Copyright Advice for Startups: Understand the Limitations of Fair Use

Copyright is protection provided by federal law for “original works of authorship.” This includes literary, dramatic, musical, architectural, cartographic, choreographic, pantomimic, pictorial, graphic, sculptural, and audiovisual creations.

The U.S. Copyright Office says that “copyright” means the right to copy, but its definition has come to include a body of exclusive rights granted by law to copyright owners for protection of their work. Copyright owners have the right to limit the use of their creative work and have the right to distribute, reproduce, display, make derivatives, or perform the work in public. This applies to published and unpublished works fixed in a tangible medium.

However, startups should keep in mind that copyright protection doesn’t extend to an idea, procedure, process, system, title, principle, or discovery. Likewise, names, titles, short phrases, slogans, familiar symbols, mere variations of typographic ornamentation, lettering, coloring, and listings of contents or ingredients aren’t subject to copyright.

Startups need to be aware of the scope of copyright protection, but also need to know that parameters of one of the most common exceptions to infringement: the fair use doctrine.

The Copyright Fair Use Doctrine

Typically, fair use is any copying of copyrighted material that’s done for a limited and “transformative” purpose… this could be to comment upon, criticize, or parody a copyrighted work. These types of fair use can be done without the copyright owner’s permission.

Some startups run into trouble operating under the belief that the fair use doctrine protects their use of a third party’s copyrighted materials because they’re acting in a “fair” manner and not doing anything that they think is illegal, like using the copyrighted material for financial gain. However, this isn’t the case. The fair use doctrine is much more limited and is primarily designed to promote socially valuable activities like education, research, and criticism. Hence, the scope of fair use is much more restrictive than most business owners think.

The Copyright Act states that the fair use of a copyrighted work “…for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include—

1. the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
2. the nature of the copyrighted work;
3. the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
4. the effect of the use upon the potential market for or value of the copyrighted work.”

Startups should consult with a knowledgeable copyright attorney for questions about the use of a copyrighted work and whether their use of that work falls under the fair use doctrine. Your IP attorney will consult the California and federal court decisions that speak to what constitutes fair use under the Copyright Act. The answer to this question is typically very fact-specific, meaning that your intellectual property legal expert will analyze your startup’s use of the work against the applicable caselaw. It’s a fairly murky area, and your company is best served by speaking with a copyright attorney before moving ahead with a potentially protected use.

Note that fair use is a defense to copyright infringement—it doesn’t afford your company immunity from being sued. If your startup uses content owned by third parties, consult an experienced IP attorney to determine whether the fair use doctrine is applicable. Your attorney will recommend a strategy on how to move ahead and limit your exposure to an infringement lawsuit.

Contact Us

Your startup should consider copyright protection as part of your intellectual property strategy. Speak with an experienced intellectual property legal professional as you work to build your startup to discuss the types of intellectual property protection you may need.

Attorney Michael Ahmadshahi, PhD, focuses on patents, intellectual property, copyright, trademarks, and trade secrets in Irvine, California. The Michael Ahmadshahi, PhD, Law Offices are also located in Beverly Hills and Sherman Oaks. Call us toll free at (800) 747-6081 or direct at (949) 556-8800 or email info@mmaiplaw.com and let us help you with your intellectual property questions and the IP strategy for your startup.

Michael Ahmadshahi

Mr. Ahmadshahi’s area of practice is Intellectual Property Laws including Patent Prosecution and Litigation, Trademarks, Copyrights, Unfair Business Practices, and Business Litigation. He is also an entrepreneur and an inventor.