installation more efficient, the Sheriff’s Department installed the software on all department computers (6,007 in total), but limited access to the software to a number of user accounts less than the total licenses purchased. In rejecting the Sheriff Department’s fair use defense, the court did not explicitly consider first sale in its assessment, but focused instead on a few key characteristics: the use was not “transformative,”[1] the use did not generally advance “public knowledge,” or otherwise “enrich[] the general public through access to creative works,” and the use was considered commercial, largely because it was made in effort to save the expense of purchasing an authorized copy from the known vendor.[2]
More recently, in Disney Enterprises, Inc. v. VidAngel, Inc., Disney sued VidAngel over its streaming video service, which provided access to edited copies of Disney films. For each user, VidAngel would purchase a physical DVD on behalf of the user, which VidAngel then copied, edited and streamed to the user online. Like in Wall Data, the court did not consider how the principles of the first sale doctrine help establish the “purpose and character” of the use under fair use. VidAngel conceded that its use was commercial, and the court did not consider the use to be transformative. Like with Wall Data, the streams were provided for videos with known copyright owners who themselves license rights to competing streaming services.[3]
One way these cases are distinguished is just that the issue was not raised; except for ReDigi (where the issue was only obliquely argued), first sale and the purpose and character assessment were not raised by the litigants or addressed by the court. The argument was not presented. Another, more significant distinguishing factor is that all three cases involved commercial uses, both in the specific application and in connection with a broader, functioning market place for the works used. This brings us to the second characteristic of CDL that we believe tilts the first factor analysis decidedly in favor of fair use: Libraries engaging in CDL are doing so for non-commercial research and learning purposes.
- 2.CDL’s Non-commercial Research and Learning Purpose
Unlike commercial resale or streaming markets, library use of CDL is non-commercial and designed to promote public benefits by facilitating research and learning. The fair use statute explicitly instructs courts to look at “whether such
