`
`No. 18-____
`
`IN THE
`Supreme Court of the United States
`
`
`
`
`
`
`TVEYES, INC.,
`
`Petitioner,
`
`
`
`
`v.
`FOX NEWS NETWORK, LLC,
`Respondent.
`
`
`
`
`On Petition for a Writ of Certiorari to
`the United States Court of Appeals
`for the Second Circuit
`
`
`
`
`
`
`PETITION FOR A WRIT OF CERTIORARI
`
`
`
`
`
`KATHLEEN M. SULLIVAN
` Counsel of Record
`ANDREW H. SCHAPIRO
`TODD ANTEN
`JESSICA A. ROSE
`QUINN EMANUEL URQUHART
`& SULLIVAN, LLP
`51 Madison Avenue
`22nd Floor
`New York, NY 10010
`(212) 849-7000
`kathleensullivan@
`quinnemanuel.com
`
`
`THOMAS C. RUBIN
`QUINN EMANUEL URQUHART
`& SULLIVAN, LLP
`600 University Street
`Suite 2800
`Seattle, WA 98101
`(206) 905-7000
`
`
`Counsel for Petitioner
`
`September 12, 2018
`
`
`
`
`
`
`
`
`i
`
`QUESTION PRESENTED
`
`In copyright law, the defense of fair use covers
`the transformative use of a work for research, com-
`ment, criticism and parody. Whether a use is “fair”
`depends upon four nonexclusive statutory factors,
`the fourth of which is “the effect of the use upon the
`potential market for or value of the copyrighted
`work.” 17 U.S.C. 107(4). This Court has held that, in
`assessing this fourth factor, market harm cannot be
`presumed from a transformative use’s commercial
`success and that harm arising from use of the copy-
`righted work for the purpose of criticism is not cog-
`nizable. See Campbell v. Acuff-Rose Music, Inc., 510
`U.S. 569, 590-92 (1994). But in the decision below,
`the Second Circuit held that the fourth factor pre-
`sumptively weighs against a finding of fair use if a
`transformative use is commercially successful and
`thwarts the author’s desire to prevent analysis or
`criticism of its work. The question presented is:
`
`Can the transformative use of a copyrighted
`work cause a cognizable market harm under
`17 U.S.C. 107(4) if it is used in connection with
`a commercially successful business that the
`author is unlikely to enter or authorize?
`
`
`
`
`
`
`
`
`ii
`
`RULE 29.6 STATEMENT
`
`TVEyes, Inc. has no parent corporation, and no
`publicly held company owns 10% or more of its stock.
`
`
`
`
`
`
`
`iii
`
`TABLE OF CONTENTS
`
`Page
`
`QUESTION PRESENTED........................................... i
`
`RULE 29.6 STATEMENT ........................................... ii
`
`TABLE OF AUTHORITIES ........................................ v
`
`INTRODUCTION ........................................................ 1
`
`OPINIONS BELOW .................................................... 3
`
`JURISDICTION .......................................................... 3
`
`STATUTORY PROVISION INVOLVED .................... 3
`
`STATEMENT OF THE CASE .................................... 4
`
`A.
`
`B.
`
`C.
`
`D.
