Copyright

Steinberg v. Columbia Pictures Industries, INC., 663 F. Supp. 706 (S.D.N.Y. 1987) wrote: [17] Defendants' access to plaintiff's illustration is established beyond peradventure. Therefore, the sole issue remaining with respect to liability is whether there is such substantial similarity between the copyrighted and accused works as to establish a violation of plaintiff's copyright. The central issue of "substantial similarity," which can be considered a close question of fact, may also validly be decided as a question of law. Berkic v. Crichton, 761 F.2d 1289, 1292 (9th Cir. 1985), citing Sid & Marty Krofft Television Productions, Inc. v. McDonald's Corp., 562 F.2d 1157 (9th Cir. 1977).

[18] "Substantial similarity" is an elusive concept. This circuit has recently recognized that

the "substantial similarity" that supports an inference of copying sufficient to establish infringement of a copyright is not a concept familiar to the public at large. It is a term to be used in a courtroom to strike a delicate balance between the protection to which authors are entitled under an act of Congress and the freedom that exists for all others to create their works outside the area protected by infringement.

Warner Bros., 720 F.2d at 245.

[19] The definition of "substantial similarity" in this circuit is "whether an average lay observer would recognize the alleged copy as having been appropriated from the copyrighted work." Ideal Toy Corp. v. Fab-Lu Ltd., 360 F.2d 1021, 1022 (2d Cir. 1966); Silverman v. CBS, Inc., 632 F. Supp. at 1351-52. A plaintiff need no longer meet the severe "ordinary observer" test established by Judge Learned Hand in Peter Pan Fabrics, Inc. v. Martin Weiner Corp., 274 F.2d 487 (2d Cir. 1960). Uneeda Doll Co., Inc. v. Regent Baby Products Corp., 355 F. Supp. 438, 450 (E.D.N.Y. 1972). Under Judge Hand's formulation, there would be substantial similarity only where "the ordinary observer, unless he set out to detect the disparities, would be disposed to overlook them, and regard their aesthetic appeal as the same." 274 F.2d at 489.

[20] Moreover, it is now recognized that "the copying need not be of every detail so long as the copy is substantially similar to the copyrighted work." Comptone Co. v. Rayex Corp., 251 F.2d 487, 488 (2d Cir. 1958). See also Durham Industries, 630 F.2d at 911-12; Novelty Textile Mills, 558 F.2d at 1092-93.

Anderson v. Stallone, 11 USPQ2D 1161 (C.D. Cal. 1989) wrote: IV. Defendants Are Entitled To Summary Judgment On Anderson's Copyright Infringement Claims

This Court finds that the" defendants are entitled to summary judgment on plaintiff's copyright infringement claims on two separate grounds. First, Anderson's treatment is an infringing work that is not entitled to copyright protection. Second, Rocky IV is not substantially similar to Anderson's treatment, and no reasonable jury could find that Rocky IV is a picturization of Anderson's script.

A. Defendants Are Entitled To Summary Judgment Because Anderson's Treatment Is An Infringing Work That Is Not Entitled To Copyright Protection

The Court finds that Anderson's treatment is not entitled to copyright protection. This finding is based upon the following determinations that will be delineated further below: (a) the Rocky characters developed in Rocky I, [*16] II and III constitute expression protected by copyright independent from the story in which they are contained; (b) Anderson's treatment appropriated these characters and created a derivative work based upon these characters without Stallone's permission in violation of Section 106(2); (c) no part of Anderson's treatment is entitled to copyright protection as his work is pervaded by the characters of the first three Rocky movies that are afforded copyright protection.

1. Visually Depicted Characters Can Be Granted Copyright Protection

The precise legal standard this Court should apply in determining when a character may be afforded copyright protection is fraught with uncertainty. The Second Circuit has followed Judge Learned Hand's opinion in Nichols v. Universal Pictures, 45 F.2d 119 (2d. Cir. 1930), cert. denied, 282 U.S. 902 (1931). Judge Hand set forth a test, simple in theory but elusive in application, to determine when a character should be granted copyright protection. Essentially, under this test, copyright protection is granted to a character if it is developed with enough specificity so as to constitute protectable expression. Id. at 121.

This circuit originally [*17] created a more rigorous test for granting copyright protection to characters. In Warner Bros. Pictures, Inc. v. Columbia Broadcasting System, Inc., (hereinafter the "Sam Spade" opinion) this circuit held that the literary character Sam Spade was not copyrightable, opining that a character could not be granted copyright protection unless it "constituted the story being told". 216 F.2d 945, 950 (9th Cir. 1954). The Sam Spade case has not been explicitly overruled by this circuit and its requirement that a character "constitute the story being told" appears to greatly circumscribe the protection of characters in this circuit.

