[00:00:00] Speaker 03:
We have before us today a continuation of the proceedings and 22-6086 White Monkey Productions versus Netflix.

[00:00:11] Speaker 03:
This is subject to the panel re-hearing that Council are certainly aware of.

[00:00:17] Speaker 03:
As indicated in our most recent order, APA-LE will begin first.

[00:00:24] Speaker 03:
And then we will continue on.

[00:00:27] Speaker 03:
So if you will make your appearance and proceed, please.

[00:00:33] Speaker 01:
Good morning, Your Honors.

[00:00:33] Speaker 01:
Robert Rothstein for the Appellees.

[00:00:36] Speaker 00:
Did we raise the volume?

[00:00:37] Speaker 00:
I'm having a little trouble hearing him.

[00:00:43] Speaker 00:
I could hear everyone else well.

[00:00:48] Speaker 01:
Is that any better, Your Honor?

[00:00:51] Speaker 00:
Well, we'll make do.

[00:00:54] Speaker 01:
At the outset, I'd like to thank the court for continuing the dialogue in this case, which truly is highly significant to copyright law.

[00:01:04] Speaker 01:
May it please the court, three elements establish that the first fair use factor weighs heavily in favor of fair use in this case.

[00:01:12] Speaker 01:
First, there was the decades-long authority addressing the use of film clips in documentaries.

[00:01:20] Speaker 01:
And in accordance with that authority, the use in this case was highly transformative, indeed a favored preamble use.

[00:01:30] Speaker 01:
Second, the narrow and limited holding in Warhol doesn't change this.

[00:01:34] Speaker 01:
Specifically, Warhol doesn't require targeting, and it's distinguishable on its facts.

[00:01:40] Speaker 01:
And third, the fact that the documentary was commercially streamed does in that way it's highly transformative nature.

[00:01:47] Speaker 01:
The key question in looking at commerciality in the world is substitution.

[00:01:52] Speaker 01:
And the documentary about the Tiger King and his dark world and big cats couldn't conceivably substitute for a video in loving memory of a friend's funeral.

[00:02:03] Speaker 01:
So with that, I'll turn to the first point.

[00:02:05] Speaker 03:
Well, and I have plenty of questions for you, Mr. Rothstein.

[00:02:09] Speaker 03:
So indeed, let's begin with the first point.

[00:02:12] Speaker 03:
And one question I would ask you in that connection is, at the end of the day, does it really matter whether this is deemed to be a preamble purpose or not?

[00:02:24] Speaker 03:
I mean, in Harper and Roe, the court made it very clear that

[00:02:27] Speaker 03:
There's no talismanic effect associated with something being a preamble purpose or not.

[00:02:33] Speaker 03:
It's not presumptively fair use.

[00:02:36] Speaker 03:
And it's just a list of examples of things that courts and Congress have deemed to be circumstances that are most often, well, often found to be fair use.

[00:02:48] Speaker 03:
So does it really matter ultimately?

[00:02:50] Speaker 01:
Well, Your Honor, first of all, the use is highly transformative.

[00:02:56] Speaker 01:
So preamble or not, it remains highly transformative.

[00:02:59] Speaker 01:
So I don't think it matters in that regard.

[00:03:02] Speaker 01:
I think it matters to the extent that these uses are favored.

[00:03:07] Speaker 01:
Warhol said their favorite falls within the example that Congress thought was a transformative use.

[00:03:13] Speaker 03:
Well, where is this word favored that you're talking about?

[00:03:17] Speaker 03:
I mean, I read recently, again, Harper and Row and Warhol, they don't use that word favored.

[00:03:22] Speaker 03:
In fact, they speak of the notion that these are examples that Congress and courts have found in the circumstances to be fair use.

[00:03:32] Speaker 03:
I mean, that's all I get out of those cases.

[00:03:35] Speaker 03:
Where does this favored notion come from?

[00:03:38] Speaker 01:
Fair enough, Your Honor, but the examples matter.

[00:03:42] Speaker 01:
Congress thought that calling these examples to the attention of courts mattered, and our use falls within those examples, squarely within those examples.

[00:03:56] Speaker 01:
its preamble use or not, use of a film clip in a biography or in a history has been consistently found to be a highly transformative use.

[00:04:10] Speaker 03:
Let me understand this.

[00:04:13] Speaker 03:
One of the arguments at least that I hear your adversary making and certainly is one that I want to hear your response to is the notion that

[00:04:23] Speaker 03:
that something would be a preamble purpose perhaps and certainly move in the direction of being transformative

[00:04:31] Speaker 03:
if it is a comment on the original work itself, as in this funeral video clip, and that that is a necessary condition for that, for it to be a preamble purpose, and certainly to move in the direction of being transformative.

[00:04:50] Speaker 03:
I take it you disagree with that, and if so, what's the foundation for your disagreement?

[00:04:56] Speaker 01:
Targeting is indeed not required.

[00:05:00] Speaker 01:
The court and Warhol said so in footnote 21 said targeting is not always required.

[00:05:06] Speaker 01:
The secondary user just has to do something other than say, I can do it better.

[00:05:11] Speaker 01:
And certainly in this case.

[00:05:13] Speaker 01:
The creators of the documentary did more than say, I can do it better.

[00:05:18] Speaker 01:
They used the clip as raw materials to create new expression, a new documentary.

[00:05:25] Speaker 01:
The court cited Google versus Oracle and Authors Guild versus Google.

[00:05:29] Speaker 01:
Neither of those cases involved targeting.

[00:05:33] Speaker 01:
This I want to stress, because I think it's very important in this next point, in footnote 12 of the Warhol opinion, Justice Sotomayor suggested that the result in that case might have been different if Warhol's orange prints appeared in an art magazine alongside an article about Warhol.

[00:05:53] Speaker 01:
That example is not targeting, that's an article about

[00:05:57] Speaker 01:
use of orange prints in an article about Warhol.

[00:05:59] Speaker 01:
That's what we have here.

[00:06:00] Speaker 01:
You have the use of the funeral video clip in a documentary about Joe Exotic and his world.

[00:06:07] Speaker 01:
So I think footnote 12, certainly it's a hypothetical, but strongly suggests that there's no targeting.

[00:06:16] Speaker 01:
Justice's Gorsuch concurrence, talking about a for-profit book commenting on 20th century art, not on

[00:06:25] Speaker 01:
Not on Goldsmith's work, 20th century art.

[00:06:27] Speaker 01:
That's not targeting.

[00:06:30] Speaker 01:
The Campbell suit example is another where the target is consumerism.

[00:06:35] Speaker 01:
Now, I realize that Justice Sotomayor also said it also targets the original, but those were alternative holy.

[00:06:40] Speaker 01:
Targeting consumerism is not targeting necessarily the label.

[00:06:44] Speaker 01:
So for all those reasons, targeting is not required.

[00:06:47] Speaker 01:
And I can't imagine that the court intended to throw out decades of jurisprudence, finding highly transformative uses in documentaries where there was no targeting, where there was use for biographical reference.

[00:07:06] Speaker 03:
Let me go back to the preamble point for a quick second here.

[00:07:10] Speaker 03:
Would it be your view that, Adam, that this is a preamble purpose in the sense that it is commenting on, I mean, the documentary itself, the Tiger King documentary, particularly that episode, is commenting on Joe Exotic and this big cat world and that that comment

[00:07:32] Speaker 03:
as opposed to some notion of needing to target or comment on the original work or the copyrighted work is sufficient.

[00:07:41] Speaker 01:
Yes, it's a commentary on Joe Exotic and society and, you know, and there's an element of news reporting also.

[00:07:49] Speaker 01:
But again,

[00:07:51] Speaker 01:
If it's highly transformative, it doesn't have to be a preamble use.

[00:07:55] Speaker 01:
You know, see Google versus Oracle.

[00:07:58] Speaker 01:
Transformative, but that wasn't a preamble use.

[00:08:01] Speaker 01:
So as I said, I think it's helpful, but not necessary for us to prevail.

[00:08:06] Speaker 03:
Let me ask you this.

[00:08:08] Speaker 03:
Where do you think the Andy Warhol Foundation, what was the deficiency

[00:08:16] Speaker 03:
or deficiencies in their position in Warhol.

[00:08:22] Speaker 03:
I mean, why did they lose essentially on the first factor of fair use so that I can understand how that maps or does not map onto this situation?

[00:08:33] Speaker 01:
They lost for three reasons, none of which applies here.

[00:08:37] Speaker 01:
They lost, number one, because Goldsmith's photograph was intended to be used in magazine articles about prints, and the Warhol Foundation used basically Goldsmith's photograph modified in a magazine article about prints.

[00:08:57] Speaker 01:
In this case,

[00:09:01] Speaker 01:
The documentarians, my clients, use a funeral video for a different purpose, not to commemorate Travis Maldonado, but to create a documentary.

[00:09:14] Speaker 01:
So that's different.

[00:09:15] Speaker 01:
I think this panel has already found that the purpose was different.

[00:09:19] Speaker 01:
Secondly,

[00:09:21] Speaker 01:
Warhol relied on meaning and message, saying it's transformative because, look, I've made these modifications, it's a different meaning and message.