`
`Statutory Framework ............................ 4
`
`The Parties ............................................. 7
`
`The District Court Proceedings ........... 11
`
`The Second Circuit Decision ................ 12
`
`REASONS FOR GRANTING THE WRIT ................ 14
`
`I. REVIEW IS WARRANTED BECAUSE
`THE DECISION BELOW CONFLICTS
`WITH DECISIONS OF THIS COURT AND
`THE COURTS OF APPEALS ........................... 14
`
`A. This Court Has Held That Market
`Harm Cannot Be Presumed From A
`Transformative Use’s Commercial Suc-
`cess .............................................................. 14
`
`B. This Court Has Held That A Copyright
`Holder May Not Preempt Exploitation
`Of A Transformative Market ..................... 17
`
`
`
`
`
`iv
`
`
`II. THE QUESTION PRESENTED IS EX-
`CEPTIONALLY IMPORTANT ......................... 19
`
`CONCLUSION .......................................................... 22
`
`APPENDIX A – Second Circuit Opinion
`(February 27, 2018) ....................... 1a
`
`APPENDIX B – District Court First Summary
`Judgment Opinion
`(September 9, 2014) .................... 36a
`
`APPENDIX C – District Court Second
`Summary Judgment Opinion
`(August 25, 2015) ........................ 73a
`
`APPENDIX D – District Court Order Setting
`Terms of Injunction
`(November 6, 2015) ..................... 95a
`
`APPENDIX E – Permanent Injunction and
`Final Order
`(November 6, 2015) ................... 100a
`
`APPENDIX F – Second Circuit Order Denying
`Rehearing
`(May 14, 2018) ........................... 105a
`
`
`
`
`
`
`
`v
`
`
`TABLE OF AUTHORITIES
`
`Cases
`
`Page
`
`Abrams v. United States,
` 250 U.S. 616 (1919) ............................................. 21
`
`Campbell v. Acuff-Rose Music, Inc.,
` 510 U.S. 569 (1994) ..................................... passim
`
`Eldred v. Ashcroft,
` 537 U.S. 186 (2003) ............................................... 5
`
`Golan v. Holder,
` 565 U.S. 302 (2012) ............................................... 5
`
`Harper & Row Publishers, Inc. v. Nation
`Enters.,
` 471 U.S. 539 (1985) ......................................... 6, 17
`
`Mattel, Inc. v. Walking Mountain Prods.,
` 353 F.3d 792 (9th Cir. 2003) ............................... 17
`
`Peter Letterese & Assocs., Inc. v. World Inst. of
`Scientology Enters.,
` 533 F.3d 1287 (11th Cir. 2008) ........................... 16
`
`Sony Corp. of Am. v. Universal City Studios,
`Inc., 464 U.S. 417 (1984) ...................................... 13
`
`Stewart v. Abend,
` 495 U.S. 207 (1990) ............................................... 5
`
`Sundeman v. Seajay Soc’y, Inc.,
` 142 F.3d 194 (4th Cir. 1998) ............................... 18
`
`Suntrust Bank v. Houghton Mifflin Co.,
` 268 F.3d 1257 (11th Cir. 2001) ....................... 5, 18
`
`
`
`Statutes
`
`17 U.S.C. 107 ......................................... 1, 3, 4, 5, 6, 17
`
`17 U.S.C. 107(1) ........................................................... 6
`
`17 U.S.C. 107(4) ........................................................... 6
`
`
`
`
`
`
`
`vi
`
`
`Other Authorities
`
`Andrew Marantz, THE NEW YORKER, “How
`‘Fox & Friends’ Rewrites Trump’s Reality”
`(Jan. 15, 2018)
`https://tinyurl.com/y943nezw .............................. 20
`
`Hunter Schwarz, CNN COVER/LINE, “Nearly a
`quarter of Trump’s Instagram posts are
`reposts of Fox News content” (Aug. 22,
`2018) https://tinyurl.com/yb5ex8u7 ..................... 20
`
`Josh Feldman, MEDIAITE, “Trump Tweets Out
`Quotes from Fox News Segments Slamming
`DOJ and ‘Police State” (Sept. 1, 2018)
`https://tinyurl.com/yckr6h3m .............................. 20
`
`Julie Hirschfeld Davis, NEW YORK TIMES, “In a
`Fox-Inspired Tweetstorm, Trump Offers a
`Medley of Falsehoods and Misstatements”
`(July 3, 2018) https://tinyurl.com/ya7yoh8g ....... 20
`
`Matthew Gertz, POLITICO, “I’ve Studied the
`Trump-Fox Feedback Loop for Months. It’s
`Crazier Than You Think” (Jan. 5, 2018)
`https://tinyurl.com/ydzcrqrc ................................. 20
`
`Matthew Rozsa, SALON, “Trump’s ‘Spygate’
`tweets perfectly illustrate his Fox News
`feedback loop” (May 23, 2018)
`https://tinyurl.com/yak8obbf ................................ 20
`
