Supreme Court Finds that First Fair Use Factor Weighs Against Andy Warhol Foundation's Commercial Licensing of 'Orange Prince' to Condé Nast
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The Supreme Court yesterday issued a 7-2 ruling in The Andy Warhol Foundation v. Goldsmith, No. 21-869, finding that the first fair use factor, namely the “purpose and character” of the Andy Warhol Foundation’s (the “Foundation”) commercial licensing of Warhol’s “Orange Prince” to publishing giant Condé Nast weighed against the Foundation. As the opinion did not consider the remaining fair use factors, this opinion affirmed the Second Circuit’s finding that the Foundation’s use was not a fair one. Slip Op. at 2.
Writing for the majority, Justice Sotomayor wrote that “the first fair use factor… focuses on whether an allegedly infringing use has a further purpose or different character, which is a matter of degree, and the degree of difference must be weighed against other considerations, like commercialism.” Slip Op. at 12. Justice Sotomayor went on to explain that new expression is not in itself dispositive of the first fair use factor, and that accordingly, Goldsmith’s photograph and the Foundation’s copying use of the photograph share the substantially same purpose in their use in magazine stories; further, the use by the Foundation of “Orange Prince” was commercial in nature. Slip Op. at 12. Even though “Orange Prince” adds new expression to the photograph, therefore, the first fair use factor favors Goldsmith. Slip Op. at 13.
The case dates back to 1984, when a professional photographer named Lynn Goldsmith granted the magazine Vanity Fair a limited license for a one-time use of her photograph of Prince for Andy Warhol to use in creating an illustration for a story they were running about Prince. Slip Op. at 3-4. In 2016, following Prince’s death, Vanity Fair’s parent company Condé Nast sought permission from the Foundation to reuse the 1984 illustration, and instead elected to use another image from Warhol’s Prince Series images, rendered in the color orange. Goldsmith only learned about the existence of the Prince Series in 2016 when she saw “Orange Prince” on the cover of Vanity Fair that year. Slip Op. at 5. After asserting her rights, the Foundation sued Goldsmith in the Southern District of New York for declaratory judgment of noninfringement or, in the alternative, fair use. Goldsmith counterclaimed copyright infringement.
The District Court granted the Foundation summary judgment on its fair use defense. Andy Warhol Found. for the Visual Arts, Inc. v. Goldsmith, 382 F. Supp. 3d 312 (S.D.N.Y. 2019). In 2021, on appeal, the Second Circuit reversed the District Court and remanded the case, finding all fair use factors to weigh in favor of Goldsmith, and also indicating that the Prince Series works were substantially similar to Goldsmith’s photograph. Andy Warhol Found. for the Visual Arts, Inc. v. Goldsmith, 992 F.3d 99 (2d Cir. 2021). The Supreme Court granted the Foundation’s petition for certiorari on the question of whether the transformative nature of the Prince Series established fair use because the works “convey a different meaning or message than…[Goldsmith’s] photograph.” Slip Op. at 12.
To begin, the Court notes the “balancing act” of the Copyright Act and the fair use defense, citing Twentieth Century Music Corp. v. Aiken, which indicated that the Copyright Act “reflects a balance of competing claims upon the public interest: Creative work is to be encouraged and rewarded but private motivation must ultimately serve the cause of promoting broad availability of literature, music, and the other arts.” Slip. Op. at 13 (citing 422 U.S. 151, 156 (1975)). The remainder of the opinion delves only into the first fair use factor, namely “the purpose and character of the use, including whether such use of a commercial nature or is for nonprofit educational purposes.” 17 U.S.C. §107(1).
The Court emphasizes that the first fair use factor is a “matter of degree” and considers “whether and to what extent” the use at issue has a purpose or character different from the original.” Slip Op. at 15-16. “The larger the difference, the more likely the first factor weighs in favor of a fair use. The smaller the difference, the less likely.” Slip Op. at 16. The Court notes that the first fair use factor takes into account whether a work is commercial as opposed to nonprofit. Slip Op. at 18. While a commercial nature of a use will not be dispositive, it will be relevant to a determination of the first fair use factor. Slip Op. at 18. Second, the first fair use factor relates to the justification for the use—where the use has a distinct purpose, it will further the goal of copyright “to promote the progress of science and the artists, without diminishing the incentive to create.” Slip Op. at 18. On the other hand, a use that shares the purpose of a copyrighted work may be considered a substitute for the original work, which may ultimately undermine the goal of copyright. Slip Op. at 19. The Court focuses, therefore, on the idea that the first fair use factor is a matter of degree, where the degree of difference between the works should be balanced against the commercial nature of the allegedly infringing use, and if the infringing work and the secondary use share the same or a highly similar purpose, then there must be some further justification for the copying—otherwise, the first factor is likely to weigh against fair use. Slip Op. at 20.
