The Second Circuit Court of Appeals ruled today that Google's digitization of books for use in its Google Books and Google Books Library Project is not copyright infringement. The Court also ruled that providing a public online search for the digitized books is noninfringing.

Authors Guild v. Google, Inc. was filed in 2005 as a putative class action by the Authors Guild on behalf of similarly situated rights-owning authors. The Authors Guild claimed that Google’s creation of an online search engine that allows the public to search for books and displays limited "snippets" from the books violated the authors' copyrights. Google argued that the use was a noninfringing fair use under the Copyright Act.

The decision is significant in part because it was written by Judge Pierre Leval, who in 1990 wrote the Harvard Law Review article on fair use that introduced the concept of "transformativeness" as a way to assess whether a use was fair or infringing. In the 25 years since its introduction, transformativeness has led to much discussion and controversy, and confusing decisions. Judge Leval went to great lengths in this new decision to clarify the meaning of the standard and provide more guidance on the often-tricky fair use determination. A few highlights follow:

The purpose of copyright is not to reward authors. The purpose is to "expand public knowledge and understanding." Giving authors exclusive rights in their works for the period of copyright is a means to an end—it motivates them to create things that contribute to our culture. "While authors are undoubtedly important intended beneficiaries of copyright, the ultimate, primary intended beneficiary is the public, whose access to knowledge copyright seeks to advance by providing rewards for authorship."

Fair use is therefore an important limit on authors' copyrights because it promotes the development of culture.

The concept of transformativeness does not mean that any and all changes to a copyrighted work will be considered a fair use. The user of a copyrighted work must have a justification for the use.

The Second Circuit acknowledged the potential conflict that arises when transformativeness is the hallmark of a fair use but transformation is part of the definition of derivative works. Copyright owners have the exclusive right to make derivative works, which the statute defines as "translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgement, condensation, and any other form in which a work may be.... transformed."

So when you want to use a copyrighted work, are you infringing by transforming it and creating a derivative work? Or is your use a transformative use that qualifies as a fair use? The transformation involved in the Google Books search engine, because it displays only a small portion of each book and because it makes all the world's books searchable by everyone, is a transformative fair use, concluded the Second Circuit. The public good is served by the search engine, which allows people all over the world to learn that a book on a particular topic exists, but stops short of providing them with copies of such books. This is the necessary justification for the use.

A commercial use can be a fair use.

The Second Circuit pointed out that the Supreme Court's dictum in Sony Corporation v. Universal City Studios, Inc. that every commercial use of copyrighted material is presumptively unfair was, in fact, "enormously overstated." Google's undoubted profit motive in creating and maintaining the search engine does not automatically make Google an infringer. If a use is indeed transformative, an underlying profit motivation does not disqualify it from fair use status.