`Maxwell Tani, BUSINESS INSIDER, “The timing
`once again suggests that Trump tweets after
`watching Fox News segments” (Jan. 26,
`2017) https://tinyurl.com/yd2rb8b3 ..................... 20
`
`Mehdi Hasan, NEW STATESMAN, “How the
`right-wing Fox News became Donald
`trump’s state propaganda channel” (May
`19, 2018) https://tinyurl.com/yclaz8ka ................ 20
`
`Philip Bump, THE WASHINGTON POST, “The
`Fox News president” (Oct. 16, 2017)
`https://tinyurl.com/y984w36h .............................. 20
`
`
`
`
`
`vii
`
`
`Pierre N. Leval, Toward a Fair Use Standard,
`103 HARV. L. REV. 1105 (1990) ........................ 6, 16
`
`Ryan J. Reilly, HUFFPOST “Trump’s Latest
`Pardon Shows The Best Way To Get One:
`Go On Fox News” (Mar. 9, 2018)
`https://tinyurl.com/y7d78d7w .............................. 20
`
`William F. Patry, PATRY ON FAIR USE § 6:10
`(2017) .................................................................... 16
`
`
`
`
`
`
`
`1
`
`INTRODUCTION
`
`This Court has not reviewed a copyright fair use
`case in more than twenty years. Extraordinary ad-
`vances in digital technology—resulting in new tools
`for research and analysis that could never have been
`imagined even as recently as a decade ago—now pro-
`vide the Court with an ideal opportunity to confirm
`that fair use protects research services that facilitate
`the analysis and criticism of copyrighted works.
`
`TVEyes is one of those advances. Its customers
`include government agencies and officials, such as
`the White House and over 100 members of Congress;
`branches of the military; and multiple news organi-
`zations. TVEyes indexes over 27,000 hours of televi-
`sion content every day, from across over 1,000 televi-
`sion channels. In so doing, TVEyes enables its sub-
`scribers to conduct internal research and analysis on
`what, when and how information is conveyed on tele-
`vision, including by being able to view short clips
`centered around searched-for keywords.
`
`The decision below, however, allows Fox to use
`copyright law to stop TVEyes from enabling its cus-
`tomers to conduct research and analysis on content
`that recently aired on Fox News Channel or Fox
`Business Network. In evaluating the four fair use
`factors set forth in 17 U.S.C. 107, the Second Circuit
`held that TVEyes serves the “transformative” pur-
`pose of “enhancing efficiency” in research, comment
`and criticism, quintessential fair use purposes identi-
`fied in the preamble of 17 U.S.C. 107. But the court
`nonetheless held that TVEyes’s service was not a fair
`use because TVEyes’s economic success demon-
`strates that it displaces revenues that Fox hypotheti-
`
`
`
`
`
`2
`
`
`cally might want to pursue at some point in the
`future.
`
`The Second Circuit’s decision conflicts with this
`Court’s decision in Campbell v. Acuff-Rose Music,
`Inc., 510 U.S. 569, 590-92 (1994), followed by other
`courts of appeals, which holds that: (1) market harm
`cannot be presumed from a defendant’s commercial
`success in a transformative market; and (2) a copy-
`right owner cannot show market harm by claiming
`injury to markets the author is unlikely to enter or
`authorize, such as for criticism of the original work.
`This Court’s intervention is necessary to resolve this
`conflict.
`
`In addition, the decision below warrants review
`because the question presented has exceptional im-
`portance. Televised news media—and Fox in particu-
`lar—have outsized importance in today’s media land-
`scape. Unlike print publications or written content
`on the internet, television broadcasts are, by their
`very nature, ephemeral. The harnessing of techno-
`logical advances to allow analysts and critics to
`quickly locate and research televised information is
`crucial to the public good and consistent with long-
`standing First Amendment principles. To allow a
`news organization to prevent meaningful research on
`its content under the guise of nonexistent licensing
`markets extinguishes this beneficial, and necessary,
`opportunity for discourse that analyzes and critiques
`the Nation’s news coverage. Proper application of the
`fair use doctrine is the key First Amendment safe-
`guard to protect the public from such abuses.
