June Nam - Edited by Ding Ding
TCA Television Corp. v. McCollum, -- F.3d --, 2016 WL 5899174 (2d Cir. 2016). Opinion hosted by Law360.
The United States Court of Appeals for the Second Circuit affirmed the judgment but rejected the reasoning of the district court, which dismissed allegations of copyright infringement. The district court granted the defendant’s 12(b)(6) motion to dismiss, finding the defendant’s play, Hand to God, qualified as a non-infringing fair use. The district court found that Hand to God’s incorporation of the routine was “highly transformative”, qualifying as non-infringing fair use. TCA Television Corp. v. McCollum, 151 F. Supp. 3d 419, 434, 437 (S.D.N.Y. 2015).
Performed by William Abbott and Lou Costello, Who's on First? is one of the best-known comedy routines of all time. This case arose when their heirs filed suit against the creators of a Broadway play, Hand to God. The heirs alleged Hand to God infringed their copyright by using—verbatim—a portion of the Who’s on First? routine in the play.
Writing for the unanimous Second Circuit, Circuit Judge Reena Raggi held that the verbatim use of the routine in Hand to God (“the play”) was not a fair use under the Copyright Act of 1976, 17 U.S.C. § 107. Section 107 of the Copyright Act lists four nonexclusive factors to determine whether a particular use qualifies as fair use: (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.
The Second Circuit held that all four factors cut against finding fair use. The play failed the first factor, as the play was not “transformative”. TCA Television Corp., 2016 WL 5899174, at *8. The play neither used the routine for a different purpose nor “imbued” the routine with a character, meaning, expression, or message, different from those included when the routine was created. Id. at *10.The play also raised commercial exploitation concerns as the creators of the play used the routine in its almost identical format in both the advertisement of the play and the actual play. Id. at *11. The play failed the second factor for which the Second Circuit noted that the routine was a creative, not a factual, work in nature. “The secondary user of the creative work must justify its functional or creative rationale behind its quotation,” Id., but the routine used in the play had no other function than that of the original routine, which is provoking the audience’s laughter. Therefore, there is no justification for the verbatim quotation. Id. The play failed the third factor as the use of a dozen of the routine’s variations was substantial and defendants did not provide any justification for such extensive use. Id. at *12. Finally, the play failed the fourth factor, as its use of the routine can adversely affect the licensing market for the routine. Id. at *13.
Despite holding that the play did not constitute a fair use, the Second Circuit nonetheless affirmed the District Court’s judgment by finding the heirs had no copyright interest in the routine. First, Abbott and Costello did not renew the copyright interest in the routine until the term of the copyright expired. TCA Television Corp., at *14 and *16. The clear language of the relevant contracts indicated that Abbott and Costello had no intention to convey the copyright of the routine to Universal Picture Company (“UPC”), but only granted a limited license to the UPC for movies. Id. at *15. The copyright renewal of Tropics, a motion picture where Abbott and Costello acted the routine, did not maintain the protection of the routine copyright. Id. at *14. The plaintiffs alternatively claimed that the UPC was an “author” of the routine under the theory of “work for hire”: the routine was created at the hiring party’s instance and expense, motivated by the hiring party. However, this claim failed because Abbott and Costello had already created and performed the routine before they contracted with the UPC. Id. at *17. Finally, plaintiffs argued that the copyright of the routine was protected because it was “merged” with the motion picture “to become a ‘unitary whole’”. Id. at *18.This claim also failed because the routine was a “freestanding” work within the Tropics. Id. at *17. It existed on its own for years before it was performed in Tropics, and it was performed independently from the films “thousands of times” on the radio and elsewhere. Id. Thus, even if the use of the routine was not fair, the heirs did not have copyright interest in the routine to claim any copyright infringement.
New York Law Journal provides an overview of the case. Devlin Hartline of Center for the Protection of IP takes a positive view on the Second Circuit’s decision. He suggests that the Second Circuit provided some limit on the expansion of derivative use under the name of “transformation.” TechDirt criticizes the decision. TechDirt argues that the Second Circuit’s analysis of fair use is not necessary considering its decision that there is no protectable copyright in the first place. Also, per TechDirt, the Second Circuit’s fair use analysis is inconsistent with circuit precedents.
This case has also received extensive reporting, including by Law360, Reuters, Bloomberg BNA, Wall Street Journal, and the American Bar Association.
June Nam is a Digest Contributor and a second-year student at Harvard Law School