UNITED STATES DISTRICT COURT. SOUTHERN DISTRICT OF NEW YORK MATTHEW LOMBARDO and WHO'S HOLIDAY LIMITED LIABILITY COMPANY, Plaintifis, DR. SEUSS ENTERPRISES, L.P., Defendant, DR. SEUSS ENTERPRISES, L-P., Counterelaim-Plaintiff v. MATTHEW LOMBARDO and WHO'S HOLIDAY LLC, Counterclaim-Defendants, Civil Action No. 16-cv-09974-AKH MEMORANDUM OF LAW OF THE DRAMATISTS LEGAL DEFENSE FUND AS AMICUS CURIAE IN SUPPORT OF PLAINTIFF OF Counsel: Ralph Sevush The Dramatists Legal Defense Fund, Inc. 1501 Broadway, Suite 701 New York, NY 10036 David H. Faux (DF-9130) Attomey for the Dramatists Legal Defense Fund, Inc. as Amicus Curiae 1501 Broadway, Suite 701 New York, NY 10036 (646)360-1106Table of Contents PRELIMINARY STATEMENT Ai INTEREST OF AMICUS CURIAE i ak STATEMENT OF FACTS... 6 ARGUMEN 7 1. Plaintiff's Who's Holiday! is a Parody of How the Grinch Stole Christmas 7 A. Introduction to Who's Holiday! as Parod 7 B. Parody Is Demonstrably Reasonably Perceived 8 C. Parody Is Described Within Counterclaim-Plaintif?’s Own Pleadings. 8 D, Conclusion of Who's Holiday! as Parody. 10 Il, Who's Holiday! is a transformative use of How the Grinch Stole Christmas 10 A. Introduction of Who's Holiday! as Transformative: 10 B. Who's Holiday! Has a Transformative Aesthetic an C. Who's Holiday! Has a Transformative Message aT D, Conclusion of Who's Holiday! as Transformative 12 IIL. Who's Holiday! Complies With the Other Fair Use Factors 12 A. Introduction to Other Fair Use Factors 12 B. Second Factor: The Nature of the Copyrighted Work... 12 C. Third Factor: Amount and Substantiality of the Portion Used 13 D, Fourth Factor: Effect on the Market for the Value of the Copyrighted Work. 13 IV. _ Public Policy Favors a Strong Declaration of the Rights of the Dramatist.. 15 A. Fair Use is the First Amendment's Ambassador in Copyright 15 B. Broader Social Costs Outweigh Private Corporate Interests... 16 C. Economie Disparity Could Erode Constitutional Rights... 18 V. Conclusion... si 20TABLE OF AUTHORITIES CASES Abilene Music Inc. v. Sony Music Entertainment, Inc., 320 F. Supp. 2d 84 (S.D.N.Y. 2003) ...0.9 Adjmi v. DLT Entm't Ltd, 97 F. Supp. 34 512 (S.D.N.Y. 2015) wvrnsseoe 5 Authors Guild, Ine. v. Google Inc., 954 F. Supp. 2d 282 (S.D.N.Y. 2013). 10,14 Bill Graham Archives v. Dorling Kindersley Lid., 448 F.3d 605 (2d Cit. 2006) . 12,13 Blanch v. Koons, 467 F.3d 244 (2d Cir. 2006) 6 Bourne Co. v. Twentieth Century Fox Film Corp., 602 F. Supp. 2d 499 (8.D.N.Y. 2009), or : : 8.9,11,13,14 Campbell v. Acuff-Rose Music, 510 U.S. 569 (1994).. 27.8,9.10,11,12,13,14 Cariou v. Prince, 714 F.3d 694 (2d Cir, 2013). 2,611, 13 Casile Rock Entertainment, Inc. v, Carol Publishing Group, 150 F.3d 132 (2d Cir. 1998)... Dr. Seuss Enters., L.P. v. ComieMix LLC, No. 16¢v2779-ILS (BGS) (S.D. Cal. June 9, 2017). 4 Dr. Seuss Enters., L.P. v. Penguin Books USA, Inc., 109 F.3d 1394, 1400 (9th Cir. 1997), 8 Harper & Row Publishers, Ine. v. Nation Enters., 471 U.S, 539 (1985) ..« 2,15 Harrell v. Can Der Plas, 2009 U.S. Dist, LEXIS 104828, 23 (8.D.N.Y. 2009) “19 Hudson v, Universal Studios, Inc., 2009 U.S. Dist. LEXIS 18729 (8.D.N.Y. 2009) Int'l News Serv. v. Assoc. Press, 248 U.S. 215 (1918) fowa State Univ, Research Found, Inc. v. Am. Broad. Cos. 621 F.2d 57 (24 Cir. 1980) Jovani Fashions Lid. v, Cinderella Divine, Inc. 820 F. Supp. 2d 569 (8.D.N.Y. 2011) Leibowitz v. Paramount Pictures Corporation, 137 F.3d 109 (2d Cir 1998) Marxtone-Graham v. Burtchaell, 631 F. Supp. 1432 (8.D.N.Y. 1980) Nash v. CBS, Inc., 899 F.2d 1537 (7th Cir. 1990) Penguin Books U.S.A., Inc. v. New Christian Church of Full Endeavor, Lt LEXIS 5648 (S.D.N.Y. 2004)... Salinger v, Colting, 641 F. Supp. 250 (S.D.N.Y. 2009).. Third Degree Films v. Does I-47, 286 FRD 188 (D. Mass. 2012). 2004 US. Dist. STATUTES IT USC. $107 on ILR. Rep. No 94-1476 (1976)... S, Rep. No, 94-473 (1975). SECONDARY SOURCES A. Mitchell Polinsky & Steven Shavell, The Economic Theory of Public Enforcement of Law, 38 J. Econ, Lit, 45, 60 (2000) 7 Ben Depoorter & Robert Kitk Walker, Copyright False Positives, 89 Notre Dame I.. Rev. 319 (O18) sscenctigecs 617,18 C. Edwin Baker, First Amendment Limits on Copyright, 55 Vand. L. Rev. 891 (2002). 7 Frank Rizzo, TheaterWorks' ‘Christmas On The Rocks’ A Sassy, Funny Parody, Hartford Courant, Dec. 9, 2013 " Karen Bovard, BIVIV Review: CHRISTMAS ON THE ROCKS at TheaterWorks, Broadway World, Dec. 7, 2015 ie esc Lawrence Lessig, Free Culture 184-87 (2004),Marci A. Hamilton, Copyright at the Supreme Court: A Jurisprudence of Deference, 47 J. Copyright Soc'y USA 317 (2000) i 3 Nimmer on Copyright, § 19E.05{C][2].. Pierre Leval, Toward a Fair Use Standard, 103 Harv. L. Rev. 1105 (1990) Rebecca Tushnet, Copyright Law as a Model for Free Speech Law: What Copyright Has in Common with Anti-Pornography Laws, Campaign Finance Reform, and Telecommunications 16 Regulation, 42 B.C. L. Rev. 1 (2000). Theater Works Pearl Street, Christmas On The Rocks (2013), YouTube (Nov. 10, 2009), William M, Landes & Richard A. Posner, An Economic Analysis of Copyright Law, 181. Legal Stud. 325 (1989). 