Private Law Theory

ABSTRACT
Recent Supreme Court cases have opened the door for market effects to play an even more prominent role in copyright law’s fair use defense to copyright infringement. Historically, however, market effect analysis under fair use’s factor four has either been largely speculative or a repackaging of analysis done under the first three factors of the fair use defense. We argue that recent developments in data availability and causal estimation in the social sciences enable litigants and courts in many cases to engage in a more fulsome and credible analysis of market effects in fair use cases. As a proof of concept, we deploy a difference-indifferences design to estimate the average effect of sampling (reusing a portion of a sound recording in a new song) on the streaming market of the sampled song. We find sampling causes a 48.4% increase in streaming for the sampled song. This large, positive market effect is an example of how direct empirical evidence could influence determinations of fair use – in this case, by providing evidence that sampling is unlikely to cause market harm to the copyright owner and may in fact result in significant market benefits. We argue this type of robust analysis is feasible and appropriate in other fair use contexts and has the potential to reorient fair use jurisprudence to better align with the fundamental purpose of copyright law: to incentivize creation for the benefit of society.

Asay, Clark D and Plamondon, Stephanie and Jones, Cree and McCleary, Cassidy, An Evidence-based Approach to Fair Use (March 20, 2025), 60 Georgia Law Review (forthcoming 2025).