The Seventh Circuit’s 2014 opinion in Kienitz v. Sconnie Nation has played an outsized role in the discourse on fair use, an affirmative defense to copyright infringement.1 The opinion is quite short, spanning just over three pages, and it emerged from a circuit that produces relatively few fair use opinions.2 Yet Kienitz is often cited for its rejection of “transformative use,” a relatively new but influential concept that has reshaped fair use doctrine.3 The court in Kienitz warned that transformative use threatens to replace the four-factor test for fair use found in § 107 of the Copyright Act4 and could erode authors’ exclusive rights to produce “derivative works” based on their original works.5 In place of transformative use, Kienitz proposed that courts should simply “stick with the statutory list” of four factors when analyzing fair use.6 The opinion applied this approach by focusing its analysis on factors three and four: the amount of the copyrighted work used and the effect of that use on the market for the copyrighted work.7
Is Kienitz’s approach a viable model for analyzing a fair use defense without relying on transformative use? The answer is no. This Note concludes that Kienitz’s reasoning is fundamentally flawed and suffers from many of the same infirmities it identified in transformative use.8
There are three problems with Kienitz’s reasoning. First, its approach to factor four defines the scope of derivative works in a way that would severely limit authors’ rights.9 Second, it employs a test, known as the “substitute/complement test,” which tends to underestimate market harm.10 Finally, its analysis of factor three implies there was no copyright infringement, which if true, would have made the fair use defense unnecessary.11 If Kienitz’s amputation of transformative use was an attempt to remedy its harmful symptoms, its cure was worse than the disease.12
Although its analysis was flawed, Kienitz’s diagnosis of the problems with transformative use was accurate.13 Transformative use has been applied in a way that has come to dominate the statutory fair use factors and blurs the line between protected derivative works and fair use.14 This Note proposes two ways to restructure fair use analysis to limit the negative effects of transformative use: (1) rearrange the order in which the factors are analyzed and (2) make a finding of transformative purpose a threshold requirement of transformative use.
Part I explains how the scope of fair use has contracted and expanded throughout United States history and how transformative use has driven the current period of expansion. Part II examines the analysis in Kienitz and concludes, for the reasons described above, that it does not provide a viable alternative to transformative use. Part III demonstrates an alternative fair use analysis of the facts in Kienitz to show how the opinion could have benefited from incorporating transformative use into its analysis and by applying this Note’s two proposals for restructuring fair use. In the process, Part III also reveals, and argues against, common issues in other courts’ analyses of each fair use factor, including the widespread underappreciation of factor two15 and Campbell v. Acuff-Rose Music, Inc.’s unprecedented instruction to emphasize findings from factor one in the analysis of factor three.16