Page 213 - A Study on the Role of UGC Platforms in Copyright Law：An Intermediary-oriented Approach

A Study on the Role of UGC Platforms in Copyright Law: Chapter 7 Platform Users’ Entitlement to UGCs: Human Use and Web Scraping
An Intermediary-oriented Approach

the Second Circuit Court of Appeals clarified with regard to the fair use rule:

[It] imposes no requirement that a work comment on the original
or its author in order to be considered transformative, and a secondary
work may constitute a fair use even if it serves some purpose other
than those (criticism, comment, news reporting, teaching, scholarship
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and research) identified in the preamble to the statute.

Nevertheless, as Section 5.2 discussed, the fair use doctrine is highly uncertain and
unpredictable and fits professional use more than large scale amateur use.
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7.2.3 Proposed schemes for human users’ use of UGCs

This thesis proposes a scheme to address the use of UGCs that cannot be shielded by
ToUs/ToSs or the statutory privileges. To correspond with the non-commercial UGC levy
schemes proposed in Chapters 4 and 5, the proposed scheme here establishes different
guidelines for commercial use and non-commercial use. In line with the definition of ‘non-
commercial use’ under the UGC levy schemes, non-commercial use of a UGC under this
scheme refers to a use conducted by a user who does not capture significant revenues as a
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direct consequence of using the UGC. The scheme only applies to copyrighted UGCs.
The non-commercial use of a UGC is free from both permission and remuneration,
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provided that the user informs the UGC creator of the use. Free use of UGCs for non-
commercial purposes has already been accepted by many UGC platforms, as discussed in
Section 7.2.1. Free use of UGC is also justified by the significantly less cost a UGC creator
incurs than a traditional copyright owner would for creating and distributing the works.
However, in this thesis a notice requirement is imposed on the user because non-commercial
use of UGCs still draws attention and traffic to the UGC platform, which results in indirect
remuneration that UGC creators can gain. Notice of how the UGC has been used would

nd
32 Cariou v. Prince, 714 F.3d 694, 705 (2 Cir., 2013).
33 Joseph P Liu, ‘Fair Use, Notice Failure, and the Limits of Copyright as Property’ (2016) 96 Boston University Law Review
101; Beebe (n 30) 622.
34 Section 5.4.2.
35 Theoretically, if the noncommercial use of the UGCs is for the sole purpose of creating second-generation UGCs, such use
would fall within the scope of the noncommercial UGC creation levy scheme under which the UGCs user can use the UGCs
for free and the UGCs platform should remunerate the UGC creator. Whereas, it is difficult to form a collective society
for UGC creators since most UGC creators are not repeat players. (Robert P Merges, ‘Contracting Into Liability Rules:
Intellectual Property Rights and Collective Rights Organizations’ (1996) 84 California Law Review 1293, 1296) The second-
best entity to collect and distribute the remuneration is the UGCs platform because a UGC platform has the information
of all its registered UGC creators and is the entity who can contact a large number of diffused UGC creators with the least
cost. However, since UGCs platforms are frequently shifting between the role of the entity that pays the levies (the platform
that hosts the second-generation UGCs) and the role of the entity that collects the levies (the platform that hosts the first-
generation UGCs), there would be no need for UGCs platforms to collect and distribute levies at the outset. Moreover, UGC
creators should not get remuneration from the use of UGCs otherwise they cannot be protected by the noncommercial UGCs
levy schemes.

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