WORLDWIDE CHURCH OF GOD v PHILADELPHIA CHURCH OF GOD, 9955850
U.S. 9th Circuit Court of Appeals
WORLDWIDE CHURCH OF GOD v PHILADELPHIA CHURCH OF GOD
9955850
WORLDWIDE CHURCH OF GOD, a
California Corporation, Nos. 99-55850
Plaintiff-Counter- 99-55934
Defendant-Appellant, 99-56005
99-56489
v.
D.C. No.
PHILADELPHIA CHURCH OF GOD,
CV-97-05306-JSL
INC., an Oklahoma Corporation,
Defendant-Counter- OPINION
Claimant-Appellee.
Appeal from the United States District Court
Central District of California
J. Spencer Letts, District Judge Presiding
Argued and Submitted
December 6, 1999--Pasadena, California
Filed September 18, 2000
Before: Melvin Brunetti and A. Wallace Tashima,
Circuit Judges, William W Schwarzer,*
Senior District Judge.
Opinion by Judge Schwarzer;
Dissent by Judge Brunetti
SUMMARY
The summary, which does not constitute a part of the opinion of the court,
is copyrighted C 2000 by West Group.
_________________________________________________________________
Intellectual Property/Copyright
The court of appeals reversed judgments of the district
court. The court held that the fair use doctrine does not allow
appropriation of a religious organization's copyrighted cre-
ative work by a competing group, when the copying is essen-
tially verbatim and the unauthorized user stands to profit from
exploiting the protected material, even though the secondary
use does not harm the market for the original work.
Herbert Armstrong wrote "Mystery of the Ages" (MOA),
a religious work. Armstrong copyrighted MOA in the name
of appellant Worldwide Church of God (WCG). In his will,
Armstrong bequeathed his entire estate to WCG.
After Armstrong's death, WCG decided to stop distributing
MOA (over nine million copies had been put into circulation
free of charge) because Armstrong's views on certain socio-
logical matters had been discredited and were no longer in
vogue. WCG planned an annotated version of MOA, but none
was ever produced.
Former WCG members formed appellee Philadelphia
Church of God, Inc. (PCG). Because PCG strictly followed
Armstrong's teachings, it deemed MOA to be central to its
religious practice. When PCG's membership outgrew avail-
able copies of MOA, PCG began copying MOA verbatim
without permission from WCG. Only the deletion of WCG
from the copyright page, the substitution of Armstrong's
name in its place, and the elimination of "Suggested Read-
ings" distinguished PCG's version from the original. PCG
distributed about 30,000 copies of its version of MOA and
received substantial contributions from persons who received
it.
When PCG ignored WCG's demand that it cease infringing
the copyright and continued distributing its MOA, WCG sued
for copyright infringement. PCG asserted that WCG's claim
was barred by the Free Exercise Clause of the First Amend-
ment, the religious Freedom Restoration Act (RFRA), and the
fair use doctrine.
The district court denied WCG's motion for a preliminary
injunction, concluding that PCG's use of MOA was a pro-
tected fair use of the work. The court found that PCG used
MOA for nonprofit religious and educational purposes, copy-
ing a religious text is reasonable in relation to that use, WCG
presented no evidence that it lost members due to PCG's dis-
tribution, a potential annotation of MOA by WCG would not
compete with PCG's copies of MOA, and MOA's being out
of print provided justification for PCG's production of its ver-
sion of the work.
On WCG's appeal, PCG asserted that Armstrong merely
granted WCG a nonexclusive implied license for MOA to be
disseminated by those who valued its religious message. Con-
sequently, PCG argued, WCG took any copyright subject to
this preexisting license.
[1] A license creates an affirmative defense to a claim of
copyright infringement. PCG did not contend that Armstrong
granted a license, but that he wished MOA to have the largest
audience possible. It offered no evidence that Armstrong cre-
ated MOA for dissemination by third parties, much less that
he intended to license PCG to reprint the entire book and use
it for its own church. Armstrong's copyright passed to WCG
through his will, and WCG was the owner of the copyright in
MOA.
[2] As the owner of the copyright, WCG had the exclusive
right to reproduce and distribute copies of MOA. That right
was not diminished or qualified by the fact that WCG was a
not-for-profit organization, and did not realize monetary bene-
fit from the use of the copyrighted work. Nor was that right
affected by the religious nature of its activity.
[3] Nor did First Amendment free speech considerations
support PCG's claim of fair use based on WCG's withdrawal
of MOA from distribution. The fair use doctrine is not a
license for theft, empowering a court to ignore a copyright
whenever it determines that the underlying work contains
material of possible public importance. Moreover, freedom of
expression includes both the right to speak freely and the right
to refrain from speaking at all. Nothing in the copyright stat-
utes would prevent an author from hoarding all his works dur-
ing the term of the copyright.
[4] In determining whether the use made of a work is a fair
use, the Copyright Act provides that the factors to be consid-
ered include: (1) the purpose and character of the use, includ-
ing whether such use is of a commercial nature, or is for
nonprofit educational purposes; (2) the nature of the copy-
righted 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 on the potential market for or value of the
work.
[5] The central purpose of the first factors to see whether
the new work merely supersedes the objects of the original
creation, or adds something new, with a further purpose or
different character, altering the first with new expression,
meaning, or message; it asks whether and to what extent the
new work is "transformative." There must be a real condensa-
tion of the materials, and intellectual labor and judgment
bestowed on them, not merely the facile use of scissors, or
extracts of the essential parts constituting the chief value of
the original work.
[6] PCG's copying bespoke no intellectual labor and judg-
ment. It merely superseded the object of the original to serve
religious practice and education. Where the use is for the
same intrinsic purpose as the copyright holder's, such use
seriously weakens a claimed fair use. The absence of com-
mercial use merely eliminates the presumption of unfairness.
That a use is educational and not for profit does not insulate
it from a finding of infringement. The crux of the prof-
it/nonprofit distinction is whether the user stands to profit
from exploitation of the copyrighted material without paying
the customary price.
[7] MOA's use profited PCG by providing it at no cost with
the core text essential to its members' religious observance,
by attracting through distribution of MOA new members who
tithe their income to PCG, and by enabling the ministry's
growth. PCG profited by copying MOA. It gained an advan-
tage or benefit from its distribution and use of MOA without
having to account to the copyright holder. The first factor
weighed against fair use.
[8] The second statutory factor turns on whether the work
is informational or creative. While it might have been viewed
as factual by readers who shared Armstrong's religious
beliefs, the creativity, imagination, and originality embodied
in MOA tilted the scale against fair use.
