[Jbarnes]

Ron, your apology is accepted – though you may owe me another one for calling me “James” twice when my name is “Jason.”

I read your article and found it to be informative and accurate. Thank you for referring us to it.

You are exactly right when you say that an indemnification agreement cannot protect you for knowingly breaking the law – I never suggested otherwise. What I did say was that an indemnification agreement is a legitimate way to protect oneself if you have a good faith belief that you are practicing fair use under the guidelines provided by the PTO and the courts. If you have a good faith belief that you are covered under the doctrine, you are, arguably, not breaking the law. Of course, the idea of “good faith” is every bit as difficult to define as the meaning of “fair use.”

Every artist, in my opinion, should be careful of relying on the doctrine of fair use for protection.

Frank Otto’s post about getting a “proof of compliance” declaration from your client is an excellent suggestion. I would include indemnification language in that document, as well.

My own work of 15 years puts me in front of judges and juries at both the state and federal level – as well as the Patent and Trademark Office and the International Trade Commission – every month. I would feel confident in relying on my due diligence (as suggested by Frank Otto) and subsequent good faith belief along with an indemnification or “proof of compliance” document to protect me under the doctrine.

Contrary to your reproof, I believe that for-profit companies use the doctrine to incorporate the copyrighted works of others into their products all the time. A viewing of the “Tonight Show” will provide ample example of this practice (parody exemption). It may not be such a clear exemption when used in the corporate presentation environment, but it is certainly not out of the question.

As for damages due to a copyright holder, remember that they are limited to his/her actual damage (lost sales) or your profits (ill-gotten gains), necessary expenses and, in some cases where you knowingly violate the copyright laws, exemplary damages (treble the real damages). Treble damages are generally levied only in situations that are egregious. The situations I have run across are generally resolved prior to any lawsuit and settle for the cost of a license plus a reasonable premium for the trouble.

I don’t know where you got the statistic about most settlements being in the $150K range and up you cite in your article or to what kind of cases that statistic refers to so I cannot comment on how that conflicts with my own experience. I agree that there are certainly many cases that do result in this kind of finding, though I also think many more are resolved for substantially less.

I hope this post doesn’t sound like I am advocating wholesale theft of intellectual property from artists under the guise of fair use. I am unequivacably against the idea. I merely wanted to join in the discussion and share what I know on the subject. Everyone in the business should read the law and the cases and make up your own mind.

Have a great weekend.

Jason Barnes

[Jbarnes]

https://www.copyright.gov/fls/fl102.html

This site will explain what is called the “doctrine of fair use” which was developed through a series of high court decisions and has now been codified as law.

Basically, under the doctrine of fair use, you can incorporate pieces of copyrighted works into your own original work under some circumstances. In your situation, you may find yourself covered under the doctrine if the use will be a parody or if it will be used for educational purposes. Alternately, your use may be “fair” if the portion you use is a small portion of the original and a small portion of your completed work. Please review the page above and the many other explanations that can be found via a quick web search.

If you think that this doctrine applies to your use of the copyrighted work, e.g., you have a “good faith” belief that it is fair use, an indemnification from your client will cover your liability if the copyright holder wants to bring suit. Check with your lawyer for specific language for your situation. Your liability is likely limited to the money you make on the job – since you have a good faith belief, there is no treble damage available. Any loss of market value to the copyright holder (if any) will likely be the problem of your client.

The best course of action is, of course, to avoid any use of unlicensed copyrighted material unless it is CLEARLY subject to the fair use doctrine. Even if you are sure, explain the doctrine to your client, send them some links on the subject and get the indemnification signed.

Jason Barnes