17,18 Yochai Benkler, Free as the Air to Common Use: First Amendment Constraints on Enclosure of the Public Domain, 74 N.Y.U, L. Rev. 354 (1999) AT‘The Dramatists Legal Defense Fund (the “DLDE”) respeetfully submits this ‘memorandum of law as amicus curiae in support of Plaintiff Matthew Lombardo (“Lombardo”), the author of the play Who's Holiday!, and to apprise the Court of theatre industry practice and underlying policy considerations. Dr. Seuss Enterprises (“DSE”) is displeased with Lombardo’s commentary and criticism of its property and now wishes to silence his speech with claims of infringement. But well-established precedent places Who's Holiday! clearly within the Copyright Act’s “fair use” exception as a parody and otherwise transformative use of the book entitled How the Grinch Stole Christmas, A ruling that Who's Holiday! is not a fair use would have negative reverberations throughout the theatre industry, particularly for dramatists, who are not only authors who make fair use of elements of works that have come before, but are also copyright owners whose works may be fairly used by others, Furthermore, failure to recognize a fair use defense here would subject playwrights to vexatious and costly litigation brought by well-heeled corporate entities and allow such entities to use their superior economic power to chill proteeted speech by means of “copyright false positives,” which are overreaching assertions of intellectual property rights that subvert the ples embodied by both the First Amendment and the Constitution’s Copyright Clause. PRELIMINARY STATEMENT The Counterclaim-Plaintiff is an entity that owns How the Grinch Stole Christmas (the “Children’s Book”). Its ownership, however, should not prevent a playwright like Lombardo from making fair use of elements of the Children’s Book, as such “tigid application of the copyright statute... would stifle the very creativity which that law is designed to foster.” Jowa State Univ. Research Found., Inc. v. Am. Broad. Cos., 621 F.2d 57, 60 (2d Cir. 1980).2m the infancy of copyright protection, some opportunity for fair use of copyrighted materials has been thought necessary to fulfill eopyright’s very purpose, ‘{t]o promote the Progress of Science and the useful Arts.’” Campbell v, Acuff-Rose Music, $10 US. 569, 575 (1994). According to legislative policy, this doctrine was meant to “continue the common-law tradition of fair use adjudication.” H.R, Rep. No 94-1476, at 66 (1976); 8. Rep. No. 94-473, at 62 (1975). In the Second Cireuit, the stage was set for fair use jurisprudence with Toward a Fair Use Standard, 103 Harv. L. Rev. 1105, 1107 (1990), by Judge Pierre Leval. In this seminal article, Leval states, “The copyright is not an inevitable, divine, or natural right that confers on authors the absolute ownership of their creations. It is designed rather to stimulate activity and progress in the arts for the intellectual enrichment of the public.” Id.; see also Cariou v. Prince, 714 F.3d 694, 705 (2d Cir. 2013). The DLDF believes it is important to keep the words of Judge Leval in mind to ensure that the law encourages the creative activity of authors like Lombardo whose works draw on our cultural history and simultaneously contribute to the intellectual enrichment of the public. However, the necessity for the Court to uphold Lombardo’s fair use claim in this ease is also imperative for the protection of the not limited to furthering the purposes of Copyright; First Amendment itself. First Amendment protections are “embodied in the Copyright Act’s distinction between copyrightable expression and uncopyrightable facts and ideas, and the latitude for scholarship and comment traditionally afforded by fair use.” See Harper & Row Publishers, Inc. v. Nation Enters., 471 U.S. 560 (1985). tis this doctrine of fair use that acts as our society's safety valve for free expression when, in the context of our copyright laws, we would otherwise be granting an exclusivemonopoly over certain speech to private interests. So when the Copyright Clause and the First Amendment are in conflict, the courts are well advised to consider that “the fair use defense is recognized as not merely a nicety of copyright law. It is tasked by the Constitution to be the First Amendment's ambassador in the territory of copyright, to champion free speech concerns; hence, it eannot be abolished or even narrowed.” Nimmer on Copyright § 19B.05(C][2}. Furthermore, curbing the over-broad assertion of copyright is particularly important in a matter like the one now before the Court, where one party isan emerging playwright and the other is an established, well-financed assignee of another author’s works. ‘The exception for fair use is necessary to mitigate “the chilling effect of copyright law upon free expression,” Maxtone- Graham v, Burtchaell, 631 F. Supp. 1432, 1435 (S.D.N.Y. 1980), especially when owners of ‘well-known properties attempt to frighten artists away from commenting on them or making, other fair use, a practice so dangerous and pervasive that it has been branded with a label, the “Copyright False Positive.” Ben Depoorter and Robert Kirk Walker, Copyright False Positives, 89 Notre Dame L. Rev. 319 (2013). INTEREST OF AMICUS CURIAE ‘The Dramatists Guild of America, Inc. (the “Guild”) formed the DLDF in 2009 to advocate for free expression in the dramatic arts as guaranteed in the First Amendment of the United States Constitution, and to encourage the vitality of @ robust public domain, in support of the purpose of the Constitution's “Copyright Clause.” ‘The DLDF is governed by an elected Board of Directors