[9] PCG copied the entire MOA verbatim, deleting only the
"Suggested Readings" and the reference to WCG from the
copyright page. Copying an entire work militates against a
finding of fair use. Moreover, that a substantial portion of the
infringing work was copied verbatim was evidence of the
qualitative value of the copied material. [10] PCG used MOA
as a central element of its members' religious observance; a
reasonable person would have expected PCG to pay WCG for
the right to copy and distribute MOA created by WCG with
its resources. The third factor therefore militated against fair
use.
[11] When properly applied, fair use is limited to copying
that does not materially impair the marketability of the copied
work. The absence of a conventional market for a work does
not effectively deprive the holder of copyright protection. [12]
Even copying for noncommercial purposes may impair the
copyright holder's ability to obtain the rewards that Congress
intended.
[13] PCG's distribution of its unauthorized version of
MOA harmed WCG's goodwill by diverting potential mem-
bers and contributions from WCG. Individuals who received
copies of MOA from PCG were present or could have been
potential adherents of WCG. MOA's value was as a market-
ing device; that was how PCG used it.
[14] PCG unfairly appropriated MOA in its entirety for the
very purposes for which WCG created MOA. Fair use does
not protect the verbatim copying, without criticism, of a writ-
ten work in its entirety. That the secondary use did not harm
the market for the original gave no assurance that the second-
ary use was justified. Notwithstanding the importance of the
market factor, it should not overshadow the requirement of
justification under the first factor, without which there can be
no fair use.
[15] The defense of fair use failed. The first three factors
weighed in WCG's favor, and the fourth factor was at worst
neutral.
[16] In the context of the RFRA, PCG failed to demonstrate
that the copyright laws subjected it to a substantial burden in
the exercise of its religion. PCG did not seek WCG's permis-
sion before copying MOA. [17] A substantial burden must be
more than an inconvenience. It must be an interference with
a tenet or belief that is central to religious doctrine. Having to
ask for permission and pay for the right to use a copyrighted
work cannot be assumed to be a substantial burden on the
exercise of religion.
Judge Brunetti dissented, writing that the noncommercial
and religious elements of PCG's use, plus the unavailability
of MOA, weighed in favor of fair use under the first statutory
factor, that the second and third factors were largely irrelevant
in this case, and that evidence did not weigh against fair use
under the fourth factor.
_________________________________________________________________
COUNSEL
Allan Browne, Brown & Woods, LLP, Beverly Hills, Califor-
nia, for the plaintiff/counter-defendant-appellant.
Mark B. Helm, Munger, Tolles & Olson, LLP, Los Angeles,
California, and Kelly M. Klaus, Munger, Tolles & Olson,
LLP, San Francisco, California, for the defendant/counter-
claimant-appellee.
_________________________________________________________________
OPINION
SCHWARZER, Senior District Judge:
Appellant Worldwide Church of God ("WCG") is a non-
profit religious organization whose late Pastor General, Her-
bert W. Armstrong, wrote a 380-page book entitled Mystery
of the Ages ("MOA"), the copyright to which is held by WCG.
After Armstrong's death, WCG retired MOA from distribution
and use. Appellee Philadelphia Church of God ("PCG"), also
a nonprofit religious organization, then appropriated MOA for
use in its religious observance, copying it in its entirety and
distributing large numbers of copies to its members and the
public. We must decide whether PCG's copying and dissemi-
nation of MOA constitutes fair use under the Copyright Stat-
ute. 17 U.S.C. S 107.
FACTUAL BACKGROUND
Herbert Armstrong founded the Radio Church of God, later
renamed Worldwide Church of God, in 1934. He held the title
of "Pastor General with the spiritual rank of Apostle" and was
its undisputed spiritual and temporal leader until his death in
1986. Armstrong was a prolific writer, producing over three
thousand articles for the church's magazine The Plain Truth,
all of which were copyrighted in the name of WCG, or its
affiliate teaching arm, Ambassador College.
Armstrong wrote MOA, his final work, between 1984 and
1985. He completed it when he was ninety-two years old,
shortly before his death. He copyrighted it in the name of
WCG and published it in serial form in The Plain Truth mag-
azine, distributed free of charge to approximately eight mil-
lion people. In addition, WCG distributed over 1.24 million
copies free of charge to employees and to viewers of WCG
telecasts. In all, WCG put over nine million free copies of
MOA into circulation.
Two years after Armstrong's death, WCG decided to dis-
continue distribution of MOA for several reasons, including
the fact that the Church's positions on various doctrines such
as divorce, remarriage, and divine healing had changed. The
Church hoped to "prevent a transgression of conscience by
proclaiming what the Church considered to be ecclesiastical
error" espoused in MOA and it considered that Armstrong,
who was ninety-two when he wrote MOA, conveyed outdated
views that were racist in nature. Its Advisory Council of
Elders indicated that the Church stopped distributing MOA
because of "cultural standards of social sensitivity" and to
avoid racial conflict. The Council noted, "Insensitivity in this
area is contrary to the doctrinal program of WCG to promote
racial healing and reconciliation among the races. " WCG dis-
posed of excess inventory copies of MOA and stopped distri-
bution, but retained archival and research copies. WCG never
sought to withdraw or destroy personal copies or copies held
by public institutions or any public library, nor did it request
that its members destroy their copies. WCG has indicated an
interest in publishing an annotated MOA sometime in the
future but has not yet begun work on it.
In 1989, two former WCG ministers, Gerald Flurry and
John Amos, founded a new religious organization, PCG. The
new church grew to over six thousand members by 1996 and
claims strictly to follow the teachings of Herbert Armstrong.
PCG asserts that MOA is central to its religious practice and
required reading for all members hoping to be baptized into
PCG. Until January 1997, PCG relied on existing copies of
MOA but it then began copying MOA for its own use. It is
undisputed that PCG never requested permission from WCG
to print MOA. It is also undisputed that PCG copied MOA ver-
batim, deleting only WCG from the copyright page and sub-
stituting Herbert Armstrong in its place, and deleting a
"Suggested Reading" page and a warning against reproduc-
tion without permission. PCG has distributed approximately
thirty thousand copies of its MOA in English text, in addition
to foreign-language versions. It has advertised its version in
newspapers and periodicals and has received substantial con-
tributions from persons who have received its MOA.
When PCG ignored WCG's demand that it cease infringing
its copyright and continued distribution of its MOA, this
action followed.
