Did A Court Just Make Creative Commons Unenforceable?

Here Attorney and legal scholar Stephen Carlisle explores a perplexing court decision that changing the context in which a photographic image is displayed constitutes ‘transformative use’ rendering a Creative Commons license ineffective and impossible to enforce.

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Guest post by Stephen Carlisle of Nova Southeastern University

January 8, 2018 saw the publication of one of the most off-base, head scratching decisions ever rendered on the issue of transformative use. The case, Philpot v. Media Research Center, ¹ held that by merely changing the context in which a photographic image is displayed, this constitutes a “transformative use” leading to a conclusion of fair use. In doing so, the Court has effectively rendered the Creative Commons license ineffective and unenforceable.

At issue were two photographs, one of Kenny Chesney and one of Kid Rock. Both were taken by Philpot in concert settings and depict the subjects performing music. The defendant, Media Research Center, copied and displayed, without the required attribution, the photographs to illustrate stories about Kid Rock and Chesney’s political beliefs on their website. ²

The Plaintiff made the photographs at issue available through a posting on the Wikimedia website, subject to the terms and conditions of a Creative Commons “attribution” license, which requires identification of the creator as a term of the license, but no payment. ³ At no time did MRC give the credit required by the license. ⁴

The first whopper to come from the pen of the Court is that “a license is not a contract” and therefore, since a copyright holder can grant licenses “unilaterally” that “no meeting of the minds is required” to form a valid license. Next, the Court rules that “the mere fact that plaintiff uploaded the Photographs to Wikimedia under a nonexclusive CCL is sufficient to grant a license to defendant.” ⁵

For this proposition, the Court cites to the unpublished opinion in Crump v. QD3 Entertainment, ⁶ which does not say this. What it does say is this:

“While federal copyright law governs whether a nonexclusive, implied license can be granted, state law governs the contractual issue of whether such a license was actually granted. (emphasis added) (Citation omitted) Under California law, the intent of the party governs the meaning of a contract. Where a contract is ambiguous, courts may consider extrinsic evidence in determining the intent of the parties.” ⁷

The Court also misconstrues this quote from Crump : “A nonexclusive license may be granted unilaterally by a copyright holder.” ⁸

The point of law Crump makes is this one, citing Davis v. Blige: ⁹

“A co-owner may grant a non-exclusive license to use the work unilaterally, because his co-owners may also use the work or grant similar licenses to other users and because the non-exclusive license presumptively does not diminish the value of the copyright to the co-owners.” ¹⁰

The point being made in Crump is that a license can be issued unilaterally against the interests of co-owners, not that a license can be issued without a “meeting of the minds” as to the license terms. Further, as Crump points out, this is governed by State contractual law.

The Court then backtracks by noting that attribution was required by the terms of the license, and both parties agree that this is a material term, meaning that by the terms of license, the license had been automatically revoked.

“Thus, a reasonable juror could find that defendant breached the license, and as a result, the license was terminated. After termination of the license, defendant’s continued use of the Chesney and Kid Rock Photographs would then be grounds for plaintiff’s copyright infringement action provided there is no other defense, including fair use.” ¹¹

The Court never addresses the issue of whether there is such a thing as a license being capable of being “automatically revoked” under the applicable State contract law.

This is an important distinction. For, if the Court first rules that the mere publication of the images on Wikimedia granted a license to MRC, then the failure to comply with the terms makes this a case of breach of contract, not copyright infringement. If the Court rules that the license was revoked automatically by failure to comply with the terms (and such “automatic revocation” is possible under the applicable State law), then there never was a license to begin with, because MRC never complied with the terms and thus we have a case of copyright infringement.

Having totally screwed up the whole issue of whether there was an actual license, the Court then turns its attention to screwing up the whole issue of transformative use. It does not disappoint.