`
`This case provides an ideal vehicle to correct the
`Second Circuit’s misinterpretation of fair use and
`ensure that news channels cannot wield copyright
`
`
`
`
`
`3
`
`
`law as a shield against becoming the subject of legiti-
`mate research and criticism. The petition should be
`granted.
`
`OPINIONS BELOW
`
`The opinion of the U.S. Court of Appeals for the
`Second Circuit is reported at 883 F.3d 169 and is re-
`produced at App. 1a-35a. The Second Circuit’s order
`denying panel and en banc rehearing is reproduced
`at App. 105a. The district court’s first summary
`judgment opinion is available at 124 F. Supp. 3d 325
`and is reproduced at App. 36a-72a. The district
`court’s second summary judgment opinion is avail-
`able at 2015 WL 7769374 and is reproduced at App.
`73a-94a. The district court’s order setting the terms
`of the injunction is available at 2015 WL 7769374
`and is reproduced at App. 95a-99a. The district
`court’s permanent injunction is available at 2015 WL
`8148831 and is reproduced at App. 100a-104a.
`
`JURISDICTION
`
`The court of appeals denied panel and en banc
`rehearing on May 14, 2018. App. 105a. On August 2,
`2018, Justice Ginsburg extended the time for filing a
`petition for a writ of certiorari to September 12, 2018.
`This Court has jurisdiction under 28 U.S.C. 1254(1).
`
`STATUTORY PROVISION INVOLVED
`
`17 U.S.C. 107 states:
`
`Notwithstanding the provisions of sections 106
`and 106A, the fair use of a copyrighted work,
`including such use by reproduction in copies or
`phonorecords or by any other means specified
`by that section, for purposes such as criticism,
`
`
`
`
`
`4
`
`
`comment, news reporting, teaching (including
`multiple copies for classroom use), scholarship,
`or research, is not an infringement of copy-
`right. 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 com-
`mercial nature or is for nonprofit edu-
`cational purposes;
`
`(2) the nature of the copyrighted work;
`
`(3) the amount and substantiality of the
`portion used in relation to the copy-
`righted work as a whole; and
`
`(4) the effect of the use upon the potential
`market for or value of the copyrighted
`work.
`
`The fact that a work is unpublished shall not
`itself bar a finding of fair use if such finding is
`made upon consideration of all the above fac-
`tors.
`
`STATEMENT OF THE CASE
`A. Statutory Framework
`
`“From the infancy of copyright protection, some
`opportunity for fair use of copyrighted materials has
`been thought necessary to fulfill copyright’s very
`purpose, ‘[t]o promote the Progress of Science and
`useful Arts ….’” Campbell v. Acuff-Rose Music, Inc.,
`510 U.S. 569, 575 (1994) (quoting U.S. CONST. art. I,
`§ 8, cl. 8; alteration in original). The import of robust
`fair use protections is not academic; it carries
`
`
`
`
`
`5
`
`
`“constitutional significance as a guarantor to access
`and use for First Amendment purposes.” Suntrust
`Bank v. Houghton Mifflin Co., 268 F.3d 1257, 1260
`n.3 (11th Cir. 2001); see also Golan v. Holder, 565
`U.S. 302, 328 (2012) (describing fair use as a “build-
`in First Amendment accommodation[]”) (quoting
`Eldred v. Ashcroft, 537 U.S. 186, 219 (2003)).
`
`Section 107 of the Copyright Act of 1976 codified
`the “common-law tradition” of fair use by listing four
`nonexclusive factors that courts must consider in
`determining whether a use is fair, and thus non-
`infringing.1 Campbell, 510 U.S. at 577. These factors
`cannot “be treated in isolation,” but instead “[a]ll are
`to be explored, and the results weighed together, in
`light of the purposes of copyright.” Id. at 578; see
`also id. at 577 (fair use analysis “‘permits [and re-
`quires] courts to avoid rigid application of the copy-
`right statute when, on occasion, it would stifle the
`very creativity which that law is designed to foster’”)
`(quoting Stewart v. Abend, 495 U.S. 207, 236 (1990)
`(alteration in original)). As a general matter, the
`illustrative fair uses listed in the preamble of § 107—
`which include “for purposes such as criticism,
`
`1 These factors are:
`
`(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.