PROCEDURAL BACKGROUND
In its complaint, WCG alleged that PCG, by reproducing,
distributing, promoting, advertising and offering unlawful and
unauthorized copies of MOA, has been infringing WCG's
copyright. PCG answered, denying WCG's ownership of the
copyright and asserting that WCG's claim was barred by the
Free Exercise Clause of the First Amendment, the Religious
Freedom Restoration Act ("RFRA"), 42 U.S.C.SS 2000bb-
2000bb-4, and the fair use doctrine, 17 U.S.C. S 107, and
counterclaimed seeking a declaration of its right to reproduce
and distribute MOA.1
WCG moved for partial summary judgment and for a pre-
liminary injunction to restrain PCG from printing or distribut-
ing any materials copyrighted by WCG, including MOA. PCG
filed a cross-motion for summary adjudication. The district
court denied WCG's motions and granted PCG's motion for
summary adjudication. It concluded that Armstrong was the
author of MOA and that it was not a work for hire, implying
that WCG did not own the copyright, and that PCG's use of
MOA is statutorily protected "fair use" of the work under 17
U.S.C. S 107.
WCG appeals the order granting summary judgment to
PCG (No. 99-55934), the denial of its motion for a prelimi-
nary injunction (No. 99-55850), and the denial of its motion
to amend the judgment (No. 99-56005). On June 30, 1999,
this court granted the motions to consolidate these three
appeals. On July 23, 1999, the district court entered judgment
for PCG on WCG's complaint pursuant to Federal Rule of
Civil Procedure 54(b). WCG filed a notice of appeal with
respect to that judgment (No. 99-56489), and this court
granted appellee's motion to consolidate that appeal as well.
Because all of the district court's orders are merged into the
final judgment, we have jurisdiction pursuant to 28 U.S.C.
S 1291. We review a grant of summary judgment de novo. See
Balint v. Carson City, Nevada, 180 F.3d 1047, 1050 (9th Cir.
1999) (en banc).
DISCUSSION
I. OWNERSHIP OF THE COPYRIGHT
PCG disputes WCG's ownership of the MOA copyright,
contending that Armstrong, not WCG, had the right to control
MOA's creation and that therefore WCG cannot claim either
authorship or ownership of MOA through the "work-for-hire"
doctrine under 17 U.S.C. S 201(b), and the district court so
found. We need not address this hotly disputed issue, how-
ever, for it is undisputed that Armstrong, who owned the
copyright, bequeathed his entire estate to WCG. His Will left
all of his real and personal property to WCG. The Will was
admitted to probate and was not challenged. The Superior
Court entered an order of final distribution providing that
"preliminary distribution having . . . been made,. . . all other
property belonging to said estate . . . be and is hereby distrib-
uted to Worldwide Church of God." Because the ownership
of a copyright may, under 17 U.S.C. S 201(d),"be bequeathed
by will," WCG is now the owner.
[1] PCG responds that "Armstrong granted a nonexclusive,
implied license for MOA to be disseminated by those who
value its religious message." As a result, it argues, WCG took
any copyright subject to this preexisting license. The exis-
tence of a license creates an affirmative defense to a claim of
copyright infringement. I.A.E., Inc. v. Shaver , 74 F.3d 768,
775 (7th Cir. 1996), citing Effects Assoc., Inc. v. Cohen, 908
F.2d 555, 559 (9th Cir. 1990). PCG did not plead this defense
in its answer (or otherwise raise it in the district court) as
required by Federal Rule of Civil Procedure 8(c) ("In plead-
ing to a preceding pleading, a party shall set forth affirma-
tively [the affirmative defense of] . . . license."). Accordingly,
the issue is not properly before us. See Magana v. Common-
wealth of the N. Mariana Islands, 107 F.3d 1436, 1446 (9th
Cir. 1997). In any event, the argument is without merit. An
implied license may be granted orally or be implied from con-
duct. See Effects, 908 F.2d at 558. PCG does not contend that
Armstrong granted it a license, but only that he wished MOA
to have the largest audience possible. It has offered no evi-
dence that Armstrong created MOA for dissemination by third
parties, much less that he intended to license PCG to reprint
the entire book and use it for its own church. We conclude
that Armstrong's copyright passed to WCG through his Will
and that WCG is the owner of the copyright in MOA.
II. THE "FAIR USE" DEFENSE
A.
The district court concluded that the facts "support a find-
ing that PCG's use of MOA is a statutorily protected `fair use'
of the work." In reaching this conclusion, it found that PCG
uses MOA "for non-profit religious and educational pur-
poses," that copying a complete religious text "is reasonable
in relation to that use," that WCG presented no evidence that
it lost members due to PCG's distribution, that a potential
annotated MOA produced by WCG would not compete
against PCG's copies of MOA, and that MOA's being out of
print provided additional justification for PCG's production of
MOA. WCG contends that the district court's determination of
"fair use" is factually and legally erroneous.
Fair use is a mixed question of law and fact. If there are no
genuine issues of material fact, or if, even after resolving all
issues in favor of the opposing party, a reasonable trier of fact
can reach only one conclusion, a court may conclude as a
matter of law whether the challenged use qualifies as a fair
use of the copyrighted work. See Hustler Magazine, Inc. v.
Moral Majority, Inc., 796 F.2d 1148, 1150-51 (9th Cir. 1986).
Where the record is sufficient to evaluate each of the statutory
factors, "an appellate court `need not remand for further fact-
finding . . . [but] may conclude as a matter of law that the . . .
use do[es] not qualify as a fair use of the copyrighted work.' "
Harper & Row, Publishers, Inc. v. Nation Enter., 471 U.S.
539, 560 (1985) (quoting Pacific & S. Co. v. Duncan, 744
F.2d 1490, 1495 (11th Cir. 1984)).
[2] Under S 106 of the Copyright Act, WCG as the owner
of the copyright has the exclusive right to reproduce and dis-
tribute copies of MOA. 17 U.S.C. S 106(1), (3). That right is
not diminished or qualified by the fact that WCG is a not-for-
profit organization and does not realize monetary benefit from
the use of the copyrighted work. Nor is that right affected by
the religious nature of its activity; Congress narrowly limited
the privilege accorded religious uses to "performance of a . . .
literary or musical work . . . or display of a work, in the
course of services at a place of worship or other religious
assembly." 17 U.S.C. S 110(3). PCG's unauthorized copying
and distribution of MOA falls outside of that narrow exception
to copyright protection. See F.E.L. Publications, Ltd. v. Cath-
olic Bishop of Chicago, 214 U.S.P.Q. 409, 411, 1982 WL
19198 (7th Cir.) ("F.E.L can prevent churches from copying
or publishing its copyrighted works, even if the churches only
intend to use the copies or publications at not-for-profit reli-
gious services. . . . Neither the religious element nor the non-
profit element of a performance will protect illegal copying or
publishing."). We have held that
we must be careful not to deprive religious organiza-
tions of all recourse to the protections of civil law
that are available to all others. Such a deprivation
would raise its own serious problems under the Free
Exercise Clause [citation omitted]. It would also
leave religious organizations at the mercy of anyone
who appropriated their property with an assertion of
religious right to it.
