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Basic Books v. Kinko's Graphics Corp.

The first case is Basic Books v. Kinko's Graphics Corp., 758 F.Supp. 1522 (S.D.N.Y. 1991). Here, Kinko's, a for-profit copying service, was sued for copyright infringement by major publishing houses in New York City. At the instruction of professors, Kinko's photocopied materials provided by the professors and assembled the copies into a single packet for sale to students. This service had been in existence for over 20 years and advertised to professors. Kinko's had a department responsible for procuring permission for their clients, but failed to do so in this case, believing that photocopying excerpts for the coursepacks constituted fair use of the materials. After applying the fair use factors to each excerpt, the court concluded that Kinko's use did not fall within the fair use exemption.

Kinko's did not appeal the case, and instead settled with plaintiffs, leaving the practice of assembling coursepacks in jeopardy and curtailing the fair use of copyrighted works for educational purposes.

Princeton University Press v. Michigan Document Services, Inc.

A more recent decision is Princeton University Press v. Michigan Document Services, Inc. Similar to the Kinko's case, Michigan Document Services (MDS) was a for-profit copying service that supplied coursepacks to nearby universities. MDS assembled the packs, added a table of contents identifying the materials in the volume and sold it to students. The fee was based on a per page basis and did not take into account the content. Unlike Kinko's, however, MDS did not have a copyright permission department. In fact, the owner of MDS was known to be opposed to the idea of obtaining copyright permission. After consulting with an attorney and conducting his own research, MDS concluded that his service constituted fair use of the materials. The lower court disagreed, deciding that MDS had committed willfully copyright infringement and issued an injunction preventing MDS from reproducing any of plaintiffs' works without permission.

In February of 1996, the 6th Circuit Court of Appeals reversed the lower court's decision, holding that MDS's use was within fair use.

The case took another turn when, on April 9, 1996, the Court of Appeals granted an en banc rehearing of the case. Rather than the standard 3-judge panel, all 12 judges of the 6th Circuit would rehear and decide the case. The effect was vacating the decision rendered just 2 months prior. In the en banc rehearing, the court reaffirmed the lower court's decision that MDS did indeed infringe plaintiffs' copyright, but did not do so willfully. This court's analysis, however, differed significantly from the previous ones in that rather than systematically applying the 4 fair use factors, majority opinion reversed the order of the factors and relied heavily (if not solely) on the fourth economic impact factor. Even more shocking, the court looked to the Classroom Guidelines for assistance in interpreting the statute and deciding the fair use issue. Justice Ryan, in his detailed dissent heavily criticized the majority's reliance of the Classroom Guidelines, correctly pointing out that legislative history is not part of the enacted law and should not be used in deciding the matter.

On January 30, 1997, MDS filed a petition for a writ of certiorari to the Supreme Court of the United States, but certiorari was denied on March 31, 1997. Rather than continue litigation, the parties settled the case that June. MDS agreed that it would copy no more than 1 page from any work published by a member of the Association of American Publishers. In exchange, the publishers accepted a lower damages payment. Thus, we are left with the 6th Circuit en banc decision and many unanswered questions about applying the area of fair use of copyrighted works for educational purposes.

Additional Resources

University of Texas Copyright Crash Course - Discussions of both cases. The section on MDS was written prior to the 6th Circuit's November 1996 en banc decision but is good for discussion purposes of the first Court of Appeals case.

Stanford University Library - Includes full text of the MDS 6th circuit case as well as filed court papers and amicus briefs.

"Whom Do You Trust?" - Opinion/Editorial piece by Roberta J. Morris and Jonathan Franklin on the MDS decision.