`
`17 U.S.C. 107.
`
`
`
`
`
`6
`
`
`comment, news reporting, teaching … scholarship, or
`research”—are those “most commonly … found to be
`fair uses,” id. at 578. But ultimately, “[t]he task is
`not to be simplified with bright-line rules, for the
`statute, like the doctrine it recognizes, calls for case-
`by-case analysis.” Id. at 577.
`
`The first and fourth factors carry particular influ-
`ence. The first factor is “the purpose and character of
`the use, including whether such use is of a commer-
`cial nature or is for nonprofit educational purposes.”
`17 U.S.C. 107(1). “The central purpose of this inves-
`tigation” is to ask “whether and to what extent the
`new work is ‘transformative,’” i.e., “adds something
`new, with a further purpose or different character”
`than the original. Campbell, 510 U.S. at 579 (quoting
`Pierre N. Leval, Toward a Fair Use Standard, 103
`HARV. L. REV. 1105, 1111 (1990)). This is “guided by
`the examples given in the preamble to § 107.” Id. at
`578. As this Court has recognized, “the goal of
`copyright … is generally furthered by the creation of
`transformative works .… and the more transforma-
`tive the new work, the less will be the significance of
`other factors, like commercialism, that may weigh
`against a finding of fair use.” Id. at 579.
`
`The fourth factor—“the effect of the use upon the
`potential market for or value of the copyrighted
`work,” 17 U.S.C. 107(4)—has been deemed “the sin-
`gle most important element of fair use,” Harper &
`Row Publishers, Inc. v. Nation Enters., 471 U.S. 539,
`566 (1985). Under this factor, where “the second use
`is transformative, market substitution is at least less
`certain, and market harm may not be so readily
`inferred,” because such use more likely “serve[s] dif-
`ferent market functions” than the original. Campbell,
`
`
`
`
`
`7
`
`
`510 U.S. at 591 (emphasis added). Moreover, not
`every use that may have an effect on the original is a
`cognizable market harm. As Campbell explained:
`
`there is no protect[a]ble derivative market for
`criticism. The market for potential derivative
`uses includes only those that creators of origi-
`nal works would in general develop or license
`others to develop. Yet the unlikelihood that
`creators of imaginative works will license criti-
`cal reviews or lampoons of their own produc-
`tions removes such uses from the very notion
`of a potential licensing market.
`
`Id. at 592. In other words, a creator cannot stop a
`parodist from using her work by claiming that it
`interferes with her potential market for licensing
`parodies; otherwise, a creator could use copyright
`law to silence any critiques of a work.2
`B. The Parties
`
`1. TVEyes is a media-monitoring service that
`enables online research and analysis of the content
`aired on over 1,400 television and radio channels.
`App. 4a, 37a. Using closed captions and speech-to-
`text technology, TVEyes captures broadcast words
`and images—twenty-four hours a day, seven days a
`week—and creates a single, comprehensive text-
`searchable database of that content, resulting in the
`capture of over 27,000 hours of television program-
`ming every day. App. 37a, 64a. By entering keywords
`
`
`2 Even where a use ultimately is found not to be fair, “the
`goals of the copyright law … are not always best served by
`automatically granting injunctive relief.” Campbell, 510 U.S. at
`578 n.10.
`
`
`
`
`
`8
`
`
`(such as a politician’s name or a news event), a sub-
`scriber can quickly see an index of every instance of
`when, where, and how those words were mentioned
`over the past 32 days (older content is deleted), and
`can view a short clip of associated video to observe
`the context of the use. App. 4a-5a. “Without a service
`like TVEyes, the only way” for a subscriber to learn
`whether and how a word or phrase was used on the
`news, for example, “would be to have an individual
`watch every station that broadcast news for twenty-
`four hours a day taking notes on each station’s
`simultaneous coverage.” App. 37a-38a.
