The Volokh Conspiracy

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"What's Wrong and What's Missing in the SG's Amicus Brief in Andy Warhol Foundation v. Goldsmith"


Andy Warhol Foundation v. Goldsmith promises to be an important precedent on fair use in copyright (itself an important area of the law), but I'm sorry to say I haven't been following it closely. Fortunately, Prof. Pam Samuelson (Berkeley), one of the leading senior scholars of copyright law in the country, and her colleague Prof. Mark Gergen put together this very interesting analysis, which I'm delighted to be able to pass along:

The Solicitor General (SG) of the U.S. has long had a reputation for excellent advocacy, considerable influence, and a high success rate with the Supreme Court when it files amicus curiae briefs in private litigant cases, so much so that the holder of this position is often said to be "the Tenth Justice."

One of us (Samuelson) has a work-in-progress about the mixed record of success that the SG has had in copyright cases, especially when it comes to substantive interpretations of that law's provisions. In last year's Google v. Oracle case, for example, the Supreme Court decided that Google's reimplementation of parts of the Java API was fair use as a matter of law, which was a strikingly different conclusion than the SG offered in its amicus briefs in support of Oracle. The same has been true for the SG's record in several other copyright cases in recent decades.

It wasn't clear until August 15, 2022, whether the SG would file an amicus brief in the most recent copyright case to come before the Court, Andy Warhol Foundation v. Goldsmith. Since the mid-1980s, the SG has filed amicus briefs in 16 of the 27 (60%) private litigant cases, so it wasn't a given that the Goldsmith case would attract an SG brief.

The Solicitor General (SG) Elizabeth Prelogar did, however, file an amicus brief asserting that the Foundation's commercial licensing of a colorful Warhol print of the singer Prince for the cover of a special issue of a Conde Nast magazine was not a fair use of Lynn Goldsmith's copyrighted photograph of the singer.

After reading this brief and talking over the issues in the Goldsmith case, we decided that the Volokh Conspiracy readership would find it interesting to get our take on the SG's arguments. We find the SG's brief troubling in several respects. One has to do with the SG's effort to reframe the question presented in Goldsmith. A second relates to the SG's inattention to a license that existed when Warhol created a series of works based on Goldsmith's photograph. A third concerns the SG's failure to explore the consequences likely to flow from rejecting the Foundation's fair use defense. Fourth, the compromise the SG proposes—allowing the Foundation to retain copyright but denying it the right to license certain uses—is infeasible as a matter of law. For these reasons, we think the SG's brief is unlikely to be persuasive with the Justices in Goldsmith.

The SG Tries to Reframe the Issues

The SG contends that the validity of the Foundation's copyrights in a series of sixteen Warhol prints and drawings of Prince is not at issue in the lawsuit before the Court. In her view, the only issue is whether the Foundation's commercial licensing of one image to a magazine infringed Goldsmith's copyright. This is incorrect.

The litigants are fighting about the legality of Warhol's creation of sixteen works of art depicting Prince, not just one relatively recent licensed use of one image. The Foundation contends that Warhol's prints and drawings based on Goldsmith's photograph of the singer are transformative fair uses because these works of art have a new meaning or message than the photograph and operate in totally different markets than Goldsmith's photograph. Two Supreme Court precedents state that having a new meaning or message makes works transformative, a consideration that weighs in favor of fair use claims.

Goldsmith contends that Warhol's works are not transformative because they are recognizably similar to her photograph, share the same purpose of depicting the singer, and harm her licensing markets. Goldsmith's complaint asked the court to find that all of Warhol's Prince works are infringing derivatives.

Some Background Facts

Before further addressing the legal issues, let's get some key facts straight. In 1984 Vanity Fair decided to publish an article on the then up-and-coming rock musician Prince and wanted an artistic image of him to accompany the article. It contracted with Goldsmith's agent to use one of Goldsmith's 1981 photographs of Prince as an "artist reference," so that Vanity Fair could commission someone to make an image based on the photograph for the magazine. The license between Goldsmith's agent and Vanity Fair was for one-time-use-only and required Vanity Fair to attribute Goldsmith as the photographer on which the commissioned image was based. The article, with the accompanying Warhol image, was published in a Vanity Fair issue with the required attribution.