[00:09:30] Speaker 01:
That wasn't sufficient.

[00:09:31] Speaker 01:
It's relevant, not sufficient.

[00:09:33] Speaker 01:
In this case,

[00:09:35] Speaker 01:
The documentarians of the Tiger King video didn't merely change the meaning and message of the funeral video.

[00:09:42] Speaker 01:
They didn't make a funeral video at all.

[00:09:44] Speaker 01:
They used it as raw materials to make completely new expression.

[00:09:47] Speaker 01:
That new expression was absent, a new work.

[00:09:50] Speaker 01:
There was no new work in Warhol.

[00:09:53] Speaker 01:
And the third reason is that in Warhol,

[00:09:58] Speaker 01:
The Warhol Orange Prince was a substitute for the Goldsmith work.

[00:10:08] Speaker 01:
In this case, in no sense of the word, it's unimaginable that someone wanting to mourn Travis Maldonado's death would

[00:10:17] Speaker 01:
by watch the documentary instead of looking at the funeral video.

[00:10:21] Speaker 01:
So for those three reasons, maybe the examples are diametrically opposed.

[00:10:26] Speaker 01:
You have new expression here, a completely different purpose and no substitution.

[00:10:30] Speaker 02:
Counsel, in your opinion, how important is the substitute issue?

[00:10:37] Speaker 02:
in this case, the fact that, assuming you're right, the fact that the documentary is not a substitute for the funeral video, how important is that under the Warhol analysis, at least?

[00:10:50] Speaker 01:
Your honor, I think it's under the first factor.

[00:10:52] Speaker 01:
I think it's just positive.

[00:10:54] Speaker 01:
Warhol, I think the war, maybe quoting said that the substitution was the bettenoir, I may have that wrong, under the first factor.

[00:11:03] Speaker 01:
And so I think when there's no substitution and, you know,

[00:11:07] Speaker 01:
Certainly, physical transformation and the making of new expression, not only a new meaning and message, a new expression, I think it's dispositive that there's no substitution under the first factor.

[00:11:17] Speaker 01:
I think that's what Warhol was about.

[00:11:20] Speaker 01:
If you look at Warhol, what they did was they said, look, here there's substitution, and let's look and see.

[00:11:28] Speaker 01:
That's when they looked at targeting.

[00:11:29] Speaker 01:
Once they determined there's a possibility of substitution,

[00:11:32] Speaker 01:
And they said, well, Warhol only said you could make it better here.

[00:11:35] Speaker 01:
There's no possibility of substitution.

[00:11:39] Speaker 01:
So you don't even get there.

[00:11:40] Speaker 01:
And my clients did far more than say I could make it better.

[00:11:45] Speaker 01:
They took a little clip and they made a seven episode documentary series out of it.

[00:11:50] Speaker 02:
Let me ask you another question.

[00:11:51] Speaker 02:
So when we're looking at this,

[00:11:56] Speaker 02:
Are we comparing the documentary to the entire funeral clip, the entire funeral video?

[00:12:03] Speaker 02:
Or are we comparing the documentary to the clip from the funeral?

[00:12:09] Speaker 02:
Are we only comparing a piece of the documentary to a piece of the funeral video?

[00:12:14] Speaker 02:
I mean, what are we comparing?

[00:12:16] Speaker 02:
What are we looking at to see if we have a substitute?

[00:12:20] Speaker 01:
You are looking at whether both, whether the documentary replaces the funeral video.

[00:12:28] Speaker 01:
It doesn't, but you can also look at the clip.

[00:12:30] Speaker 01:
And that short clip doesn't replace the entire funeral either because rather than mourning,

[00:12:37] Speaker 01:
Travis Maldonado in the clip, it's really criticizing Joe and kind of criticizing what's happening at the funeral.

[00:12:46] Speaker 01:
If you look at the entire funeral video, it's still on YouTube, but there are many poignant things, even from Jones quoting from the Bible.

[00:12:54] Speaker 01:
So there's no substitution either in the entire video or in the clip.

[00:13:00] Speaker 02:
I know, but I guess, so tell me what your position would be on the best rule of law

[00:13:07] Speaker 02:
what are we comparing?

[00:13:08] Speaker 02:
Is it the whole video to the whole video, or is it the whole documentary to a piece?

[00:13:17] Speaker 02:
I mean, what are we comparing?

[00:13:19] Speaker 01:
You can compare the use of the funeral video clip, what that shows, to the entire funeral video.

[00:13:27] Speaker 01:
And

[00:13:29] Speaker 01:
Criticism, as this court has actually already found in the panel, criticism of Joe Exotic, you know, for the broader picture, it's not the same as mourning Travis Maldonado and not a substitution.

[00:13:45] Speaker 03:
Let me follow up on that.

[00:13:47] Speaker 03:
If I understood you correctly, you said that you would compare the use of the video clip to the use of the entire video, as in the funeral video that was shot by Mr. Cepi, right?

[00:14:00] Speaker 01:
Right.

[00:14:01] Speaker 01:
OK.

[00:14:02] Speaker 03:
OK.

[00:14:02] Speaker 03:
Let me let me frames a different sort of notion.

[00:14:08] Speaker 03:
Should we be looking at the documentary and evaluating how the documentary

[00:14:20] Speaker 03:
Well, should we be looking at episode five or should we be looking at the entire documentary and trying to assess whether it is a transformative use?

[00:14:32] Speaker 03:
I mean, and part of the reason I asked that question is some of the documentary cases, and I think of the Baltimore Ravens case in particular, and some of those other cases talk about the notion of whether the copyrighted work is an insignificant or insubstantial piece of the whole.

[00:14:51] Speaker 03:
And what I would like to understand here is what is the whole, for purposes of conducting that analysis, would it be the full season one of Tiger King or would it be the episode five where the funeral video clip appears?

[00:15:09] Speaker 01:
Well, I think it would be the entire documentary because the clip serves a purpose of telling the narrative starting from day one.

[00:15:21] Speaker 01:
Joe Exotic is violent.

[00:15:22] Speaker 01:
He seems like kind of a court jester.

[00:15:24] Speaker 01:
And then tragedy happens.

[00:15:26] Speaker 01:
But even if you look at episode five itself,

[00:15:31] Speaker 01:
that funeral clip tells the story of Travis.

[00:15:35] Speaker 01:
You see Travis complaining and upset.

[00:15:38] Speaker 01:
And I will say, I see my time is up.

[00:15:39] Speaker 01:
But I will add that most of the cases, Campbell versus Acre Bros and Google and Bill Graham archives and SOFA didn't involve de minimis uses.

[00:15:52] Speaker 01:
They involved significant uses.

[00:15:55] Speaker 03:
Mr. Rothstein, we have decided amongst ourselves that we're here to get to the bottom of this.

[00:16:04] Speaker 03:
And so within reason, you can continue on in answering these questions and we're going to treat your opposing counsel in the same way.

[00:16:14] Speaker 03:
And so if there are any other questions from the panel right now, you can fire away.

[00:16:19] Speaker 03:
Otherwise, I'll keep firing.

[00:16:21] Speaker 01:
Okay, thank you, Your Honor.

[00:16:23] Speaker 01:
I did hope to have some rebuttal, but.

[00:16:25] Speaker 03:
And you can add that too.

[00:16:27] Speaker 01:
Thank you.

[00:16:29] Speaker 03:
Well, then let me fire away then.

[00:16:31] Speaker 03:
And one of the things that I particularly want to get to the bottom of is this question in Warhol of justification.

[00:16:40] Speaker 03:
And that phrase has been used quite a bit.

[00:16:43] Speaker 03:
And it may play in that case, and it may play on something that I thought I heard you say to Judge Carson, which is that

[00:16:52] Speaker 03:
One began to look at the question of targeting because there was the possibility of substitution as it related to the Andy Warhol Foundation use of

[00:17:02] Speaker 03:
of the print and Goldsmiths.

[00:17:07] Speaker 03:
So what I want to understand from you, Warhol speaks of justification used in a broad sense as relating to furthering the purposes of copyright.

[00:17:19] Speaker 03:
And then it says used in a narrow sense in the sense of reasonably necessary to achieve the user's purpose.

[00:17:29] Speaker 03:
And this concept of justification apparently is important because Griner in the A circuit says that the whole question of transformativeness turns on justification.

[00:17:39] Speaker 03:
So the answer to the question, the short version of the question is this.

[00:17:44] Speaker 03:
What do you make of Warhol's reference to justification and how does justification relate to this case and help me by juxtaposing how it related to Warhol?

[00:18:05] Speaker 01:
Dejustification was, I think, put in footnote 21 by Justice Sotomayor, I can make it better.

[00:18:13] Speaker 01:
That was a justification.

[00:18:14] Speaker 01:
Andy Warhol was going to take this photograph, and he was going to silkscreen it and make it better.

[00:18:20] Speaker 01:
And that wasn't a sufficient justification.

[00:18:23] Speaker 01:
And that's why some kind of targeting was necessary.

[00:18:26] Speaker 01:
Targeting can be a justification in that case.

[00:18:32] Speaker 01:
In the instant case, the justification is clear.