that eurrently includes such renowned dramatists as J.T. Rogers (Oslo, Blood and Gifts), Sarah Ruhl (In the Next Room), Lydia Diamond (Stick Fy), and the current President, John Weidman (Assassins, Contact, Anything Goes). The Board also includes several lawyers well established within the theatreindustry. ‘The sole member of the DLDF is the Dramatists Guild, a century-old trade association with a governing board of playwrights and musical theatre authors that ineludes Marsha Norman (The Color Purple, ‘Night Mother), Stephen Sondheim (Sweeney Todd, Company), Tony Kushner (Angels in America), and John Guare (House of Blue Leaves, Six Degrees of Separation). ‘The current president of the Guild is Doug Wright (/Am My Own Wife, War Paint). Lombardo is not a member of the DLDF, but he isa member of the Guild. Regardless, the DLDF and the Guild recognize that their interests and the interests of the public are threatened by Counterclaim-Plaintif?’s attempts to silenee his eritique of How the Grinch Stole Christmas, ‘The freedom of expression guaranteed by the First Amendment is central to the DLDP’s mission, as well as to the professional life of all dramatists, including but not limited to Guild members. Dramatists often draw on a broad variety of source material for inspiration for their works, Some have drawn on material in the public domain, like Phantom of the Opera, Les Miserables, and Natasha, Pierre & The Great Comet of 1812. But this practice is not a recent phenomenon. Shakespeare's King Lear was based on a well-known folk tale, and there was another play at the time based on the same story (The True Chronicle History of King Leir). In modern times, The Disney Company has adapted public domain stories into films and then into stage musicals like Beauty and the Beast, The Little Mermaid, and Aladdin, not to mention The Lion King, which is loosely based on Hamlet. Several shows on Broadway this season are based on stories or historical facts in the public domain, such as Come From Away, Indecent, and Oslo. Sometimes plays are based so closely on existing works that are protected by copyright (such as films, novels, television shows, or even other plays) that the new works may be developed incollaboration with the original creators and, in any event, rightly require the permission of the owners of the original works. Examples in the current Broadway season include Groundhog Day, Anastasia, Amelie, Charlie and the Chocolate Factory, and Bronx Tale In many instances, however, playwrights are inspired by other works to create works of their own that cannot be considered adaptations. Often, they want to comment on or develop ideas expressed in works that have had significant cultural impact. One recent example is Clybourne Park, a drama that won the Tony Award and Pulitzer Prize in 2012. The author jie drama, A Raisin in the Sun, as well as some historical incorporated a character from the cla: events of the period, Off-Broadway, too, we have the example of David Adjmi’s play 3C, a parody of the TV situation comedy Three's Company that the Second Circuit recognized sa transformative work and a fair use. See Adjmi v, DLT Entm’t Ltd, 97 F. Supp. 3d 512 (S.D.N.Y. 2015). Another example is IYho's Holiday! Parodies may draw heavily on characters and situations in the works they parody because audiences need to recognize the resemblance to appreciate the dramatists’ points. An equitable understanding of fair use is needed to permit and encourage the creation of new works that will enrich the culture and someday enrich the public domain themselves, Of course, the DLDF, as established by the Guild, is keenly aware of the need to protect copyright. Copyright infringement can have a significant negative impact on a dramatist’s income and reputation; many of the nation’s dramatists who are most vulnerable to these harms sit on the Guild’s Council, Similarly, a fledgling playwright may not gain deserved attention or be able to maintain control of his or her work if copyright is infringed; many of these emerging talents are among the Guild’s 7,200 members nationwide. In fact, the dramatists’ rights to own their copyrights and to control their work are the founding principles on which the Guild isbased, and dramatists have forgone unionization, accepting an economically disadvantaged labor status for the last ninety years or so, in order to preserve these rights, Because the DLDF’s mission is to advocate for free expression while advancing the interests of a trade association of copyright owners, our every statement is preceded by a consideration of “the property rights [that copyright law] establishes in creative works, which must be protected up to a point, and the ability of authors, artists, and the rest of us to express them- or ourselves by reference to the works of others, which must be protected up to a point.” Leval, supra at 1109. See Blanch v. Koons, 467 F.3d 244, 250 (2d Cir. 2006); see also Cc 714 F.3d at 705. This gives the DLDF a unique perspective ~ and duty — to present a balanced and reasoned view without an ideological predisposition one way or the other. From this rare vantage point, the DLDF can see that Who's Holiday!, like 3C before it, is a transformative work of parody and so requests that Lombardo’s creative activity be protected as a fair use so