The Court held that the purpose of the licensing by the Foundation of “Orange Prince” to Condé Nast was the same as that of the original work—they are both portraits of Prince used alongside magazine articles about Prince. Slip Op. at 22-23. The Court also deemed the use of “Orange Prince” to be commercial in nature, because, of course, the Foundation licensed “Orange Prince” to Condé Nast for $10,000. Slip Op. at 24. Given the identical purpose and commercial use of the secondary work, the Court concluded that the first fair use factor weighed against the Foundation. The Court also disagreed with the Foundation’s argument that the licensing of “Orange Prince” constituted a “transformative” purpose because the silkscreen image created a new meaning or message in the work, and constituted a commentary on celebrity, specifically “the dehumanizing nature of celebrity.” Slip Op. at 28. Rather, the Court noted that the purpose of the secondary work was to “illustrate a magazine about Prince with a portrait of Prince.” Slip Op at 33. In sum, the Court affirmed the Second Circuit’s finding that this factor weighed again the Foundation and in favor of Goldsmith.
The Court took pains to make clear that its opinion took no stance on “the creation, display or sale of any of the original Prince Series works.” Slip Op. at 21. Nor did the Court opine on the question of whether the Foundation’s use was in fact infringing, or whether the Foundation’s commercial licensing ultimately constituted fair use, beyond affirming the Second Circuit’s holding.
In a concurring opinion, Justice Gorsuch, joined by Justice Jackson, wrote that because the actual uses of the original and secondary works overlapped, the Foundation’s use was effectively a “commercial substitute” for Goldsmith’s use. Concurrence at 2, 4. The concurrence also noted that an author’s intent has been and continues to be irrelevant to a determination of fair use and accordingly, the subjective “artistic purpose” of an underlying work has no bearing on the determination. Concurrence at 3.
Justice Kagan, joined by Chief Justice Roberts, filed a fiery dissenting opinion, previewed in contentious footnotes and comments in the majority opinion. The dissent noted that the Foundation’s silkscreen “dramatically alter[ed] an existing photograph,” Dissent at 1, arguing that by focusing so heavily on the commercial nature of the Foundation’s license and not accounting for the aesthetics and details of the actual work, the majority “leaves our first-factor inquiry in shambles,” Dissent at 3. The dissenting opinion focuses on Warhol’s artistry, statement, and place in the history of art to argue that the Foundation’s use is sufficiently transformative so as to constitute a fair use, Dissent at 5-9, noting that the majority effectively “stymies and suppresses” creative endeavors that copyright law intends to foster, Dissent at 30-32.
As with many fair use cases, the devil is in the details, and we will continue to monitor developments in the copyright landscape.
Writing for the majority, Justice Sotomayor wrote that “the first fair use factor… focuses on whether an allegedly infringing use has a further purpose or different character, which is a matter of degree, and the degree of difference must be weighed against other considerations, like commercialism.” Slip Op. at 12. Justice Sotomayor went on to explain that new expression is not in itself dispositive of the first fair use factor, and that accordingly, Goldsmith’s photograph and the Foundation’s copying use of the photograph share the substantially same purpose in their use in magazine stories; further, the use by the Foundation of “Orange Prince” was commercial in nature. Slip Op. at 12. Even though “Orange Prince” adds new expression to the photograph, therefore, the first fair use factor favors Goldsmith. Slip Op. at 13.
The case dates back to 1984, when a professional photographer named Lynn Goldsmith granted the magazine Vanity Fair a limited license for a one-time use of her photograph of Prince for Andy Warhol to use in creating an illustration for a story they were running about Prince. Slip Op. at 3-4. In 2016, following Prince’s death, Vanity Fair’s parent company Condé Nast sought permission from the Foundation to reuse the 1984 illustration, and instead elected to use another image from Warhol’s Prince Series images, rendered in the color orange. Goldsmith only learned about the existence of the Prince Series in 2016 when she saw “Orange Prince” on the cover of Vanity Fair that year. Slip Op. at 5. After asserting her rights, the Foundation sued Goldsmith in the Southern District of New York for declaratory judgment of noninfringement or, in the alternative, fair use. Goldsmith counterclaimed copyright infringement.
The District Court granted the Foundation summary judgment on its fair use defense. Andy Warhol Found. for the Visual Arts, Inc. v. Goldsmith, 382 F. Supp. 3d 312 (S.D.N.Y. 2019). In 2021, on appeal, the Second Circuit reversed the District Court and remanded the case, finding all fair use factors to weigh in favor of Goldsmith, and also indicating that the Prince Series works were substantially similar to Goldsmith’s photograph. Andy Warhol Found. for the Visual Arts, Inc. v. Goldsmith, 992 F.3d 99 (2d Cir. 2021). The Supreme Court granted the Foundation’s petition for certiorari on the question of whether the transformative nature of the Prince Series established fair use because the works “convey a different meaning or message than…[Goldsmith’s] photograph.” Slip Op. at 12.