After Prince died in 2016, Conde Nast decided to publish a special issue about the musician and contacted the Foundation to license again the print it had published in 1984. When its agent discovered that Warhol had made several other prints of the musician, it chose to license a different one for the cover of the special issue and paid the Foundation $10,000 for use of that image. After Goldsmith saw the cover of the special issue, she contacted the Foundation to say that she should be compensated for this use of that image, which she claimed was an infringement of her copyright. The Foundation was so confident that the Warhol works were non-infringing that it brought a declaratory judgment action against Goldsmith, who then counterclaimed for infringement.

A trial court granted the Foundation's motion for summary judgment, holding that Warhol had made transformative fair use of the Goldsmith photograph. The Second Circuit Court of Appeals reversed, ruling that Warhol's works were non-transformative and not fair uses because Warhol's works were recognizably similar to her photograph and unfairly competed with her photograph in the market for licensing images of Prince for popular media publications. Although that court did not hold that the Warhol works were infringing derivatives, it suggested that they might be. The Foundation asked the Supreme Court to review the Second Circuit's ruling on the sole issue of whether Warhol's works were transformative because of the new meaning and message they conveyed. The Court granted this request.

Why Might the License Between Vanity Fair and Goldsmith's Agent Be Important?

One way in which the license between Vanity Fair and Goldsmith's agent might be important is that the sixteen prints created by Warhol under the Vanity Fair license may be authorized derivative works. Presumably Goldsmith's agent knew that Vanity Fair would hire an artist who would make some images based on the photograph, and that one of these images would be selected for publication in the magazine. Saying that the Vanity Fair license with Goldsmith's agent was for one-time-use-only does not foreclose the possibility the sixteen prints were authorized derivative works.

If the sixteen prints were authorized derivative works, then Warhol (and the Foundation after his demise) would own copyrights in this series of works, as they are certainly original enough to satisfy copyright's modest standards. If they were lawfully made derivatives, Warhol and the Foundation would be entitled to sell the originals to others and publicly display them in museums and the like under 17 U.S.C. § 109(a) and (c). As the successor to Warhol's copyrights, the Foundation would seem to have a legal entitlement to exploit the works commercially, just as any other copyright owner would.

The SG's brief indirectly raised this possibility by suggesting that Warhol may have created the Prince series "as part of his artistic process for creating the licensed 1984 Vanity Fair illustrations," but the brief did not characterize Warhol's creation of the works as licensed derivatives, let alone as fair uses.

The terms of the license between Vanity Fair and Goldsmith's agent are not relevant to the fair use issue before the Court because Warhol was not a party to that contract.

The Privity Problem

It is a fundamental principle of contract law that contracts bind only the parties who enter into them. As one of us (Gergen) has observed, privity rules "that prevent a contract from protruding negatively upon a nonparty serve a partitioning function. Because of these rules, when an actor engages in a transaction that is part of a chain or web of contracts, she need not worry about a contract to which she is not a party subjecting her to a contractual obligation." This work goes on to explain:

A pair of rules in contract law limit the legal effect of a contract to the parties to the contract. The first rule is that a contract cannot bind a nonparty or "destroy rights of a nonparty." There is no exception to this rule in contract law: other bodies of law must be used to get around it. Property law makes it possible to use a covenant to bind a non-party. A nonparty may also be liable for tortious interference with contract. And a non-party may be required to respect a contractual restriction on the use of property by the doctrine of equitable notice.

The second rule is that a nonparty acquires no rights under a contract. Modern contract law does make exceptions to this rule though the common law took some time to come around to this position. Modern contract law allows parties to a contract to bestow a contract right on a nonparty by assignment or as a third-party beneficiary.