Subsequent decisions in the Ninth Circuit cast doubt on the reasoning and implicitly limit the holding of the Sam Spade case. In Walt Disney Productions v. Air Pirates, this circuit held that several Disney comic characters were protected by copyright. 581 F.2d 751, 755 (9th Cir. 1978). In doing so the Court of Appeals reasoned that because "comic book characters . . . are distinguishable from literary characters, the Warner Bros language does not preclude protection of Disney's characters." Id. Air Pirates can be interpreted as either attempting [*18] to harmonize granting copyright protection to graphic characters with the "story being told" test enunciated in the Sam Spade case or narrowing the "story being told" test to characters in literary works. If Air Pirates is construed as holding that the graphic characters in question constituted the story being told, it does little to alter the Sam Spade opinion. However, it is equally as plausible to interpret Air Pirates as applying a less stringent test for protectability of graphic characters.

Professor Nimmer has adopted the latter reading as he interprets Air Pirates as limiting the story being told requirement to word portraits. 1 M. Nimmer, THE LAW OF COPYRIGHT, § 2-12, pg. 2-176 (1988). Further, Professor Nimmer finds that the reasoning of the Sam Spade case is undermined by the Air Pirates opinion, even as it relates to word portraits. Id. This is true because the use of a less stringent test for protection of characters in the graphic medium casts doubt on the vitality of the more stringent story being told test for graphic characters. As a practical matter, a graphically depicted character is much more likely than a literary character to be fleshed out [*19] in sufficient detail so as to warrant copyright protection. But this fact does not warrant the creation of separate analytical paradigms for protection of characters in the two mediums.

This circuit's most recent decision on the issue of copyrightability of characters, Olson v. National Broadcasting Corporation, 855 F.2d 1446 (9th Cir. 1988) does little to clarify the uncertainties in this circuit as to how the Air Pirates decision effects the continued viability of the Sam Spade test. In Olson, the Court of Appeals cited with approval the Sam Spade "story being told test" and declined to characterize this language as dicta. Id. at 1451-52 n. 6. The Court then cited Air Pirates along with Second Circuit precedent and "recognize[d] that cases subsequent to Warner Bros [Sam Spade] have allowed copyright protection for characters who are especially distinctive." Id. at 1452. Olson also stated definitively that "copyright protection may be afforded to characters visually depicted in a television series or in a movie." Id. But later in the opinion, the court in Olson distanced itself from the character delineation test that these cases employed, [*20] referring to it as "the more lenient standards adopted elsewhere". Id.

In an implicit acknowledgment of the unsettled state of the law, in considering the characters at issue in Olson, the circuit court evaluates the characters in the suit under both tests. Id. at 1452-53.

2. The Rocky Characters Are Entitled To Copyright Protection As A Matter Of Law

Olson's evaluation of literary characters is clearly distinguishable from the visually depicted characters of the first three Rocky movies for which the defendant seeks protection here. Thus, the more restrictive "story being told test" is inapplicable to the facts of this case. Air Pirates, 581 F.2d at 755, 1 M. Nimmer, § 2-12, pg 2-176. However, out of an abundance of caution this Court will determine the protectability of the Rocky characters under both tests. As shown below, the Rocky characters are protected from bodily appropriation under either standard.

The Rocky characters are one of the most highly delineated group of characters in modern American cinema. The physical and emotional characteristics of Rocky Balboa and the other characters were set forth in tremendous detail in the three Rocky movies before [*21] Anderson appropriated the characters for his treatment. The interrelationships and development of Rocky, Adrian, Apollo Creed, Clubber Lang, and Paulie are central to all three movies. Rocky Balboa is such a highly delineated character that his name is the title of all four of the Rocky movies and his character has become identified with specific character traits ranging from his speaking mannerisms to his physical characteristics. This Court has no difficulty ruling as a matter of law that the Rocky characters are delineated so extensively that they are protected from bodily appropriation when taken as a group and transposed into a sequel by another author. Plaintiff has not and cannot put before this Court any evidence to rebut the defendants' showing that Rocky characters are so highly delineated that they warrant copyright protection.

Plaintiff's unsupported assertions that Rocky is merely a stock character, made in the face of voluminous evidence that the Rocky characters are copyrightable, do not bar this Court from granting summary judgment on this issue. See Anderson v. Liberty Lobby, 477 U.S. 242, 247-48 (1986) ("the mere existence of some alleged factual dispute between [*22] the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.") (emphasis in original). If any group of movie characters is protected by copyright, surely the Rocky characters are protected from bodily appropriation into a sequel which merely builds on the relationships and characteristics which these characters developed in the first three Rocky movies. No reasonable jury could find otherwise.

