Fair dealing in Canada: Warhol Foundation would likely face the same ruling

The U.S. Supreme Court (SCOTUS) decided against Andy Warhol Foundation’s claim that fair use applied to the publication of Andy Warhol’s work Orange Prince. This is a narrow decision limited to only one of four factors in the U.S. fair use analysis. A Canadian court, applying Canada’s two analogous fair dealing factors to these facts, would likely agree with the SCOTUS majority.

Background to the SCOTUS decision

Lynn Goldsmith regularly photographed musicians and licenced her works to be published. In 1981, she photographed Prince at a live performance and in her studio for an article for Newsweek. One of her unpublished portraits from that shoot was later licenced to Vanity Fair for single use only as an “artist reference” in 1984. She was paid US$400 and would receive source credit in the magazine.

Andy Warhol used the portrait to make the purple silkscreen version that was run in Vanity Fair. However, Goldsmith did not know that Warhol made an additional 15 works, called the Prince Series, based on her photograph. Following Prince’s death in 2016, Goldsmith saw Orange Prince on the cover of a tribute magazine published by Vanity Fair’s parent company, Condé Nast. She did not receive a licence fee nor a source credit for this later publication.

Goldsmith considered Orange Prince to be infringing her copyright, so the Andy Warhol Foundation for the Visual Arts, Inc. (AWF) sued her for a declaration of non-infringement or, in the alternative, fair use.

The U.S. decision found the purpose and character of the use favoured Goldsmith

The United States has a four-factor test for fair use, and the Court of Appeals for the Second Circuit held that all four factors favoured Goldsmith:

1. the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
2. the nature of the copyrighted work;
3. the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
4. the effect of the use upon the potential market for, or value of, the copyrighted work.

Despite that ruling, AWF appealed a single question to SCOTUS: whether the first fair use factor favoured Goldsmith or Warhol.

AWF argued fair use applies to the Prince Series because the works are transformative and convey a different meaning or message than the original photograph. However, SCOTUS held that the specific use here, licencing Orange Prince to Condé Nast to depict Prince in a magazine article about Prince, shares the same purpose as the original photograph.

Moreover, it was found to be in direct commercial competition to Goldsmith, who licenced her other photos of Prince to be used in different commemorative publications. Therefore, the first factor was found to favour Goldsmith. Nevertheless, a strong dissent suggests the issue is not clear-cut, even on what appears to be a narrow analysis.

Canada’s fair dealing would likely reach a similar result

Canada’s fair dealing doctrine is similar but not identical to the United States’ fair use doctrine. To begin, the dealing must fall within the stated purposes that can be considered as fair dealing in Canada under the Copyright Act: research, private study, education, parody, satire, criticism, review, or news reporting.

Within those purposes, the dealing must still be fair. Canada’s six-factor fair dealing test considers the purpose and the character of the dealing, like the United States. For example, research for commercial purposes may not be as fair as research done for charitable purposes. Nevertheless, commercial use can still be fair. Providing song previews has been found to be fair dealing for the purpose of research because the ultimate purchase of the song benefits the original copyright owner. On the other hand, copying photographs to drive traffic and revenue to a website that does not benefit the photographer is not fair.

As for the character of the dealing, distributing multiple copies of the works will tend to be less fair than a single copy of the work used for a specific legitimate purpose. For example, commercially distributing copies of the Canadian Standards Association (CSA) Electrical Code was not considered to be fair.

Therefore, if a Canadian court was limited to the same facts and considered only a subset of the fair dealing factors, it would likely agree with the SCOTUS majority to find that the dealing was not fair because:

1. This specific use of Orange Prince does not easily fall within one of the allowed purposes, favouring Goldsmith.
2. Even if the dealing was argued to be news reporting covering Prince’s death, the purpose of the dealing was found to be for-profit and in competition with Goldsmith, favouring Goldsmith.
3. Equally, multiple copies of the work were widely distributed, suggesting the character of the dealing favours Goldsmith.
4. Lastly, Canada has an attribution requirement for news reporting that was not met because no source credit was provided, favouring Goldsmith.

Contact us

For more information on fair dealing in Canada or for any assistance with intellectual property matters, please reach out to the author or any lawyer from BLG’s Intellectual Property Group.