Landmark Decision Sets YouTube Fair Use Precedents

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YouTube Fair Use Dispute

Last year, two well-known YouTube content creators went to court over claims of copyright infringement.  In 2016, YouTuber Matt Hosseinzadeh, also known as “MattHossZone,” sued couple Ethan and Hila Klein, better known as “h3h3productions,” over claims of copyright infringement and defamation.  As discussed below this case set YouTube fair use precedent.

The dispute began when h3h3productions posted a YouTube video they had created that lampooned Hosseinzadeh using Hosseinzadeh’s own content.  In their defense, h3h3productions claimed that their video was not infringing because their use of Hosseinzadeh’s content was protected under fair use.

When the case got to court, both parties petitioned the court for summary judgment.  Earlier this week, District Judge Katherine B. Forrest found in favor of h3h3productions.  Forrest laid out her reasoning in a twenty-one page ruling that found h3h3productions’ content to be protectable under fair use because it could be considered commentary or criticism.  Forrest went further by saying that h3h3productions’ content could be likened to the type of critique that an instructor may use in a film studies class. As such, it constituted fair use.

YouTube Fair Use Analysis

Copyright Fair Use Elements

In finding in favor of h3h3productions, Judge Forrest examined each factor of fair use analysis: 1) purpose and character of the use; 2) the nature of the copyrighted work; 3) the amount and substantiality of the portion used in relation to the copyrighted work overall; and 4) the effect of the use upon the copyrighted content’s potential market or value.

Fair Use Analysis

As with any copyright fair use analysis, the court noted that no one, single factor in fair use analysis is dispositive.  Instead, in finding for fair use, courts have often centered their analysis around whether the allegedly-infringing work’s use of the copyrighted material is “transformative.”  By transformative, courts generally examine whether the new work alters the character, adds significant addition to, or changes the overall meaning or message of the copyrighted work.  For example, courts generally find that a mere repackaging or republishing of a copyrighted work does not constitute transformative use.

One of the most accepted readings into transformative work is allowing the use of copyrighted material for commentary or criticism.  Here, the court found that the first factor heavily supported h3h3productions’ claims of fair use because it fell under both criticism and/or comment.  In weighting the second factor, the court found in favor of the plaintiff because Hosseinzadeh’s works were entirely functional in nature, and as such, it weighed against a finding of fair use.  For the third factor, the court found it to be neutral.  While the court found that h3h3productions did use a substantial amount of the plaintiff’s work, the court held that it was it necessary to do so.  In other words, using a substantial amount of a copyrighted work when critiquing or commenting upon the work may be defensible under the fair use doctrine.  Lastly, the court found for the defendants in the fourth factor.  Specifically, the court held that h3h3productions’ video would not negatively impact the market for plaintiff because the nature of the videos was so different.  In other words, the critique offered by h3h3productions’ video could not be considered a market substitute for the fictional content of plaintiff’s work.

Takeaways for Fair Use Defense on YouTube

For those aforementioned reasons, the court granted summary judgment in its entirety for defendants, h3h3productions, thereby denying plaintiff’s motion in turn.  Online content creators have been long following this case, and it marks important precedent for such artists.  The court's analysis of the fair use factors potentially provides guidance to content creators wishing to use third-party copyrighted content for transformative purposes, but wish to fall within YouTube fair use principles.

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For more information on this topic, please visit our Copyright Infringement Defense service page, which is part of our Software & Copyrights Practice.

Klemchuk LLP is an Intellectual Property Law, Litigation, and Transactions law firm located in Dallas, Texas.The firm offers comprehensive legal services including litigation and enforcement of all forms of IP as well as registration and licensing of patents, trademarks, trade dress, and copyrights.  The firm also provides a wide range of technology, Internet, e-commerce, and business services including business planning, formation, and financing, mergers and acquisitions, business litigation, data privacy, and domain name dispute resolution.  The firm publishes the following blogs: Intellectual Property Law, Conversations with Innovators (interviews with thought leaders), Leaders in Law (discussions on timely law topics), and Culture Counts (thoughts on law firm culture and the business of the practice of law).