In the past three years, there has been considerable activity on the Title IX/Sexual Assault legal front.  We have all read about the increase in claims  brought by victims against their institutions through the complaint procedures of the U.S. Department of Education’s Office for Civil Rights.  There have been well publicized resolution agreements reached between OCR and institutions.  And there has been the April 2011 “Dear Colleague” letter issued by OCR that has been the subject of much debate. But institutions are also starting to see an increase in push back from students accused of sexual assault.  A recent Bloomberg report highlights a number of legal complaints filed by male students against their institutions as a result of disciplinary action taken against them arising out of sexual assault claims. Institutions should not ignore these latest challenges.   At a minimum, they should review their existing investigation and hearing procedures not only to ensure that they provide appropriate protections for those accused, but to also make sure that they provide “equal” process for both the victim and the accused.  OCR has made it clear that the process needs to be the basically the same for both parties.  For example, if the victim has the right to have an advisor present throughout the proceeding, the accused must be afforded that same right; if the victim has the right to appeal a hearing decision, the accused must be afforded that same right. In addition, it is critical that institutions “execute” in accordance with their own policies and procedures.  While institutions have a fair degree of leeway with respect to what goes into their policies, the surest way to create a legal issue is to then not follow those policies.  Do not put something in your policy that you are not prepared to live with, and once you put it in your policy you need to make sure you follow it. Whether now, at the end of the calendar year, or in the Spring, at the end of the academic year, at least annually an institution should conduct a thorough review and audit of the past year’s sexual harassment/assault cases.  Determine what was done correctly and what could have been done better.  Based on those experiences, consider modifications to your policies and procedures, and/or to your implementation of them, to best position your institution, and the outcomes reached in your internal proceedings, against future legal attack.

The status of graduate assistants under the National Labor Relations Act (“Act”) -- are they employees eligible to organize or students without employee status under the Labor Law -- has garnered considerable attention in recent years.  New York University (“NYU”) graduate assistants will, for the second time in recent years, be represented by a union and negotiate their terms and conditions of employment due to a neutrally supervised vote held under an agreement between NYU and the United Auto Workers (“UAW”).   Under that agreement, graduate, research, and teaching assistants at NYU have voted overwhelmingly (620 to 10) in favor of union representation by the UAW.  The election occurred after the UAW and NYU reached agreement in November under which NYU agreed to remain neutral, refrain from participating in the election, and bargain in good faith for a contract if a majority voted in favor of representation.  Under the same agreement, the UAW agreed to withdraw pending petitions for election before the National Labor Relations Board (“NLRB”). A unit of graduate assistants at NYU had previously voted in favor of representation in 2002 and the UAW had bargained a contract with NYU.  During that first contract, the NLRB decided the Brown University case, 342 NLRB 42 (2004), holding that certain graduate assistants were primarily students, not employees and therefore were not legally entitled to organize under the Act.  NYU withdrew recognition of the Union in response to the Brown decision.  In 2010, the UAW filed several petitions seeking to represent graduate assistants and providing a vehicle for the NLRB to revisit the Brown ruling.  The NLRB sought briefing from the parties and interested organizations concerning the employee status of graduate assistants.  Many felt that Brown was likely to be overturned by the NLRB appointed by the Obama administration. The agreement between NYU and the UAW resulted in the withdrawal of the NLRB proceeding.  The NLRB has issued an unpublished decision indicating that it is granting the Union’s request to withdraw and now considers the review of the Brown decision to be “moot.” Thus, NYU will enter into bargaining with the UAW for its graduate students.  The broader issue of whether graduate students are employees from the NLRB’s perspective will have to wait for a new test case before the Board.  In the interim, Brown remains governing law.