This Court need not and does not reach the issue of whether any single character alone, apart from Rocky, is delineated with enough specificity so as to garner copyright protection. Nor does the Court reach the issue of whether these characters are protected from less than bodily appropriation. See I M. Nimmer, § 2.12, pg. 2-171 (copyrightability of characters is "more properly framed as relating to the degree of substantial similarity required to constitute infringement rather than in terms of copyrightability per se")

This Court also finds that the Rocky characters were so highly developed and central to the three movies made before Anderson's treatment that they "constituted the story [*23] being told". All three Rocky movies focused on the development and relationships of the various characters. The movies did not revolve around intricate plots or story lines. Instead, the focus of these movies was the development of the Rocky characters. The same evidence which supports the finding of delineation above is so extensive that it also warrants a finding that the Rocky characters - Rocky, Adrian, Apollo Creed, Clubber Lang, and Paulie- "constituted the story being told" in the first three Rocky movies.

3. Anderson's Work is An Unauthorized Derivative Work

Under 17 U.S.C. section 106(2), the holder of a copyright has he exclusive right to prepare derivative works based upon his copyrighted work. In this circuit a work is derivative "only if it would be considered an infringing work if the material which it had derived from a prior work had been taken without the consent of the copyright proprietor of the prior work." Litchfield v. Spielberg, 736 F.2d 1352, 1354 (9th Cir. 1984) (emphasis in original), citing United States v. Taxe, 540 F.2d 961, 965 n. 2 (9th Cir. 1976). This Court must now examine whether Anderson's treatment is an unauthorized derivative work [*24] under this standard.

Usually a court would be required to undertake the extensive comparisons under the Krofft substantial similarity test to determine whether Anderson's work is a derivative work. See I M. Nimmer, § 3.01 at 3-3; pgs. 25-28 supra. However, in this case, Anderson has bodily appropriated the Rocky characters in his treatment. This Court need not determine whether the characters in Anderson's treatment are substantially similar to Stallone's characters, as it is uncontroverted that the characters were lifted lock, stock, and barrel from the prior Rocky movies. Anderson retained the names, relationships and built on the experiences of these characters from the three prior Rocky movies. 1 M. Nimmer, § 2.12 at 2-177 (copying names of characters is highly probative evidence of infringement). His characters are not merely substantially similar to Stallone's, they are Stallone's characters. As Professor Nimmer stated, "Where there is literal similarity . . . . t is not necessary to determine the level of abstraction at which similarity ceases to consist of an 'expression of ideas' since literal similarity by definition is always a similarity as to the expression [*25] of ideas." 3 M. Nimmer, § 13.03[3], pg. 13-35. Anderson's bodily appropriation of these characters infringes upon the protected expression in the Rocky characters and renders his work an unauthorized derivative work. 1 Nimmer, § 2.12 at 2-171. By bodily appropriating the significant elements of protected expression in the Rocky characters, Anderson has copied protected expression and his treatment infringes on Stallone's copyrighted work.

4. Since Anderson's Work Is An Unauthorized Derivative Work, No Part Of The Treatment Can Be Granted Copyright Protection

Stallone owns the copyrights for the first three Rocky movies. Under 17 U.S.C. section 106(2), he has the exclusive right to prepare derivative works based on these copyrighted works. This Court has determined that Anderson's treatment is an unauthorized derivative work. Thus, Anderson has infringed upon Stallone's copyright. See 17 U.S.C. section 501(a).
...
The case law interpreting section 103(a) also supports the conclusion that generally no part of an infringing derivative work should be granted copyright protection. In Eden Toys, Inc. v. Florelee Undergarment Co., the circuit court dealt primarily with the question of whether an authorized derivative work contained sufficient originality to gain copyright protection. 697 F.2d 27, 34-35 (2d. Cir. 1982). However, in [*30] dicta the court opined on what result would be warranted if the derivative work had been made without the permission of the original author. The Court cited to the aforementioned passages from Professor Nimmer's treatise and the House Report and assumed without discussion that the "derivative copyrights would be invalid, since the preexisting illustration used without permission would tend to pervade the entire work" Id. at 34 n.6. In Gracen v. Bradford, the Seventh Circuit also dealt primarily with whether plaintiff's derivative work had sufficient originality to comply with requirements of section 103. 798 F.2d 300, 302-303 (7th Cir. 1983). Gracen also discussed the issue of the copyrightability of an unauthorized derivative work. The Court stated "if Miss Gracen had no authority to make derivative works from the movie, she could not copyright the painting and drawings, and she infringed MGM's copyright by displaying them publicly." Id. at 303. Once again, the Circuit court assumed that no part of an unlawful derivative work could be copyrighted.