that, dramatists (and others) will be assured and aware of the freedom they have to comment on important cultural phenomena, A clear declaration of Lombardo’s rights will curb the chilling ion, effects that over-aggressive copyright owners can have on free expres STATEMENT OF FACTS ‘The DLDF understands from Counterclaim-Plaintiff's pleadings that its claims are based on ownership of the children’s book entitled How the Grinch Stole Christmas, Counterelaim- Plaintiff asserts that Who's Holiday! infringes on How the Grinch Stole Christmas as a derivative work that borrows some of How the Grinch Stole Christmas’s most recognizable features solely to capitalize on the Children’s Book’s success and is, therefore, not a fair use. ‘This amicus brief addresses the copyright question of fair use in this case, as well as its constitutional and public policy implications. 6ARGUMENT. 1. Plaintiff's Who's Holiday! is a Parody of How the Grinch Stole Christmas A. Introduction to Who's Holiday! as Parody Plaintiff authored an original play entitled Hho 's Holiday!, which parodies the 1957 children’s book How the Grinch Stole Christmas, in which Counterclaim-Plaintiff’s hold the copyright, and as such constitutes a proper fair use under copyright law. 17 U.S.C. §107. Anyone reading the script of Who's Holiday! can tell that Who's Holiday! is a parody. Assertions to the contrary ignore the very definition of “parody” well established by the Supreme Court in Campbell and by this court in Bourne Co. v. Twentieth Century Fox Film Corp., 602 F. Supp. 2d 499 (S.D.N.Y. 2009), among many others. Counterclaim-Plaintif?’s position that Iho’s Holiday! is merely another derivative work that should (or even would) have been pre~ authorized, or that it offers no commentary or criticism of the underlying work, is clearly contradicted by the play itself, See Answer to Compl, and Countercls. at 17. In making such a claim, Dr. Seuss Enterprises exhibits a staggering lack of self-awareness. How the Grinch Sole Christmas was published as a children’s Christmas book, and its suecess was based on its entertaining appeal to children and its ability to instill in them a love of reading and teach life lessons, but not such life lessons as the risk of poverty, domestic violence, teenage pregnancy, or drug abuse. Answer to Compl, and Counterels. at 14, Counterclaim-Plaintff is clearly disturbed by Lombardo’ depiction of its property and now seeks to use superior economie power to suppress what it perceives as a disrespectful threat, regardless of the cost to the dramatist’s right to free expression.B, Parody Is Demonstrably Reasonably Perceived ‘The fair use defense requires only “that ‘a parodic character may be reasonably perceived,” Bourne, 602 F. Supp. at 507, quoting Campbell, 510 U.S. at $82-83. In fact, the original ten-minute iteration of Who's Holiday!, then named Going Green, was presented in a show called Christmas on the Rocks, which was received and advertised in the theatre community as a parody. TheaterWorks’ video of the Christmas on the Rocks production refers to the show as a “delightful holiday parody.” TheaterWorks Pearl Street, Christmas On The Rocks (2013), YouTube (Nov. 10, 2009), https://www. youtube.com/watch?v=bINW0zz9Qmo. The Hartford Courant described the show as a “sassy, easy-going parody.” Frank Rizzo, TheaterWorks’ ‘Christmas On The Rocks’ A Sassy, Funny Parody, Hartford Courant, Dec. 9, 2013. In one review, Lombardo’s Going Green was described as having an “extra dollop of style ‘on top of the parody.” Karen Bovard, BIW Review: CHRISTMAS ON THE ROCKS at TheaterWorks, Broadway World, Dec. 7, 2015. ‘The disputed production was also advertised as aparody. The Who's Holiday! website and website for ticket sales both describe the play as a “heartfelt parody.” Am, Compl, at 13. Apparently, no one but the underlying copyright holder had any trouble perceiving the parody. C. Parody Is Described Within Counterclaim-Plaintiff's Own Pleadi “Parody is regarded as a form of social and literary eriticism, having a socially significant value as free speech under the First Amendment.” Dr. Seuss Enters. L.P. v. Penguin Books US4, Inc., 109 F.3d 1394, 1400 (9th Cir, 1997). As stated in Campbell, “For the purposes of copyright law, the nub of the definitions, and the heart of any parodist’s claim to quote from existing material, isthe use of some elements of a prior authors composition to ereate a new onethat, at least in part, comments on that author's works.” 510 U.S, at $80; Bourne, 602 F. Supp. at 504-05; Abilene Music Inc. v. Sony Music Entertainment, Inc., 320 F. Supp.2d 84, 91 (S.D.N.Y. 2003); Leibowitz v. Paramount Pictures Corporation, 137 F.3d 109, 114 (2d Cir 1998); Seuss, 109 F. 3d at 1400. Additionally, “[p]arody needs to mimic an original to make its point, and so has some claim to use the creation of its victim's (or collective vietims’) imagination . .. Campbell, 510 Us at 580-81. Furthermore, the “parody must target the original, and not just its general style, the genre of art to which it belongs, or society as a whole (although if t targets the original, it may target those features as well).” Jd, at 597 (Kennedy, J., coneurring); see also Salinger v, Colting, 641 F.Supp. 250, 256-57 (S.D.N.Y. 2009) (stating that a “parody must critique or comment on the work itself”). From