`
`A subscription generally costs about $500 per
`month. App. 5a. TVEyes is available only to profes-
`sionals, such as government agencies and businesses,
`and not to the general public. App. 40a. As of October
`2013, TVEyes had over 2,200 subscribers, including:
`the White House, over 100 members of Congress, the
`Department of Defense, the U.S. Army, the Associ-
`ated Press, MSNBC, Reuters, Bloomberg, ABC Tele-
`vision Group, CBS Television Network, the Associa-
`tion of Trial Lawyers, AARP, the American Red
`Cross, political campaigns for Republican and Demo-
`cratic candidates and organizations, and many
`others. App. 40a-41a, 64a.
`
`TVEyes expressly restricts subscribers’ use of the
`service to internal research purposes only—a limita-
`tion reinforced through signed contracts, warnings,
`reminders and technological limitations. App. 5a,
`41a. Clips located on TVEyes begin to play 14
`seconds before the selected keyword occurs, not at a
`predesignated “beginning” of any story. App. 4a. The
`average clip is played for 41 seconds, and 82% of
`clips are played for one minute or less. App. 62a.
`
`
`
`
`
`9
`
`
`In addition to enabling subscribers to find and
`view clips for internal research and analysis, TVEyes
`also offers “ancillary functions” related to research—
`such as the ability to archive or download clips for
`later analysis, to email clips, and to search for clips
`by date and time rather than keyword—all of which
`likewise are restricted to use for internal research
`and analysis only. App. 5a.3
`
`As the district court concluded:
`
`TVEyes subscribers use this service to com-
`ment on and criticize broadcast news channels.
`Government bodies use it to monitor the accu-
`racy of facts reported by the media so they can
`make timely corrections when necessary. Polit-
`ical campaigns use it to monitor political ad-
`vertising and appearances of candidates in
`election years. Financial firms use it to track
`and archive public statements made by their
`employees for regulatory compliance. The
`White House uses TVEyes to evaluate news
`stories and give feedback to the press corps.
`The United States Army uses TVEyes to track
`media coverage of military operations in re-
`mote locations, to ensure national security and
`the safety of American troops. Journalists use
`TVEyes to research, report on, compare, and
`criticize broadcast news coverage. Elected offi-
`cials use TVEyes to confirm the accuracy of
`information reported on the news and seek
`timely corrections of misinformation. Clearly,
`
`
`3 For a more detailed description of TVEyes’s service and
`functions, see App. 37a-42a.
`
`
`
`
`
`10
`
`
`TVEyes provides substantial benefit to the
`public.
`
`App. 64a. For example, TVEyes allows journalists to
`serve as a watchdog on how Fox covers particular
`subjects, compare Fox’s coverage with those of other
`channels, research the accuracy of the raw infor-
`mation, and critique the graphics used and the tone
`of the coverage—information that cannot be con-
`veyed through a raw transcript and that Fox may not
`want to make available for criticism. App. 55a. In
`short, “[w]ithout TVEyes, there is no other way to
`sift through more than 27,000 hours of programming
`broadcast on television daily, most of which is not
`available online or anywhere else, to track and
`discover information.” App. 64a.
`
`2. Fox is an international news organization that
`owns and operates two television channels, Fox
`News Channel (“FNC”) and Fox Business Network
`(“FBN”), which air news-related content. App. 42a.
`
`Fox owns and operates a website on which only a
`limited amount of content that aired on FNC or FBN
`can be viewed. Specifically, just 16% of Fox broad-
`casts are made available on its website, Fox’s website
`is restricted to “personal use,” the video segments
`Fox makes available may be edited or “corrected”
`versions of the originals, and website videos excludes
`the “ticker” at the bottom of the screen during broad-
`casts. App. 43a-44a.
`
`Fox also purports to offer licenses for use of some
`of the video segments that aired on FNC or FBN.
`However, among other provisions, licensees must
`agree to a specific restriction prohibiting the use of
`
`
`
`
`
`11
`
`
`licensed clips “in a way that is derogatory or critical”
`of Fox. App. 77a (emphases added).
`C. The District Court Proceedings
`
`In 2013 Fox brought claims against TVEyes for
`copyright infringement of 19 hour-long episodes that
`aired on FNC or FBN (the “Works”). App. 45a & n.3.