Institutions often make a “deal” with an individual faculty member that is memorialized in something less formal than a lawyer-drafted contract, and there is always that lingering question as to whether it will be “enforceable” if and when the time comes.  A recent decision involving Northwestern University is good news for institutions in this regard. Here, a faculty member had requested from the Dean a year’s leave so that he could visit at another institution.  The Dean indicated that she would provide that leave, along with a second leave to take place three academic years into the future (with the faculty member teaching in the intervening years) provided the faculty member would then retire at the end of that second leave.  Ultimately a “deal” was struck and the Dean followed up with a letter to the faculty member that provided “…I will accept your resignation from the …faculty effective with your retirement on August 31, 2012….”  The letter went on to explain his leave and teaching responsibilities. In 2011, the faculty member was reminded that the next year would be his last and then he would be retired.  He balked, indicating that he did not want to retire and insisting that he had never agreed to retire.  He filed an EEOC charge and upon receiving his right to sue letter, commenced an action in U.S. District Court in Chicago.  The District Court ruled against him and he appealed to the U.S. Court of Appeals for the Seventh Circuit, which also found for the University. First, the faculty member argued that the University discriminated against him by offering retirement packages to older employees but not younger ones.  After recognizing that employers would have little reason to offer retirement/early retirement packages to new workers, the Seventh Circuit confirmed that the Age Discrimination in Employment Act (ADEA) simply “does not forbid offers that favor older workers over their younger colleagues.” Next the faculty member argued that he construed his arrangement with the University as giving him an option to retire after the 2011-2012 year, but it was never his intent that he had to retire.  The Court had no trouble describing the arrangement reflected in the letter from the Dean a “contract.”  Nor did it have any trouble interpreting this agreement as committing the faculty member to retire no later than the end of the 2011-2012 year.  The faculty member’s non-sensical “understanding” – that it remained his option – would have had the University giving him two years worth of paid leave in exchange for only the possibility that he might retire after the 2011-2012 year (which of course was a possibility anyway).  As the Court observed:  “People pay to acquire options; they do not get options (and two years’ pay) handed to them for nothing.”  Thus the Court rejected the faculty member’s interpretation as unreasonable.  In a welcomed explanation of judicial reasoning, the Court observed: “judges understand written agreements to mean what reasonable people understand them to mean.” When so much happens between an institution and its faculty through less formal arrangements, often reflected in simple letters, it is good to know that Courts will recognize them and, along the way, provide a common sense interpretation.

In the same week that we acknowledged the first anniversary of Sandy Hook, and read about yet another school shooting, in Colorado, the Florida District Court of Appeals, in a 12-3 decision, has ruled that the University of North Florida does not have the right to prohibit its students from carrying encased firearms in their vehicles even while on campus property.  While this decision has received a fair amount of attention, and it may be a significant ruling for other institutions within Florida, it should not have much bearing on institutional conduct in most other states.  The legal issue in this case was actually fairly narrow.  Florida law provides that firearms may not be possessed on school property except when securely encased in a vehicle.  The rule adopted by the University of North Florida prohibited firearms, even when encased, in a vehicle while on University property.  The issue was whether Florida law recognized a right in the University to effectively make an exception to that Florida law.  Ultimately, the Court concluded that the University did not have that right – that the Florida Legislature had preempted the field of firearm regulation and the University had no authority to act in the manner it did. The Court reached this decision notwithstanding the fact that another Florida statute arguably provided the University with authority to more generally restrict the use of firearms on campus.  Indeed, the Court acknowledged that “[i]f the issue in this case involved the right of a student to carry a firearm in the classroom or at a sporting event, our analysis would be different.”  But here the Court found that in the face of an explicit statutory provision permitting firearms to be maintained in vehicles, the University simply had no authority to provide differently.  This decision is the result of the unique nature of the Florida law.  Florida’s state constitution expressly recognizes the right to bear arms:   

The right of the people to keep and bear arms in defense of themselves and of the lawful authority of the state shall not be infringed, except that the manner of bearing arms may be regulated by law.   