assertions by Counterclaim-Plaintiff, it is beyond question that Lombardo used some elements of the prior work, including the setting of Who-ville, key characters, and rhyming couplets to target the original and perhaps also target the themes the book represents. Answer to Compl. and Countercls. at 12, Additionally, also as stated in the counterclaims, Who's Holiday! builds on the original, mimicking the story are and “look and feel” of an authorized Dr. Seuss work.” Id. In Abilene, the court found that the new work's “sarcastic” use of “What a Wonderful World” was protected as parody because “the song’s take on the world . .. highlights the contrast between the two worldviews, and expresses the rapper’s belief in the realism of his own perspective.” Abilene, 320 F. Supp. 2d at 91. This finding is “on all fours” with the faet-pattemn here, Lombardo’s work, as stated by all parties in this dispute, is an attempt to bring adult humor and themes to the classic family Christmas story How the Grinch Stole Chrisimas.D. Conclusion of Hito's Holiday! as Parody Who's Holiday! fits neatly within the definition of parody set forth by well-established precedent of the Supreme Court of the United States, the Second Circuit, and the Southem District of New York. To avoid chilling critical comment on significant cultural works, Who's Holiday! must be seen as a parody: a form of social and literary criticism, with a socially significant value as free speech. Il. Who's Holiday! is a transformative use of How the Grinch Stole Christmas A, Introduction of Who's Holiday! as Transformative: Even if Who's Holiday! were not so obviously a parody, it would certainly be found to be transformative. [T]he law 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, and research) identified in the preamble to the statute. Cariou, 714 F.3d at 706. Transformation occurs when the secondary use adds value to the original—if [the original work] is used as raw ‘material, transformed in the creation of new information, new aesthetics, new insights and understandings—this is the very type of activity that the fair use doctrine intends to protect for the enrichment of society. Leval, supra at 1007; see also Castle Rock Entertainment, Inc. v. Carol Publishing Group, 150 F.3d 132 (2d Cir. 1998); Authors Guild, Ine. v. Google Inc., 954 F. Supp. 2d 282 (S.D.N.Y. 2013). When determining whether a new work is transformative, the court investigates “whether the new work merely supersedes] the objects of original creation, or instead adds somethingnew, with a further purpose or different character, altering the first with new expression, meaning, or message.” Campbell, 510 U.S. at 579. B. Who's Holiday! Has a ‘Transformative Aesthetic ‘The Second Circuit has consistently found a new work transformative when it manifests an entirely different aesthetic from the original work. For example, in Cariou, the court found fai use transformation where the original photographs were “serene and deliberately composed ve.” Cariow, 714 F.3d at 706. The portraits” but the new works were “heetic and provos original works were reproduced but adjusted in “composition, presentation, scale, color palette, and media.” Id, Ina much more obvious way, Lombardo has taken the original premise of How the Grinch Stole Christmas—Christmas children’s book—and transformed that premise into something dark, troubling, and destructive, thus manifesting an entirely different aesthetic. C. Who's Holiday! Has a Transformative Message ‘The Second Circuit has consistently found a new work transformative when it updates the message of an old work. For example, in Bourne, the eourt stated that a new work that is both “very similar to the original” but “strikingly different in tone and message” is transformative. Bourne, 602 F. Supp. 2d at 509. Lombardo has referenced characters and the plot of How the Grinch Stole Christmas superficially, but transformed the characters significantly and used a strikingly different tone, meaning, and message by, for example, exposing ways in which innocent Cindy-Lou Who's life tured upside down as she grew older. See Am, Compl. at 5. ‘This is clearly an updated message to a work that is nearly sixty years old.D. Conclusion of Who's Holiday! as Transformative Where Who's Holiday! seems to have borrowed plot devices, characters, or premises, it neaning of Chi mas toa clearly has transformed the original work from teaching the “true’ dramatic work that reflects unforgiving reality. ‘This new aesthetic yields new messages from the original, especially with respect to ostracization, unplanned pregnancy, and violence. And it has done so asa form of criticism of the original work, which is a use that would not be licensable for the very reason that the Counterclaim-Plaintiff has pursued this case against Lombardo: it does not like what the playwright has said about its book. Nevertheless, the stage play at issue is a form of expression that is at the core of fair use. For these reasons, IVho's Holiday! must be seen as transformative, And “[t}ransformative works . . . lie at the heart of the fair use doctrine’s guarantee of breathing space.” Campbell, 510 U.S. at 579. IIL.Who's Holiday! Complies With the Other Fair Use Factors A, Introduction to Other Fair Use Factors In examining the other three factors applied in a fair use