The Copyright Act confers upon owners of copyrights the right to prevent others from reproducing and publicly displaying their copyrighted works. (1) Specifically, section 106 states that "the owner of a copyright under this title has the exclusive rights ... to reproduce the copyrighted work in copies" and "to display the copyrighted work publicly." (2) However, with the growing number of computer users accessing the Internet, and the advance of innovative technologies organizing this access to information in meaningful ways, copyright owners' exclusive rights to reproduce and display their copyrighted works on the Internet, and the burgeoning technologies to facilitate access to information, have increasingly come into conflict. (3)
In an effort both to preserve copyright owners' exclusive rights and to accommodate advancing technologies designed to improve the anarchic Internet, courts have looked to the principal exception to these exclusive rights to determine whether these technologies can be justified as "fair use." Section 107 of the Copyright Act specifically provides that, notwithstanding the exclusive rights in section 106, "the fair use of a copyrighted work ... is not an infringement." (4) The statute itself delineates the principal factors for a court's consideration in determining whether an infringing use can be justified as "fair use." (5) Section 107 provides:
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. (6)
In Kelly v. Arriba Soft Corp., (7) plaintiff alleged that defendant's new visual search engine, reproducing plaintiff's copyrighted photographs to generate thumbnail image reference links and displaying the full-sized images of plaintiff's copyrighted photographs, infringed plaintiff's reproduction and public display rights in those images. (8) Plaintiff further alleged that defendant's infringing uses could not be justified as "fair use." (9) In applying the multi-factor fair use test under section 107, the Court of Appeals for the Ninth Circuit attempted to strike a balance between protecting copyright owners' exclusive rights and encouraging new technologies designed to facilitate Internet navigation.
This Case Note examines the fair use multi-factor balancing test as applied by the court in Kelly, with particular focus on transformative use and the limits imposed on both innovative Internet technologies and the assertion of exclusive copyrights on the Internet.
II. FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff-appellant, Leslie A. Kelly (hereinafter "Kelly"), is a professional photographer specializing in photographs of the American west and gold rush country. (10) Kelly displays some of his photographs on two Web sites he owns, on which he markets corporate retreats and sells books related to the subject of his photographs. (11) Kelly also licenses his photographs for display on Web sites other than his own. (12) Defendant-respondent, Ditto.com, formerly known as Arriba Soft Corporation ("Arriba"), (13) maintains a database of images, which have been indexed by its "Arriba Vista Image Searcher" Internet search engine. (14) This search engine responds to user queries by first scouring the Internet for related images, retrieving and downloading the images onto Arriba's server, converting the images into thumbnail form and then deleting the downloaded image, and, finally, displaying the results of the search as thumbnail images on the "results" page available for the user to view. …