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Magazines > Information Today > November 2003
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Information Today
Vol. 20 No. 11 — December 2003
Intranet Publishers Beware!
By Dick Kaser

Every once in a while, there's a landmark court decision that goes far beyond the facts involved in the case to affect many users and producers of information services.

Three cases come quickly to mind as classic examples (all from the 1990s):

• Texaco, which was about the photocopying of journal articles for industrial research. Many conclude that the decision said, in effect, "there is no fair use in companies."

• Kinko's, which was about the photocopying of chapters and articles for college coursepacks. The decision essentially said, "Just because it's for educational purposes, that doesn't make it fair use, either."

• Feist, which was about alphabetical telephone directory listings. Many would say it definitively affirmed that facts are not copyright-protected.

Now, in a shades-of-Texaco decision, a federal court in Maryland ruled in October that brokerage firm Legg Mason was guilty of copyright infringement for loading Lowry's Market Trend Analysis newsletter on its company intranet without paying the requisite license fee. (Legg Mason did pay for one $700 subscription, but shared it among 1,300 workers. Lowry's considered that a flagrant practice that had spanned more than 12 years and involved fax machines as well as computers.)

The court ordered Legg Mason to pay about $20 million to the newsletter publisher, mostly in special damages—calculated at $50,000 per issue before a cease-and-desist order and $100,000 per issue after the order. By statute, the damages could have gone to $150,000 an issue.

According to a press release from Lowry's: "Legg Mason argued that what occurred was a good-faith mistake by low-level employees caught up in a technological transition. Lowry's responded that the fault lay not with those employees, but with corporate decisions that gave them technology that made infringement likely and easy without first training them in how to use technology legally."

As with the Texaco case, the Legg Mason decision, if it holds on appeal, would seem to say there's no fair use in companies, especially if the illegal copying (photo or now, digital) damages the market for the copyrightable work in question. This case should send a warning to everyone who operates the content side of an intranet. As a publisher for your organization, you need to understand and respect copyright law.

Database Producers Beware!

In striking the proper balance between copyright and fair use, as much as it may seem to the contrary, the courts don't always rule in favor of publishers.

The perfect example is the Feist case. In 1991, the court said that just because you, Mr. Publisher, worked really hard and spent a lot of money to create a collection of facts, it doesn't mean others can't copy it straight from you and go into business for themselves.

Ever since the Feist decision came down, publishers of legal, news, scientific, and other factual collections have felt more than a little uneasy about this ruling, since it seems to put their investment at risk.

And for years now, these same publishers have made numerous attempts to get legislation introduced in Congress that would, if passed, make the flagrant "misappropriation" of such databases a crime. The European Union has had a similar law for years.

But every time the legislation comes up for public debate in the States, the library, scientific, academic, and even the news-reporting communities object to it, saying that facts should not be protected, even from misappropriation for the commercial advantage of an entire database. The past three or four bills attempting to legislate database protection have ultimately died.

In fact, the whole debate has been placed on the back burner for a couple of years now. But after a 2-year legislative hiatus, a database protection bill is back before Congress.

Introduced in early October, the new measure, dubbed the "Database and Collections of Information Misappropriation Act" (HR 3261) attempts—through a long list of exceptions and exemptions to balance the desire of researchers, reporters, and librarians—to keep facts in the public domain while protecting the ability of compilers and classifiers to feel that their investment in creating directories, databases, and other factual collections is protected from flagrant and malicious theft. This version of the proposed legislation seems to me a good attempt at compromise.

But will this compromise legislation pass any more muster with the user community than earlier attempts to protect databases from theft? As much as I might empathize with the producers—Information Today, Inc. does publish the American Library Directory, after all—I wouldn't bet the future of our own factual databases on this bill's likely passage.

But as the one who worries about such things for this company—and in the wake of the Legg Mason decision—I'm at least comforted to know that if you're loading our stuff on your intranet without permission, you'll now be wanting a license.

Dick Kaser is Information Today, Inc.'s vice president of content. His e-mail address is
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