analysis of Who's Holiday!, the Court will note that any reasonable assessment of the other factors will result in a finding of fair use on those bases as well. B. Second Factor: The Nature of the Copyrighted Work This factor is of litle import to parodies as “parodies almost invariably copy publicly known, expressive works.” Campbell, 510 U.S. at $86. Even with otherwise transformative ‘works, “this factor ‘may be of limited usefulness where,’ as here, “the creative work of art is being used for a transformative purpose."” Cariou, 714 F.3d at 710, (quoting Bil! Graham 12Are lives v, Dorling Kindersley Lid., 448 F.3d 605, 612 (2d Cir. 2006)). Hence, this factor is inrelevant to Who's Holiday!’s status as a parody or an otherwise transformative work. C. Third Factor: Amount and Substantiality of the Portion Used “[T}he extent of permissible copying varies with the purpose and character of the use.” Campbell, 510 U.S. at 579. In faet, neither the Second Circuit “nor any of our sister circuits has ever ruled that the copying of an entire work favors fair use, [but] courts have concluded that such copying does not necessarily weigh against fair use...” Graham, 448 F.3d at 613; see Cariou, 714 F.3d at 710. Moreover, “the law does not require that the secondary artist may take no more than is necessary . . . The secondary use ‘must be [permitted] to ‘conjure up’ at least enough of the original’ to fulfill its transformative purpose.” Cariow, 714 F.3d at 710 (quoting Campbell, 310 U.S. at 587-88 (emphasis added by Cariou)). Because Who’s Holiday! is clearly a parody and otherwise transformative, the amount and substantiality of How the Grinch Stole Christmas is, like the nature of the copyrighted work, irrelevant as well. Lombardo conjured up the original and fulfilled his transformational purpose. D, Fourth Factor: Effect on the Market for the Value of the Cop: ‘Transformative works rarely have an impact on the market of the copyrighted work “Indeed, as to parody pure and simple, it is more likely that the new work will not affeet the market for the original in a way cognizable under this factor, that is, by acting as a substitute for it.” Campbell, 510 US. at 591. Furthermore, while a bona fide critique or commentary may cause harm to intellectual property, “it does not produce a harm cognizable under the CopyrightAct.” Id. at 591-92; see also Bourne, 602 F. Supp. 2d at 510 (stating, “the parody and the original here serve different market functions”). Here, it seems clear that the book How the Grinch Stole Christmas and the dramatic play Who's Holiday! can co-exist, each on its own terms. Whereas Counterclaim-Plaintiff’s book and authorized derivative works are a Christmas tradition for children and their families, Lombardo’ play is an ever out for adults. To wit, the performance of Christmas on the Rocks was well- received as an adult re-evaluation about the “true meaning of Christmas.” Moreover, the Southern District recently stated, “Although transformative use is not ‘absolutely necessary’ to a finding of fair use, ‘the goal of copyright, to promote science and the arts, is generally furthered by the creation of transformative works.” Authors Guild, 954 F. Supp. 2d at 291-92 (quoting Campbell, 510 U.S. at 579). Therefore, the most likely effect Who's Holiday! will have on the potential market for How the Grinch Stole Christmas is a positive one: “an important factor in the success of an individual title is whether it is discovered—whether potential readers learn of its existence.” Id. at 293. Adults may be inclined to share How the Grinch Stole Christmas, as a book, movie, or television special, with a more sophisticated perspective on its themes vis-2-vis childhood, adulthood, and family life, generally. Counterclaim-Plaintif?’s may try to bootstrap their recent survival in Dr. Seuss Enters., LP. v. ComicMix LLC, No. 16¢v2779-JLS (BGS) ($.D. Cal. June 9, 2017), as justification for the Court to silence a playwright in the Southern District of New York. However, this case is easily distinguished: the lawsuit against ComicMix survived a motion to dismiss, taking as true DSE’s statement of market harm; here, DSE has already lost its dismissal against the playwright while emphasizing the benefit of the book's continued popularity, including numerous derivative works from 1966 through 2018, “as well as film strips used in classrooms, an annual Grinchmasevent at Universal Studios Hollywood theme parks, other Grinch books, and licensed goods bearing source-identifying indicia related to the work, such as downloadable and hosted digital books, games, and digital applications.” Answer to Compl, and Counterels, at 9. DSE cannot reasonably assert or even identify any cognizable form of market harm ereated by Lombardo’s theatrical parody and, in any event, DSE’s manifest mission is not to protect the copyrights it has inherited from the author from market harm, which is non-existent, but to control any speech that may related to those assigned copyrights. IV. Public Policy Favors a Strong Declaration of the Rights of the Dramatist More is at stake here than mechanical application of the fair use factors. Public policy concerns require clarity in the protection of an individual artist’s freedom of expression. The narrow interests of a private corporation cannot be allowed to