Section 107 of the Copyright Act 1976: Four Factors of Fair Use

Section 107 of the Copyright Act of 1976 is the federal statute that makes fair use legal in the United States. It lets you use copyrighted material without permission or payment for purposes like criticism, comment, news reporting, teaching, scholarship, and research, and it sets out a four-factor test that courts apply to decide whether any specific use qualifies.¹ The statute’s language is short. The case law that interprets it is where the real answers live.

What the Statute Says

Section 107 opens with a list of purposes that Congress considered generally compatible with fair use: criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, and research.¹ The statute uses the phrase “such as,” which signals that other purposes can qualify too. A book reviewer quoting to critique, a professor photocopying an article, a journalist reproducing a photograph to illustrate a story: each falls comfortably inside these examples.

The list is illustrative, not a checklist. Falling within a named category does not guarantee your use is fair. A professor who copies an entire textbook for a class still has to survive the four-factor analysis. The preamble opens the door. The four factors decide whether you walk through it.

How Courts Weigh the Four Factors

Section 107 directs courts to consider four factors together, and no single factor is automatically decisive. A use can fail on one factor and still qualify as fair overall if the remaining factors tip the balance.¹ Judges treat the analysis as a holistic balancing test rather than a scorecard, which is why outcomes can be hard to predict even when the facts look similar.

Factor One: Purpose and Character of the Use

The first factor looks at why and how you used the copyrighted material, including whether the use is commercial or nonprofit and educational.² Non-commercial uses get a friendlier reception, but a commercial motive does not automatically kill a fair use claim. The real weight of this factor comes from whether the new use is “transformative.”

Transformative Use After Campbell and Warhol

The concept of transformative use entered fair use law through the Supreme Court’s 1994 decision in Campbell v. Acuff-Rose Music, Inc., which involved 2 Live Crew’s parody of Roy Orbison’s “Oh, Pretty Woman.” The Court held that the central question is whether the new work merely replaces the original or instead adds something new with a different purpose or character.³ The more transformative the use, the less commercialism weighs against it.

That framing shifted in 2023 when the Supreme Court decided Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith by a 7–2 vote.⁴ The case involved Warhol’s silkscreen prints based on Lynn Goldsmith’s photograph of Prince. The Warhol Foundation argued the prints were transformative because they conveyed a different meaning. The Court rejected that argument, holding that when the original work and the secondary use share the same or a highly similar purpose, and the secondary use is commercial, the first factor is likely to weigh against fair use.⁵

After Warhol, adding new meaning or expression still matters, but it is not enough on its own. Courts now look more carefully at whether the secondary use actually serves a distinct purpose from the original. Licensing a silkscreen of a photograph to a magazine serves the same purpose as licensing the photograph itself, even if the silkscreen looks nothing like it. Anyone relying on fair use today needs to show not just that they altered the original, but that they used it for a genuinely different purpose.

Parody Versus Satire

Parody remains one of the strongest examples of transformative use because it targets the original work itself. A parody has to borrow from the original to make its point, which gives it a built-in justification for copying. The Supreme Court recognized this in Campbell, noting that a parody needs to mimic the original to function.⁶

Satire gets less protection because it uses a copyrighted work as a vehicle to criticize something else. If your joke is about society or politics rather than about the specific work you borrowed from, a court will ask why you needed to copy that particular work at all. The general rule is that the more your work comments on the original, the stronger your fair use argument.

Factor Two: Nature of the Copyrighted Work

The second factor considers what kind of work was copied. Creative and imaginative works like novels, films, and songs receive stronger protection than factual works like technical manuals and biographies.² Copyright exists to protect original expression, and creative works contain more of it. Using a chart from a research paper is more likely to be fair than using a passage from a novel, all else being equal.

Publication status also matters. The statute explicitly states that a work being unpublished does not bar a fair use finding, but courts treat unpublished material more cautiously because authors have a recognized interest in controlling the first public appearance of their work.¹ In practice, this factor rarely decides a case on its own. It tends to reinforce whichever direction the other factors are already pointing.

Factor Three: Amount and Substantiality of the Portion Used

The third factor examines how much you took, both in quantity and in quality.² Copying a few sentences from a 400-page book is different from copying half a short poem. Raw percentage is only part of the story, though. Courts care just as much about whether you took the most important or recognizable part of the work.

