Legal Issues: Understanding Copyright Laws And the Impact of the Digital Age

March 1, 2013 | By George C. Hlavac, Esq., and Edward J. Easterly, Esq.

Legal Issues
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TAGS: journal, legal issues,

NACE Journal, March 2013

Many people post items on the Internet, and, intentionally or unintentionally, infringe on copyright. To use copyrighted materials, one must obtain consent of the copyright holder.

Copyright: Legal Definition

A copyright is a legal construction that provides protections to works produced by an individual or entity. Copyright protections apply to both published and unpublished works. An individual or entity is not required to file for a copyright in order for a work to be copyrighted. This means that even if an article does not contain the copyright symbol (©), it is still copyrighted material. A legal copyright is required only to obtain the protections afforded by the applicable laws.

The Copyright Act of 1976 is the backbone for current protections of copyrighted materials. Under this act, eight primary categories of works are protected:

  • Literary works;
  • Musical works, including any accompanying words;
  • Dramatic works, including any accompanying music;
  • Pantomimes and choreographic works;
  • Pictorial, graphic, and sculptural works;
  • Motion pictures and other audiovisual works;
  • Sound recordings; and
  • Architectural works.

The Copyright Act provides for some exclusive rights to copyright holders, such as the right to reproduce the work into copies, the right to create derivative works of the original work, the right to distribute copies of the work to the public by sale, the right to perform the work publicly, and the right to display the work publicly. While this act provides significant protections for copyright holders, it does not cover all issues, such as those created by the digital age.

In the 1990s, Congress began to take steps to address the digital transmission of copyrighted materials on the Internet, and implemented the Digital Millennium Copyright Act (DMCA) in 1998. This act was created “due to the ease with which digital works can be copied and distributed worldwide virtually instantaneously.” Congress also stated that without further protections “copyright owners will hesitate to make their works readily available on the Internet.” The DMCA extended the reach of copyright law by further criminalizing the infringement of copyrighted materials. To enforce these measures, the DMCA introduced “notice and takedown procedures” as a mechanism to increase a copyright holders’ ability to protect their rights on the Internet.

The notice and takedown procedures require a copyright holder to provide notice of the alleged infringement to the individual violating the law. To be effective, the notice must adhere to certain requirements.

A notification of infringing material must include:

  • A signature;
  • Identification of the copyrighted work;
  • Identification of the allegedly infringing material and information reasonably sufficient to assist in locating the material;
  • The complaining party’s contact information;
  • A statement that the complaining party has a good-faith belief that the use of the material is not authorized by the owner or by law; and
  • A statement that the information in the notice is accurate under penalty of perjury.

Once such a notification is received, the party allegedly infringing on the copyrighted works is provided an opportunity to provide a statement that he or she has a good-faith belief that the notice was provided as a result of a mistake or misidentification. If the alleged infringer fails to take down the copyrighted material, he or she may be subject to fines up to $150,000 and potential imprisonment.

Not every posting, however, will result in jail time. Since its inception in 1998, courts have interpreted the DMCA repeatedly, and the issue at the heart of many of the cases is the fair use doctrine.

Copyright: Fair Use Doctrine

The fair use doctrine is a defense available to copyright infringement defendants, in which the fair use of a copyrighted work—by reproduction (copies) for purposes such as criticism, comment, news reporting, teaching, scholarship, or research—is not an infringement of copyright.

Under fair use, copyrighted material could be used in a manner that would otherwise violate copyright. The fair use doctrine allows an individual to infringe on another’s copyrighted materials without the fear of liability.

When invoking fair use, four factors are considered:

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

The first consideration examines how the work has been changed or “transformed” from the original and whether the purpose of the copying is educational or commercial.

Courts will consider whether use of the copied material earns the person or website a profit, either directly by selling the work or indirectly by using the work to attract customers to purchase other services.

Regarding the “nature of the work,” courts will review what type of work is being reposted (i.e., creative vs. informational and functional). When a court reviews the amount of work that was copied, it is essentially reviewing how much of an article, photograph, or song was reproduced. Exact copies of photographs or articles will weigh against a finding of fair use.

Finally, and most significantly, is the “impact on value.” Fair use, when properly applied, is limited to copying that does not materially impair the marketability of the copied work. In other words, the copying does not devalue the original work. This includes the immediate financial effect and future economic impact—that is, the owner/creator would not be able to sell the article if it’s all over the Internet for free viewing. A court will consider the actual market harm and the potential market harm if the copyrighted material is infringed.

However, courts have recently stated that a copyright holder cannot rely solely on the potential loss of a licensing fee associated with the copyrighted material as evidence of infringement. The court will consider whether the posted material directly competes with the copyright holder’s market or acts as a substitute for the purchase of the work. If the copying fulfills the demand for the original work and diminishes or prejudices the potential sale, this is enough to justify a finding against fair use. All of the foregoing factors must be considered prior to posting copyrighted content on the Internet. If the infringer is able to satisfy the foregoing factors, he or she can use the copyrighted materials without fear of liability.

The fair use doctrine also has applications under the DMCA and the notice provisions. Recently, a federal court issued a ruling that has been viewed as a win for fair use on the Internet.

In Lenz v. Universal, a mother posted a video on YouTube of her children dancing. The video contained approximately 20 seconds of the Prince song “Let’s Go Crazy” playing in the background. Universal, which owned the copyright to the song, sent a DMCA takedown notice to YouTube demanding that they remove the clip. The mother sued Universal for misrepresentation under the DMCA, claiming that her use of the song was fair under the law. Universal contended that it had no obligation to consider whether the use was fair prior to sending the DMCA notice. The court did not agree with Universal’s interpretation of the law and stated that “a fair use is a lawful use of a copyright…in order for a copyright owner to proceed under the DMCA with a good faith belief that use of the material in the manner complained of is not authorized by the copyright owner…the owner must evaluate whether the material makes fair use of the copyright.” The court went on to state that a “good faith consideration of whether a particular use is fair use is consistent with the purpose of the DMCA.”

As a result of the decision, copyright owners must now conduct an assessment of fair use prior to issuing the takedown notice. If they do not comply with this requirement, they can face potential liability. This decision has made it more difficult for individuals to be deemed liable for posting materials on the Internet.

Prior to using copyrighted materials on the Internet, individuals should take precautions. Only the amount of copyrighted material necessary for the purpose should be posted; any such posting should be accompanied by commentary, criticism, or statement (review why the material is being used); the material should be posted in a manner which cannot be recreated; if possible, the image or material should be transformed in some manner; the material should be posted in low-resolution formats; a fee should not be charged for any access to the copyrighted material; and any copyright language included on the material should not be removed.


Individuals and organizations must be careful when downloading, linking, or posting material online that is from another website: The best course of action is to secure permission to use the information from the owner/creator.

Copyright 2013 by the National Association of Colleges and Employers. All rights reserved.

blank default headshot of a user George C. Hlavac, Esquire, and Edward J. Easterly, Esquire, are attorneys in the Labor and Employment Law Department at Norris, McLaughlin & Marcus, P.A.