Maktab Tarighe Oveyssi Shah Maghsoudi, Inc. v. Kianfar,
179 F.3d 1244, 1248 (9th Cir. 1999).
[3] Nor do First Amendment free speech considerations
support PCG's claim of fair use based on WCG's withdrawal
of MOA from distribution.
The public interest in the free flow of information is
assured by the law's refusal to recognize a valid
copyright in facts. The fair use doctrine is not a
license for corporate theft, empowering a court to
ignore a copyright whenever it determines the under-
lying work contains material of possible public
importance.
Harper & Row, 471 U.S. at 558 (quoting Iowa State Univ.
Research Found., Inc. v. American Broad. Cos., Inc. , 621
F.2d 57, 61 (2d Cir. 1980)). "Moreover, freedom of thought
and expression `includes both the right to speak freely and the
right to refrain from speaking at all.' " Id. at 559 (quoting
Wooley v. Maynard, 430 U.S. 705, 714 (1977)); see also Sal-
inger v. Random House, Inc., 811 F.2d 90, 100 (2d Cir. 1987)
(holding that copyright owner has right to protect "the expres-
sive content of his unpublished writings for the term of his
copyright"). This is not a case of "abuse of the copyright
owner's monopoly as an instrument to suppress facts." Har-
per & Row, 471 U.S. at 559. Cf. Rosemont Enter., Inc. v. Ran-
dom House, Inc., 366 F.2d 303, 311 (2d Cir. 1966)
(concurring opinion) (purchase by Howard Hughes of copy-
right on magazine articles to block publication of his biogra-
phy). As the Supreme Court has explained:
[A]lthough dissemination of creative works is a goal
of the Copyright Act, the Act creates a balance
between the artist's right to control the work during
the term of the copyright protection and the public's
need for access to creative works. The copyright
term is limited so that the public will not be perma-
nently deprived of the fruits of an artist's labors.
[Citation omitted]. But nothing in the copyright stat-
utes would prevent an author from hoarding all of
his works during the term of the copyright.
Stewart v. Abend, 495 U.S. 207, 228 -29 (1990).
B.
[4] PCG seeks to defend its infringing activity as fair use
under S 107 of the Copyright Act. That section provides in
relevant part that "the fair use of a copyrighted work . . . for
purposes such as criticism, comment, news reporting, teach-
ing . . . , scholarship or research, is not an infringement of
copyright." 17 U.S.C. S 107. In determining whether the use
made of a work in any particular case is a fair use,S 107 pro-
vides that the factors to be considered shall include:
(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.
17 U.S.C. S 107.
The common-law background of the fair use doctrine illu-
minates the consideration of the factors Congress incorpo-
rated into S 107. As the Supreme Court has explained:
The statutory formulation of the defense of fair use
in the Copyright Act reflects the intent of Congress
to codify the common-law doctrine. . . . "[T]he
author's consent to a reasonable use of his copy-
righted works ha[d] always been implied by the
courts as a necessary incident of the constitutional
policy of promoting the progress of science and the
useful arts, since a prohibition of such use would
inhibit subsequent writers from attempting to
improve upon prior works and thus . . . frustrate the
very ends sought to be attained." [Ball, Law of
Copyright and Literary Property 260 (1944)]. Profes-
sor Latman, in a study of the doctrine of fair use
commissioned by Congress for the revision effort,
see [Sony Corp. v. Universal City Studios, Inc., 464
U.S. 417, 462-463 n.9 (dissenting opinion)], summa-
rized prior law as turning on the "importance of the
material copied or performed from the point of view
of the reasonable copyright owner. In other words,
would the reasonable copyright owner have con-
sented to the use?"
Harper & Row, 471 U.S. at 549-50.
The Court went on to observe that Justice Story gave early
judicial recognition to the doctrine, quoting the following
statement:
[A] reviewer may fairly cite largely from the original
work, if his design be really and truly to use the pas-
sages for the purposes of fair and reasonable criti-
cism. On the other hand, it is as clear, that if he thus
cites the most important parts of the work, with a
view, not to criticise, but to supersede the use of the
original work, and substitute the review for it, such
a use will be deemed in law a piracy.
Id. at 550 (quoting Folsom v. Marsh, 9 F. Cas. 342, 344-45
(C.C. Mass. 1841)).
C.
With this background in mind, we turn to consideration of
the four statutory factors.
[5] 1. The first factor calls for consideration of "the pur-
poses and character of the use, including whether such use is
of a commercial nature or is for nonprofit educational pur-
poses." 17 U.S.C. S 107(1). "The central purpose of this
investigation is to see, in Justice Story's words, whether the
new work merely `supersede[s] the objects' of the original
creation [citations omitted] or instead adds something new,
with a further purpose or different character, altering the first
with new expression, meaning, or message; it asks, in other
words, whether and to what extent the new work is`transfor-
mative.' " Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569,
579 (1994). As Justice Story put it: "There must be real, sub-
stantial condensation of the materials, and intellectual labor
and judgment bestowed thereon; and not merely the facile use
of the scissors; or extracts of the essential parts, constituting
the chief value of the original work." Folsom , 9 F. Cas. at
345.
[6] PCG's copying of WCG's MOA in its entirety bespeaks
no "intellectual labor and judgment." It merely "supersedes
the object" of the original MOA, to serve religious practice
and education. Although "transformative use is not absolutely
necessary for a finding of fair use," Campbell, 510 U.S. at
579, where the "use is for the same intrinsic purpose as [the
copyright holder's] . . . such use seriously weakens a claimed
fair use." Weissmann v. Freeman, 868 F.2d 1313, 1324 (2d
Cir. 1989). Nevertheless, PCG argues that this factor favors
fair use because its use is not commercial or for profit. The
Supreme Court has cautioned that "the commercial or non-
profit educational purpose of a work is only one element of
the first factor inquiry into its purpose and character." Camp-
bell, 510 U.S. at 584. While the fact that a publication is com-
mercial tends to weigh against fair use, the absence of a
commercial use merely eliminates the presumption of unfair-
ness. "[T]he mere fact that a use is educational and not for
profit does not insulate it from a finding of infringement . . . ."
Id.; see also Sony Corp. v. Universal City Studios, Inc., 464
U.S. 417, 450 (1984) ("Even copying for noncommercial pur-
poses may impair the copyright holder's ability to obtain the
rewards that Congress intended him to have."); Marcus v.
Rowley, 695 F.2d 1171, 1175 (9th Cir. 1983)."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, 471 U.S. at 562.