Harper & Row v. Nation Enterprises illustrates this. The Nation magazine published roughly 300 to 400 words taken verbatim from President Gerald Ford’s unpublished memoir. That was a tiny fraction of the full manuscript, but the Supreme Court found those excerpts represented “the heart of the book” and were qualitatively the most significant portion.⁷ The use was not fair despite the small amount copied.

On the other end, the Supreme Court found in Google LLC v. Oracle America, Inc. that copying 11,500 lines of code from Java’s API was fair use because those lines represented only 0.4 percent of the full API and Google copied only what was needed to let programmers work in a new computing environment.⁸ The amount was tethered to a transformative purpose, and that made the difference. Take only what your purpose requires, and avoid grabbing the most distinctive or memorable material unless your use genuinely demands it.

Factor Four: Effect on the Market

The fourth factor asks whether the secondary use harms the existing or potential market for the original.² Courts look at whether the new work functions as a substitute that could displace sales or licensing revenue. If your work competes directly with the original in the same market, this factor will weigh heavily against you.

The analysis extends beyond current sales. Courts also consider markets the copyright holder might reasonably develop, such as film adaptations or merchandise, and they consider what would happen if the kind of copying at issue became widespread. You do not need to prove that the copyright holder actually lost money. The question is whether the use, if it became common, would cause real economic harm. This is where many seemingly harmless uses run into trouble. Posting a full song to a social media account might not hurt the artist in isolation, but if everyone did it, the streaming and licensing markets would erode.

Fair Use Is an Affirmative Defense

Fair use is a legal defense, not a permission slip. You cannot get pre-approval. If a copyright holder sues you for infringement, you raise fair use as your defense in court, and the burden of proof falls on you as the defendant. You must prove your case by a preponderance of the evidence.⁹

Every time you rely on fair use without a license, you are making a judgment call you might have to defend in litigation. For well-funded publishers, that risk is manageable. For individuals and small creators, it can be paralyzing. Legal fees alone can run into six figures even if you win, which is why so many potential fair uses never happen.

Common Misconceptions

Several widely believed “rules” about fair use have no basis in the statute or case law. Knowing what fair use is not will save you as much trouble as knowing what it is.

Giving credit does not make copying legal. Attribution is polite and academically important, but it has zero effect on the fair use analysis. You can credit the original author by name and still be liable for infringement.
Non-commercial use is not automatically fair. Non-commercial and educational purposes are considerations that favor fair use, but they are one piece of the four-factor test. A nonprofit that copies an entire work for free distribution can still lose.
There is no safe percentage or word count. No court has ever held that copying fewer than a certain number of words or a specific percentage is automatically fair. As Harper & Row showed, even 300 words can be too much if they are the most important 300 words.
A disclaimer does not protect you. Adding “no copyright infringement intended” to a social media post has no legal effect. Courts look at what you did with the material, not what you wrote above it.

What Happens When Fair Use Fails

If a court determines your use is not fair, you face the full range of copyright infringement remedies. A copyright holder can elect to recover either actual damages (lost profits and any profits you earned from the infringement) or statutory damages. Statutory damages range from $750 to $30,000 per work infringed, at the court’s discretion. For willful infringement, the ceiling rises to $150,000 per work. If the court finds you had no reason to know your use was infringing, it can reduce the minimum to $200 per work.¹⁰

Those per-work numbers add up fast. If you copied 50 photographs, that is 50 separate works, each carrying its own damage award. There is an important catch on the other side. Statutory damages and attorney fees are only available if the copyright was registered before the infringement began, or within three months of the work’s first publication.¹¹ Without timely registration, the copyright holder is limited to actual damages and the infringer’s profits, which is why some infringement claims carry far less financial risk than others.

1
Office of the Law Revision Counsel. 17 USC 107 – Limitations on Exclusive Rights: Fair Use
2
U.S. Copyright Office. About Fair Use
3
Library of Congress. Campbell v. Acuff-Rose Music, Inc.
4
Oyez. Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith
5
Supreme Court of the United States. Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith
6
Oyez. Campbell v. Acuff-Rose Music, Inc.
7
U.S. Copyright Office. Harper and Row Publishers, Inc. v. Nation Enterprises
8
Supreme Court of the United States. Google LLC v. Oracle America, Inc.
9
United States Courts for the Ninth Circuit. Copyright – Affirmative Defense – Fair Use
10
Office of the Law Revision Counsel. 17 USC 504 – Remedies for Infringement: Damages and Profits
11
Office of the Law Revision Counsel. 17 USC 412 – Registration as Prerequisite to Certain Remedies for Infringement