In fact, Florida’s recognition of the right to bear arms is so strong, that its Legislature had previously passed the following statutory protection: 

This act is intended to codify the long-standing legislative policy of the state that individual citizens have a constitutional right to keep and bear arms, that they have a constitutional right to possess and keep legally owned firearms within their motor vehicles for self-defense and other lawful purposes, and that these rights are not abrogated by virtue of a citizen becoming a customer, employee, or invitee of a business entity. It is the finding of the Legislature that a citizen's lawful possession, transportation, and secure keeping of firearms and ammunition within his or her motor vehicle is essential to the exercise of the fundamental constitutional right to keep and bear arms and the constitutional right of self-defense. The Legislature finds that protecting and preserving these rights is essential to the exercise of freedom and individual responsibility. The Legislature further finds that no citizen can or should be required to waive or abrogate his or her right to possess and securely keep firearms and ammunition locked within his or her motor vehicle by virtue of becoming a customer, employee, or invitee of any employer or business establishment within the state, unless specifically required by state or federal law. 

So while this recent decision is worthy of note, it is not likely to have any impact on the scope of permissible college and university regulations outside of Florida and other states that have adopted similar legislation.

On December 18, 2013, Governor Cuomo signed the Nonprofit Revitalization Act of 2013 (the “Act”) passed by the New York State Legislature this past July.  The Act will become effective July 1, 2014, and makes a number of significant changes to the law regarding nonprofit corporations.  These changes will affect virtually every nonprofit corporation in the State of New York, including colleges and universities.  The Act also makes numerous changes regarding internal controls, conflicts of interest, audit requirements and other governance issues.  Some of the changes create greater restrictions, such as requiring all nonprofits to adopt written conflict of interest policies, and requiring nonprofits with 20 or more employees and annual revenue of more than $1 million to also adopt whistleblower policies.  Other changes remove antiquated provisions that have complicated simple governance issues like conducting board meetings.  For example, the Act specifically provides that facsimile and e-mail notices may be used for board and membership meeting notices and waivers, and confirms that they also may be used for votes that require unanimous written consent.  It also allows board members to participate in meetings by video conference, Skype and other forms of video communication.  By allowing the use of what has become readily available technology, the Act will help New York’s law conform with modern corporate realities of boards of directors that include members in far off locations who have difficulty attending regular meetings in person. The Act creates both opportunities and responsibilities for nonprofit organizations to review, update and improve their operational processes based on the new statutory requirements. This will require, among other things, the adoption of new policies and possible changes to organizational documents.

Historically, the Department of Education had interpreted all provisions of Title IV of the Higher Education Act (which authorizes federal student aid programs) consistent with Section 3 of the Defense of Marriage Act (“DOMA”), which prohibited federal agencies from recognizing same-sex marriages.  As a result of United States v. Windsor, in which the U.S. Supreme Court invalidated portions of DOMA, the Department announced this past Friday that it will now recognize a student or parent in a same sex marriage as legally married provided they were married in a jurisdiction which recognizes that marriage, and regardless of where they now reside. In a Dear Colleague letter  issued December 13, the Department indicated that this recognition applies to both a student and to the parents of a dependent student. It also applies to a student attending an institution located in a jurisdiction that recognizes same-sex marriage as well as in a jurisdiction that does not recognize same-sex marriage. However, this determination applies only to marriages and not other relationships, such as registered domestic partnerships, civil unions, or similar formal relationships recognized under state law.  This guidance will be relevant to all questions concerning marriage and marital status on the FAFSA. Additional information regarding implementation of the Department's interpretation, especially as it relates to the 2013-2104 FAFSA, is contained in the Dear Colleague letter.

Inside Higher Ed recently released its 2013 Survey of College & University Human Resources Officers, conducted on its behalf by Gallup.  If you have not already reviewed a copy, you can download a copy here.    The survey covers a wide range of HR subjects, from adjunct compensation and benefits, to retirement issues, to discrimination, and many topics in between.  Among the more interesting survey findings from HR professionals at the 399 responding institutions (206 of which were public, 171 were private and 7 were for-profit): 

• 62% were moderately concerned or very concerned about faculty members working past traditional retirement age and 53% were moderately concerned or very concerned that their institutions lacked sufficient retirement incentives for faculty, even though (on a scale of 1 to 5, with 1 being strongly disagree and 5 being strongly agree) 63% responded with a score of 3 or higher that their institution offered sufficient phased retirement options for faculty. 