We agree with the Second Circuit that in weighing whether
the purpose was for "profit," "[m]onetary gain is not the sole
criterion . . . [p]articularly in [a] . . . setting [where] profit is
ill-measured in dollars." Weissmann, 868 F.2d at 1324 (hold-
ing that a professor's verbatim copying of an academic work
was not fair use, in part because "the profit/nonprofit distinc-
tion is context specific, not dollar dominated" and a professor
can "profit" by gaining recognition among his peers and
authorship credit). See also WEBSTER'S THIRD NEW INTERNA-
TIONAL DICTIONARY (1971) 1811 (defining "profit" as "an
advantage, [a] benefit").
[7] Putting aside the disputed question whether PCG uses
MOA to generate income, and having in mind that like
academia, religion is generally regarded as "not dollar domi-
nated," MOA's use unquestionably profits PCG by providing
it at no cost with the core text essential to its members' reli-
gious observance, by attracting through distribution of MOA
new members who tithe ten percent of their income to PCG,
and by enabling the ministry's growth. During the time of
PCG's production and distribution of copies of MOA its mem-
bership grew to some seven thousand members. It is beyond
dispute that PCG "profited" from copying MOA--it gained an
"advantage" or "benefit" from its distribution and use of MOA
without having to account to the copyright holder. The first
factor weighs against fair use.
[8] 2. The second statutory factor,"the nature of the
copyrighted work," turns on whether the work is informa-
tional or creative. See Harper & Row, 471 U.S. at 563 ("The
law generally recognizes a greater need to disseminate factual
works than works of fiction or fantasy."); see also Sony, 464
U.S. at 455 n.40 ("Copying a news broadcast may have a
stronger claim to fair use than copying a motion picture.");
Hustler, 796 F.2d at 1153-54 ("The scope of fair use is greater
when `informational' as opposed to more `creative' works are
involved."). PCG's brief describes MOA as "primarily a tex-
tual, historical account of [Armstrong's] views of the `the
truth' of the Bible." While it may be viewed as "factual" by
readers who share Armstrong's religious beliefs, the creativ-
ity, imagination and originality embodied in MOA tilt the
scale against fair use. See Dr. Seuss Enter., L.P. v. Penguin
Books USA, Inc., 109 F.3d 1394, 1402 (9th Cir. 1997).
[9] 3. The third factor directs us to consider "the amount
and substantiality of the portion used in relation to the copy-
righted work as a whole." 17 U.S.C. S107(3). PCG copied the
entire MOA verbatim, deleting only the "Suggested Readings"
and the reference to "Worldwide Church of God " from the
copyright page. While "wholesale copying does not preclude
fair use per se," copying an entire work "militates against a
finding of fair use." Hustler, 796 F.2d at 1155. Moreover,
"the fact that a substantial portion of the infringing work was
copied verbatim is evidence of the qualitative value of the
copied material, both to the originator and to the plagiarist
who seeks to profit from marketing someone else's copy-
righted expression." Harper & Row, 471 U.S. at 565.
[10] PCG argues its verbatim copying of the whole work is
reasonable because its use of MOA is religious in nature.
"[T]he extent of permissible copying varies with the purpose
and character of the use." Campbell, 510 U.S. at 586-87. In
Campbell, the Court held that "[c]opying does not become
excessive in relation to parodic purpose merely because the
portion taken was the original's heart." Id. at 588. PCG's
copying stands on a different footing for the purpose for
which it uses the MOA is the same as WCG's. This court has
held "that a finding that the alleged infringers copied the
material to use it for the same intrinsic purpose for which the
copyright owner intended it to be used is strong indicia of no
fair use." Marcus, 695 F.2d at 1175. Reliance on Sony would
be misplaced. There, the Supreme Court held that reproduc-
tion of the entire work "[did] not have its ordinary effect of
militating against a finding of fair use" under the unique cir-
cumstances of that case, to wit: copying of videotapes for
time-shifting for personal use to "enable[ ] a viewer to see
such a work which he had been invited to witness in its
entirety free of charge." Sony, 464 U.S. at 449-50. No such
circumstances exist here to justify PCG's reproduction of the
entire work. PCG uses the MOA as a central element of its
members' religious observance; a reasonable person would
expect PCG to pay WCG for the right to copy and distribute
MOA created by WCG with its resources. The third factor,
therefore, weighs against fair use.
[11] 4. The fourth factor considers "the effect of the use
upon the potential market for or value of the copyrighted
work." 17 U.S.C. S 107(4). It has been said that "[f]air use,
when properly applied, is limited to copying by others which
does not materially impair the marketability of the work
which is copied." Harper & Row, 471 U.S. at 566-67 (quoting
Nimmer, Copyright S 1.10[D], at 1-87). This case presents a
novel application of the fair use doctrine where the copyright
owner is a not-for-profit organization. As might be expected,
published case law deals with works marketed for profit.
However, it cannot be inferred from that fact that the absence
of a conventional market for a work, the copyright to which
is held by a nonprofit, effectively deprives the holder of copy-
right protection. If evidence of actual or potential monetary
loss were required, copyrights held by nonprofits would be
essentially worthless. Religious, educational and other public
interest institutions would suffer if their publications invested
with an institution's reputation and goodwill could be freely
appropriated by anyone.
[12] The statute by its terms is not limited to market effect
but includes also "the effect of the use on the value of the
copyrighted work." 17 U.S.C. S 107(4) (emphasis added). As
Sony states, "[e]ven copying for noncommercial purposes
may impair the copyright holder's ability to obtain the
rewards that Congress intended him to have." Sony, 464 U.S.
at 450. Those rewards need not be limited to monetary
rewards; compensation may take a variety of forms. Id. at 447
n.28 ("The copyright law does not require a copyright owner
to charge a fee for the use of his works. . . . It is not the role
of the courts to tell copyright holders the best way for them
to exploit their copyrights").
[13] WCG points out that those who respond to PCG's ads
are the same people who would be interested in WCG's
planned annotated version or any future republication of the
original version. With an annotated MOA, WCG hopes to
reach out to those familiar with Armstrong's teachings and
those in the broader Christian community. PCG's distribution
of its unauthorized version of MOA thus harms WCG's good-
will by diverting potential members and contributions from
WCG. While the district court found that PCG's MOA and
WCG's proposed annotated MOA "would not in any sense
`compete' in the same market," undisputed evidence shows
that individuals who received copies of MOA from PCG are
present or could be potential adherents of WCG. MOA's value
is as a marketing device; that is how PCG uses it and both
PCG and WCG are engaged in evangelizing in the Christian
community.
PCG argues that WCG's failure to exploit MOA for ten
years and its lack of a concrete plan to publish a new version
show that "MOA has no economic value to the WCG that the
PCG's dissemination of the work would adversely affect."
We disagree. Even an author who had disavowed any inten-
tion to publish his work during his lifetime was entitled to
protection of his copyright, first, because the relevant consid-
eration was the "potential market" and, second, because he
has the right to change his mind. See Salinger , 811 F.2d at 99.
