Report on Orphan Works

Overview
By conducting stakeholder discussions and reviewing extensive submissions of comments, the U.S. Copyright Office’s Report on Orphan Works considers the landscape surrounding orphan works.

At the outset, it sets forth what were not considered to be orphan work problems, namely, situations where a prospective user contacted the owner but did not receive permission to use the work. The analysis also narrows the situations in which it views orphan works as presenting an insurmountable problem to prospective users. It delineates several provisions of the copyright law that might permit use of an orphan work (or any copyrighted work) absent an owner’s permission: and codified at 17 U.S.C. §102(b), prohibits copyright protection for ideas, procedures, concepts, etc. that may otherwise be embodied in a copyright-protected work. This jurisdictional limitation on copyright protection may be especially useful to prospective users of works of non-fiction, and “utilitarian” works like computer programs, textbooks, manuals, etc.
 * The “idea/expression” dichotomy, rooted in the First Amendment

copyright-protected work for purposes such as criticism, comment, news reporting, teaching, scholarship, or research.
 * Fair use, codified at 17 U.S.C. §107, permits limited use of

preservation, education, and religious activities.
 * Other express exemptions in the Copyright Act at §§108, 110, and 117 allow specified uses of copyrighted works associated with

The Report identifies many obstacles to identifying and locating copyright owners and assigns general categories of uses that appear to be most impacted by orphan works, namely, uses by “subsequent creators” who may create a derivative commercial work incorporating the orphan work; “large scale access uses” by institutions such as libraries that make available a wide body of work to the public; “enthusiast” uses by individuals who have an interest in a particular work, subject, or artist; and “private” uses, the most common illustration being someone who wishes to reproduce a family photograph or make a potentially infringing use of obsolete or orphaned computer software.

The Report explains that the 1976 Copyright Act arguably exacerbated the orphan works problem by abandoning formalities such as renewal registration, and why the international copyright regime to which the United States is a signatory both precludes a re-adoption of formalities and limits the scope of permissible exemptions to the copyright holders’ rights.

The study reviews solutions proposed by those involved in the orphan works dialogue. It groups and considers them in four categories, described in the Report as follows:


 * Solutions that already exist under current law and practice. These were usually noted only in passing; commenters (even commenters opposed to any orphan works provision) did not take the position that the existing law is sufficient to solve the orphan works problem.


 * Non-legislative solutions. An example of a solution in this category is a proposal for improved databases for locating owners of works. These solutions were also usually noted only in passing, and were not advanced as sufficient to fix the problem.


 * Legislative solutions that involve a limitation on remedies when a user uses an orphan work. The most substantive comments fell into this category, and most of the comments by professional organizations or academics fell into this category.


 * Other legislative solutions. Examples of proposed solutions in this category are deeming all orphaned works to be in the public domain, or changing the tax or bankruptcy codes to reduce the factors that cause orphan works to come into existence in the first place.

It also considers several of the solutions proposed. For example, one approach might be that utilized by the Canadian Copyright Board, which reviews applications for use of orphan works and approves them prior to use. This method receives support by some for the certainty that it provides and opposition by others who view it as administratively cumbersome, expensive, and largely ineffective in promoting actual use of orphan works.

The Copyright Office’s Recommendation
The Report concludes that the orphan work problem, though difficult to describe and quantify, is indeed real. Though some instances of non-infringing use of such works may be effected under other sections of the law, there are still many situations in which prospective users lack guidance on whether and how they may use orphan works, and authority to do so.

The Report recommends statutory language to remedy the orphan works problem, with a detailed supporting rationale. The proposal takes the approach of limiting remedies for the copyright owner if a user satisfies new statutory requirements for use of an orphan work. The proposed language would add a new Section 514 under chapter 5 of the Copyright Act, dealing with copyright infringement and remedies. One who uses an orphan work would be required to have performed “a good faith, reasonably diligent search” to identify the copyright holder and provide “attribution to the author and copyright owner of the work, if possible and appropriate.”

If the user of a orphan work who has satisfied the search and attribution requirements is subsequently sued by the rights’ holder for infringement, the owner would be limited to “reasonable compensation for the use of the infringed work.”