To begin, the Court notes the “balancing act” of the Copyright Act and the fair use defense, citing Twentieth Century Music Corp. v. Aiken, which indicated that the Copyright Act “reflects a balance of competing claims upon the public interest: Creative work is to be encouraged and rewarded but private motivation must ultimately serve the cause of promoting broad availability of literature, music, and the other arts.” Slip. Op. at 13 (citing 422 U.S. 151, 156 (1975)). The remainder of the opinion delves only into the first fair use factor, namely “the purpose and character of the use, including whether such use of a commercial nature or is for nonprofit educational purposes.” 17 U.S.C. §107(1).
The Court emphasizes that the first fair use factor is a “matter of degree” and considers “whether and to what extent” the use at issue has a purpose or character different from the original.” Slip Op. at 15-16. “The larger the difference, the more likely the first factor weighs in favor of a fair use. The smaller the difference, the less likely.” Slip Op. at 16. The Court notes that the first fair use factor takes into account whether a work is commercial as opposed to nonprofit. Slip Op. at 18. While a commercial nature of a use will not be dispositive, it will be relevant to a determination of the first fair use factor. Slip Op. at 18. Second, the first fair use factor relates to the justification for the use—where the use has a distinct purpose, it will further the goal of copyright “to promote the progress of science and the artists, without diminishing the incentive to create.” Slip Op. at 18. On the other hand, a use that shares the purpose of a copyrighted work may be considered a substitute for the original work, which may ultimately undermine the goal of copyright. Slip Op. at 19. The Court focuses, therefore, on the idea that the first fair use factor is a matter of degree, where the degree of difference between the works should be balanced against the commercial nature of the allegedly infringing use, and if the infringing work and the secondary use share the same or a highly similar purpose, then there must be some further justification for the copying—otherwise, the first factor is likely to weigh against fair use. Slip Op. at 20.
The Court held that the purpose of the licensing by the Foundation of “Orange Prince” to Condé Nast was the same as that of the original work—they are both portraits of Prince used alongside magazine articles about Prince. Slip Op. at 22-23. The Court also deemed the use of “Orange Prince” to be commercial in nature, because, of course, the Foundation licensed “Orange Prince” to Condé Nast for $10,000. Slip Op. at 24. Given the identical purpose and commercial use of the secondary work, the Court concluded that the first fair use factor weighed against the Foundation. The Court also disagreed with the Foundation’s argument that the licensing of “Orange Prince” constituted a “transformative” purpose because the silkscreen image created a new meaning or message in the work, and constituted a commentary on celebrity, specifically “the dehumanizing nature of celebrity.” Slip Op. at 28. Rather, the Court noted that the purpose of the secondary work was to “illustrate a magazine about Prince with a portrait of Prince.” Slip Op at 33. In sum, the Court affirmed the Second Circuit’s finding that this factor weighed again the Foundation and in favor of Goldsmith.
The Court took pains to make clear that its opinion took no stance on “the creation, display or sale of any of the original Prince Series works.” Slip Op. at 21. Nor did the Court opine on the question of whether the Foundation’s use was in fact infringing, or whether the Foundation’s commercial licensing ultimately constituted fair use, beyond affirming the Second Circuit’s holding.
In a concurring opinion, Justice Gorsuch, joined by Justice Jackson, wrote that because the actual uses of the original and secondary works overlapped, the Foundation’s use was effectively a “commercial substitute” for Goldsmith’s use. Concurrence at 2, 4. The concurrence also noted that an author’s intent has been and continues to be irrelevant to a determination of fair use and accordingly, the subjective “artistic purpose” of an underlying work has no bearing on the determination. Concurrence at 3.
Justice Kagan, joined by Chief Justice Roberts, filed a fiery dissenting opinion, previewed in contentious footnotes and comments in the majority opinion. The dissent noted that the Foundation’s silkscreen “dramatically alter[ed] an existing photograph,” Dissent at 1, arguing that by focusing so heavily on the commercial nature of the Foundation’s license and not accounting for the aesthetics and details of the actual work, the majority “leaves our first-factor inquiry in shambles,” Dissent at 3. The dissenting opinion focuses on Warhol’s artistry, statement, and place in the history of art to argue that the Foundation’s use is sufficiently transformative so as to constitute a fair use, Dissent at 5-9, noting that the majority effectively “stymies and suppresses” creative endeavors that copyright law intends to foster, Dissent at 30-32.
As with many fair use cases, the devil is in the details, and we will continue to monitor developments in the copyright landscape.
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