Mirage Editions, Inc. v. Albuquerque A.R.T. Co.

United States Court of Appeals, Ninth Circuit
856 F.2d 1341 (1988)

ELI5:

Rule of Law:

Permanently mounting a lawfully purchased, copyrighted art print onto a new medium, such as a ceramic tile, constitutes the creation of an unauthorized derivative work that infringes the copyright holder's exclusive rights. The first sale doctrine does not protect this activity, as it only permits the resale of the particular copy purchased, not the right to recast or transform it.

Facts:

Artist Patrick Nagel created numerous works of art.
After Nagel's death in 1984, his widow Jennifer Dumas and Mirage Editions, Inc. (Mirage) came to own all copyrights to his works.
Alfred Van Der Marck Editions, Inc., as a licensee, published a commemorative book titled 'NAGEL: The Art of Patrick Nagel', which compiled selected copyrighted art works.
Albuquerque A.R.T. (A.R.T.) purchased copies of this book.
A.R.T. cut out individual art prints from the book pages.
A.R.T. then glued each print onto a black plastic sheet and then onto a white ceramic tile.
Finally, A.R.T. applied a transparent plastic film over the entire surface and offered the finished tiles for sale.

Procedural Posture:

Mirage, Dumas, and Van Der Marck sued Albuquerque A.R.T. in federal district court for copyright infringement, trademark infringement, and unfair competition.
The district court granted summary judgment for A.R.T. on the trademark claim but denied it on the copyright claim.
Mirage then moved for summary judgment on the copyright claim, which the district court granted.
The district court found that A.R.T. had infringed Mirage's copyright and issued an injunction preventing A.R.T. from continuing its activities.
A.R.T., as the appellant, appealed the summary judgment ruling on the copyright claim to the U.S. Court of Appeals for the Ninth Circuit.

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Issue:

Does permanently mounting a lawfully purchased copyrighted art print onto a ceramic tile, and then selling it, constitute the creation of an unauthorized derivative work that violates the copyright holder's exclusive rights under 17 U.S.C. § 106(2)?

Opinions:

Majority - Brunetti, Circuit Judge

Yes. Mounting an art print from a book onto a ceramic tile creates an unauthorized derivative work in violation of the Copyright Act. The Copyright Act grants the copyright holder the exclusive right to prepare derivative works, which are defined as works that have been 'recast, transformed, or adapted.' By removing the images from the book and incorporating them into a permanent tile product, A.R.T. transformed the original works into a new version. The 'first sale' doctrine, codified in 17 U.S.C. § 109(a), does not serve as a defense because it only extinguishes the copyright holder's right to control the resale of the specific 'copy' purchased (the book itself); it does not grant the purchaser the separate and exclusive right to prepare derivative works from that copy.

Analysis:

This decision significantly clarifies the boundary between the first sale doctrine and the copyright holder's exclusive right to create derivative works. It establishes that a permanent physical modification that incorporates a copyrighted work into a new product constitutes a 'transformation' or 'recasting,' thus creating an infringing derivative work. The case serves as a key precedent limiting the ability of purchasers to alter and resell copyrighted material, reinforcing that the right of adaptation remains with the creator. This ruling impacts businesses that repurpose or upcycle copyrighted content by confirming that such activities can fall outside the protections of the first sale doctrine if they create a new version of the original work.

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