664 F.Supp.3d 370
S.D.N.Y.2023Background
- Four major publishers (Hachette, HarperCollins, Wiley, Penguin) own exclusive print and ebook rights to 127 Works in Suit; IA scanned print copies and created unauthorized ebooks.
- Internet Archive (IA), a nonprofit digital library, made copyrighted ebooks available via Controlled Digital Lending (CDL) and an Open Libraries program that increased concurrent loan counts by pooling partner libraries’ holdings.
- IA’s Website let patrons borrow ebooks (14-day loans, up to 10 at a time per patron); IA asserted a one-to-one owned-to-loaned ratio but sometimes counted partner-library copies and could not always verify physical suppression.
- During COVID-19 IA briefly ran a National Emergency Library (NEL) removing CDL limits and vastly increasing concurrent loans; the NEL was ended after this suit was filed.
- Publishers sued for copyright infringement; IA asserted fair use (and relied on nonprofit status, first sale, and utility/transformative arguments). The court granted publishers’ summary judgment and denied IA’s motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether IA’s scanning and public lending of full ebooks is fair use (transformative inquiry) | IA’s copying is non-transformative; ebooks are derivative and infringing | IA: making books digitally lendable expands utility and is akin to time‑shifting/efficiency; comparable to HathiTrust/Google Books | Not transformative; copying entire works to lend online is republishing/derivative and disfavors fair use |
| Effect of IA’s nonprofit status and alleged noncommercial nature (first‑factor commerciality) | IA obtains benefit from site traffic, donations, and monetized links; use is commercial in effect | IA: nonprofit, no fees to patrons, private reading is noncommercial | Commercial‑leaning: IA gains advantages and monetizes pages; favors publishers |
| Whether first‑sale (§109) or ownership of physical copies permits creating/distributing digital copies | IA: owning lawful physical copies supports making and lending digital copies under first‑sale principles | Publishers: §109 covers distribution of a particular physical copy, not reproduction into new digital copies | §109 does not authorize reproduction; ReDigi analog controls—creating new copies remains infringement |
| Market harm and overall fair use balancing (including NEL) | IA: little or no demonstrated market harm; possible discovery/purchase benefits; NEL was temporary emergency measure | Publishers: IA usurps a thriving library ebook licensing market and offers a free substitute that displaces licensing revenue | Fourth factor strongly favors publishers; IA’s use competes with authorized ebook market; fair use defense fails (NEL fails even more strongly) |
Key Cases Cited
- Authors Guild, Inc. v. HathiTrust, 755 F.3d 87 (2d Cir. 2014) (searchable database was transformative; distribution of full readable copies only allowed in narrow, disability context)
- Authors Guild v. Google, 804 F.3d 202 (2d Cir. 2015) (full‑text scanning with limited snippet view was transformative; distributing full digitized books would be strong infringement)
- Campbell v. Acuff‑Rose Music, Inc., 510 U.S. 569 (1994) (fair use transformative‑purpose framework)
- Capitol Records, LLC v. ReDigi Inc., 910 F.3d 649 (2d Cir. 2018) (creating new digital copies from lawfully owned files was reproduction and not excused by first sale or fair use)
- Fox News Network, LLC v. TVEyes, Inc., 883 F.3d 169 (2d Cir. 2018) (utility‑expanding search services can be transformative but will fail if they usurp the rights‑holder’s market)
- Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417 (1984) (time‑shifting noncommercial private use was fair use; inapposite where distribution to public occurs)
- Harper & Row Publishers, Inc. v. Nation Enters., 471 U.S. 539 (1985) (publication status and market harm weigh against fair use)
- Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith, 11 F.4th 26 (2d Cir. 2021) (transformative use and market impact analysis under §107)
- Bill Graham Archives v. Dorling Kindersley Ltd., 448 F.3d 605 (2d Cir. 2006) (copying entire works can be justified only when necessary for a transformative purpose)
- A&M Records, Inc. v. Napster, Inc., 239 F.3d 1004 (9th Cir. 2001) (distribution to the public that supplants markets is not shielded by Sony)