The Court rules that the use by MRC is “transformative” because “defendant’s purpose in using the Photographs—to identify the celebrities as pro-life advocates or conservative Senate candidates—was different from plaintiff’s purpose in taking the Photographs.” ¹²

Huh?

But wait, there’s more!

“Here, by contrast, plaintiff took the Chesney and Kid Rock Photographs to depict the musicians in concert. (citation omitted) Had defendant used the Chesney and Kid Rock Photographs alongside articles about the concerts depicted, then that use might not have been transformative. But importantly, defendant here used the Photographs in a completely different context, namely to identify these celebrities as pro-life advocates or conservative candidates for office.” ¹³

This contradicts the Court’s earlier recitation that Philpot “created the Chesney Photograph for an additional purpose, namely to enhance visually articles about Chesney.” ¹⁴

This is precisely what the display of the photographs by MRC accomplishes. They merely say “this is what Kenny Chesney looks like.” This is solely a visual enhancement of the story about Kenny Chesney, a purpose contemplated by Philpot. The fact that the article is about his political beliefs does not change things. It could have been an article about his brief failed marriage to movie actress Renee Zellweger. ¹⁵ Also consider the fact that the story could have been written without any pictures at all, and not changed the meaning of the story. So, the pictures add nothing substantive to the story. They do not imbue the story with “new meaning.” To rule the reverse, that the story imbues “new meaning” to the photographs, is simply incomprehensible.

So let’s get back to Kenny Chesney. According to this Court decision, anyone can write a story about his failed marriage (which Ms. Zellweger called “a fraud” ¹⁶), and use Philpot’s photograph because it was not Philpot’s intent to document Chesney’s failed marriage. This use, according to this Court would be “transformative,” and not require compliance with the license terms or any payment to Philpot.

Or suppose the picture is of Donald Trump giving a speech as President. To follow the logic of this ruling, this photograph can now be used to illustrate ANY story about Trump not related to his actions or duties as President. Stories about his alleged affairs with porn actresses (currently very popular), his business bankruptcies, his TV shows, or the failed Trump University, all could use this same picture of his Presidential speech, and would be in the eyes of this Court “transformative.”

So the Court puts factor one firmly on the side of MRC. Quickly, it rules factor two (the nature of the work) as neutral and factor three (the amount of the work used) in favor of Philpot since all of the work was used.

The final nail in the coffin is since Philpot used the Creative Commons license, which does contemplate monetary payment, Philpot has no damages and therefore there is no negative market effect under the fourth factor or fair use. So the entire use is “fair use” under the Court’s ruling. The Court states:

“In sum, there is nothing in this record to suggest there is currently any market for the Chesney or Kid Rock Photographs or that any preparations have been made to establish or create a market. Any speculative economic effects on the future market for plaintiff’s Chesney and Kid Rock Photographs owing to a lack of attribution do not outweigh the lack of direct economic effects and defendant’s generally noncommercial use of the Photographs. Accordingly, this factor weighs in favor of finding a fair use.” ¹⁷

What this does is simply kill off the Creative Commons license as an effective or enforceable means of licensing your work.

All a person has to do, according to this Court, is present the work in a slightly alternative context, and none of the terms and conditions of the Creative Commons license need to be observed.

The big swing and a miss by the Court is divorcing the attribution from the lack of a license fee. The license is free in order to achieve the widest dissemination possible of the photographs with the accompanying credit. If MRC had approached Philpot directly and asked for a license for free but stating up front that he would get no credit for it, the answer clearly would have been no. You don’t get to “free” without agreeing to “attribution.”

This decision also puts firmly in the crosshairs any photographer that does charge a fee for a license. Recall the Court’s assertion above that there was no market for the Chesney photographs. Well, clearly there was a market since MRC used it. However, in the eyes of the Court, unless there was significant licensing revenue, then there is no real market, and therefore no negative market effect.

So, Supreme Court of the United States, please do something about the mess that is transformative use. It’s a quagmire that gets deeper and nastier every passing day. ¹⁸

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