Plaintiff has written a treatment which is an unauthorized derivative work. This treatment infringes upon Stallone's [*31] copyrights and his exclusive right to prepare derivative works which are based upon these movies. 17 U.S.C. § 106(2). Section 103(a) was not intended to arm an infringer and limit the applicability of section 106(2) on unified derivative works. As the House Report and Professor Nimmer's treatise explain, 103(a) was not intended to apply to derivative works and most certainly was not an attempt to modify section 106(2). Section 103(a) allows an author whose authorship essentially is the arrangement or ordering of several independent works to keep the copyright for his arrangement even if one of the underlying works he arranged is found to be used unlawfully. The infringing portion would be easily severable and the scope of the compilation author's own work would be easily ascertainable. Even if this Court were to interpret section 103(a) as allowing an author of an infringing derivative work to sue third parties based on the non-infringing portions of his work, section 106(2) most certainly precludes the author of an unauthorized infringing derivative work from suing the author of the work which he has already infringed. Thus, the Court HOLDS that the defendants are entitled to summary [*32] judgment on plaintiff's copyright claims as the plaintiff cannot gain copyright protection for any portion of his work under section 103(a). In addition, Anderson is precluded by section 106(2) from bringing an action for copyright infringement against Stallone and the other defendants.

Rogers v. Koons, 960 F. 2d 301 wrote:
24
Further, even were such direct evidence of copying unavailable, the district court's decision could be upheld in this case on the basis that defendant Koons' access to the copyrighted work is conceded, and the accused work is so substantially similar to the copyrighted work that reasonable jurors could not differ on this issue. See Warner Brothers, Inc. v. American Broadcasting Cos., Inc., 654 F.2d 204, 207 (2d Cir.1981).

25
Substantial similarity does not require literally identical copying of every detail. See 3 Nimmer, § 13.03[A]. See also Comptone Company Ltd. v. Rayex Corp., 251 F.2d 487, 488 (2d Cir.1958). Such similarity is determined by the ordinary observer test: the inquiry is "whether an average lay observer would recognize the alleged copy as having been appropriated from the copyrighted work." Ideal Toy Corp. v. Fab-Lu Ltd., 360 F.2d 1021, 1022 (2d Cir.1966). Or, stated another way, whether "the ordinary observer, unless he set out to detect the disparities, would be disposed to overlook them, and regard their aesthetic appeal as the same." Peter Pan Fabrics, Inc. v. Martin Weiner Corp., 274 F.2d 487, 489 (2d Cir.1960). Thus, Koons' allegation that a trial judge uneducated in art is not an appropriate decision-maker misses the mark; the decision-maker, whether it be a judge or a jury, need not have any special skills other than to be a reasonable and average lay person.
...
28
Moreover, no copier may defend the act of plagiarism by pointing out how much of the copy he has not pirated. See Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d 49, 56 (2d Cir.) (L. Hand, J.), cert. denied, 298 U.S. 669, 56 S.Ct. 835, 80 L.Ed. 1392 (1936). Thus, where substantial similarity is found, small changes here and there made by the copier are unavailing. It is only where the points of dissimilarity exceed those that are similar and those similar are--when compared to the original work--of small import quantitatively or qualitatively that a finding of no infringement is appropriate. See 3 Nimmer § 13.03[a]. This is not the case here. Koons' additions, such as the flowers in the hair of the couple and the bulbous noses of the puppies, are insufficient to raise a genuine issue of material fact with regard to copying in light of the overwhelming similarity to the protected expression of the original work.

...

III The Fair Use Doctrine

30
Defendant Koons further defends his use of Rogers' work "Puppies" to craft "String of Puppies" under a claim of a privilege of "fair use." This equitable doctrine permits other people to use copyrighted material without the owner's consent in a reasonable manner for certain purposes. Codified in § 107 of the 1976 Copyright Act, it is of ancient lineage. Section 107 states that an original work copied for purposes such as criticism or comment may not constitute infringement, but instead may be a fair use. The section provides an illustrative--but not exhaustive--list of factors for determining when a use is "fair." These factors include (1) the purpose and character of the use, (2) the nature of the copyrighted work, (3) the amount and substantiality of the work used, and (4) the effect of the use on the market value of the original. 17 U.S.C. § 107.

