Advanced Copyright Issues on the Internet - Fenwick & West LLP

(c) in respect of specific acts of reproduction made by publicly accessiblelibraries, educational establishments or museums, or by archives, which are notfor direct or indirect economic or commercial advantage;(d) in respect of ephemeral recordings of works made by broadcastingorganizations by means of their own facilities and for their own broadcasts; thepreservation of these recordings in official archives may, on the ground of theirexceptional documentary character, be permitted;(e) in respect of reproductions of broadcasts made by social institutions pursuingnon-commercial purposes, such as hospitals or prisons, on condition that therightholders receive fair compensation.It is interesting to note that the majority of these exceptions are conditioned upon therightholders receiving fair compensation, and they cover only copying that is for noncommercialpurposes. Exception (b) is of particular interest, for it provides a right for naturalpersons to make copies for private use and for purposes that are neither directly or indirectlycommercial, provided the rightholders receive fair compensation. Presumably the exceptionwould apply where a natural person has purchased a copy of a copyrighted work, therebyproviding fair compensation to the rightholders, and thereafter makes additional copies forpersonal, noncommercial uses – e.g., by making a copy of one’s purchased music CD onto acassette for use in one’s car. The drafters of the European <strong>Copyright</strong> Directive deemed this rightof private use to be of such significance that under Article 6(4), member states are permitted totake measures to ensure that beneficiaries of this right are able to take advantage of it, “unlessreproduction for private use has already been made possible by rightholders to the extentnecessary to benefit from the exception or limitation concerned and in accordance with theprovisions of Article 5(2)(b) and (5), without preventing rightholders from adopting adequatemeasures regarding the number of reproductions in accordance with these provisions.” 182The right of private use contained in Article 5(2)(b) is similar to a right afforded in theUnited States under the Audio Home Recording Act (AHRA), 17 U.S.C. § 1008, whichprovides, “No action may be brought under this title alleging infringement of copyright based onthe manufacture, importation, or distribution of a digital audio recording device, a digital audiorecording medium, an analog recording device, or an analog recording medium, or based on thenoncommercial use by a consumer of such a device or medium for making digital musicalrecordings or analog musical recordings.” This statute is discussed in detail in Section II.A.7below, and in Section III.C.2.(c)(1) below in connection with the Napster litigations. Napster,Inc., the operator of a service that enabled subscribers to share music files in MP3 audio formatwith one another, asserted the AHRA as a defense to an allegation by copyright owners that itwas contributorily and vicariously liable for the unauthorized sharing of copyrighted soundrecordings through its service. Napster argued that the AHRA permitted its subscribers to share182Under the last paragraph of Article 6(4), this right of member states to take measures to ensure thatbeneficiaries of the right of private use are able to take advantage of it does not apply “to works or othersubject-matter made available to the public on agreed contractual terms in such a way that members of thepublic may access them from a place and at a time individually chosen by them.”- 54 -