Copyright - Copyright Law In Action: Basic Books V. Kinko's Graphics Corp.

Copyright cases typically involve disputes between competing private interests: an author against someone who has copied the author's work without permission. However, the outcome of such cases often has significant repercussions for the general public as well. One such case with significant public effect was Basic Books v. Kinko's Graphics Corp., 758 F. Supp. 1522 (S.D.N.Y. 1991), which dealt with the question of whether photocopy stores may sell copied excerpts of books to college students without authorization from the books' publishers. The decision in the case ultimately affected the price that the public must pay for access to copyrighted information.

Many college and university students purchase photocopied materials from copy stores in association with courses they are taking. Usually consisting of chapters or sections taken from different books or journals, these photocopied materials enable students to read from a wide variety of sources without having to purchase a large number of books. By the late 1980s, book publishers realized they were losing sales owing to such photocopying. As a result, several publishers, including Basic Books, Inc., filed a lawsuit in federal court against one of the largest photocopy firms in the United States—Kinko's Graphics Corporation, a company that in 1989 had more than two hundred locations and annual sales of $54 million.

At issue in the case was the question of who may profit from the reproduction of an author's work, particularly with regard to the practice that Kinko's called anthologizing, which is the copying of book excerpts into course "packets" sold to college students. The publishers, the plaintiffs in the case, maintained that Kinko's violated the Copyright Act of 1976 (17 U.S.C.A. § 101 et seq.), by failing to secure permission to reprint the excerpts included in course packets and, in turn, pay the necessary fees involved, part of which would be passed on to the authors of the books. Kinko's claimed that its sale of the excerpts was an example of the kind of fair use that is allowed by the Copyright Act.

Citing the commercial interests involved—namely, the fact that Kinko's made a significant amount of money from the sale of course packets, and that packet sales competed with book sales—the court found that Kinko's was guilty of copyright infringement. It ordered the company to pay $500,000 in damages to the publishers and issued an order forbidding it to prepare anthologies without securing permission from and prepaying fees to the appropriate publishers.

Basic Books was a victory for the publishers and authors of books that are excerpted for course anthologies. As for Kinko's, it now has to pay fees to publishers, but it is able to pass on those costs to customers in the form of higher prices. Does this mean that students are the losers in this case? In the short run, yes, because they will pay more for their course materials. But in the long run, students and the rest of society may derive more benefit, even if it is indirect, from a system that rewards authors for their intellectual labor.