31
The fact that the test envisioned by the Act is dependent on the circumstances of each case, see 3 Nimmer, § 13.05[A], might suggest summary judgment is unavailable when fair use is the issue, but such relief may be granted when appropriate. See e.g., Stewart v. Abend, 495 U.S. 207, 110 S.Ct. 1750, 109 L.Ed.2d 184 (1990) (summary judgment granted upon finding of no fair use). The trial court found no genuine issues of fact present regarding the fair use exception and granted summary judgment to plaintiff on this issue also. We proceed therefore to analyze the fair use factors in the circumstances of the case at hand. Our examination of these factors leads us to conclude that the district court properly granted summary judgment in favor of plaintiff.

1. Purpose and Character of the Use

32
The first factor, purpose and character of the use, asks whether the original was copied in good faith to benefit the public or primarily for the commercial interests of the infringer. See MCA, Inc. v. Wilson, 677 F.2d 180, 182 (2d Cir.1981). Knowing exploitation of a copyrighted work for personal gain militates against a finding of fair use. And--because it is an equitable doctrine--wrongful denial of exploitative conduct towards the work of another may bar an otherwise legitimate fair use claim. See 3 Nimmer, § 13.05[A]. Relevant to this issue is Koons' conduct, especially his action in tearing the copyright mark off of a Rogers notecard prior to sending it to the Italian artisans. This action suggests bad faith in defendant's use of plaintiff's work, and militates against a finding of fair use.

33
The Supreme Court has held that copies made for commercial or profit-making purposes are presumptively unfair. See Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417, 449, 104 S.Ct. 774, 792, 78 L.Ed.2d 574 (1984). The Court explained in a subsequent case that the "crux of the profit/nonprofit distinction is not whether the sole motive of the use is monetary gain but whether the user stands to profit from exploitation of the copyrighted material without paying the customary price." Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 562, 105 S.Ct. 2218, 2231, 85 L.Ed.2d 588 (1985). We have stated that, though it is a significant factor, whether the profit element of the fair use calculus affects the ultimate determination of whether there is a fair use depends on the totality of the factors considered; it is not itself controlling. See Maxtone-Graham v. Burtchaell, 803 F.2d 1253, 1262 (2d Cir.1986), cert. denied, 481 U.S. 1059, 107 S.Ct. 2201, 95 L.Ed.2d 856 (1987). Thus, while we note that Koons' substantial profit from his intentionally exploitive use of Rogers' work also militates against the finding of fair use, we turn next to consider his contention that the primary purpose of the use was for social comment.

34
Parody or Satire as Fair Use: The Act expressly provides that comment on or criticism of a copyrighted work may be a valid use under the fair use doctrine. We must analyze therefore whether "String of Puppies" is properly considered a comment on or criticism of the photograph "Puppies." Koons argues that his sculpture is a satire or parody of society at large. He insists that "String of Puppies" is a fair social criticism and asserts to support that proposition that he belongs to the school of American artists who believe the mass production of commodities and media images has caused a deterioration in the quality of society, and this artistic tradition of which he is a member proposes through incorporating these images into works of art to comment critically both on the incorporated object and the political and economic system that created it. These themes, Koons states, draw upon the artistic movements of Cubism and Dadaism, with particular influence attributed to Marcel Duchamp, who in 1913 became the first to incorporate manufactured objects (readymades) into a work of art, directly influencing Koons' work and the work of other contemporary American artists. We accept this definition of the objective of this group of American artists.

35
To analyze Koons' parody defense, we must first define it. Parody or satire, as we understand it, is when one artist, for comic effect or social commentary, closely imitates the style of another artist and in so doing creates a new art work that makes ridiculous the style and expression of the original. Under our cases parody and satire are valued forms of criticism, encouraged because this sort of criticism itself fosters the creativity protected by the copyright law. See Warner Bros., Inc. v. American Broadcasting Cos., Inc., 720 F.2d 231, 242 (2d Cir.1983). We have consistently held that a parody entitles its creator under the fair use doctrine to more extensive use of the copied work than is ordinarily allowed under the substantial similarity test. See Elsmere Music, Inc. v. National Broadcasting Co., 623 F.2d 252, 253 (2d Cir.1980) (per curiam).

36
Hence, it must first be determined whether "String of Puppies" is a parody of Rogers' work for purposes of the fair use doctrine. We agree with the district court that it is not. It is the rule in this Circuit that though the satire need not be only of the copied work and may, as appellants urge of "String of Puppies," also be a parody of modern society, the copied work must be, at least in part, an object of the parody, otherwise there would be no need to conjure up the original work. See MCA, Inc. v. Wilson, 677 F.2d at 185; 3 Nimmer, § 13.05[C] n. 60.9.