[00:18:36] Speaker 01:
It is to further the narrative of the Tiger King, his life, his dark world, this culture of violence that spirals down.

[00:18:50] Speaker 01:
If you look at the beginning of episode five, you see Travis starting to fall apart and he unfortunately takes his own life and the funeral

[00:19:03] Speaker 01:
excerpt shows Joe's exotic really indifference to this.

[00:19:09] Speaker 01:
And later, if you keep watching, you have more of Travis Maldonado's mother saying that Joe was with Dylan Passage just a couple of months later.

[00:19:20] Speaker 01:
So the justification here, as it is with all biographical reference works, is to

[00:19:27] Speaker 01:
tell the story, and this really would critically help tell the story of the funeral clip by showing how Joe behaved at that funeral.

[00:19:34] Speaker 01:
That's much more than I can do it better.

[00:19:37] Speaker 01:
I can do it better than if our clients had tried to make a funeral video and, you know, and change the music or something, that we'd make a funeral video at all.

[00:19:45] Speaker 03:
And fitting it within sort of the framework of the analysis in Warhol, it would seem to me that

[00:19:53] Speaker 03:
that what I hear you saying anyway is that this justification, this sort of documentary justification is in line with the broad purpose of justification that the court speaks of.

[00:20:04] Speaker 03:
In other words, furthering the goals of copyright.

[00:20:09] Speaker 03:
Would you agree with that?

[00:20:11] Speaker 01:
I would agree with that, and I think Google versus Oracle supports that.

[00:20:15] Speaker 01:
No targeting there, but the justification for using a tremendous amount of Oracle software was to allow interoperability and basically do good for society and create a brand new copyrighted work, new expression.

[00:20:30] Speaker 01:
And that's exactly what happened here.

[00:20:32] Speaker 01:
It didn't happen in Warhol.

[00:20:36] Speaker 01:
Warhol didn't create anything very new.

[00:20:38] Speaker 01:
Goldsmith was still intact.

[00:20:48] Speaker 03:
Anything else from the panel?

[00:20:53] Speaker 03:
All right.

[00:20:53] Speaker 03:
For the moment, we'll let you sit down, or figuratively anyway, and we'll hear from opposing counsel.

[00:21:05] Speaker 04:
Good morning, Your Honors.

[00:21:06] Speaker 04:
Can everyone hear me okay?

[00:21:08] Speaker 04:
Yes.

[00:21:10] Speaker 04:
Wonderful.

[00:21:10] Speaker 04:
Thank you.

[00:21:11] Speaker 04:
Gregory Keenan of the Digital Justice Foundation appearing on behalf of Appellant Respondents, White Monkey Productions, and Mr. Timothy Seppi.

[00:21:21] Speaker 04:
Warhol teaches us that we have to focus on the specific use.

[00:21:24] Speaker 04:
And here, that's Netflix's commercial streaming use, a highly commercial use streaming to millions of paying customers on Netflix's for-profit paywall platform.

[00:21:34] Speaker 04:
And critically, Netflix made this commercial use and this commercial exploitation without paying the customary license.

[00:21:43] Speaker 04:
And that matters.

[00:21:44] Speaker 04:
It matters for the logic and the policy concerns that the Copyright Act is balancing.

[00:21:51] Speaker 03:
Let me, if I may, let me understand one point as it relates to this whole commercial use dimension.

[00:22:00] Speaker 03:
I mean, would you agree that, I mean, the case law seems to suggest that, I mean, commerciality is not dispositive, is it?

[00:22:07] Speaker 03:
I mean, it has to be balanced with the transformativeness of the item in question.

[00:22:13] Speaker 03:
Would you agree with that?

[00:22:15] Speaker 04:
Yes, I would agree with the caveat that Warhol kind of, I would say, reinjected fervor into that commerciality consideration so that it does have to be balanced.

[00:22:29] Speaker 04:
And I would say that tracing all the way back to Harper and then reiterated in even documentary cases like Elvis, a crucial consideration is whether or not the use could have been made by paying a customary fee for that use.

[00:22:44] Speaker 04:
Go ahead, I'm sorry.

[00:22:48] Speaker 04:
I'm sorry.

[00:22:50] Speaker 04:
That's because that strikes the balance your honor is looking for.

[00:22:53] Speaker 04:
Harper stressed that fair use should not be used to deprive a copyright owner of their right and their property at the very moment when they encounter those users who could afford to pay for that use.

[00:23:05] Speaker 04:
And Warhol stressed that it wouldn't impoverish our world if the defendant there had to pay Goldsmith a fraction of the proceeds from its commercial exploitation and reuse.

[00:23:15] Speaker 00:
And I think there's- Once you had a Yoko Ono situation where she says, no, I don't like the purpose of your film and I'm not gonna help.

[00:23:26] Speaker 00:
Or someone could just charge an exorbitant amount or could say,

[00:23:31] Speaker 00:
You can use it only if I have the right to edit what you do in that regard.

[00:23:37] Speaker 00:
What's the solution in that circumstance?

[00:23:41] Speaker 04:
Yes, your honor.

[00:23:44] Speaker 04:
I think at the Supreme Court level, that's an under-determined question, and it's an important question.

[00:23:49] Speaker 04:
One might be tempted to look at that as this type of justification, a situation where someone is literally preventing the use of another work in that way.

[00:23:59] Speaker 04:
But at the same time, Warhol is pretty clear that we need to be responsive to the derivative rights that a user does have to license or not license.

[00:24:10] Speaker 00:
The issue in Warhol was

[00:24:14] Speaker 00:
And the court makes it very clear that it's drawing the line between a fair use and a derivative use is the whole point here.

[00:24:24] Speaker 00:
And it's a difficult thing to measure.

[00:24:28] Speaker 00:
But doesn't the case law, at least up to now, suggest that if it doesn't matter

[00:24:42] Speaker 00:
whether the person would take a small fee or not.

[00:24:46] Speaker 00:
That is not an important factor in determining whether it's fair use.

[00:24:53] Speaker 00:
Where it does come into play, where you have a more wealthy user, then the wealthy user may decide, I will offer them something just to avoid any litigation and problems with it.

[00:25:10] Speaker 00:
respond to that if you will.

[00:25:12] Speaker 04:
Sure.

[00:25:12] Speaker 04:
I actually think it goes deeper than just that last point.

[00:25:16] Speaker 04:
So Warhol stresses we have to focus on the specific use.

[00:25:20] Speaker 04:
So in footnote 10, for example, it draws this distinction between the making use, the making of the silkscreen and the commercial licensing.

[00:25:27] Speaker 04:
And we have to look at the specific use and the commercial nature of it to understand whether or not there is an existing licensing market where this use, the very specific use could be done for the customary fee.

[00:25:40] Speaker 04:
So in your honor's example where Yoko Ono is being intransigent and just there's no price high enough for her to relinquish to the world.

[00:25:50] Speaker 04:
That might be useful to look at compared to well is there a customary licensing fee that this use could have been accomplished under and if she is

[00:25:58] Speaker 04:
not agreeing to that customary fee, then perhaps that's a consideration of justification.

[00:26:04] Speaker 04:
However, in this case, Mr. Seppi wasn't offered the customary fee.

[00:26:07] Speaker 04:
The record is replete with customary fees for these uses.

[00:26:11] Speaker 04:
And importantly, that's important to the copyright acts balance about rewarding creators of the raw materials and the users of the raw materials.

[00:26:19] Speaker 04:
Because there's nothing here to suggest that if Mr. Seppi

[00:26:23] Speaker 04:
had been offered and accepted the same customary fee for this use that's extended to other people, that that would disrupt the Tiger King from being made or being distributed.

[00:26:32] Speaker 00:
There have been a couple cases.

[00:26:36] Speaker 00:
I think the language of Justice Sotomayor appeared very similarly in a circuit opinion.

[00:26:42] Speaker 00:
I can't remember which one, saying the world won't be injured if the user has to pay a fee.

[00:26:50] Speaker 00:
But that was

[00:26:53] Speaker 00:
As far as I could tell, dictum, are there any cases where this fact that they could afford to pay the fee actually made a difference in whether the court determined that it was fair use or not?

[00:27:10] Speaker 04:
I'd say Harper's discussion about whether or not the use could have been accomplished for the same fee.

[00:27:16] Speaker 04:
And critically, Harper was a meat and potatoes preamble use, still news reporting on a presidential memoir.

[00:27:22] Speaker 04:
The court was still concerned with whether or not the use could have been accomplished.

[00:27:29] Speaker 04:
For the customary fee, the Elvis case from the Ninth Circuit, which was a biography documentary case involving Elvis said that that focus, whether or not one is commercially exploiting without paying the customary fee for that use is the crux of the commerciality focus.

[00:27:44] Speaker 04:
And Warhol tells us we have to really examine the commerciality focus.

[00:27:48] Speaker 04:
including with an eye for derivative uses out of respect for the statute's balancing of derivative rights.

[00:27:54] Speaker 04:
And I would just say the fact that Netflix is already using these licensing fees, these clip licensing fees in the record shows that providing clip licenses at a modest amount, everyone wins.