WCG explained that it ceased distribution because the
Church's position on various doctrines had changed, contin-
ued distribution would offend cultural standards of social sen-
sitivity, and dissemination would perpetuate what the Church
considered ecclesiastical error. For those reasons, WCG
planned an annotated edition of MOA.2
[14] Finally, PCG argues that if WCG published an anno-
tated version it would be so different as not to be competitive
with PCG's MOA. The argument, aside from being specula-
tive, misses the point. The fact remains that PCG has unfairly
appropriated MOA in its entirety for the very purposes for
which WCG created MOA. We have found no published case
holding that fair use protected the verbatim copying, without
criticism, of a written work in its entirety. As the 1967 House
Report notes, the market factor "must almost always be
judged in conjunction with the other three criteria. " H.R. REP.
NO. 83, at 35 (1967). Judge Pierre N. Leval has written:
When the secondary use does substantially interfere
with the market for the copyrighted work, as was the
case in [Harper & Row], this factor powerfully
opposes a finding of fair use. But the inverse does
not follow. The fact that the secondary use does not
harm the market for the original gives no assurance
that the secondary use is justified. Thus, notwith-
standing the importance of the market factor, espe-
cially when the market is impaired by the secondary
use, it should not overshadow the requirement of jus-
tification under the first factor, without which there
can be no fair use.
Pierre N. Leval, Toward a Fair Use Standard, 103 HARV. L.
REV. 1105, 1124 (1990).
[15] On balance, the defense of fair use of MOA fails. The
first three factors weigh in WCG's favor and the fourth factor
is, at worst, neutral.
III. PCG's DEFENSE UNDER THE RELIGIOUS
FREEDOM RESTORATION ACT
PCG contends that the judgment should be affirmed on the
independent ground of the Religious Freedom Restoration Act
("RFRA"), 42 U.S.C. SS 2000bb-2000bb-4. RFRA provides
in relevant part that "Government shall not substantially bur-
den a person's exercise of religion even if the burden results
from a rule of general applicability [subject to exceptions not
relevant here]." 42 U.S.C. S 2000bb-1(a). RFRA "essentially
requires the government to justify any regulation imposing a
substantial burden on the free exercise of religion by showing
that the regulation satisfies strict scrutiny." Goehring v. Bro-
phy, 94 F.3d 1294, 1298 n.4 (9th Cir. 1996). PCG contends
that the relief requested by WCG would substantially burden
a central tenet of its religious doctrine, namely, distribution of
MOA to current and potential adherents of its church. It also
considers MOA to play an important role in its daily religious
practice. The district court dismissed PCG's claim and affir-
mative defense under RFRA.
In City of Boerne v. Flores, 521 U.S. 507 (1997), the
Supreme Court held that RFRA exceeded the authority of
Congress under Section 5 of the Fourteenth Amendment to
enforce the First Amendment. We have held, along with most
other courts, that the Supreme Court invalidated RFRA only
as applied to state and local law. See Sutton v. Providence St.
Joseph Med. Ctr., 192 F.3d 826, 832 (9th Cir. 1999). We will
continue to assume, without deciding, that RFRA is constitu-
tional as applied to federal law. See id. at 833-34. Courts have
interpreted RFRA as an amendment of existing federal stat-
utes and thus a constitutional exercise of Congressional
authority. In In re Young, 141 F.3d 854 (8th Cir. 1998), the
court found RFRA amended the bankruptcy code, precluding
the bankruptcy trustee from avoiding a debtor's tithes to his
church. Id. at 861. See also EEOC v. Catholic Univ. of Am.,
83 F.3d 455, 470 (D.C. Cir. 1996) (holding, pre-Boerne, that
RFRA precluded application of Title VII to plaintiff whose
position was the functional equivalent of a minister).
[16] Whether the rationale of those cases can be extended
to the copyright statute is an open question. It seems unlikely
that the government action Congress envisioned in adopting
RFRA included the protection of intellectual property rights
against unauthorized appropriation. Compare International
Olympic Comm. v. San Francisco Arts & Athletics, 781 F.2d
733, 737 (9th Cir. 1986) (enforcement of federally-granted
trademarks is not state action). We need not decide this knotty
question, however, for in the context of this case PCG has
failed to demonstrate that the copyright laws subject it to a
substantial burden in the exercise of its religion. See United
States v. Grant, 117 F.3d 788, 792 n.6 (5th Cir. 1997) (declin-
ing to address constitutionality of RFRA as applied to federal
law because the government action at issue did not substan-
tially burden the defendant's free exercise of religion). In its
answer to the amended complaint, PCG admitted that it did
not seek WCG's permission before copying MOA. This fact
is confirmed by the certified minutes of the Advisory Council
of Elders of the Church of God, submitted under the affidavit
of the Secretary of the Church in support of WCG's motion
for partial summary judgment, which states: "Prior to January,
1997, neither PCG, nor any of its agents, ever made an offer
to purchase the copyrights of the MOA, or any of the Literary
Works, nor did they request to purchase a license to exploit
any rights therein, nor offered any royalties to do so."
[17] A substantial burden "must be more than an inconve-
nience." Bryant v. Gomez, 46 F.3d 948, 949 (9th Cir. 1995)
(quoting Graham v. C.I.R., 822 F.2d 844, 850-51 (9th Cir.
1987) (internal citations omitted), aff'd sub nom. Hernandez
v. Commissioner, 490 U.S. 680, 699 (1988)).
[T]he religious adherent, . . . has the obligation to
prove that a governmental regulatory mechanism
burdens the adherent's practice of his or her religion
by pressuring him or her to commit an act forbidden
by the religion or by preventing him or her from
engaging in conduct or having a religious experience
which the faith mandates. This interference must be
more than an inconvenience; the burden must be
substantial and an interference with a tenet or belief
that is central to religious doctrine.
Goehring, 94 F.3d at 1299 (citation omitted) (alteration and
emphasis in the original). Having to ask for permission, and
presumably to pay for the right to use an owner's copyrighted
work may be an inconvenience, and perhaps costly, but it can-
not be assumed to be as a matter of law a substantial burden
on the exercise of religion. In the absence of evidence that
PCG's needs could not reasonably be accommodated under
the copyright laws, we decline to hold that enforcement of
those laws in these circumstances constitutes an unreasonable
burden.3
IV. CONCLUSION
The undisputed facts establish as a matter of law that PCG
is not entitled to claim fair use. Because infringement by PCG
of WCG's copyright is undisputed, barring fair use, WCG is
entitled to a permanent injunction against the reproduction
and distribution by PCG of MOA. Accordingly, we reverse
the judgment for PCG in Nos. 99-55934 and 99-56489, and
the denial of WCG's motion for a preliminary injunction in
No. 99-55850, dismiss the appeal from the denial of WCG's
motion for an injunction pending appeal in No. 99-56005 as
moot, and remand for entry of a preliminary injunction pend-
ing a trial of any damages and final adjudication.