37
We think this is a necessary rule, as were it otherwise there would be no real limitation on the copier's use of another's copyrighted work to make a statement on some aspect of society at large. If an infringement of copyrightable expression could be justified as fair use solely on the basis of the infringer's claim to a higher or different artistic use--without insuring public awareness of the original work--there would be no practicable boundary to the fair use defense. Koons' claim that his infringement of Rogers' work is fair use solely because he is acting within an artistic tradition of commenting upon the commonplace thus cannot be accepted. The rule's function is to insure that credit is given where credit is due. By requiring that the copied work be an object of the parody, we merely insist that the audience be aware that underlying the parody there is an original and separate expression, attributable to a different artist. This awareness may come from the fact that the copied work is publicly known or because its existence is in some manner acknowledged by the parodist in connection with the parody. Of course, while our view of this matter does not necessarily prevent Koons' expression, although it may, it does recognize that any such exploitation must at least entail "paying the customary price." Harper & Row Publishers, Inc., 471 U.S. at 562, 105 S.Ct. at 2231.

38
The problem in the instant case is that even given that "String of Puppies" is a satirical critique of our materialistic society, it is difficult to discern any parody of the photograph "Puppies" itself. We conclude therefore that this first factor of the fair use doctrine cuts against a finding of fair use. The circumstances of this case indicate that Koons' copying of the photograph "Puppies" was done in bad faith, primarily for profit-making motives, and did not constitute a parody of the original work.

2. Nature of the Copyrighted Work

39
The next fair use factor asks what is the nature of the work that has been copied. Where the original work is factual rather than fictional the scope of fair use is broader. See New Era Publications, Int'l. v. Carol Publishing Group, 904 F.2d 152, 157 (2d Cir.), cert. denied, --- U.S. ----, 111 S.Ct. 297, 112 L.Ed.2d 251 (1990). Whether the original is creative, imaginative, or represents an investment of time in anticipation of a financial return also should be considered. MCA, Inc. v. Wilson, 677 F.2d at 182. Here "Puppies" was a published work of art. As an original expression it has more in common with fiction than with works based on facts, such as, for example, biographies or telephone directories. Since "Puppies" was creative and imaginative and Rogers, who makes his living as a photographer, hopes to gain a financial return for his efforts with this photograph, this factor militates against a finding of fair use.

3. Amount and Substantiality of Work Used

40
Where the amount of copying exceeds permissible levels, summary judgment has been upheld. Walt Disney Productions v. Air Pirates, 581 F.2d 751, 758 (9th Cir.1978), cert. denied, 439 U.S. 1132, 99 S.Ct. 1054, 59 L.Ed.2d 94 (1979). To a large degree, this factor involves the same analysis as that used when determining if the copy is substantially similar to the original. Sometimes wholesale copying may be permitted, while in other cases taking even a small percentage of the original work has been held unfair use. See Maxtone-Graham, 803 F.2d at 1263. "[W]hat is relevant is the amount and substantiality of the copyrighted expression that has been used, not the factual content of the material in the copyrighted works." Salinger v. Random House, Inc., 811 F.2d 90, 97 (2d Cir.) (emphasis in original), reh'g denied, 818 F.2d 252, cert. denied, 484 U.S. 890, 108 S.Ct. 213, 98 L.Ed.2d 177 (1987). It is not fair use when more of the original is copied than necessary. Even more critical than the quantity is the qualitative degree of the copying: what degree of the essence of the original is copied in relation to its whole. Id. at 98; see also New Era Publications Int'l., 904 F.2d at 159.

41
Appellants claim that under a parody defense their use of Rogers' work did not exceed the level permitted under the fair use doctrine. As discussed previously, this Circuit has traditionally afforded parodists significant leeway with respect to the extent and nature of their copying. See Elsmere, 623 F.2d at 253, n. 1; Berlin v. E.C. Publications, Inc., 329 F.2d 541, 545 (2d Cir.), cert. denied, 379 U.S. 822, 85 S.Ct. 46, 13 L.Ed.2d 33 (1964). Yet, even under such a defense there are limitations on what constitutes fair use. See MCA v. Wilson, 677 F.2d at 185. Here, the essence of Rogers' photograph was copied nearly in toto, much more than would have been necessary even if the sculpture had been a parody of plaintiff's work. In short, it is not really the parody flag that appellants are sailing under, but rather the flag of piracy. Moreover, because we have already determined that "String of Puppies" is not a parody of Rogers' work, appellants cannot avail themselves of this heightened tolerance under a parody defense.