[00:28:05] Speaker 04:
The raw material makers are incentivized to make the raw materials.

[00:28:09] Speaker 04:
It actually facilitates Netflix from distributing and making these types of works.

[00:28:14] Speaker 04:
So that's the logic, I would say, and the policy decisions and policy wisdom of the Copyright Act.

[00:28:19] Speaker 00:
Well, let me read you something from the from the Warhol opinion and see if my take on this is correct.

[00:28:35] Speaker 00:
I'll read the quote, but it's my understanding that this is the way to determine whether it satisfies the first prong of the Farrelly's test.

[00:28:46] Speaker 00:
The quote is, whether a youth shares the purpose or character of an original work or instead has a further purpose or different character.

[00:28:57] Speaker 00:
And it says that's a matter of degree.

[00:28:59] Speaker 00:
But is that the test?

[00:29:02] Speaker 00:
Do you agree that that's the basic test?

[00:29:04] Speaker 00:
for the first problem.

[00:29:07] Speaker 04:
If I remember the quote correctly, and please do correct me if I'm misremembering it, I think it's a matter of degree that then has to be balanced against commerciality.

[00:29:15] Speaker 04:
I think it's the next sentence.

[00:29:17] Speaker 04:
The answer would be, if you account for the commerciality, yes.

[00:29:24] Speaker 03:
Well, those aren't blended inquiries.

[00:29:28] Speaker 03:
You're determining whether something's transformative, and then you balance it against commerciality, right?

[00:29:35] Speaker 04:
Yeah, oh, I'm sorry.

[00:29:37] Speaker 04:
I understand now.

[00:29:38] Speaker 04:
Yes, but when the Bet Noir, the substitute problem that we're concerned with and the respect for the derivative rights, Campbell talks about not just substitute of the original, but also substitute in the form of potentially licensable derivative works.

[00:29:56] Speaker 04:
When we're looking at something, whether or not it's justified, I would compare it to, for example, Google, where it's an interoperability case.

[00:30:05] Speaker 04:
The justification that has to be balanced against the commerciality is whether or not that use is even possible if they don't make use of that work.

[00:30:14] Speaker 04:
So the Supreme Court permitted that use in Google, said there was a justification, and arguably that wasn't targeting justification.

[00:30:22] Speaker 03:
Arguably, in what sense was it targeting?

[00:30:26] Speaker 03:
There was no targeting in Google.

[00:30:28] Speaker 04:
I'll concede then that it is not targeting, but what the court was concerned with was that use could not be made if you didn't interact with the other work.

[00:30:39] Speaker 04:
Google kind of actually dovetails nicely with Campbell.

[00:30:42] Speaker 04:
In Campbell, the Supreme Court drew a distinction reiterated in Warhol between a satire and a parody.

[00:30:49] Speaker 04:
And the nuance, the Campbell nuance as Warhol calls it, is one cannot even make a parody unless it sufficiently invokes or references the original work.

[00:31:00] Speaker 04:
So that justification is one of necessity.

[00:31:02] Speaker 04:
Same in Google, which is a technology case, but involving interoperability.

[00:31:06] Speaker 04:
You kind of have to copy enough of the code for the

[00:31:09] Speaker 04:
to works or technologies to speak to each other, you can't make that use if you're not invoking the other work.

[00:31:18] Speaker 03:
But in Campbell, was it not the case that you had essentially the same purpose at play, same or similar purpose, which created an analogy in some ways to Warhol?

[00:31:29] Speaker 03:
And in that situation, because it was a same or similar purpose,

[00:31:33] Speaker 03:
there was the search for the independent justification that would allow for it, and they found that justification in the parity purpose.

[00:31:41] Speaker 03:
Well, I think the argument that your opposing counsel would make is there is not the same or similar purpose here, that you have a documentary that uses a clip of the funeral video and is engaged in an entirely different purpose.

[00:31:56] Speaker 03:
Hence, why the need

[00:31:58] Speaker 03:
for targeting, hence why the need for an independent justification.

[00:32:02] Speaker 03:
It's embedded in what they're doing.

[00:32:06] Speaker 04:
Well, of course, but that would be true, Your Honor.

[00:32:09] Speaker 04:
Let's take, for example, a translation of a book that features some of the original.

[00:32:16] Speaker 04:
Of course, I would have to take enough to translate.

[00:32:18] Speaker 04:
We would still consider that within the ambit of the derivative right.

[00:32:21] Speaker 04:
Just because I want to use it, it wouldn't make it a necessary use.

[00:32:26] Speaker 04:
So I think the really important distinction being drawn in the case law for justification or non-targeting justifications is between necessity

[00:32:35] Speaker 04:
and convenience or what Campbell calls avoiding the drudgery of creating something new.

[00:32:43] Speaker 03:
And then what do you do with this legion of documentary cases that we've been cited and that I've consumed a good number of those, which there was no necessity for that.

[00:32:53] Speaker 03:
And let's use, for example, the Elvis case that you pointed out.

[00:32:57] Speaker 03:
Note, there were two things going on in Elvis.

[00:32:59] Speaker 03:
Some things were determined to be fair use, and they were little clips.

[00:33:04] Speaker 03:
And of that were activities that and they were small activity clips, but they were clips that were used.

[00:33:10] Speaker 03:
It was only the court found when they used so much of it that it could be deemed the same purpose as entertainment as the archival Elvis footage that there was a problem.

[00:33:25] Speaker 03:
So it's not like there weren't any clips that were used and it wasn't like there weren't any clips used out of convenience.

[00:33:32] Speaker 03:
to use those smaller clips?

[00:33:36] Speaker 04:
The smaller clips, no, but my understanding of Elvis is that turned on the commentary and use to comment on the original work, for example, interviews that were providing context about where that fit into Elvis's career.

[00:33:50] Speaker 03:
So there was comment on Elvis, right?

[00:33:52] Speaker 03:
I mean, and not necessarily on the original work, was it?

[00:33:56] Speaker 04:
Well, I think Warhol makes clear that targeting or commenting, sorry, on a person, a persona, a character, in fact, a series of cases makes clear is not enough.

[00:34:06] Speaker 04:
So Elvis found some uses not transformative or sufficiently justified, even though obviously it was talking about the person of Elvis in Warhol, Prince, and in Harper,

[00:34:17] Speaker 04:
Of course, Gerald Ford is a historical person.

[00:34:20] Speaker 04:
It didn't turn on those comments on those characters.

[00:34:23] Speaker 04:
That's not enough.

[00:34:24] Speaker 04:
I'd also just like to stress, it's not about the subjective purpose of the subsequent user.

[00:34:30] Speaker 04:
And to ignore whether or not it's truly essential to make this use would upset the delicate balance that copyright is drawing in Warhol, that it's talking about in Harper, about being able to incentivize those who provide the raw materials or the

[00:34:47] Speaker 00:
Let me pursue what the chief judge has been asking about.

[00:34:52] Speaker 00:
First, I just looked at the Warhol opinion to see about the quoted language.

[00:34:59] Speaker 00:
I don't see anything about commerciality in the next sentence or the next few sentences.

[00:35:04] Speaker 00:
Maybe it comes another page later, but I don't think that's what they were talking about balancing at that time.

[00:35:11] Speaker 00:
The basis of my trying to get some agreement on this, and maybe you don't agree with me, but it seems to me that what I quoted was whether it has a further purpose or different character.

[00:35:23] Speaker 00:
And that's what I'd like to pursue in the context of, say, of what's called the documentary.

[00:35:30] Speaker 00:
And I fully agree with your statement that the label doesn't matter.

[00:35:35] Speaker 00:
If you decided to publish all of the Beatles songs in chronological order and say, this is a documentary on how their work has developed, you wouldn't get anywhere.

[00:35:47] Speaker 00:
No court is going to say, oh, that's a documentary, so it's fair use.

[00:35:51] Speaker 00:
But in general, when we think of documentaries, we think of something that takes a bunch of snippets, really, about subject and

[00:36:05] Speaker 00:
puts them together with commentary and editing and so on to help you understand what's going on.

[00:36:15] Speaker 00:
And isn't that what happened here?

[00:36:19] Speaker 00:
The Netflix series, this is a little difficult for me because I have no interest in this fellow, but it's to show his character, how this developed, what's going on.

[00:36:36] Speaker 00:
When that's the purpose, then it informs every little snippet.

[00:36:42] Speaker 00:
When you know the relationship between Joe and Travis, was that his name?

[00:36:48] Speaker 00:
The one who, yes, Joe and Travis, then you understand that snippet from the funeral better.

[00:36:56] Speaker 00:
And the snippet from the funeral helps you understand Joe better.

[00:37:02] Speaker 00:
And that seems to me to be the essence of what's going on in any documentary.

[00:37:08] Speaker 00:
And isn't that a sufficiently further purpose or different character to conclude that this is fair use?

[00:37:16] Speaker 00:
What's different about this and the typical documentary?

[00:37:22] Speaker 00:
that is considered to be able to use snippets as fair use.

[00:37:30] Speaker 04:
Three answers.

[00:37:31] Speaker 04:
So first of all, I think this gets to what the distinction between a broad justification and a specific justification means.

