Excuse and Justification in the Law of Fair Use: Commodification and Market Perspectives
52 Pages Posted: 13 Dec 2001
Date Written: January 2002
This article suggests that that from a perspective of market-based economics, the various defenses to property torts (including the tort of copyright infringement) can be divided into two categories. The two types correspond in a rough but useful way to the categories of defense in criminal law known respectively as "excuse" and "justification." "Excuse" connotes a response that the law allows but does not want emulated. Therefore, from a market perspective, "excuse" can be used to denote behavior that the law allows to bypass the market because of particular circumstances, but which we would prefer to occur through a consensual market transaction. A case of "excuse," then, would arise when economic norms remain the appropriate governing criteria, but the market has temporarily become an unreliable mode of increasing social welfare because of a failure of perfect market conditions (information is imperfect, significant transaction costs are present, and so forth). In such a case, if the transaction cost problem or other market malfunction were eliminated, the court would want the defendant to proceed through the market. At best, therefore, the defendant's market bypass is "excused." By contrast, the notion of "justification" connotes behavior that, even absent special circumstances, we would be willing to see emulated. Market bypass can be "justified" when significant noneconomic norms or noncommodifiable interests give rise to a court's doubts about the reliability of the market as a mode of achieving social goals. Justification occurs when, even if market conditions were perfect, it would be normatively appropriate for the defendant to proceed outside the market's ordinary process of consent and payment.
The article argues that excuse and justification should be applied separately to three distinct levels of inquiry: (1) the appropriateness of the defendant's behavior in using the plaintiff's property, (2) the appropriateness of the defendant's having failed to obtain the property owner's consent, and (3) the appropriateness of the defendant's having failed to pay compensation.
The article also suggests, inter alia, that cases of "excuse" are curable in a way that cases of "justification" are not. It also suggests that a property owner who can show that the defendant's behavior significantly harms him is likely to be able to defeat claims of "excuse," while claims of "justification" are likely to be more robust against showings of plaintiff harm.
For an example of "excuse" in copyright, consider cases where transaction costs prevent otherwise-desirable negotiations between copyright owners and users, e.g., where individual copiers are making photocopies of articles, or are making videocassette recordings of television programs at home. A court might well order "fair use" as the only practicable way to preserve the socially-valuable copying behavior. If so, however, the defendants? failure of payment and consent is only "excused." When transaction costs decrease in such a case, the court might instead enforce the copyright and expect consensual licensing to evolve between the copyists and the copyright owners. "Excuse," therefore, suggests only a temporary market bypass.
Defenses falling within the other category, "justification," appear where the market's unreliability arises from the market's inherent limitations. Curing a temporary market imperfection would not eliminate the defense.
As an example of "justification" in copyright law, consider utilizing "fair use" as a way to escape private censorship. The ongoing litigation over THE WIND DONE GONE, a novel by Alice Randall, provides a good illustration. Currently being sold as an 'unauthorized parody' of the famous GONE WITH THE WIND ("GWTW"), the GWTW copyright owners are suing to take Randall's novel off the bookstore shelves.
Randall's book would never have been authorized by the GWTW copyright owners. In THE WIND DONE GONE, Randall continues the story of GWTW from an Afro-American perspective, and uses elements which the GWTW copyright owners had forbidden other, potential authors of sequels to use - most notably, miscegenation. Randall's narrator and main character is the newly imagined daughter of a union between Scarlett O'Hara's father and the character known as "Mammy." Randall utilizes copyrightable elements from the target work, GWTW, in order to free herself and others from that work's harmful effects.
In cases like Randall's, we might well feel the target work copyright owner should have no control over the new work even if the market were frictionless and otherwise perfect. If so, then regardless of the presence or absence of perfect market conditions, it is "justifiable" for the parodist or critic to proceed without obtaining consent. The defendant's behavior (here, writing and selling a 'derivative work' based on the work being criticized) is justified as well.
Whether lack of compensation is also "justified" in cases of parody and other potential fair uses needs to be separately considered. The article acknowledges that turning to monetary remedies (a form of judicially-imposed compulsory license) holds the promise of simultaneously furthering the goals of both incentives and free speech. Nevertheless, the article suggests that despite its surface attractions, such 'liability rule' solutions have some under-appreciated dangers.
JEL Classification: K110, K130, K11, K10
Suggested Citation: Suggested Citation