• With respect to adjunct faculty, 80% responded with a score of 3 or higher that their institutions fairly compensated their adjunct faculty, while 67% responded with a score of 3 or higher that their institutions provided an “appropriate” benefits package for adjunct faculty (although only 24% indicated that they actually provided health insurance for adjunct faculty).  Seventy-five percent responded with a score of 3 or above that their institutions provided appropriate job security and due process protections for adjunct faculty.  Interestingly, 48% of the respondents indicated that their institutions were placing or enforcing limits on adjunct faculty hours in order to avoid having to meet the requirements for employer-provided health insurance under the Affordable Care Act. 

• With respect to benefits generally available on their campuses, 53% of respondents indicated that telecommuting was permitted, 78% indicated that “family-friendly” work policies were in place; 81% had wellness programs (but only 30% provided financial rewards/benefits for healthy employees); and 77% provide financial support for children of employees to pursue post secondary education.  However, the responses indicated that HR professionals thought their institutions could do more: 76% of respondents thought there SHOULD be telecommuting permitted, 94% thought there SHOULD be family friendly policies, 98% thought there SHOULD be wellness programs in place, 82% thought there SHOULD be financial rewards/benefits for healthy employees, and 88% thought there SHOULD be financial support for employees’ children for post secondary programs. 

• 50% of respondents indicated that they were paying “more attention” to long term employees with declining job performance. 

• 62% indicated that they were paying “more attention” to implementing performance evaluation measures. 

• Only 40% indicated that they were paying “more attention” to addressing ADA and similar mandates regarding disabilities. 

• 88% of respondents indicated that their institutions had a nondiscrimination policy regarding sexual orientation and 74% had a nondiscrimination policy regarding gender identity. 

• Finally, 61% of the respondents responded with a score of 3 or higher that HR is blamed for unpopular changes or reductions in employee benefits and services.

In today’s environment, with colleges and universities facing rising expenses and pressure to refrain from increasing tuition and other charges, the cost of legal compliance at the federal, state and local levels is a significant, and seemingly never-ending, concern.  Last month saw the prospect of relief, or at least a sympathetic ear, at the federal level. On November 18, members of the U.S. Senate Education Committee announced the formation of the Task Force on Government Regulation of Higher Education, comprised of 14 college presidents and higher education industry experts, for the stated purpose of studying the burdens of federal regulation on higher education.  The Task Force, convened by Senators Lamar Alexander (R- Tennessee), Michael Bennet (D- Colorado), Richard Burr (R- North Carolina) and Barbara Mikulski (D-Maryland), is to conduct “a comprehensive review of federal regulations and reporting requirements affecting colleges and universities and make recommendations to reduce and streamline regulations, while protecting students, institutions and taxpayers.” A particular focus of the Task Force’s review will be the contention that government “red tape” inflates costs and stifles innovation. It is contemplated that the Task Force’s recommendations will be made available for consideration in connection with congressional discussion over reauthorization of the Higher Education Act. Though a healthy dose of skepticism is understandable, and likely warranted, as to the prospect of meaningful regulatory relief, the work of the task force and congressional reaction to it bears watching.