[00:37:40] Speaker 04:
So perhaps there is the broad justification that biographies or documentaries do have to invoke some things.

[00:37:45] Speaker 04:
Elvis itself kind of said, you can't make an Elvis documentary without taking something.

[00:37:49] Speaker 04:
The question then was, all right, well, what are you allowed to take and how?

[00:37:52] Speaker 04:
And I would just point to Warhol footnote 4 and Warhol footnote 10 because it's talking about how specific the inquiry gets.

[00:38:01] Speaker 04:
So in footnote 10, it's talking about the distinction between the commercial licensing use and the commercial making use.

[00:38:11] Speaker 04:
in footnote forwards talking about a book review that quotes a bunch of you know passages and it says that we have to actually justify each specific use so i'd just like to focus on is it necessarily is it necessary for netflix to commercially stream in order to do that

[00:38:29] Speaker 04:
I don't know that it is without paying a customary fee to do that.

[00:38:32] Speaker 04:
There's a licensing agreement with every other person for whom they're making this use.

[00:38:37] Speaker 04:
So it's not justified to do this without paying that customary price.

[00:38:40] Speaker 04:
And it wouldn't be profoundly disruptive for Netflix's streaming purposes.

[00:38:44] Speaker 00:
So that might be different, for example, than... If I'm understanding you correctly, then this same documentary, if it was on film and showed little theaters around the country,

[00:38:57] Speaker 00:
Then it would be fair use.

[00:39:00] Speaker 04:
It would be a different analysis.

[00:39:01] Speaker 04:
It wouldn't be technology dependent, but it would be about the commerciality.

[00:39:05] Speaker 04:
So take.

[00:39:10] Speaker 00:
I thought that was a wonderful quote from Samuel Johnson.

[00:39:13] Speaker 00:
I was surprised.

[00:39:14] Speaker 00:
to see that quote that anyone who writes without being paid is an idiot or something along those lines.

[00:39:23] Speaker 00:
That surprised me from him anyway.

[00:39:27] Speaker 00:
But all this stuff has commercials.

[00:39:32] Speaker 00:
The preamble uses are all commercial uses in general.

[00:39:40] Speaker 00:
You're really focusing totally on, hey, we've got a really rich user, and they ought to pay us a little bit.

[00:39:47] Speaker 00:
That seems to be the thrust of your argument, because everything else that goes into determining fair use seems irrelevant in your approach.

[00:39:58] Speaker 00:
Because that's what you always come back to.

[00:40:01] Speaker 04:
Sorry, Your Honor.

[00:40:04] Speaker 04:
No, it's certainly not irrelevant.

[00:40:05] Speaker 04:
It's very important.

[00:40:06] Speaker 04:
It's just that Warhol makes clear that if there is no targeting, and not targeting of the characters, targeting of the work itself, then we're at Campbell's lowest ebb.

[00:40:14] Speaker 04:
And it requires serious justification.

[00:40:16] Speaker 00:
No, it was saying targeting or some other further use or purpose.

[00:40:22] Speaker 03:
And wasn't that search for a justification because the purposes themselves were the same or similar?

[00:40:33] Speaker 03:
The purpose in Campbell was the same as what Roy Orbison did.

[00:40:37] Speaker 03:
The purpose in Warhol was the same as Ms.

[00:40:40] Speaker 03:
Goldstein did.

[00:40:41] Speaker 03:
It was the same purpose.

[00:40:43] Speaker 03:
The argument here is it is not the same purpose, that they've created a documentary that profiles Joe Exotic's megalomania, not a funeral video about remembrance, which in fact, in our panel decision, we said that distinction exists.

[00:40:59] Speaker 03:
So if it is not the same purpose, why the need for the same justification, this search for this independent justification of targeting that was in Warhol and that was in Campbell?

[00:41:12] Speaker 03:
Why is that necessary here?

[00:41:16] Speaker 04:
The targeting is not necessary.

[00:41:17] Speaker 03:
That's not our position, so I'm sorry if I. Oh, in your brief that's fairly clear that that's what you've been saying that it doesn't need there needs to be targeting.

[00:41:25] Speaker 03:
That's all through your brief.

[00:41:27] Speaker 04:
Sorry, I would point to the section.

[00:41:28] Speaker 04:
I don't believe so.

[00:41:29] Speaker 04:
We have a section where we list three separate justifications, such as the orphan work problem that a documentary where.

[00:41:36] Speaker 04:
So it's an orphan work problem it's widely recognized and copyright.

[00:41:39] Speaker 04:
This is a situation where you literally cannot locate the rights holder because it's been out of print for so long, there's no way to, which I think goes back to the Yoko Ono example that might provide a justification that has nothing to do with targeting.

[00:41:52] Speaker 04:
So we provided documentary specific I believe we gave four examples.

[00:41:57] Speaker 03:
Why is that?

[00:41:57] Speaker 03:
The point is, why is that necessary?

[00:41:59] Speaker 03:
Why is it necessary?

[00:42:01] Speaker 03:
Indeed, in Elvis, it wasn't necessary for the snippets that they used.

[00:42:05] Speaker 03:
It wasn't necessary in the Baltimore Ravens cases.

[00:42:08] Speaker 03:
When they found fair use, it was not necessary.

[00:42:11] Speaker 03:
They had little clips that were profiled in their Hall of Fame or wherever it was.

[00:42:15] Speaker 03:
It wasn't necessary.

[00:42:17] Speaker 03:
In fact, so why is necessity

[00:42:22] Speaker 03:
the operative principle if the use, the challenge use is different.

[00:42:29] Speaker 04:
I would point, for example, to the Supreme Court's Google example.

[00:42:33] Speaker 04:
So the reason there's a justification there is that you need to make the use, just like Campbell, but it's not targeting, but you need to make the use in order to do the work.

[00:42:44] Speaker 04:
And that respects Campbell's insistence that what we're concerned with is substitution, not just of the original, but also of potentially licensed derivative uses.

[00:42:55] Speaker 03:
Does Campbell set the floor?

[00:42:59] Speaker 03:
I mean, does it have to be a necessity as in Campbell for there to be a use of a snippet in a documentary?

[00:43:08] Speaker 04:
Where there are clip licensing agreements, and that is a customer practice and customer use that incentivizes creation of those clips and rewards that.

[00:43:20] Speaker 04:
I mean, to say that this is a fair use, it's not just going to stiff our client.

[00:43:24] Speaker 04:
It would eviscerate those licenses.

[00:43:26] Speaker 04:
Why would anyone pay a license for these types of use if just throwing it in a montage or a documentary is enough?

[00:43:31] Speaker 03:
Let's go back then to the example in Warhol that Justice Gorsuch gave about putting that same print

[00:43:39] Speaker 03:
in a book on 20th century art.

[00:43:41] Speaker 03:
Nobody's going to pay that person in that situation.

[00:43:44] Speaker 03:
They said the potential for it to be fair use was to come from the fact that the overall objective was a different purpose of a different character.

[00:43:55] Speaker 03:
There was no payment going on in that situation.

[00:43:58] Speaker 03:
He said he didn't definitively say it would be fair use, but he said it militated in the direction of fair use.

[00:44:03] Speaker 03:
So there was no necessity to use the prints print from Warhol in such a hypothetical book.

[00:44:16] Speaker 04:
I would say that that example, first of all, and I understand it, but it is a concurrence and it doesn't I don't know whether or not there is a licensing market for those uses.

[00:44:25] Speaker 04:
That would be an evidentiary question.

[00:44:28] Speaker 04:
So I understand what Justice Gorsuch said.

[00:44:30] Speaker 03:
I thought Justice Sotomayor in a footnote had a very similar sort of hypothetical that she talked about.

[00:44:36] Speaker 03:
And in both instances, the question was whether the character and purpose overall was different.

[00:44:43] Speaker 03:
And therefore, what necessity would there need to be

[00:44:46] Speaker 03:
for an independent justification, which was a term that Justice Sotomayor used in Warhol, independent justification, why would there be a need for one if there was the same or different purpose?

[00:45:00] Speaker 04:
Because I think that language, while I understand the term justification is a little amorphous, it's talking both about at a broad level, which I think your honors are speaking about, and at a very specific level.

[00:45:12] Speaker 04:
And then Warhol further reiterates in footnote 10 that it's very specific.

[00:45:17] Speaker 04:
So you have to do it use by use.

[00:45:18] Speaker 04:
So just saying, what might be a justification for someone making a documentary?

[00:45:26] Speaker 04:
but not streaming it publicly is a very different question than the commercial streaming.

[00:45:31] Speaker 04:
So in Warhol, for example, they said there's a bunch of uses going on.

[00:45:33] Speaker 04:
The specific use we're concerned with is the commercial licensing.

[00:45:37] Speaker 04:
So I just think the justification at the making stage and the streaming stage is very different.

[00:45:46] Speaker 04:
The justification for the need to use it is going down as the commerciality is going drastically up.

[00:45:53] Speaker 04:
So I think the justification and the balancing that has to be done between the transformation or the justification and the commerciality has to be evaluated at each stage and sensitive to each use.