Costs on appeal to WCG.
SO ORDERED.
_________________________________________________________________
BRUNETTI, Circuit Judge, dissenting:
I respectfully dissent and disagree with the majority's
reversal of the district court's ruling on fair use.
The copyright dispute in this case arises from a change in
religious doctrine of the Worldwide Church of God ("WCG").
This doctrinal shift produced a splinter church, the Philadel-
phia Church of God ("PCG"). PCG, which was founded by
"defrocked" WCG ministers in 1989, seeks to adhere to
WCG's original religious doctrine as espoused by its former
leader Herbert W. Armstrong. In particular, PCG views Mys-
tery of the Ages ("MOA"), a book written by Armstrong, as
a divinely inspired text necessary for proper interpretation of
the Bible. It is required reading for every member baptized
into the PCG church and any prospective member prior to
their attendance at church services.
WCG, on the other hand, has renounced many of Arm-
strong's teachings since shortly after his death in 1986.
Although it had previously distributed approximately 1.25
million copies of MOA in book form and 8 million copies in
serial form, WCG ceased publication and distribution of MOA
in 1988. WCG then destroyed all excess copies of MOA in its
inventory, retaining only archival and research copies. WCG
has not printed or distributed any copies of MOA since 1988
and has no plans for publication or distribution of the work as
originally written.
WCG took this course of action, at least in part, because it
believes that MOA contains historical, doctrinal and social
errors. Armstrong's successor at WCG explained that WCG
has kept MOA out of print based on a "Christian duty" to keep
Armstrong's doctrinal errors out of circulation. WCG has
described MOA as "not in conformity with biblical teaching"
and "racist." Although WCG claims that it plans to publish an
annotated version of MOA, as of 1998, a decade after it
ceased publishing MOA, testimony of WCG leaders demon-
strates that the annotation of MOA is "not something that is
going to be decided or happen any time soon." Apart from
determining whether an annotation is financially feasible,
WCG would need to take surveys of its membership, assess
its priorities, determine the format, hire an author and
researcher, and secure a publisher before any such annotation
of MOA could be published.
PCG was founded because its ministers and members
believe the religious doctrine espoused by Armstrong and as
set forth in MOA. When WCG changed its church doctrine
and renounced much of Armstrong's teachings, the founders
and believers of PCG were forced from WCG as they could
no longer practice their religious beliefs as set forth in MOA.
It was WCG's doctrinal shift and renunciations that created
the PCG and its need to publish MOA.
In light of these facts, this court must decide whether
PCG's publication and distribution of MOA to church mem-
bers and the public without charge beginning in January 1997
constitutes fair use of WCG's copyrighted work.
The fair use doctrine is an equitable rule of reason. Sony
Corp. of America v. Universal City Studios, Inc., 464 U.S.
417, 448 & n.31 (1984). The statutory factors listed in 17
U.S.C. S 107 provide guidance in determining when the fair
use doctrine applies. However, there are no bright-line rules
and "each case raising the [fair use] question must be decided
on its own facts." Id. at 448 n.31 (quoting H.Rep. No. 94-
1476). All four statutory factors "are to be explored, and the
results weighed together, in light of the purposes of copy-
right." Campbell v. Acuff-Rose Music, Inc. , 510 U.S. 569, 578
(1994).
Here, PCG, a nonprofit organization, copied and distributed
MOA free of charge to spread a religious message. PCG
began publishing MOA because it was out of print and diffi-
cult to obtain through normal channels. It is undisputed that
PCG did not solicit any funds in connection with its distribu-
tion of MOA. PCG's use stands in sharp contrast to other uses
found to be commercial under the first statutory factor. See
Campbell, 510 U.S. at 583-85 (parodic rap song sold to the
public); Harper & Row Publishers, Inc. v. Nation Enterprises,
471 U.S. 539, 562 (1985) (magazine printed excerpts of soon-
to-be published presidential memoir); Dr. Seuss Enterprises
L.P. v. Penguin Books USA, Inc., 109 F.3d 1394, 1403 (9th
Cir.), cert. dismissed, 118 S.Ct. 27 (1997) (book-length par-
ody of O.J. Simpson murder trial written in style of Dr. Seuss
and intended for public sale); Hustler Magazine, Inc. v. Moral
Majority, Inc., 796 F.2d 1148, 1152-53 (9th Cir. 1986) (maga-
zine's parody of prominent minister mailed to minister's sup-
porters together with letters soliciting donations and displayed
on television as part of a fundraising drive).
Despite PCG's nonprofit status, its free-of-charge distribu-
tion of MOA, and the religious purpose behind such distribu-
tion, the majority concludes that the first statutory factor
militates against a finding of fair use because PCG's use is
not transformative and PCG profits by using MOA as a mar-
keting tool to attract new tithing members. As an initial mat-
ter, PCG's use need not be transformative to qualify as fair
use. Campbell, 510 U.S. at 579. In this case, altering or
adding to MOA would defeat PCG's religious purpose
because it believes that MOA is a divinely inspired text. As to
the profitability of PCG's use, WCG does not contest PCG's
assertion that unsolicited donations in response to the distribu-
tion of MOA fail to come close to covering the enormous
expense of printing MOA. WCG itself has stated that the
costly production of MOA was one of the reasons it ceased
publication. In my view, the noncommercial and religious ele-
ments of PCG's use overwhelm any commercial aspects and
weigh in favor of fair use under the first statutory factor.
Moreover, the fact that MOA had been out of print for nine
years at the time of PCG's publication and could only be
obtained through some libraries and used bookstores also sup-
ports a finding of fair use under the first factor. See Harper
& Row, 471 U.S. at 553 ("A key, though not necessarily
determinative factor in fair use is whether or not the work is
available to the potential user. If the work is out of print and
unavailable for purchase through normal channels, the user
may have more justification for reproducing it . . ..") (quoting
S.Rep. No. 94-473 (1975)); Maxtone-Graham v. Burtchaell,
803 F.2d 1253, 1264 n.8 (2d Cir. 1986) (out-of-print status of
copyrighted book supports fair use determination).