From time to time, institutions will find themselves in a dispute with a donor, a donor’s descendants (in jurisdictions that allow standing for such actions), and or state attorneys general or other regulators, over the appropriate use of a prior gift.  A recent case involving The Johns Hopkins University is the latest to illustrate the importance of the language used in any gift, or other contractual, instrument. In the late 1980’s, the University was the beneficiary of the purchase of an undeveloped piece of property for a price that was about one-third of the fair market value of the parcel.  The seller was a well recognized critic of development in Montgomery County, Maryland.  She sold the property at a reduced price to the University (recognizing the excess value of the transaction as a charitable contribution) rather than succumb to numerous offers for the property’s commercial development, and with the apparent expectation for the University to develop it as a pastoral-like University campus.  Accordingly, the contract and deed restricted the University’s use of the parcel to “agricultural, academic, research and development, delivery of health and medical care and services, or related purposes only, which uses may specifically include but not be limited to development of a research campus in affiliation with one or more divisions” of the University.  After plans were approved to allow for rezoning of the parcel to permit much higher density use of the property than, according to the donor’s surviving family, the donor would ever have considered acceptable, the family commenced litigation to prevent the University from moving forward. Ultimately the Maryland Court of Appeals determined that the restrictions in the deed and contract were “unambiguous” and allowed the development the University sought.  The Court found that there was no dispute that the University’s plan sought only to pursue “agricultural, academic, research and development, delivery of health and medical care and services, or related purposes” as specified in the restriction.  The dispute was whether the contract and deed restricted the scale and density of that development and whether they required “Hopkins qua Hopkins to own and operate the buildings and programs” on the property. While the Court noted that the donor’s family was “no doubt … genuinely aggrieved” by the University’s plans to deviate from the donor’s thoughts regarding the future use of the property, the Court noted that its “task is to examine the agreement the parties did sign, not the agreement that one or the other now wishes they had negotiated instead.”  Relying on basic contract construction principles, the Court rejected the family’s contention that the restriction on “its [the University’s] use” of the property to the specified purposes meant that only the University could own or occupy that property and that it prohibited leasing any portion of the property to third parties:  “We cannot see why Hopkins leasing the property to others to accomplish one or more of the listed purposes does not qualify as a use by Hopkins….Here, the [property] will be used for an indisputably approved purpose, and nothing in [the deed or contract] restricts how or through whom the Buyer, Hopkins, can carry out those purposes.”  The Court also rejected the family’s argument that the mere reference to a “campus” use imposed scale and density restrictions on the University’s development of the parcel. Ultimately the Court found that the unambiguous language of the deed and contract did not preclude the University from moving forward with its plans, notwithstanding the seller’s intent.  Had the language been less clear, the result could have been different, in that the seller’s intent might have functioned to further restrict the University in its actions.  This possibility highlights the importance of careful drafting in gift instruments.  While institutions may be understandably reluctant to test donors’ patience by negotiating extensively over language in a gift instrument, they should always keep in mind that needs and resources change over time.  Restrictions, especially on real property, which an institution may see as workable at the time a gift is made, may prove far less workable when it comes time to actually make use of the gift.  As a result it is important to make sure that gift instruments provide sufficient flexibility to the institution to allow it to deal with the gift in an appropriate manner, and/or to modify the permitted use as desired, as circumstances change several decades or more into the future.  Clarity in this regard may not only help prevent years of costly litigation and/or regulatory scrutiny, but it can also help to avoid public disputes that can negatively impact its relationship with future donors.