[00:46:03] Speaker 04:
And Warhol certainly draws such distinctions that are that fine and razor sharp.

[00:46:09] Speaker 04:
And it chastises the dissent for talking too broadly, just saying, well, this work is, you know, transformative of this work.

[00:46:16] Speaker 04:
In footnote 10 in particular, it says, that's a sleight of hand, and it's committing a fallacy of conflating two distinct uses, that it was laser focused on the commercial licensing use.

[00:46:25] Speaker 04:
So our only point would be, when we're evaluating the commercial streaming use, we have to look at that balance, independent justification, whether or not there's targeting, and commerciality at that stage.

[00:46:38] Speaker 04:
And we have to say, what is the justification

[00:46:42] Speaker 04:
At that stage, why is it necessary to make this film?

[00:46:45] Speaker 04:
Why is it necessary in the way that satire, which doesn't target?

[00:46:49] Speaker 04:
It might be socially valuable, but we wouldn't say a satire is justified just because it wants to say something and wants to use someone else's stuff to say it.

[00:46:57] Speaker 04:
So we would just stress that it's a matter of the specific level of justification and the specific focus on the particular work and balancing it with the commerciality at that stage, which isn't just going after deep pockets or rich defendants.

[00:47:11] Speaker 04:
It's actually looking at what the exploitation

[00:47:16] Speaker 03:
Of the work is so if you're that's a that's a that's a good point and let me let me raise that in a number of cases what we're talking about is the courts have said what we're what when we say commerciality we're talking about exploiting the specific work itself.

[00:47:32] Speaker 03:
We're not talking about the overall commerciality of the item of the secondary work.

[00:47:39] Speaker 03:
And so how does that help you?

[00:47:41] Speaker 03:
Because you've got a snippet, which I did, and my math is horrible, but I'll tell you what, when I did the percentages on this, what we ended up with is that the funeral video clip is 2.5% of episode five, and it is one third of 1%

[00:48:00] Speaker 03:
of the entire season one.

[00:48:03] Speaker 03:
Now, how is it that Netflix is commercially exploiting the funeral video clip in such a situation?

[00:48:11] Speaker 03:
And we're not talking about exploiting Tiger King itself.

[00:48:15] Speaker 03:
We're talking about that clip.

[00:48:19] Speaker 04:
I would say Harper answers that question.

[00:48:24] Speaker 03:
There's a lot, there's a big difference in Harper and what is one third of one percent.

[00:48:30] Speaker 03:
And if you look at, and I came up with this analysis, when you look at, I think it was the Baltimore Ravens case, it talked about the notion of insubstantial or insignificant presence.

[00:48:42] Speaker 03:
And why isn't that an insignificant or insubstantial presence?

[00:48:48] Speaker 04:
Well, it's certainly not insubstantial.

[00:48:53] Speaker 03:
First of all, you heard the percentages, and even if I'm wrong on my math, I'm not that wrong.

[00:48:59] Speaker 04:
I'm not going to challenge your math.

[00:49:00] Speaker 04:
I'm not sure I'd be able to do it much better.

[00:49:02] Speaker 04:
I'll take your word for it.

[00:49:03] Speaker 04:
But I would say even withstanding that mathematical percentage, I would revisit Harper with a close examination of the percentages going on there.

[00:49:11] Speaker 04:
reexamine the fact that we're yes there is quantitative analysis but there's also qualitative analysis that in footnote four of warhol they're saying you have to go snippet by snippet in a book review that makes many quotes of the same book you have to do a quote by quote analysis and i can't imagine

[00:49:27] Speaker 04:
I don't want to play around with the math because I'd be guessing and I'd be guessing wrong.

[00:49:31] Speaker 04:
But my point is, it's qualitatively significant.

[00:49:34] Speaker 04:
This is a far cry from an incidental use where something's passing in the background.

[00:49:38] Speaker 04:
Like if I'm making a documentary.

[00:49:40] Speaker 02:
Let me stop you for a minute because it seems like this may all play into the idea of whether or not there's a substitute.

[00:49:50] Speaker 02:
Whether the Netflix documentary is a substitute because

[00:49:54] Speaker 02:
if it's true that it's such a small portion, I mean, how is the Netflix documentary a substitute?

[00:50:03] Speaker 02:
And in that same line of thinking, I mean, what's the shared purpose between the two that would make the Netflix documentary a substitute?

[00:50:15] Speaker 02:
I mean, so you have two things going on.

[00:50:16] Speaker 02:
You have the fact that it's such an infinitesimal piece of

[00:50:24] Speaker 02:
of the Netflix documentary, and then you also have the idea that they don't have the same shared, they don't share a purpose, unless you can tell me otherwise.

[00:50:38] Speaker 04:
So on the infinitesimal, I would just quickly say that the fact that defendants are even licensing such uses and try to license such use shows that as a functional matter.

[00:50:46] Speaker 04:
It's not really de minimis or incidental.

[00:50:48] Speaker 04:
I mean, it's a clip license agreement.

[00:50:50] Speaker 04:
It's designed to license clips.

[00:50:52] Speaker 04:
So in the industry, I mean, particularly in an age of shorter attention spans and anyone who's ever used TikTok or anything like that, I mean, you're looking at very quick snippets that are seven seconds long and they capture people's attention.

[00:51:04] Speaker 04:
So I think we'd be really speculating to say,

[00:51:06] Speaker 04:
licensed uses are incidental and a minimus.

[00:51:10] Speaker 04:
There's entire copyright clearance teams and licensing agreements around this.

[00:51:14] Speaker 04:
Two, it's not fleeting or incidental in the background.

[00:51:16] Speaker 04:
It's centrally featured.

[00:51:17] Speaker 04:
I mean, it's a whole scene.

[00:51:19] Speaker 04:
It may not be a huge part of the whole thing, but you could do that with every scene.

[00:51:23] Speaker 04:
You could chop off every scene into smaller and smaller scenes and say, you know, that's not very important.

[00:51:28] Speaker 04:
No.

[00:51:28] Speaker 02:
I mean, don't you have an issue on the substitution question

[00:51:34] Speaker 02:
where, I mean, who is, if I want to take a look at a portion of the funeral, how am I, am I gonna go behind Netflix paywall and go search this out?

[00:51:51] Speaker 02:
Because I'll tell you, finding it is not easy if you don't know exactly where to look.

[00:52:00] Speaker 02:
Am I gonna go behind Netflix paywall and pay for it and look for the funeral scene?

[00:52:06] Speaker 02:
Or am I just gonna go to your client's video for free on YouTube and take a look at it?

[00:52:11] Speaker 02:
I just don't see how the Netflix.

[00:52:15] Speaker 02:
production is a substitute.

[00:52:17] Speaker 04:
I appreciate that.

[00:52:18] Speaker 04:
And I'll start with the second answer, because I think that highlights a great point.

[00:52:24] Speaker 04:
So I'd like to draw a contrast, if I may.

[00:52:26] Speaker 04:
And I just draw it out.

[00:52:27] Speaker 04:
I'll try and do it as fast as possible between, let's say, this type of use.

[00:52:31] Speaker 04:
where the use is uncredited and behind a paywall so millions of people have seen our clients clip no one knows where a client is they wouldn't be able to find him he's not referenced he's not credited so there's an actual real world effect that that has because it is drawing it's people aren't going to see him they don't know who he is by contrast take a youtube reaction video right there you're watching something it's

[00:52:55] Speaker 04:
commenting on the original video, but typically it's telling you what that video is, it's crediting it, and typically it's freely available right in the kind of recommendation page on the right.

[00:53:04] Speaker 04:
So taking something- How about this?

[00:53:06] Speaker 02:
How about this?

[00:53:07] Speaker 02:
If I've seen the Travis Maldonado funeral clip in the Tiger King or somewhere else, and I want to see it again, and I type in the search term on Google or wherever,

[00:53:26] Speaker 02:
The funeral video is going to be one of the top choices that pops up, isn't it?

[00:53:33] Speaker 02:
The actual funeral video, your client's video is one that's going to pop up and it's going to be readily available to me.

[00:53:40] Speaker 04:
It's a great question.

[00:53:41] Speaker 04:
I honestly don't know.

[00:53:43] Speaker 02:
I know.

[00:53:45] Speaker 02:
I know because I did it.

[00:53:47] Speaker 02:
Okay.

[00:53:47] Speaker 02:
But that's extra record and I'm not, I'm just saying.

[00:53:50] Speaker 02:
There are, it takes you places when you look for this.

[00:53:54] Speaker 02:
So your idea that there's no attribution, so nobody would know where to find it.

[00:53:58] Speaker 02:
I mean, you just type in a search term and it gives you a lot of opportunities to view it.

[00:54:04] Speaker 04:
I'm not familiar with the particular search terms one would have to use.

[00:54:07] Speaker 04:
I haven't done them myself.

[00:54:09] Speaker 04:
I understand the concern.

[00:54:10] Speaker 04:
I'm not saying that no one would ever find it.

[00:54:12] Speaker 04:
I'm just saying naturally, if you take someone else's work, particularly if you're claiming you're being a historian,

[00:54:18] Speaker 04:
putting the source and referencing it would minimize the adverse harm on the person you're already stiffing to make use of it.