42
Nor does Sony Corp. of America, 464 U.S. at 449-50, 104 S.Ct. at 792-93, bear the weight that appellants place on it for the proposition that even 100 percent copying does not preclude a fair use finding. Although correct as a general statement, it applied in Sony to a narrow set of circumstances. Sony's copying equipment (Betamax VCRs) was used by members of the public to record television programs--the copyright of which was owned by plaintiffs. The question was whether Sony's selling of the copying equipment violated plaintiffs' rights under the Copyright Act. The Supreme Court said "no" because "time-shifting" for those watching a television program enlarges the viewing audience, and does not impair plaintiffs' commercial right in the value of the copyright. Hence, no basis existed under the Act upon which plaintiffs could hold Sony liable for selling VCR's to the general public. Id. at 421, 104 S.Ct. at 778.

43
Those are not the facts found here. Instead, Koons' copying of Rogers' work was the essence of the photograph, and designedly done as the notes to the Italian artisans conclusively reveal. Koons went well beyond the factual subject matter of the photograph to incorporate the very expression of the work created by Rogers. We find that no reasonable jury could conclude that Koons did not exceed a permissible level of copying under the fair use doctrine.

44
4. Effect of the Use on the Market Value of the Original

45
The fourth factor looks at the effect of the use on the market value of the original. The Supreme Court in Stewart, 495 U.S. 207, 110 S.Ct. 1750, 109 L.Ed.2d 184, stated that the fourth factor "is the 'most important, and indeed, central fair use factor.' " Id. at 238, 110 S.Ct. at 1769 (quoting 3 Nimmer § 13.05[A]; see also Harper & Row, 471 U.S. at 566, 105 S.Ct. at 2233. Under this factor a balance must be struck between the benefit gained by the copyright owner when the copying is found an unfair use and the benefit gained by the public when the use is held to be fair. The less adverse impact on the owner, the less public benefit need be shown to sustain non-commercial fair use. It is plain that where a use has no demonstrable impact on a copyright owners' potential market, the use need not be prohibited to protect the artist's incentive to pursue his inventive skills. Yet where the use is intended for commercial gain some meaningful likelihood of future harm is presumed. See Sony Corp. of America, 464 U.S. at 451, 104 S.Ct. at 793.

46
A critical inquiry under this factor then is whether defendants Koons and Sonnabend planned to profit from their exploitation of "Puppies" without paying Rogers for their use of his photo--that is, whether Koons' work is primarily commercial in nature. We have already concluded that it is. In this case, of course, the copy was in a different medium than the original: one was a three-dimensional piece of sculpture, and the other a two-dimensional black and white photo. But the owner of a copyright with respect to this market-factor need only demonstrate that if the unauthorized use becomes "widespread" it would prejudice his potential market for his work. See id.; Harper & Row, 471 U.S. at 568, 105 S.Ct. at 2234. The reason for this rule relates to a central concern of copyright law that unfair copying undercuts demand for the original work and, as an inevitable consequence, chills creation of such works. Hence the inquiry considers not only harm to the market for the original photograph, but also harm to the market for derivative works. It is obviously not implausible that another artist, who would be willing to purchase the rights from Rogers, would want to produce a sculpture like Rogers' photo and, with Koons' work extant, such market is reduced. Similarly, defendants could take and sell photos of "String of Puppies," which would prejudice Rogers' potential market for the sale of the "Puppies" notecards, in addition to any other derivative use he might plan.

47
Further, in discussing this fourth factor, the leading scholar in this area of the law uses an example that closely parallels the facts of the present case and demonstrates the irrelevance of copying in a different medium when analyzing this factor: a movie adaptation is made of a book. Even though the movie may boost book sales, it is an unfair use because of the effect on the potential sale of adaptation rights. 3 Nimmer, § 13.05. The function of demand for each original work of art is a relevant facet in this factor's analysis; that is, fair use permits lyrics or music to be copied in a literary magazine, but where the same material is published in a song sheet magazine, purchased for playing and not simply for reading, it is an unfair use. Id.

48
Here there is simply nothing in the record to support a view that Koons produced "String of Puppies" for anything other than sale as high-priced art. Hence, the likelihood of future harm to Rogers' photograph is presumed, and plaintiff's market for his work has been prejudiced.

UMG Recordings, Inc. v. MP3.com, Inc., 92 F. Supp. 2d 349 (S.D.N.Y. 2000) wrote: Regarding the fourth factor -- "the effect of the use upon the potential market for or value of the copyrighted work" -- defendant's activities on their face invade plaintiffs' statutory right to license their copyrighted sound recordings to others for reproduction. See 17 U.S.C. § 106. [*10] Defendant, however, argues that, so far as the derivative market here involved is concerned, plaintiffs have not shown that such licensing is "traditional, reasonable, or likely to be development." American Geophysical, 60 F.3d at 930 & n.17. Moreover, defendant argues, its activities can only enhance plaintiffs' sales, since subscribes cannot gain access to particular recordings made available by MP3.com unless they have already "purchased" (actually or purportedly), or agreed to purchase, their own CD copies of those recordings.