The second and third statutory factors are mostly irrelevant
to this case. For example, as a religious text, Armstrong's
MOA defies easy classification under the second factor as
either informational or creative. Compare New Era Publica-
tions, Int'l v. Carol Publishing Group, 904 F.2d 152, 157 (2d
Cir. 1990) ("the quoted works -- which deal with [Scien-
tology founder L. Ron] Hubbard's life, his views on religion,
human relations, the Church, etc. -- are more properly
viewed as factual or informational") and Religious Technol-
ogy Center v. Netcom On-Line Com. Services, Inc., 923
F.Supp. 1231, 1246 (N.D. Cal. 1995) (policy letters of Hub-
bard Communication Office and works which are part of the
methodology of "applied religious philosophy" are primarily
functional or instructive, but other Hubbard works which
appear more creative or original deserve greater fair use pro-
tection) with Bridge Publications, Inc. v. Vien , 827 F.Supp.
629, 635-36 (S.D. Cal. 1993) ("the undisputed evidence
shows that L. Ron Hubbard's works are the product of his cre-
ative thought process, and not merely informational"). As to
the amount of copying, even wholesale copying does not
weigh against a finding of fair use under the third factor if it
is consistent with the noncommercial purpose and character of
the use. Sony, 464 U.S. at 449-50. In contrast to Hustler
where the purposes of raising funds and rebutting derogatory
information could have been served by less than wholesale
copying of the parody, PCG's purpose in seeking to spread
the religious message of Armstrong's divinely inspired text,
like the nonprofit purpose of home videotaping in Sony Corp.,
requires copying of the text as a whole. Accordingly, neither
the second nor the third statutory factor militate against a
finding of fair use.
Even though PCG's use is primarily noncommercial and
religious, such use could not be considered fair use in light of
the fourth and most important statutory factor if it impaired
the value or marketability of WCG's original MOA or its pro-
posed annotated MOA. Yet, WCG has intentionally kept MOA
out of circulation and made no reasonable effort to create an
annotated version of MOA in the decade following its deci-
sion to cease publication. WCG originally distributed MOA
free of charge as a way of spreading the religious message of
its then current leader Armstrong. Like PCG, WCG used
MOA as an educational and evangelical tool and may have
obtained an indirect financial benefit by attracting tithing
members. WCG's decision to cease publication of MOA,
destroy inventory copies, and disavow MOA's religious mes-
sage in the context of its doctrinal shift as a church demon-
strates that MOA is no longer of value to WCG for such
purposes, regardless of PCG's actions. Because WCG has
admitted that it has no plans to publish or distribute MOA as
originally written, there can be no market interference.
Nor has WCG shown that "some meaningful likelihood of
future harm exists" as to the potential market for WCG's
planned publication of an annotated version of MOA. See
Sony Corp., 464 U.S. at 451. In Maxtone-Graham v. Burtch-
aell, 803 F.2d 1253 (2d Cir. 1986), the court determined that
publication of a book opposing abortion which used quota-
tions from an earlier book tending to view abortion in a favor-
able light did not economially harm the earlier work. The
court held that the plans for a second edition of the earlier
work was not affected by the publication of the infringing
work in part because "it is unthinkable that potential custom-
ers for a series of sympathetic interviews on abortion and
adoption would withdraw their requests [for a second edition]
because a small portion of the work was used in an essay
sharply critical of abortion." Id. at 1264. It continued by stat-
ing that "[t]his conclusion is supported by our finding that the
two works served fundamentally different functions, by virtue
both of their opposing viewpoints and disparate editorial for-
mats." Id.
Here, as in Maxtone-Graham, the functions served by MOA
and the proposed annotation as well as their potential markets
are different. In contrast to PCG's evangelical use, the central
purpose behind WCG's proposed annotated version of MOA
is to identify Armstrong's historical, doctrinal, and social
errors. The target markets for the two versions of MOA are
different because it simply does not make sense for WCG to
widely distribute an annotated MOA highlighting the errors of
the original MOA to the general public in order to recruit new
members. Unlike a publication which would provide a
straight-forward explanation of WCG's religious doctrines for
the purposes of recruitment, an annotated version of MOA
would require a reader to become familiar with the text of the
original MOA and then to read WCG's response to or criti-
cism of Armstrong's religious views in order to discover
WCG's doctrines. Indeed, because WCG hopes to use an
annotated MOA to reach out to those familiar with Arm-
strong's teachings, PCG's use creates a larger potential mar-
ket for an annotation rather than interfering with it. Moreover,
the failure of WCG to make any reasonable progress on the
annotation over the course of a decade as well as WCG's
belief that it has a Christian duty to keep Armstrong's doctri-
nal errors out of circulation tends to undermine the credibility
of WCG's intention to publish any such annotation.
Because there is no evidence, beyond the mere speculation
by WCG's leaders, that PCG's use has a "demonstrable effect
on the potential market for, or value of," MOA or WCG's pro-
posed annotation, the use "need not be prohibited in order to
protect the author's incentive to create." Sony Corp., 464 U.S.
at 450. The prohibition of PCG's noncommercial, religious
use "would merely inhibit access to ideas without any coun-
tervailing benefit." Id. at 450-51. Accordingly, the fourth stat-
utory factor also supports a finding of fair use.
In this lawsuit, WCG appears less interested in protecting
its rights to exploit MOA than in suppressing Armstrong's
ideas which now run counter to church doctrine. Although the
Supreme Court has recognized that "freedom of thought and
expression `includes both the right to speak freely and the
right to refrain from speaking at all,' " it does not "suggest
that this right not to speak would sanction an abuse of the
copyright owner's monopoly as an instrument to suppress
facts." Harper & Row, 471 U.S. at 559.
In light of this principle and the statutory factors discussed
above, I conclude that the district court did not err in granting
partial summary judgment to PCG because it properly found
that PCG's distribution of MOA constitutes fair use.
_______________________________________________________________
FOOTNOTES
*The Honorable William W Schwarzer, Senior United States District
Judge for the Northern District of California, sitting by designation.
1 The district court granted WCG's motion to strike the RFRA defense
and counterclaim before reaching PCG's summary judgment motion. The
RFRA issue is before us, therefore, only by way of the appeal from the
final judgment.
2 Because the Church plans at some time to publish an annotated version
of MOA, it is entitled to protection of its copyright. This is not a case of
market failure, as PCG contends, for the very reason stated in the article
on which it relies:
When an owner refuses to license because he is concerned that
defendant's work will substitute for his own work or derivative
works, the owner is representing not only his own interest, but
also the interest of his potential customers and thus the public
interest. Market failure should be found only when the defendant
can prove that the copyright owner would refuse to license out of
a desire unrelated to the goals of copyright--notably a desire to
keep certain information from the public.
Wendy Gordon, Fair Use As Market Failure: A Structural and Economic
Analysis of the Betamax Case and its Predecessors , 82 Colum. L. Rev.
1600, 1634 (1982).
3 Because we decide that PCG has not met RFRA's substantial burden
test, we need not decide whether the Copyright Act is the least restrictive
means of serving a compelling governmental interest. See 42 U.S.C.
S 2000bb-1(b).