Caseflicks

Court of Appeals for the Fourth Circuit • 1997

Donna R. Hotaling William W. Hotaling, Jr. James P. Maher Dorothy C. Sherwood v. Church of Jesus Christ of Latter-Day Saints

118 F.3d 199 | 1997 U.S. App. LEXIS 16046

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Takeaway

In short, this case holds that a library may infringe the distribution right by cataloging and publicly making available an unauthorized copy, even without records proving that a specific patron used it.

Background

The Hotalings compiled and copyrighted genealogical research materials, which were published and marketed in microfiche form. Between 1985 and 1989, the Church acquired one legitimate copy for its main Salt Lake City library. Before 1992, however, the Church made unauthorized microfiche copies and sent them to branch libraries around the country. After Donna Hotaling complained in 1991, the Church recalled and destroyed many copies.

In 1994, Hotaling found a paper copy at the Rhode Island branch library, apparently made and left behind by a patron. In 1995, she found a purple-background microfiche copy—identifying it as a Church-made copy—in the main Salt Lake City library. It was listed in the card file and available to the public. The Church acknowledged that it retained this copy after inadvertently destroying the legitimate copy it had purchased.

The Hotalings sued in August 1995. Because copyright claims have a three-year limitations period, claims based on the Church's copying and initial distribution before 1992 were untimely. The district court nevertheless granted summary judgment for the Church on the ground that the Hotalings lacked evidence of copying or actual public distribution during the limitations period. The Hotalings appealed.

Issues

Issue #1

Whether a library distributes an unauthorized copyrighted work under 17 U.S.C. § 106(3) when it places the work in its collection, catalogs it, and makes it available to the public, without proof that a particular patron used it.

Holding

Yes. A library completes a public distribution when it adds an unauthorized copy to its collection, lists it in its catalog or index, and makes it available to the borrowing or browsing public.

Reasoning

Section 106(3) gives a copyright owner the exclusive right to distribute copies to the public by sale, transfer, rental, lease, or lending. Although the first-sale doctrine permits a library to lend a lawfully acquired copy, that doctrine does not authorize the distribution of an unlawfully made copy.

The court treated cataloging and public availability as the functional completion of a library's distribution. Once a work is in the collection, indexed, and available for public consultation, any member of the public may come to the library and use it; no additional act by the library is needed to make the work available to the public.

Requiring proof of a particular patron's use would unfairly burden copyright owners where a library does not keep use records. The court reasoned that a library should not benefit from failing to document public use of infringing materials, nor should that omission prevent an owner from proving infringement.

Issue #2

Whether the record created a genuine issue of material fact that an unauthorized copy was publicly distributed within the three-year limitations period.

Holding

Yes, as to the Church's main Salt Lake City library copy; no, as to the Rhode Island paper copy and the six copies returned by branch libraries in 1993.

Reasoning

Donna Hotaling testified that, in 1995, the Salt Lake City library held a purple-background microfiche in its collection, listed it in its card file, and made it available to the public. Since the Church admitted that its remaining copy was Church-made rather than the originally acquired legitimate copy, a reasonable jury could find that this was an unauthorized copy publicly distributed within the limitations period.

The Rhode Island paper copy did not supply comparable evidence. The unrebutted record showed that a patron had made and left the copy behind, and there was no evidence that library staff had added it to the collection or cataloged it for public use.

Nor did the fact that six branch libraries returned copies in 1993 establish timely public distribution. The record did not show where those copies had been located, whether they were in the libraries' collections, or whether they had been accessible to patrons.

Issue #3

Whether the Hotalings' knowledge before 1992 that the Church had made and placed unauthorized copies in its libraries barred a claim based on the main library's continued public availability of a copy in 1995.

Holding

No. Each infringing act gives rise to a distinct claim, and a timely claim may be based on distribution occurring within three years before suit even if the copyright owner knew of related earlier infringement.

Reasoning

The court distinguished the time-barred 1991 copying and initial distribution from later public distribution. The earlier acts accrued when Hotaling learned of them in 1991, but the continued public distribution of the Salt Lake City copy was a separate alleged infringement.

Under the court's distribution rule, the library distributed the copy as late as 1995 by keeping it in the collection, cataloging it, and making it available to the public. That alleged act fell within three years of the August 1995 complaint and therefore provided a timely basis for suit.

The court added that the Church's contrary approach would create the same proof problem rejected earlier: if actual patron use were necessary, a copyright owner could be defeated merely because the allegedly infringing library did not retain records of use.

Issue #4

Whether the Church's remaining copy was authorized as a replacement library copy under 17 U.S.C. § 108(c).

Holding

The court did not decide the question and remanded for the district court to determine it in the first instance.

Reasoning

Section 108(c) may permit a library to make a replacement copy of a published work, but only when statutory conditions are met, including a reasonable determination that an unused replacement cannot be obtained at a fair price. The library also must comply with the statute's other applicable requirements.

Because the district court had disposed of the case on limitations grounds, it had not considered whether the Church satisfied § 108. The court of appeals therefore declined to resolve that fact- and statute-dependent defense on appeal.

On remand, the district court was instructed to dismiss the action if the Church complied with § 108. If it did not, the court was to proceed with the remaining issues, including the validity of the copyrights.

Dissents

Judge Hall

Reasoning

Judge Hall read § 106(3) more narrowly. In his view, the statute protects against distribution by sale, transfer of ownership, rental, lease, or lending, and merely making a work available for free on a library's premises does not fit any of those categories.

He considered lending the only potentially relevant statutory term, but concluded that a research library does not lend a work simply because a patron consults it on site. Because the materials could not be checked out for off-premises use, he would describe a patron as having used or looked at the work, not as having borrowed it.

Judge Hall also emphasized that the Hotalings offered no proof that anyone actually used an infringing copy during the limitations period. Although he sympathized with the majority's concern that public on-site access to an unauthorized copy should perhaps be infringing, he concluded that existing copyright law did not make it an actionable distribution and would have affirmed summary judgment for the Church.