A “Prince” of an Opinion or a Drag on Creativity? SCOTUS Decides Fair Use Issues in Andy Warhol Foundation for Visual Arts, Inc. v. Goldsmith[1]

Written by Eleanor M. Lackman and Robert H. Rotstein

On May 18, 2023, in a 7-2 ruling, the United States Supreme Court held that Andy Warhol’s use of a photograph of the late musician Prince to create a new image for licensing in a magazine was not “transformative” under the first fair use factor set forth in 17 U.S.C. § 107. Because Petitioner Andy Warhol Foundation for Visual Arts, Inc. (“AWF”) did not challenge the Second Circuit’s conclusion that the other three fair use factors weighed against fair use, the Court affirmed the holding against AWF.

In 1981, photographer Lynn Goldsmith photographed Prince, then an up-and-coming musician. Several years later, the magazine Vanity Fair hired Andy Warhol to create an illustration of Prince. Under a limited, one-use-only license from Goldsmith, Warhol created an illustration that appeared in a 1984 issue of Vanity Fair using Goldsmith’s black and white photograph as a reference in accordance with the license.However, without permission, Warhol created a series of 15 additional works based on Goldsmith’s photographs. In 2016, AWF licensed one of the Warhol works to Condé Nast for a magazine article about Prince. Meanwhile, Goldsmith had previously licensed her photo to other magazines in connection with articles about Prince. When Goldsmith discovered Condé Nast’s unauthorized use, she threatened to sue for copyright infringement. Before she could do so, AWF sued seeking a declaratory judgment arguing that Warhol’s use of Goldsmith’s photo constituted fair use under section 107 (and Goldsmith countersued). In response, AWF argued that Warhol’s use of Goldsmith’s photo constituted fair use under section 107.

Under section 107, a court determines whether a use is fair based on a four-factor test: (1) the purpose and character of the use; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used; and (4) the effect of the use upon the potential market for or the value of the original. The district court found Warhol’s use to be fair. The Second Circuit reversed. By AWF’s construction in its petition, the sole question before the Supreme Court was whether the first factor weighed in favor or against fair use.

The Court first noted that under the first fair use factor, a court will analyze whether an allegedly infringing work has a further purpose or different character from the original purpose. The resolution is a “matter of degree,” and the degree of difference will be weighed against other factors—most importantly, the use’s commerciality. One way to measure the purpose and character is to inquire into whether the defendant’s use has a transformative purpose. In the case before it, the Court focused on the narrow purpose of AWF’s use—namely, AWF’s commercially licensing of the Warhol image to Condé Nast for publication—and held that Goldsmith’s original photograph of Prince had substantially the same purpose. Thus, because the use was non-transformative and commercial, the Court held that the first factor weighed against fair use.

The Court rejected AWF’s argument that a defendant’s work is transformative simply because it might convey a different meaning or message from the original. As the majority noted, so too do derivative works, such as sequels and spin-offs. While a different meaning or message might be relevant to whether a defendant’s use has a distinct purpose or character under section 107, adding a new or different meaning or message is not dispositive. To hold otherwise, according to the Court, would eviscerate the copyright holder’s rights under 17 U.S.C. § 106(2) to make derivative works—which by definition “transform” the original work. As examples of transformative uses with a different purpose or character, the Court referred to the parody in Campbell v. Acuff-Rose, Inc., 510 U.S. 569, 679 (1994) and the defendant’s use of the plaintiff’s software in a distinct and different computing environment in Google LLC v. Oracle America, Inc. 593 U.S. ___ (2021). Finally, the fair use test is not a subjective test, based on what message judges or art critics might be able to perceive in the defendant’s work. Rather, the test is objective: what was the actual purpose of the work and does that purpose substitute for the original? In AWF, despite the aesthetic value of Warhol’s image, both works at issue served the purpose of providing a licensed image to a magazine for an article about Prince.

In her dissenting opinion, Justice Kagan expressed concern that the majority’s focus on the manner of exploitation—rather than changes to the original work—would stifle creativity. The dissent would have found Warhol’s use transformative simply because his work had a different meaning or message from the Goldsmith photograph. In answer to the majority’s concerns about the derivative work right, the dissent stated that the fourth fair use factor—market harm—would preserve the right to make derivative works.

Significantly, the majority opinion is very narrow, focusing only on the use of images for licensing to magazines for articles about Prince. The Court expressed no opinion on whether AWF’s use would be transformative in other contexts. For example, the Court reserved judgment on whether use of Warhol’s image would be transformative in a book about Warhol or at a nonprofit museum.

Moreover, while the Court noted that a secondary work that targets the original—e.g., through commentary, criticism, or parody—will tend to be more transformative, the Court specifically did not require that the secondary work target the original. Indeed, the Court explicitly made that point both in a footnote and by its citation of Google v. Oracle and lower court cases that did not involve targeting the original. Finally, the Court reaffirmed the principle that in analyzing fair use, all four factors still count and must be weighed together.

In summary, given its narrow focus, the Court’s opinion will not likely change existing fair use law as fashioned by the lower courts since Campbell.

[1] MSK represented certain Amici Curiae that filed a brief in the matter in support of neither party.

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