Under the privity doctrine, Warhol cannot be bound by any contract restriction to which Vanity Fair agreed insofar as he was not a party to the contract with Goldsmith's agent.

Under some circumstances, courts have held that a third party can be bound by restrictions agreed to by contracting parties when that outsider knew about restrictions that limited uses of a resource and the outsider obtained the resource with knowledge of the restrictions. But there is no evidence that Warhol, let alone the Foundation, knew of any restriction upon his use of the photograph that would implicate his rights in the works he created for Vanity Fair.

What Warhol knew was that he was given the Goldsmith photo as an artist reference and that he was commissioned to create art for Vanity Fair. (That the Foundation now knows of the restriction is irrelevant. For the restriction to bind based on notice, Warhol must have had notice of the restriction at the time he created the prints.)

Had Warhol agreed with Vanity Fair not to commercialize the Prince works without getting permission from Goldsmith's agent, that would have bound him. The issue would then be whether Goldsmith was a third-party beneficiary to this agreement. But there is no evidence of such an agreement.

The SG's brief does not delve into the significance of the license as it affects the Warhol copyrights. Like the Second Circuit, the SG seems to think that the Foundation can make some uses of the Prince series, maybe even commercial ones, as long as they don't interfere with Goldsmith's markets. But how can courts decide which kinds of commercializations of the Warhol works are off limits and which are not?

This is the first case of which we are aware in which copyrights are thought to exist but be encumbered as to some uses despite the absence of an agreement to restrict an artist's uses of his copyrighted work.

In any case, Warhol did not lose his right to make fair uses of the Goldsmith photograph by virtue of a license restriction to which he had not agreed and of which, so far as we know, he was unaware. Moreover, nothing in the lower court decisions suggests that when the Foundation licensed the Warhol print to Conde Nast, it knew that Goldsmith or her photograph existed.

What If Goldsmith Is Right that the Prince Series Infringes Rights in Her Photograph?

Another issue that the SG's brief does not consider is an obvious implication of a possible ruling that Warhol's prints and drawings are infringing derivatives, as Goldsmith has alleged and the Second Circuit seemed inclined to believe. Section 103(a) of U.S. copyright law states that "protection for a work employing preexisting material in which copyright subsists does not extend to any part of the work in which such material has been used unlawfully."

This means that if the Warhol Prince works are infringing derivatives, the Foundation owns no copyrights in them. Copyrights that had been in existence since 1984 would suddenly vanish. Not only would the Foundation's licensing them infringe, but the Foundation could not even lawfully display the Prince works in the Andy Warhol Museum. And other museums that long ago purchased one of the sixteen works could not lawfully display them either, although the SG's brief suggests that this might be fair use because it would not harm the market for Goldsmith's photograph.

Some Final Reflections

One can understand the impulse to find some Solomonic compromise in the Goldsmith case. Vanity Fair paid Goldsmith's agent only $400 for use of the photograph as an artist reference. During his lifetime Warhol and then the Foundation have earned substantial revenues from Warhol's Prince series.

The Second Circuit contemplated a compromise under which if the Warhol works were infringing derivatives, the court could order that Goldsmith be compensated, but withhold injunctive relief and allow certain types of uses of the Warhol works that didn't compete with Goldsmith's photograph. The SG's proposed compromise does not question Warhol's copyrights and would limit infringement claims to the Foundation's commercial licensing of the works to certain types of clients. We think these proposed compromises are unsound as a matter of law.

The Warhol works at issue in Goldsmith are either fair uses or infringing derivatives. There is no middle ground. We think the fairest outcome would be for courts to find that Warhol's creations were either fair upon his creation of the Prince series or authorized under the license between Vanity Fair and Goldsmith's agent.

The Court should, moreover, answer the question on which it granted cert, not the SG's alternative formulation. Under the Court's precedents, including last year's Google v. Oracle decision, the Warhol Prince works were transformative because of the different meaning and message they conveyed as compared to Goldsmith's photograph.