`The parties cross-moved for summary judgment on
`TVEyes’s fair use defense. App. 46a. The district
`court granted summary judgment to TVEyes that its
`core viewing function is a fair use, ruling that
`“recording content, putting it into a searchable data-
`base and, upon a keyword query, allowing users to
`view short clips of the content up to 32 days from the
`date of airing … constitutes fair use.” App. 81a.
`Specifically, applying the four statutory factors, the
`court found that: (1) the nature of the use favors
`TVEyes because the use is transformative; (2) the
`nature of the copyrighted work is neutral; (3) the
`amount of use is neutral because the value of the
`database requires it to be comprehensive; and (4) the
`market effect favors TVEyes because Fox showed no
`licenses lost to TVEyes, Fox’s licensing market is
`very small, and any minimal impact on licensing is
`outweighed by the substantial benefit TVEyes
`provides to the public. App. 49a-65a.
`
`Of particular relevance, the district court found
`that “[n]o reasonable juror could find that people are
`using TVEyes as a substitute for watching [Fox]
`broadcasts on television,” App. 63a, and that any
`potential lost revenue from the possible licensing of
`clips was not only “de minimis,” but “any ‘cognizable
`market harm’” is “substantially outweighed by the
`important public benefit provided by TVEyes,” App.
`63a-65a (quoting Campbell, 510 U.S. at 590 n.21).
`
`
`
`
`
`12
`
`
`The district court ultimately weighed all of the
`factors together, concluding that “TVEyes’ service
`copies television broadcasts but for an entirely
`different purpose and function.” App. 65a. Moreover,
`“TVEyes’ service provides social and public benefit
`and thus serves an important public interest.” App.
`66a. The court concluded that TVEyes’s copying of
`Fox content and enabling subscribers to view
`searched-for clips “constitutes fair use.” App. 66a.
`
`The district court later ruled that certain ancil-
`lary TVEyes functions (archiving) are also fair use,
`while other functions (emailing, downloading and
`date/time-search) are not fair unless modified. App.
`73a-94a. The court issued a permanent injunction
`against the functions it held not a fair use. App. 95a-
`99a (decision regarding terms of injunction); App.
`100a-104a (permanent injunction).
`D. The Second Circuit Decision
`
`On cross-appeals under 28 U.S.C. 1292(a)(1), the
`Second Circuit reversed, holding as a matter of law
`that TVEyes’s use of Fox content to allow subscribers
`to conduct internal research and analysis of what
`had aired on FNC and FBN was not fair use.
`
`On factor one (nature of the use), the panel
`majority agreed with the district court (App. 7a-11a)
`that TVEyes’s use is transformative, and thus
`“favors TVEyes,” (App. 11a) because creating a com-
`prehensive text-searchable database of all broadcast
`content enables users “to isolate, from an ocean of
`programming, material that is responsive to their
`interests and needs” and to obtain “nearly instant
`access” to material that would not otherwise be
`practically retrievable (App. 9a).
`
`
`
`
`
`13
`
`
`The Second Circuit held that factor two (nature of
`the work) was neutral (App. 11a-12a), and that factor
`three (substantiality of use) favored Fox because
`“TVEyes makes available virtually the entirety of the
`Fox programming that TVEyes users want to see and
`hear” (App. 12a-13a).4
`
`Finally, the Second Circuit held that factor four
`(market harm) favors Fox. App. 13a-15a. First, the
`court asserted that “[t]he success of the TVEyes busi-
`ness model demonstrates that deep-pocketed con-
`sumers are willing to pay well for a service that
`allows them to search for and view selected televi-
`sion clips,” and thus that there is “a plausibly ex-
`ploitable market for such access to televised content.”
`App. 15a. Second, the court presumed from this com-
`mercial success that TVEyes “displaces potential Fox
`revenues” either by “depriving Fox of licensing
`revenues from TVEyes or from similar entities” or by
`usurping Fox’s own possible “wish to exploit the mar-
`ket for such a service rather than license it to
`others.” App. 15a. The court of appeals made no ref-
`erence to the anti-criticism restrictions that Fox ex-
`pressly imposes on licensees or the public benefits
`TVEyes’s service offers.