In the private sector, most full-time (tenured/tenure track) faculty are currently considered “managerial” under the National Labor Relations Act (“NLRA”), making them ineligible for the protections of the NLRA, including the right to organize and bargain collectively.  (Managers and supervisors are not considered “employees” under the NLRA.)  Managerial status does not preclude an institution from voluntarily recognizing a faculty union, but it does prevent faculty from compelling a unionization vote under the NLRA.  At the risk of oversimplifying, what makes most private sector full-time faculty managerial is their shared governance role. Adjuncts, or contingency faculty, on the other hand are often not included in the shared governance model.  The Chronicle recently reported on a study presented at this year’s Association for the Study of Higher Education (“ASHE”) annual conference on adjuncts and shared governance.  According to The Chronicle’s report, the Study examined more than 100 research universities in an attempt to quantify adjuncts’ involvement in governance.  The Study found that at about two-thirds of the institutions studied, faculty senates were off-limits to adjunct instructors who had less than half the workload of a full-time faculty member.  The remaining one-third of institutions were about evenly split between those whose faculty senates were more open to adjuncts and those whose senates were more restrictive in terms of access for adjuncts.  Interestingly, these results are inconsistent with AAUP’s view, reflected in a report  issued in late 2012  which recommended that eligibility for voting or holding office in shared-governance bodies should be the same for all faculty, regardless of their full-time or part time status. Because adjuncts, who along with others who constitute the “contingent” faculty that now comprise perhaps as much as 75% of higher education teaching ranks, do not participate in shared governance, they generally are not considered managerial under the NLRA.  As a result, they are entitled to compel unionization through the National Labor Relations Board’s election procedures.  And over the past several years, adjuncts at a number of institutions have actively pursued this path, often with a fair degree of success. For example, when adjuncts at Georgetown University voted to unionize this past May with SEIU Local 500, it purportedly raised the number of adjuncts in the District of Columbia organized by Local 500 to more than 75% (including adjuncts at previously organized American University, George Washington University, and public Montgomery College) .  The potential long term impact of achieving this level of “density” success across all of D.C. is apparent.  More recently, a similar "regional" approach was started by SEIU in Boston.  Operating under the name Adjuncts Action, adjuncts at Tufts University voted to unionize this past September, and unionization efforts are underway at Northeastern University and Lesley University.  This effort suffered a setback in late October when adjunct faculty at Bentley University in Boston voted 100-98 against unionization.  (Objections to the election outcome have been filed and are pending.)  Despite this setback, the trend appears clear and institutions should expect efforts to organize adjunct faculty will continue, and likely expand, across the country. While there are a number of factors that undoubtedly contribute to adjuncts’ interest in organizing, and economic factors are often prominently noted, in reality experience suggests that it may often be non-economic factors that ultimately drive the outcome.   As with any other employee group, non-economic factors are often as important as economic factors when it comes to unionization.  In this context, the more critical question may be how are adjuncts treated on their campuses?  Are they welcomed and received by the rest of the campus community as important contributors to the overall mission, or not?  Ironically, it can often be their relationship with their full-time colleagues that creates a tension and feeling of disrespect (or at least insufficient respect) which is a contributing factor in unionization decisions.  In other words, an interest in securing an institutional voice like their full-time colleagues may drive the outcome as much as anything else.  As noted, at most institutions examined in the ASHE Study, adjunct involvement in shared governance is limited and that voice does not exist.  Yet, at least one faculty study has concluded that involvement in meaningful shared governance may be a more important indicator of faculty satisfaction than economic factors.  There is little reason to think this conclusion is not as relevant for contingent faculty as it is for full-time faculty. The moral?  Institutions should consider promoting the involvement of their adjuncts in governance matters.  Not only may it result in more satisfied adjuncts, but it might also impact their status as possibly "managerial" members of the institution.

Many colleges and universities are federal contractors and, as such, need to comply with Department of Labor, Office of Federal Contract Compliance Programs’ (“OFCCP”) regulations relating to affirmative action.  Revised Regulations have been issued by OFCCP addressing affirmative action obligations applicable to disabled individuals under the Rehabilitation Act of 1973, as amended ("Section 503"), and to protected veterans pursuant to the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended ("VEVRAA"), and become effective March 24, 2014. Due to the numerous requirements in these new Regulations, higher education institutions that are federal contractors should start reviewing and implementing procedures to ensure compliance. Ten steps that covered institutions should implement by March 24, 2014 include:

1.         Review current electronic systems and databases to determine if there is capacity to capture protected veteran and disability status for both applicants and employees. If not, institutions will need to invest in new systems or methods to capture this required data.

2.         Review current referral sources to determine if sources are providing qualified protected candidates; sources that are not should be eliminated and/or new ones should be added. This is a key component for meeting the 8% hiring benchmark under VEVRAA and the 7% utilization goal under Section 503.

 

3.         Ensure all required notices are posted. Where notices are posted electronically, make sure they are accessible to all employees, including those with disabilities. For covered institutions that use electronic or internet-based application processes, an electronic notice must be posted and stored with the electronic application to inform job applicants of their EEO rights.

4.         Review collective bargaining agreements to determine if the agreements include notice of the institution’s affirmative action and non-discrimination policies and request for cooperation. If they do not, institutions should send annual letters to each union, notifying the union(s) of the policies and requesting cooperation.

5.         Review and update the list of all existing subcontracts, including vendors and suppliers, who should be receiving the mandatory written notice to subcontractors of the institution’s affirmative action efforts and request for cooperation.

6.         Revise contracts and purchase orders to include the revised mandatory EEO language under both Section 503 and VEVRAA.

