by pirates
ß Ct says copyright law is not intended to provide consumer protection or convenience, but rather it is there to protect copyright holder’s property interest
ß Further, plaintiffs have not expressed any objection to the idea of what defendants are doing. They merely want to make sure they get their fair share of the profits
o Outside of the fair use defense:
ß Defendants argue plaintiff is misusing its “dominant market share to selectively prosecute only certain parties.
• Ct says they are only exercising their valid rights as copyright holders
ß Defendants argue that plaintiff has abandoned its copyrights
• There is no evidence that plaintiffs have abandoned their copyrights
• Also, plaintiffs filed suit shortly after defendants launched their service
ß Defendants argue that plaintiff is estopped from filing this claim
• Defendants produce no evidence that they relied on any statement from plaintiff
ß Defendants try an unclean hands defense
• Defendants present no evidence of any wrong doing on the part of plaintiffs