Such arguments -- though dressed in the garb of an expert's "opinion" (that, on inspection, consists almost entirely of speculative and conclusory statements) -- are unpersuasive. Any allegedly positive impact of defendant's activities on plaintiffs' prior market in no way frees defendant to usurp a further market that directly derives from reproduction of the plaintiffs' copyrighted works. See Infinity Broadcast, 150 F.3d at 111. This would be so even if the copyrightholder had not yet entered the new market in issue, for a copyrightholder's "exclusive" rights, derived from the Constitution and the Copyright Act, include [*11] the right, within broad limits, to curb the development of such a derivative market by refusing to license a copyrighted work or by doing so only on terms the copyright owner finds acceptable. See Castle Rock, 150 F.3d at 145-46; Salinger v. Random House, Inc., 811 F.2d 90, 99 (2d Cir.), cert. denied, 484 U.S. 890, 98 L. Ed. 2d 177, 108 S. Ct. 213 (1987). Here, moreover, plaintiffs have adduced substantial evidence that they have in fact taken steps to enter that market by entering into various licensing agreements. See, e.g., Forrest R. Aff., Ex. F., Vidich Dep. at 61-63; id., Ex. N; Goodman R. Aff., Ex. B., Silver Dep. at 64-65; id., Ex. D, Eisenberg Dep. at 130-32; id., Ex. E., Evans Dep. 145-48.

Finally, regarding defendant's purported reliance on other factors, see Campbell, 510 U.S. at 577, this essentially reduces to the claim that My.MP3.com provides a useful service to consumers that, in its absence, will be served by "pirates." Copyright, however, is not designed to afford consumer protection or convenience but, rather, to protect the copyrightholders' property interests. Moreover, as a practical [*12] matter, plaintiffs have indicated no objection in principle to licensing their recordings to companies like MP3.com; they simply want to make sure they get the remuneration the law reserves for them as holders of copyrights on creative works. Stripped to its essence, defendant's "consumer protection" argument amounts to nothing more than a bald claim that defendant should be able to misappropriate plaintiffs' property simply because there is a consumer demand for it. This hardly appeals to the conscience of equity.

In sum, on any view, defendant's "fair use" defense is indefensible and must be denied as a matter of law. Defendant's other affirmative defenses, such as copyright misuse, abandonment, unclean hands, and estoppel, are essentially frivolous and may be disposed of briefly. While defendant contends, under the rubric of copyright misuse, that plaintiffs are misusing their "dominant market position to selectively prosecute only certain online music technology companies," Def.'s Consolidated Opp. to Pls.' Motions for Summ. J. at 21, the admissible evidence of records shows only that plaintiffs have reasonably exercised their right to determine which infringers to pursue, and [*13] in which order to pursue them, cf. Broadcast Music, Inc. v. Peppermint Club, Inc., 1985 U.S. Dist. LEXIS 12761, 1985 WL 6141, at *4 (N.D. Ohio Dec. 16, 1985). The abandonment defense must also fall since defendant has failed to adduce any competent evidence of an overt act indicating that plaintiffs, who filed suit against MP3.com shortly after MP3.com launched its infringing MY.MP3.com service, intentionally abandoned their copyrights. See Richard Feiner & Co., Inc. v. H.R. Indus., Inc., 10 F. Supp. 2d 310, 313 (S.D.N.Y. 1998). Similarly, defendant's estoppel defense must be rejected because defendant has failed to provide any competent evidence that it relied on any action by plaintiffs with respect to defendant's My.MP3.com service. Finally, the Court must reject defendant's unclean hands defense given defendant's failure to come forth with any admissible evidence showing bad faith or misconduct on the part of plaintiffs. See generally Dunlop-McCullen v. Local 1-S, AFL-CIO-CLC, 149 F.3d 85, 90 (2d Cir. 1998); A.H. Emery Co. v. Marcan Prods. Corp., 389 F.2d 11, 18 n.4 (2d Cir.), cert. denied, 393 U.S. 835, 21 L. Ed. 2d 106, 89 S. Ct. 109 (1968). [*14]

Bridgeport Music, Inc. v. Dimension Films, 410 F.3d 792 (6th Cir. 2005) wrote: Get a license or do not sample. We do not see this as stifling creativity in any significant way.