generate heavy social costs that harm not only the artists but also the broad social interest. Consideration should also be given to the tisk that economic disparity between parties may endanger foundational Constitutional rights. Thankfully, there is well-established precedent for the court to weigh these public policy concems—and these concems clearly weigh in favor of Plaintiff. ‘A, Fair Use is the First Amendment's Ambassador in Copyright ‘The principle that courts should protect against private censorship was first embodied in the Statute of Anne and later the Copyright Clause “to be the engine of free expression.” See Harper & Row Publishers, Inc. v. Nation Enters., 471 U.S. 539, 558 (1985). First Amendment protections are “embodied in the Copyright Act's distinction between copyrightable expression and uncopyrightable facts and ideas, and the latitude for scholarship and comment traditionallyafforded by fair use.” 1d. at $60. In fact, the Copyright Act was meant, among other things, to encourage free speech. See Rebecea Tushnet, Copyright Law as a Model for Free Speech Law: What Copyright Has in Common with Anti-Pornography Laws, Campaign Finance Reform, and Telecommunications Regulation, 42 B.C. L. Rev. 1, 2 (2000) (stat ng that “[t]he First ‘Amendment gets government off speakers’ backs, while the Copyright Act enables speakers to make money from speaking and thus encourages them to enter the public marketplace of ideas”). When the Copyright Clause and the First Amendment come into conflict, itis not surprising that courts are advised to consider that “the fair use defense is recognized as not merely a nicety of copyright law. Itis tasked by the Constitution to be the First Amendment’s ambassador in the territory of copyright, to champion free speech concems; hence, it cannot be abolished or even narrowed.” Nimmer on Copyright § 19E.05{C][2]- In the instant case, itis far-fetched to assert that Who's Holiday! will be viewed by the public as an authorized adaptation, or that it will obliterate the benefits the Counterelaim- Plaintiff has reaped and is entitled to continue to reap from the book sales and any strictly~ controlled, approved licensing of actual derivative works. Clearly, however, in seeking to suppress Who's Holiday!, Counterclaim-Plaintiff's main concer is not any economic threat Who's Holiday! could pose as a market substitute (which is so unrealistic as to be preposterous), but the artist’s negative critique of its property: it simply does not like what the playwright has to say. Yet Lombardo’s commentary and critique of How the Grinch Stole Christmas is exactly what the Copyright Act was designed to protect, and the Court should employ fair use as the First Amendment's ambassador, championing this dramatist’s free speech, B, Broader Social Costs Outweigh Private Corporate InterestsIn addition to potentially curtailing an individual’s First Amendment rights, there are significant costs to society for the court to consider. Should the court allow Counterclaim- Plaintiff to stop Lombardo’s speech, it risks adding to a growing body of “copyright false positives” that will impair freedom of speech for the U.S, as.a whole, add to unnecessary litigation and transactional costs for appropriate use of pre-existing artistic material, and weaken the public’s willingness to adhere to the Copyright Act. The DLDF requests that the court weigh these social costs in favor of Plaintiff's fair use. “False positives” occur in law when an individual is found guilty or liable of some wrong doing when he or she should not be.” A. Mitchell Polinsky & Steven Shavell, The Economic Theory of Public Enforcement of Law, 38 J. Econ, Lit. 45, 60 (2000). “Copyright False Positives” are “instances in which copyright enforcement actions target activities that are not infringements . ...” Depoorter & Walker, supra at fn.13. “Copyright False Positives often motivate copyright owners to seek enforcement of rights that are . .. outside the scope of copyright.” Jd, at 321. Enforcement of non-existent intellectual property rights can have a variety of unnecessary and negative social costs that should be avoided, See William M. Landes & Richard A. Posner, An Economic Analysis of Copyright Law, 18 J. Legal Stud. 325, 332-33, 349-59 (1989) (describing social costs of the copyright system). One significant social cost of Copyright False Positives is that they can “hamper free speech and the rightful exercise of copyright except ns.” Depoorter & Walker, supra at 340. See C. Edwin Baker, First Amendment Limits on Copyright, 55 Vand. L. Rey. 891 (2002); Yochai Benkler, Free as the Air to Common Use: First Amendment Constraints on Enclosure of the Public Domain, 74 N.Y.U. L. Rev. 354, 411 (1999); Marci A. Hamilton, Copyright at the Supreme Court: A Jurisprudence of Deference, 47 J. Copyright Soc’ y USA 317 (2000). 