[00:54:25] Speaker 04:
I think Warhol does talk about credit and money going back.

[00:54:29] Speaker 04:
And I just think that's a matter of kind of common sense that if I- I mean, would you agree use the term stiffing a lot?

[00:54:35] Speaker 02:
Would you use the, would you agree with the idea that anybody whose work is the subject of fair use in some

[00:54:43] Speaker 02:
instance or another is being stiffed.

[00:54:46] Speaker 02:
I mean, they're not getting paid for it.

[00:54:48] Speaker 02:
It's their work.

[00:54:49] Speaker 02:
So they'd like to get paid for it, but they're not getting paid for it because it's fair use.

[00:54:54] Speaker 02:
So they're being stiffed.

[00:54:56] Speaker 02:
That's every fair use case.

[00:55:01] Speaker 04:
Yes, that is every fair use case, but there's a critical difference there because the question is, I'm not saying he's being stiffed because his work is being used.

[00:55:13] Speaker 04:
I'm saying he's being stiffed because others are being paid for the same specific use, which Warhol instructs has to be the focus.

[00:55:20] Speaker 04:
So there's a difference between existing markets.

[00:55:23] Speaker 04:
And it's important because it's not just about the client.

[00:55:25] Speaker 04:
It's about the incentive structure for the whole ecosystem, right?

[00:55:28] Speaker 04:
So if we say something's a fair use, what we're doing is we're getting rid of those licenses for those uses.

[00:55:34] Speaker 04:
So for example, people put songs in movies as part of a soundtrack.

[00:55:39] Speaker 04:
they have to get licenses to do that.

[00:55:41] Speaker 04:
If you've ever watched a popular movie, you'll hear a bunch of songs.

[00:55:45] Speaker 04:
It's made by a different person.

[00:55:47] Speaker 04:
You have to get a license to do that.

[00:55:50] Speaker 04:
Someone could call that a fair use, but because there's existing licenses for that, as Harper and Warhol stress, at the point that people are making productive social uses and have the ability to pay some portion to the rights holder,

[00:56:07] Speaker 04:
That's just copyright incentives working.

[00:56:09] Speaker 04:
It's a win-win-win.

[00:56:11] Speaker 04:
All boats rise.

[00:56:12] Speaker 02:
Let me ask you, I don't want to belabor this point.

[00:56:15] Speaker 02:
You had a chance to talk about that quite a bit.

[00:56:18] Speaker 02:
I have one more question.

[00:56:18] Speaker 02:
I don't want to test the chief's patience with me for continuing this well past your time.

[00:56:28] Speaker 02:
And this is a preamble question having to do with commenting.

[00:56:34] Speaker 02:
And I just want to know is it your position that the commenting has to be on the clip itself or on on your clients?

[00:56:43] Speaker 02:
Video itself or can the commenting be on a person who's in the clip?

[00:56:51] Speaker 02:
even if it's unrelated to the subject of the clip.

[00:56:53] Speaker 02:
Does that make sense?

[00:56:54] Speaker 04:
It makes sense.

[00:56:55] Speaker 04:
I have a very precise answer.

[00:56:58] Speaker 04:
So because there is no presumption in favor of preambles, you would still have to do the exact same justification analysis.

[00:57:07] Speaker 02:
And so I totally agree, but that's not responsive.

[00:57:10] Speaker 02:
I want to know if you see a distinction in those two.

[00:57:14] Speaker 02:
Can the second type of commenting, which is commenting on a person in the clip,

[00:57:19] Speaker 02:
but the comment is unrelated to the clip.

[00:57:25] Speaker 02:
Is that commenting for purposes of the preamble or is that not commenting?

[00:57:31] Speaker 04:
I would say it's not commenting because it would have to target in the sense of conjuring up the original.

[00:57:38] Speaker 02:
And I think- Okay, so you sort of view commenting and targeting as related.

[00:57:46] Speaker 04:
I would say that the Brammer case and its discussion of scholarly and commentary, it talks about providing commentary on the work itself.

[00:57:57] Speaker 04:
So that would be the Fourth Circuit, making that connection.

[00:58:00] Speaker 04:
I also think it's important that

[00:58:05] Speaker 04:
When we're looking at, for example, like book reviews that are using raw materials, Morehall talks about conjuring up the original work to shed light on the work itself, not just the subject of that work.

[00:58:17] Speaker 04:
So we would say that the type of specific justification, even for the commenting in the preamble use, that yes, it would have to be discussing the work itself in the way that Brammer discusses.

[00:58:30] Speaker 02:
Thank you.

[00:58:31] Speaker 04:
Thank you.

[00:58:32] Speaker 04:
Anything further?

[00:58:34] Speaker 04:
Could I make one just response to Judge Carson's earlier question that I didn't get to answer?

[00:58:41] Speaker 04:
We're at 22 plus.

[00:58:42] Speaker 04:
It better be quick.

[00:58:45] Speaker 04:
Go ahead, say it.

[00:58:46] Speaker 04:
Just ask you to look at footnote four of Warhol regarding whether you have to do the work as a whole or not.

[00:58:53] Speaker 04:
And then regarding substitution, it's not just the original, but also the substitution of a derivative

[00:59:01] Speaker 04:
potentially licensable use.

[00:59:03] Speaker 04:
And we would just point to Campbell's discussion of that as a basis for that.

[00:59:06] Speaker 04:
Thank you very much for your time and attention today.

[00:59:09] Speaker 04:
I really appreciate it.

[00:59:11] Speaker 03:
Robert, why don't you start, if you would, giving rebuttal of 10 minutes, and you don't need to use it, Mr. Rothstein, but if you want it, that is what we'll view as the ceiling now.

[00:59:28] Speaker 03:
You have your rebuttal time, please.

[00:59:30] Speaker 00:
Thank you, your honor.

[00:59:30] Speaker 00:
I'll try to- Let me start, if I may.

[00:59:33] Speaker 00:
I suspect this is something you want to go in.

[00:59:35] Speaker 00:
I didn't ask any questions before, but in terms of what Mr. Keenan said,

[00:59:40] Speaker 00:
And perhaps I should preface this by saying you might be confused about what's going on here.

[00:59:44] Speaker 00:
And I can only speak for myself, but I was fully on board with the panel opinion.

[00:59:53] Speaker 00:
No one forced me to join that.

[00:59:54] Speaker 00:
I thought it was a great opinion and was pleased to join it.

[01:00:00] Speaker 00:
But one thing that's great about this court is we want to make sure we've

[01:00:05] Speaker 00:
we pursued everything and make sure we didn't miss something.

[01:00:08] Speaker 00:
And there was something in the supplement in the rehearing briefs that made us, at least me, think that it'd be worthwhile pursuing some more things.

[01:00:16] Speaker 00:
But the one thing Mr. Keenan has mentioned frequently is the market for paying people whose works are used in part in a Netflix state documentary.

[01:00:34] Speaker 00:
And

[01:00:35] Speaker 00:
Apparently, a lot of people were paid for clips that were used in the Tiger King documentary.

[01:00:44] Speaker 00:
Tell me what's going on there.

[01:00:46] Speaker 00:
If we ruin your favor in this case, does that mean you're never going to pay anybody anything anymore?

[01:00:54] Speaker 00:
What's going on?

[01:00:55] Speaker 00:
There may not be a legal issue, but it's a gut issue.

[01:01:00] Speaker 00:
Why pay these people and not others?

[01:01:03] Speaker 00:
What's going on?

[01:01:04] Speaker 01:
Yes, I will get to the practical issue.

[01:01:06] Speaker 01:
May I start with sort of the legal portion of the licensing?

[01:01:09] Speaker 00:
Yes, yes.

[01:01:11] Speaker 01:
Google versus Oracle, refusal.

[01:01:13] Speaker 01:
Google and Oracle negotiated for a license.

[01:01:17] Speaker 01:
I can imagine that Google would not have been able to pay for it.

[01:01:20] Speaker 01:
They just thought Oracle was asking too much.

[01:01:22] Speaker 01:
And so they went ahead and used it.

[01:01:25] Speaker 01:
Also, there was no necessity.

[01:01:27] Speaker 01:
They didn't need to use it.

[01:01:29] Speaker 01:
The federal circuit actually held that the use wasn't transformative because Google could have done it themselves, just as Marshall's dissent in Google versus Oracle said.

[01:01:38] Speaker 01:
Google could have made the software itself without, you know, they didn't want it.

[01:01:42] Speaker 01:
The majority rejected that.

[01:01:44] Speaker 01:
So there's no necessity.

[01:01:45] Speaker 01:
And the fact that someone can afford to license doesn't matter.

[01:01:48] Speaker 01:
What's going on in licensing, practically, in state reasons?

[01:01:55] Speaker 01:
People license for many reasons.

[01:01:59] Speaker 01:
One reason they license is so frankly they don't have lawsuits that go up to a circuit court and then are re-heard and they have to spend the legal fees.

[01:02:07] Speaker 01:
It's much less expensive to pay, even though they might not have to pay, to avoid litigation.

[01:02:15] Speaker 01:
The second thing that happens when we're talking about licensing we're talking about licensing of long portions of films, not necessarily just excerpts of films.

