"Coursepack" publisher liable for copying without permission

MICHIGAN–In early November, the U.S. Court of Appeals in Cincinnati (6th Cir.) ruled 8-5 that a Michigan business owner who sold “coursepacks” to college students without paying royalties to copyright owners had violated federal copyright laws.

James Smith, owner of Michigan Documents Services Inc., argued that the multiple copies of educational materials he produced for students at the University of Michigan were lawful under the “fair use” doctrine, which allows reproduction of copyrighted materials under certain circumstances, including where the reproduction is for an educational use.

The court found that Smith’s photocopying was of a commercial nature and not for nonprofit educational purposes. Although the actual nature of the content — excerpts from six academic works — was educational, the purpose was purely commercial, the court ruled.

Ann Arbor, home of the University of Michigan, has several copy shops to serve professors’ needs, but only Smith refused to pay royalty fees. He even advertised this fact, emphasizing that professors who used his services would not have to wait for publisher permission to reproduce copyrighted materials, according to court findings.

Three publishing firms, Princeton University Press, MacMillan Inc. and St. Martin’s Press, sued both Smith and his corporation. In June 1994, a federal district judge in Ann Arbor awarded the publishers damages of $5,000 for each copied work. Smith appealed, and the judgment was reversed by a three-judge panel in February. The full court then reconsidered the case, and ruled in favor of the publishers. It ordered the federal District Court to reconsider the damage award on the grounds that Smith reasonably believed the copying constituted fair use, so the infringement was not willful.

In one of the three dissenting opinions, Chief Judge Boyce Martin Jr. wrote that because Michigan Document Services provided a service that promoted scholarship and higher education, the copying was a fair use of the material. Martin added that the majority’s opinion presented an “obvious example of how laudable societal objectives … have been thwarted by a decided lack of judicial prudence.” (Princeton University Press v. Michigan Document Services; Publishers’ Counsel: J. Michael Huget, Ann Arbor)