7.         Make sure solicitations and advertisements include all the protected categories – minorities, females, disabled individuals, and veterans. OFCCP has indicated in recent FAQs that just using "D" and "V" is not adequate since abbreviations must be commonly understood by jobseekers.

8.         Update recordkeeping procedures to incorporate the three-year retention requirement for specific records under Section 503 (documentation and assessment of external outreach and data collection analysis) and VEVRAA (documentation and assessment of external outreach, data collection analysis, and benchmarking records).

9.         Revise self-identification forms inviting applicants to self-identify at both the pre-offer and post-offer stage of the selection process. All Section 503 invitations must use the new OFCCP form which will be posted on OFCCP’s website once approved. Under the Section 503 Regulations, employees must be invited to self-identify again every five years and reminded on an annual basis that they can voluntarily update their status at any time.

10.       Adopt written reasonable accommodation procedures to ensure uniformity in processing requests. The OFCCP’s guidance for creating procedures (listed in Section 503 Regulations as Appendix B) can be used in developing such procedures.

Google Books is a groundbreaking project launched in 2004 to scan and digitize books all over the world.  Currently more than 20 million books have been digitized and are available for searching, with “snippets” of books being presented to users as search hits. In 2005, the Authors Guild and several other plaintiffs filed suit against Google in the Southern District of New York, alleging that the digitization and display of millions of books not within the public domain constituted copyright infringement. Last week, the court issued a decision on cross-motions for summary judgment on the sole issue of whether Google Books constitutes fair use under 35 U.S.C. § 107.  The Authors’ Guild, Inc. v. Google Inc., 05 Civ. 8136 (DC) (S.D.N.Y. Nov. 14, 2013).  After first assuming that the plaintiffs had established a prima facie case of copyright infringement, Judge Chin analyzed the four statutory fair use factors individually and concluded that Google’s actions do indeed constitute fair use.

a.      Purpose and Character of Use

The first factor is “the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes.” Here, Judge Chin found that Google Book’s use of the copyrighted works was “highly transformative,” as the snippets allow users to identify and locate books.  Further, the ability to data mine the digitized books has resulted in entirely new fields of research.  Judge Chin also noted that Google does not sell the scans it creates and does not run ads on the pages that contain snippets. Accordingly, this factor weighed strongly in favor of Google.

b.      Nature of the Copyrighted Works

The second factor is “the nature of the copyrighted work,” with works of fiction typically entitled to greater copyright protection.  Since the Google Books database is overwhelmingly non-fiction, with only about 7% of the books constituting fiction, this factor favored fair use.

c.       Amount and Substantiality of the Portion Used

The third factor is “the amount and substantiality of the portion used in relation to the copyrighted work as a whole.”  Although Google reproduces the entirety of the books that it scans, it limits the amount of text that is displayed to the user in response to a search of the Google Books database.  Without any significant analysis, Judge Chin held that this factor weighed “slightly against” a finding of fair use.

d.      Effect of Use Upon Potential Market or Value

The fourth and final factor is “the effect of the use upon the potential market for or value of the copyrighted work.”  The plaintiffs argued that Google Books negatively impacts the market for books by effectively serving as a market replacement.  Refuting this argument, Judge Chin countered that “a reasonable factfinder could only find that Google Books enhances the sales of books to the benefit of copyright holders,” as consumers use Google Books to identify books that otherwise would be left undiscovered.  As a result, the fourth factor also weighed strongly in favor of fair use. Weighing all four factors together, Judge Chin ruled that Google Books constitutes fair use and advances the progress of the arts and sciences while concurrently considering the rights of authors and copyright holders. Higher Education Digitization Projects Many colleges and universities are repositories of books with questionable or unclear copyright status, and several have considered or begun digitization projects.  Following this decision and a comparable decision in Authors Guild v. HathiTrust 902 F.Supp.2d 445 (S.D.N.Y. Oct. 10, 2012) under a similar set of facts, these digitization projects may have a strong foundation in fair use if they are non-commercial, limit the amount of a work displayed, and largely focus on non-fiction works. The HathiTrust decision has already been appealed, and many predict that the Google decision will have a similar fate.  Stay tuned here for future developments.