7Copyright False Positives threaten to erode the tradition of jurisprudence in favor of the First Amendment, and, if they are not curbed, have the effect of bestowing property rights upon copyright owners for material that should be “free as the air to common use.” Int'l News Serv. v. Assoc. Press, 248 U.S. 215, 250 (1918) (Brandeis, J, dissenting). This stifles the production of new work, even in situations where, as here, the benefits of allowing authors, as a class of professionals, to make fair use of others’ works outweigh any theoretical detriments to that same class from lost royalties. Landes & Posner, supra at 332-33, 349-59. Another social cost is “increased litigation and transactional costs” for valid uses of pre~ existing works. Depoorter & Walker, supra at 343; see, e.g., Nash v. CBS, Inc., 899 F.2d 1537, 1540 (7th Cir. 1990) (stating, “Once a work has been written and published, any rule requiring people to compensate the author slows progress in literature and art, making useful expressions too expensive, forcing authors to re-invent the wheel, and so on. Every work uses scraps of thought from thousands of predecessors, far too many to compensate, even if the legal system were frictionless, which it isn’t”), ‘The widely acknowledged trend of “copyright trolling” also attests to these inereased social costs. See, e.g., Third Degree Films v. Does 1-47, 286 F.R.D. 188, 190 (D. Mass. 2012). The instant case is the epitome of this social cost: an individual artist has been forced to prove that his use is non-inftinging or risk the sharp end of Damocles’ sword. Finally, “a perception that copyright law reaches beyond reasonable boundaries and serves private but not public interests” could weaken society's willingness to adhere to the Copyright Act by respecting owners’ rights. Depoorter & Walker, supra at 345-46; see, e.x., Lawrence Lessig, Free Culture 184-87 (2004), The DLDF hopes the court will address this demonstrated social cost. C. Economie Disparity Could Erode Constitutional Rights‘The courts have long acknowledged in contract law that inequitable bargaining positions, most often due to financial disparities, can create unconscionable, and therefore unenforceable, agreements. Courts in this district have also considered the financial disparities between parties in copyright infiingement suits. See Harrell v. Can Der Plas, 2009 U.S. Dist. LEXIS 104828, 23, (S.D.N.Y. 2009); Hudson v, Universal Studios, Inc., 2009 US. Dist, LEXIS 18729, 2 (S.D.N.Y. 2009); Penguin Books U.S.A., Ine. v. New Christian Church of Full Endeavor, Ltd, 2004 US. Dist. LEXIS 5648, 5 (S.D.N.Y. 2004). They have acknowledged the concern that the threat of a lawsuit may deter people “from exercising [their] rights, because pressing a meritorious defense is more costly than surrendering it.” Jovani Fashions Ltd. v. Cinderella Divine, Inc., 820 F. Supp. 2d 569, 575 (S.D.N.Y. 2011) (internal quotes and citation omitted). This recognized concern is at the center of the facts here, Counterelaim-Plaintif's letter {o the Shubert Organization prompted Shubert to terminate its license agreement for the theatre with Lombardo, See Am. Compl. at 10. The Shubert Organization was unwilling to be subject to lawsuits for any copyright infringement, perhaps for fear of a costly suit by a deep-pocketed corporation, Afier delay of his play's debut and the opportunity to produce his play later this year, Lombardo resolved to pursue and enforce his First Amendment rights in keeping with the purpose of the Copyright Act, Who knows how many other authors may have decided not to fight, or not to ereate new works that refer to any successful properties, just because they or the theater they are working with cannot risk the cost of a lawsuit and cannot risk investing their time and talent in creating a work that the threat of litigation may prevent from ever being published or produced?V. Conclusion From the DLDF’s dual perspective in promoting free speech while protecting copyright ownership, the play Who's Holiday! is patently a transformative parody of How the Grinch Stole Christmas, it complies with all the factors of a fair use analysis, and it is thus deserving of the benefits of the First Amendment via the fair use exception, Furthermore, the public policies that underlie our constitutional values prompt the DLDF to urge a strong declaration that the law provides plenty of room for a parody like Who's Holiday! This is exactly the kind of creative activity by an individual artist that risks being stifled by the overbroad assertion of copyright ownership rights by a well-financed corporation. Copyright owners may prefer not to have their properties targeted for mockery, but dramatists recognize that, when they publish or perform. their own works, they 00 are subject to criticism that may take the form of parody, and elements of their work may be transformed by other artists. ‘They recognize that artists have the right to mock, and, more than that, they have an obligation to critique such vestments of our culture. Consequently, in keeping with both the Copyright Clause of the United States Constitution and the Copyright Act, as well as the established jurisprudence of the Supreme Court of the United States, the Second Circuit, the Southern District of New York, and the well- accepted practices of the theatre industry, the Dramatists Legal Defense Fund respectfully and strongly supports a finding in favor of the Plaintiff in this matter. Dated: New York, NY \ June 30, 2017 DRAMATISTS LEGAL DEFENSE FUND, Inc. By: David H. Faux (DF-9130) 1501 Broadway, Suite 701 New York, NY 10036 20(646)360-1106 Attorney for the Dramatists Legal Defense Fund, Ine, as Amicus Curiae Of Counsel: Ralph Sevush ‘The Dramatists Legal Defense Fund, Inc. 1501 Broadway, Suite 701 New York, NY 10036 al