Page 22 - Intellectual Property Disputes

Among the limitations on the copyright owner’s exclusive rights is the doctrine of "fair use" codified in
the Copyright Act, Section 107. Under the fair use doctrine, copying for "purposes such as criticism,
comment, news reporting, teaching . . . scholarship, or research" fn 35 may not constitute infringement,
based upon an analysis of the following factors:

• The purpose and character of the use, including whether such use is of a commercial nature or
for nonprofit educational purposes

• The nature of the copyrighted work

• The amount and substantiality of the portion used in relation to the copyrighted work as a whole

• The effect of the use upon the potential market for or value of the copyrighted work

Ownership and Works for Hire

Similar to patent rights that vest with the inventor, the ownership of a copyright typically vests with the
author. Under the "work made for hire" doctrine, the author may be someone other than the person who
actually performed the physical act of creating the work. The Copyright Act provides that this doctrine
can apply in (a) employer-employee relationships (for example, if an employee creates a work within
the scope of employment, the employer is the author) and (b) if works are commissioned. If the parties
agree in writing that the work is a "work for hire," the employer or commissioning party owns the
copyright. fn 36

Enforcement of Copyright Rights

The violation of any of the exclusive rights of a copyright owner under the Copyright Act can result in
an action for copyright infringement. Proving infringement requires a demonstration that the infringer
copied original elements of the copyrighted work, and copying can be proved by either direct or
circumstantial evidence. Under the latter approach, the copyright owner must prove that (a) the
infringing party had access to the copyrighted work (such as if the accused infringer had an opportunity
to review the copyrighted work), and (b) the alleged infringing work is substantially similar to the
copyrighted work.

17 USC 504 is the primary copyright damage provision in the Copyright Act. 17 USC 504(a) provides
that "an infringer of copyright is liable for either (1) the copyright owner’s actual damages and any
additional profits of the infringer, as provided by subsection (b); or (2) statutory damages, as provided
by subsection (c)." fn 37 17 USC 504(b) states that the copyright owner, when disgorging the infringer’s
profits, must present proof of the infringer’s gross revenue; the infringer, however, is required to prove
deductible expenses and elements of profit attributable to factors other than the copyrighted work.

17 USC 504(c) states that the statutory amount of damages must be as follows:

fn 35 17 USC 107.

fn 36 Bryan A. Garner, ed., Black’s Law Dictionary, Eighth Edition (St. Paul, MN: West Publishing Co., 2004), 1637.

fn 37 17 USC 504.

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