What rights does a library in a for-profit educational institution have concerning reproduction and other exceptions to the Copyright Act?

Many of the exceptions detailed in the Copyright Act are available only to nonprofit educational institutions. For example, the classroom exception found in section 110(1) and the distance education provision in section 110(2) are restricted to nonprofit institutions. Also, the negotiated Guidelines on Multiple Copying for Classroom Use and the Guidelines for Educational Uses of Music apply only to nonprofit educational institutions. Neither the library exception nor fair use is so limited, however. The reason for this restriction to nonprofit educational institutions is statutory recognition of nonprofit education as a public good.

Section 108, the library exception, contains criteria that a library or archive must satisfy in order to qualify for the exception, but nonprofit status is not one of them. A library must (1) receive no direct or indirect commercial advantage from the reproduction of copyrighted works, (2) be open to the public or to researchers conducting specialized research, and (3) ensure that copies reproduced under this exception contain the notice of copyright.

Fair use is not limited to nonprofit educational institutions, but it is generally thought to be less robust for for-profit entities. One interesting development is that copyright owners do not appear to charge higher royalties for permissions to for-profit educational institution libraries. Thus, the royalties for electronic reserves, course packs, and the like seem to be the same for both types of schools.

Are public libraries considered educational institutions? What criteria are used to determine whether an organization is a nonprofit educational institution as part of the fair use exception?

For copyright purposes, the question is not whether an institution is educational in nature but whether it is organized under the U.S. tax code as a nonprofit educational institution. Nonprofit educational institutions have certain privileges and exceptions that apply to them in copyright that are not available to for-profit educational institutions or to other nonprofit organizations.

Libraries are not necessarily educational institutions. To some extent, the answer depends on the type of library. A library in a school, college, or university is a part of an educational institution, and therefore it qualifies. A corporate library, even in a nonprofit corporation, is not an educational institution. A public library, while it definitely has an educational mission, is a nonprofit library, but it is not a nonprofit educational institution. The Copyright Act contains no criteria for determining what constitutes a nonprofit educational institution, but the common understanding among most lawyers is that the status is determined by how the institution is organized under the U.S. tax code.

Academic libraries often subscribe to publications that they retain for only a few months and do not bind. Is there a problem in giving discarded issues to another department on campus? For example, the library subscribes to Paris Match, which it retains only for three months. The foreign language department wants the discarded issues.

It is perfectly permissible to give another department discarded materials. The Copyright Act states in section 109(a), the "first sale doctrine," that anyone who has a lawfully acquired copy of a work may dispose of that copy in any way. The library subscribes to journals, purchases materials, and receives other materials as gifts. It may lend these items to users, give them away, sell them, and so forth. Royalties go to the copyright holder only for the first sale (i.e., the library's subscription). The first sale doctrine does not permit the reproduction of those copies, however.

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