`
`
`4 In assessing the third factor, the Second Circuit failed to
`acknowledge that “the extent of permissible copying varies with
`the purpose and character of the use.” Campbell, 510 U.S. 586-
`87 (citing Sony Corp. of Am. v. Universal City Studios, Inc., 464
`U.S. 417, 449-50 (1984) for proposition that “reproduction of en-
`tire work” can be consistent with fair use); see also App. 59a-
`60a (“One cannot say that TVEyes copies more than is neces-
`sary to its transformative purpose for, if TVEyes were to copy
`less, the reliability of its all-inclusive service would be compro-
`mised.”).
`
`
`
`
`
`14
`
`
`Balancing the four factors, the Second Circuit
`concluded that “TVEyes’s service is not justifiable as
`a fair use” (App. 16a), and reversed the district
`court’s order “to the extent it held that TVEyes’s
`product was a fair use” (App. 19a). The court ordered
`the district court to enjoin TVEyes’s current service.
`App. 19a.
`
`The Second Circuit denied TVEyes’s petition for
`panel and en banc rehearing. App. 105a.
`
`REASONS FOR GRANTING THE WRIT
`
`I. REVIEW IS WARRANTED BECAUSE THE
`DECISION BELOW CONFLICTS WITH
`DECISIONS OF THIS COURT AND THE
`COURTS OF APPEALS
`
`The decision below alters the balance between
`copyright protection and the First Amendment by
`presuming market harm from a subsequent user’s
`commercial success and the author’s asserted desire
`to exploit secondary markets. This approach not only
`contradicts Campbell—and the faithful adherence to
`Campbell by other courts of appeals—but also guts
`the central premise of fair use, which is to allow
`others to use copyrighted works when it serves the
`interests of copyright and is in the public interest.
`
`A. This Court Has Held That Market Harm
`Cannot Be Presumed From A Trans-
`formative Use’s Commercial Success
`
`The decision below conflicts with this Court’s
`holding in Campbell that market harm cannot auto-
`matically be presumed from a defendant’s commer-
`cial success. In Campbell, this Court considered
`
`
`
`
`
`15
`
`
`whether a secondary use—a parody of Roy Orbison’s
`rock ballad Oh, Pretty Woman—was a fair use. In
`assessing market harm, this Court noted that the
`Sixth Circuit had “resolved the fourth factor against
`2 Live crew … by applying a presumption about the
`effect of commercial use, a presumption which as
`applied here we hold to be error.” 510 U.S. at 591.
`Reversing the Sixth Circuit, this Court explained
`that, while a non-transformative use may make
`market substitution more likely,
`
`when, on the contrary, the second use is trans-
`formative, market substitution is at least less
`certain, and market harm may not be so read-
`ily inferred. Indeed, as to parody pure and
`simple, it is more likely that the new work will
`not affect the market for the original in a way
`cognizable under this factor, that is, by acting
`as a substitute for it. This is so because the
`parody and the original usually serve different
`market functions.
`
`Id. (citations omitted).
`
`The decision below, however, conflicts with that
`directive by holding that “[t]he success of the TVEyes
`business model demonstrates that deep-pocketed
`consumers are willing to pay well for a service that
`allows them to search for and view selected televi-
`sion clips, and that this market is worth millions of
`dollars in the aggregate,” and concluding that,
`“[s]ince the ability to re-distribute Fox’s content in
`the manner that TVEyes does is clearly of value to
`TVEyes, it (or a similar service) should be willing to
`pay Fox for the right to offer the content.” App. 15a.
`In other words, the Second Circuit departed from
`Campbell by holding that mere business success es-
`
`
`
`
`
`16
`
`
`tablishes cognizable market harm as a matter of law,
`even where the use serves transformative purposes
`like research, commentary or criticism. There is no
`dispute here that Fox’s programming and TVEyes’
`service “serve different market functions.” 510 U.S.
`at 591; see App. 57a (“[D]atabases that convert copy-
`righted works into a research tool to further learning
`are transformative. TVEyes’ message, ‘this is what
`they said’—is a very different message from [Fox
`News’]—‘this is what you should [