When the infringement is made without commercial advantage and the user ceases infringement promptly after receiving notice thereof, no monetary relief would be available. Injunctive relief, i.e., prohibiting continuing use of the infringing work, would not be available when the orphan work is incorporated into a derivative work that uses the protected work in a transformative manner, provided that the infringer pays reasonable compensation to the copyright owner and provides attribution to the protected work as reasonable. In all other cases, the court may impose injunctive relief to prevent the continuing infringement, but would be directed to consider the harm that relief would cause the infringer who has complied with orphan works requirements in making the infringing use.

The proposed language specifies that nothing in its provisions would affect other rights, limitations or defenses to copyright infringement, including fair use. The provision would sunset ten years after enactment.

The goal of the proposal is to promote the good-faith use of true orphan works by limiting damages available in the event that an owner appears and the user is subsequently charged with infringement. The proposed solution attempts to balance several competing interests:

Notice
Some content users complain about the lack of easy-to-use comprehensive sources of information identifying copyright owners. Easier access to ownership information would minimize mistakes by users in calculating whether a work is actually an orphan work. But a solution that imposes notice or identification requirements on rights’ holders as a condition of protecting their copyright would violate both the Copyright Act and international treaty obligations if its effect was to reinstate formality requirements. While it is obviously in the interest of copyright holders to make the public aware of ownership, the proposal would not impose additional regulatory burdens on owners, or the government, by establishing new reporting mechanisms.

Certainty versus Flexibility
Many who promote access to orphan works seek a system that best assures potential users that they will be exempt from copyright infringement liability prior to usage. But any proposed orphan work exemption will potentially affect a vast array of industries and media, such as movies, music, books, and photographs. There are different physical characteristics, traditions, standards, and business practices which affect the ease of researching ownership and obtaining permissions for any given medium. Likewise, different users have different goals, such as nonprofit versus commercial usage.

The approach suggested is in many ways comparable to copyright’s well-known “fair use” exemption in its breadth and flexibility. Like fair use, the orphan work exemption would be a defense to copyright infringement. The proposal takes a case-by-case approach that would give a court discretion to consider behavior by both the user and claimant. Did the user perform a “reasonably diligent search” with proper attribution? Did the claimant decline to accept “reasonable compensation” for the identified infringement, which, under the proposal, becomes, in effect, a statutory cap on relief available?

Arguably, it would share many of the strengths and weaknesses of fair use. Among the former is flexibility to accommodate a broad range of media and situations. Among the latter may be difficulty assessing the likelihood of the success of the defense, and costs that may be unintentionally incurred.

Standards
The proposal does not define terms such as “reasonably diligent search,” although much discussion is provided. Best practices for media-specific searches are likely to evolve over time through collaborative efforts and judicial interpretation. Likewise the notion of reasonable compensation is a fluid one, another factor that is viewed as advantageous or non-advantageous by different parties.

Critics among users point to difficulties when the amount of liability exposure is uncertain. Critics among owners worry that courts interpreting the term may depress the value of “reasonable compensation,” by valuing it at what the user proposes to pay absent negotiations. They fear that it may amount to a statutory royalty rate.

Damages
Because the proffered exemption is a defense to copyright infringement, the costs of litigation were considered in the discussion. Indeed, the Report spells out at great length the concerns expressed by both content owners and users on the burdens imposed by having to litigate a claim of or a defense to infringement. Users argue that the prospect of statutory damages has a chilling effect on their use of valuable historic material, for example, documentary film footage. But many owners assert that a limitation on the remedies for infringement would make enforcement impracticable. They simply cannot enforce their copyright if the enforcement costs more than recoverable damages.

Visual Arts
Photography and visual arts pose special challenges for copyright ownership identification generally, and, consequently, in connection with orphan works. By their very nature, they are difficult to source. Critics are concerned that the orphan work proposal would affect illustrations and photographs disproportionately because images are commonly published, by tradition or business practice, without identifying information. If a visual representation contains identifying information, it may be, and often is, easily removed. Verbal registries cannot adequately describe visual representations, e.g., “nine abstract dogs in an abstract garden.” Visual registries may contain prohibitively voluminous entries and be too difficult to search.

They fear enactment of the orphan works proposal might interfere with commercial markets for visual work; that it could have the effect of “legalizing” infringement where ever the rights’ holder cannot be identified or located; that it will put too great a burden on rights’ holders to exercise diligence in monitoring infringing use; and that limiting recoverable damages will make enforcement actions economically unfeasible. The de facto result, they contend, would deprive visual artists of meaningful copyright protection.