[01:02:24] Speaker 01:
It wouldn't be different if we use the whole funeral video and played it from beginning to end.

[01:02:30] Speaker 01:
That, I will say, would have required a license.

[01:02:35] Speaker 01:
So if we paid for that.

[01:02:38] Speaker 01:
So license gives you the chance to use more than you can in connection with fair use.

[01:02:44] Speaker 01:
But it's not required.

[01:02:47] Speaker 01:
Again, Google Oracle, Google just didn't want to pay.

[01:02:52] Speaker 01:
And yet it was fair use.

[01:02:54] Speaker 03:
Judge Hartz, could I play off of that comment for a quick second?

[01:02:58] Speaker 03:
On the notion of whether snippets would be something, well, you talked about the idea that if you would use more of it, it might be the case that you would have to pay.

[01:03:10] Speaker 03:
It seems to me that that aligns with what went on in Elvis, where essentially they used snippets, they didn't pay for that.

[01:03:17] Speaker 03:
When they decided to use larger portions that conceivably could have entertainment value, that changed the analysis, right?

[01:03:25] Speaker 01:
Right, the substitution.

[01:03:28] Speaker 01:
If it's substitutive, if that's a word, it's more likely that it's not fair use and you have to pay.

[01:03:34] Speaker 01:
And paying a license fee gives you the right to substitute and exploit a word commercially.

[01:03:41] Speaker 03:
Let me ask you this question and this goes back to my endeavor at percentage analysis and on that point, I don't recall you taking a position as to whether you thought this was an insignificant or insubstantial use and that's the language

[01:03:56] Speaker 03:
of both of the Baltimore Ravens cases and Bill Graham, that's where this percentage analysis stuff comes from.

[01:04:04] Speaker 03:
And I don't recall in your briefing that you took a position to say that, you know, this is really an insignificant use and therefore it's not the kind of thing that really, as it a la either those cases or a la Elvis, would be something that I would be in the licensing business to pay for.

[01:04:22] Speaker 03:
that I would have to pay for.

[01:04:23] Speaker 01:
I think it clearly is an insubstantial use.

[01:04:26] Speaker 01:
I think your honor so held in the panel in connection with the third factor.

[01:04:32] Speaker 01:
So this is, I will make a distinction, the Baltimore Ravens, I think they said de minimis use.

[01:04:37] Speaker 03:
Well, no, whether they use that or not, both in Bill Graham and in Baltimore Ravens, what we're talking about, and I think in Bill Graham, they said that there's a question as it relates to the third factor, but they also thought that it played on the first factor because it was telling on the substitution issue.

[01:04:56] Speaker 03:
It was telling on the question of whether you were really trying to use it beyond as a sort of snippet for something.

[01:05:04] Speaker 01:
This clearly is an insubstantial use under that.

[01:05:06] Speaker 01:
I mean, Bill Graham, they used the entire posters, the whole work.

[01:05:10] Speaker 01:
And still, they found that was insubstantial.

[01:05:12] Speaker 01:
It follows up, of course, that our use of the short clip with interstitial material is insubstantial.

[01:05:22] Speaker 01:
So absolutely, I think this case is an easier case to find transformative use than Bill Graham, because they used

[01:05:31] Speaker 01:
Quite a few, the entire posters, not attenuated at all.

[01:05:37] Speaker 01:
And again, the lack of substantiality, if you will, leads to the fact that there's no substitution and the use is transformative.

[01:05:47] Speaker 03:
What do you understand the Warhol decision to mean when it speaks of the Campbell nuance?

[01:05:55] Speaker 03:
What is your sense of what that means?

[01:06:00] Speaker 01:
I don't remember the context of those words, Your Honor.

[01:06:05] Speaker 01:
I apologize.

[01:06:07] Speaker 03:
Well, that's OK.

[01:06:09] Speaker 03:
I won't have you pursue it.

[01:06:10] Speaker 03:
But it comes up in connection with the principal opinion responding to the dissent and explaining what the dissent is not considering.

[01:06:23] Speaker 03:
And one thing that it purportedly is not considering is the, quote, Campbell nuance.

[01:06:28] Speaker 03:
And like I said, I don't want to belabor that or eat up your time.

[01:06:31] Speaker 03:
I can read, so I'll follow up on that.

[01:06:36] Speaker 03:
Go ahead.

[01:06:37] Speaker 01:
Okay.

[01:06:38] Speaker 01:
I also want to mention this bit about, well, it could have been licensed.

[01:06:46] Speaker 01:
This case has, I don't want to overstate it, but shorthand, it's got a bit of a Yoko Ono flavor.

[01:06:52] Speaker 01:
This isn't a situation where my clients knew about Tim Seppi.

[01:06:56] Speaker 01:
The only thing in the record is they asked him about film clips because he was helping provide them.

[01:07:02] Speaker 01:
And after he left the park, he said, oh, you'll have to talk to Joe.

[01:07:05] Speaker 01:
He didn't say, I own those film clips.

[01:07:07] Speaker 01:
any of those film clips were mine and later they asked him to do some work and he even offered to pay him a fee and he didn't say I'm going to pay so this is not a situation where that's in the record is that right it is in the record and so it's clear that it's not a situation where my clients knew that Tim Seppi took the funeral video and used it anyway they didn't they didn't in fact they probably I think they thought they licensed it from from

[01:07:33] Speaker 01:
from Joe Exotic, not that they had the license to clip, I didn't say, but in the abundance of caution, as they do in Hollywood.

[01:07:42] Speaker 01:
Finally, I think I heard Mr. Kenan say that, in fact,

[01:07:55] Speaker 01:
the use of the clip of the funeral video in the documentary was a broad use.

[01:08:00] Speaker 01:
Well, if that's so, this case is over because it's clear from Warhol that the majority thought a broad fair use is transformative in and of itself.

[01:08:11] Speaker 01:
And certainly there was a broad transformative use in Google versus Oracle.

[01:08:18] Speaker 01:
So I think

[01:08:23] Speaker 01:
Going back to concluding with Judge Hartz's comment, there's no question that the use of the excerpt from the funeral video had a further purpose in character.

[01:08:34] Speaker 01:
It added not only additional meaning in message, it created a new expressive work.

[01:08:42] Speaker 01:
And it couldn't possibly, neither the clip nor the documentary itself could possibly substitute for the original.

[01:08:50] Speaker 01:
Therefore, under the first factor, it highly transformed.

[01:08:54] Speaker 03:
Let me hear your response to something that's come up in this oral argument and the other about these YouTube reaction videos.

[01:09:02] Speaker 03:
And the idea was that in some sense, in that context,

[01:09:06] Speaker 03:
This lacked the notion of identification and targeting on that was present in the YouTube reaction videos.

[01:09:16] Speaker 03:
I may be butchering some of what Mr. Keenan said, but I mean, essentially the question that this is, it was allowable in that context, but it's not in, but you don't follow those same rules here and therefore the problem exists on fair use.

[01:09:30] Speaker 01:
Yeah, I'm not sure I understand the point because reaction videos seem to show the entire work.

[01:09:36] Speaker 01:
They're not necessarily commenting on the original because I understand that they're really commenting on the individuals who are doing the reacting.

[01:09:46] Speaker 01:
I will say that the argument that, well, this is commercial streaming and that's the use that should be addressed under Warhol.

[01:09:59] Speaker 01:
If that were the case, then Campbell would have come out the other way because in both works they were for

[01:10:04] Speaker 01:
for records and concerts and radio and in Google, the software were both for devices.

[01:10:13] Speaker 03:
That's a valid point.

[01:10:15] Speaker 03:
In the sense that you're drawing a distinction, I want to make sure I understand.

[01:10:19] Speaker 03:
I think I did hear Mr. Keenan speak of this as being a commercial streaming as being the use.

[01:10:27] Speaker 03:
I take it your position is that is not the use and what is the use?

[01:10:30] Speaker 03:
What is the challenge used to use Justice Gorsuch?

[01:10:33] Speaker 03:
terminology.

[01:10:35] Speaker 01:
Okay, as in Warhol, the challenge use was use of a photograph or an image of Prince for a magazine article about Prince.

[01:10:45] Speaker 03:
What is the challenge use here, I'm saying?

[01:10:48] Speaker 01:
Challenge use here is use of a brief excerpt from a funeral video to criticize Joe Exotic for the larger purpose of telling Joe Exotic's story, the tragedy that, you know, that is Joe Exotic and maybe more importantly, the people around him.

[01:11:09] Speaker 01:
That's the use, completely different from as the panel held views in the funeral video.

[01:11:15] Speaker 03:
All right.

[01:11:15] Speaker 03:
Judge Hart, you look like you want to ask a question.

[01:11:21] Speaker 00:
I'm sorry.

[01:11:22] Speaker 00:
I've been enjoying your questions all morning.

[01:11:26] Speaker 03:
All right.

[01:11:28] Speaker 03:
Council cannot say they were not heard.

[01:11:32] Speaker 03:
And so we will end at that.

[01:11:38] Speaker 03:
Thank you for your fine arguments and we are adjourned.