200._org_Form International Association of Scientific Technical and Medical Publishers, STM,

Full name: Andre Myburgh

If you are making this submission on behalf of an organisation, please provide the name: 
International Association of Scientific, Technical & Medical Publishers, STM

Address: Prama House 267 Banbury Road Oxford OX2 7HT UNITED KINGDOM

Question 1: 
REFERENCE IS MADE TO STM'S LETTER DATED 29 NOVEMBER 2012, WHICH ACCOMPANIES THESE SUBMISSIONS
Since the late 1990’s, STM publishers have invested heavily in electronic systems to facilitate usage, access and improved speed in processing and reviewing content,[1] embracing the technological capacities and pent-up consumer demand for digital information, relying on the adoption of changes or clarifications of the copyright laws and treaties noted above (clarifications that in our view were intended to encourage such investments).  The STM sector has engaged in precisely the introduction of new and innovative business models contemplated by the Issues Paper, and has done so working with, and relying on, strong copyright protection.  
Virtually all STM journal content is available and accessible online, as noted, and e-book content is becoming equally common. STM publishers recognised early on that the digital environment supported and indeed required standards and programmes to encourage interoperability, linking, access, and discovery.[2]  Creative licensing programmes including consortium licensing, national licenses (of all users in a given country), “pay-per-view” systems to enable transactional access to articles from non-subscribed journal titles, and improved permissions and rights-clearances systems,[3] have resulted in a wealth of content availability for researches and professional practitioners and have significantly improved productivity.[4]  Scientific and institutional customers have many choices and options in obtaining such licences, including by working through collective management organisations such as the Copyright Agency Limited.

[1] A useful catalogue of the digital changes in scholarly publishing can be found in the STM report (2006) “Scientific publishing in transition: an overview of current developments” at http://www.stm-assoc.org/2006_09_01_Scientific_Publishing_in_Transition_White_Paper.pdf.  Recent presentations on innovations in online information and presentation can be found on the STM web site in connection with the “Innovations” conference held in London in December 2010, for example the presentation by the Royal Society of Chemistry at http://www.stm-assoc.org/2010_12_03_Innovations_Kidd_ChemSpider_What_do_we_do_first.pdf
[2] For a recent summary of developments in technology and information on levels of access, see the STM Report (2009) at http://www.stm-assoc.org/2009_10_13_MWC_STM_Report.pdf.
[3] See the information about the Australian Copyright Agency’s rights permissions system RightsPortal at http://rightsportal.copyright.com.au/Pages/HomePage.aspx, creative user-oriented information provided by the United Kingdom’s Copyright Licensing Agency (CLA) at http://www.cla.co.uk/licences/excluded_works/ and information about the CCC’s automated rights permissions system Rightslink at http://www.copyright.com/media/swfs/Rightslink-Publisher.swf.
[4] See the Publishing Research Consortium 2006 report on productivity at
http://www.publishingresearch.net/journals_scientific.htm.
Question 2: 
To quote from STM’s position paper “Digital copyright exceptions and limitations for scholarly publications in the education and research communities” (2008, the full text of which accompanies this submission):
“The public interest of research and education is best served by encouraging the creation of new publications and information services with [research and education communities] in mind. For example, journal articles, academic treatises and textbooks are published by STM publishers for the very purpose of contributing to scholarly communication and education.  Libraries for non-commercial research or non-commercial educational institutions are the primary purchasers of (or licensees for) STM publisher materials and services.  Offering publications and information services to these non-commercial communities, eg by way of subscription or individual journal article supply, is the very essence of “normal exploitation” which must be left free of exceptions that prejudice the legitimate interests of rights-holders unreasonably.”
“Clearly any exceptions and limitations for education and research dealing with STM materials would need to be carefully and cautiously crafted to minimise any potential distortion of this vital and well-functioning system for scholarly communication.  Given that STM materials are prepared specifically for the educational and research context, this context does not constitute a "certain special case" (1st step under [the Berne Convention ‘three-step test’)) in relation to STM materials.  An unqualified exception that includes all STM materials would also interfere with the normal exploitation of the work (2nd step under the Berne Convention).  Recognising this, a number of copyright laws with digital exceptions and limitations pertaining to research and education exclude STM materials designed for such markets, i.e. an "exception from a more general exception”, as one of a number of specific qualifiers the exception or limitation.  Further, any exception or limitation newly introduced would also fully need to take into account the amplified risks of the digital environment (in this sense, “digital is different”).  Finally, it must also be recognised that different circumstances will apply in different countries, consistent with local legal traditions and experience.”
STM respectfully disagrees with the notion reflected in paras 30 and 31 of the Issues Paper that there is “too much intellectual property protection” and that intellectual property is a barrier to innovation. 
Question 3: 
Question 4: 
Question 5: 
Question 6: 
Question 7: 
Question 8: 
Question 9: 
Question 10: 
Question 11: 
Question 12: 
STM is of the view that exceptions on their own will not deliver the potential benefits since authors’ moral rights are a factor here too.  Further exceptions would expose copyright-protected works to greater risks of piracy and abuse.  
Question 13: 
Arising out of Australia’s international obligations, STM submits that any exceptions must comply with the “three-step test” prescribed by Article 9(2) of the Berne Convention, namely that if the circumstance concerned can be determined as a “special case”, use under the exception must not conflict with the normal exploitation of the copyright material and not unreasonably prejudice the legitimate interests of the copyright owner.
Question 14: 
Question 15: 
The concept of the free use of transformative uses of copyright works has become an element under the fair use defence in US copyright litigation.  STM’s full response to the question of fair use, in which reference is also made to cases of transformative use, is set out in that context in the answer to Question 52.
With respect to the use of literary works such as STM publications, the research community and literary critics have long-established processes and guidelines over the re-use of quotations, over the use of factual information from scholarly articles (not a copyright infringement provided proper attribution is used), and the like.  Concepts such as “sampling” or “remixes” would not be relevant for literary material, and the key question with respect to academic and scientific material relates to text and data mining uses, which we discuss in our answer to Question 25.
In general, STM views the notion of an exception allowing transformative use with concern, primarily because it would be difficult to define and therefore difficult to anticipate its impact on literary markets.  If we analogise from some of the US case-law, transformative uses, such as scanning print material to make such content accessible, would in our view likely interfere with rightsholders’ legitimate interests.  Specifically, STM is of the view that such exceptions on their own will not deliver significant potential benefits, given existing quotation arrangements and market conditions for text and data mining, but exceptions would expose copyright-protected works to greater risks of piracy and abuse.  In particular, even if a user creates an independent work which contains a reproduction of, or is an adaptation of, a copyright work (such as private editing or a “mash-up”) outside the existing exceptions of parody and satire, there is no sound policy reason why the rights in the original work, i.e. both the copyright and moral rights, should be abrogated.
The meaning of the term “transformative use” for the purpose of the fair use defence has recently (since release of the Issues Paper) been broadened in the US in a trial court decision the HathiTrust case (the decision of the US District Court for the Southern District of New York, The Authors Guild, Inc et al v. HathiTrust el al, handed down on 10 October 2012) to cases where nothing new is added by the unauthorised reproduction of the work, but only that “the copies serve an entirely different purpose than the original works: the purpose is superior search capabilities rather than actual access to copyrighted material” and where “the use of digital copies ... facilitate access for print-disabled persons.” Although we are hopeful that an appellate court review will correct this significant expansion of “fair use” concepts in US jurisprudence, it is indicative of the problems that unclear definitions and reliance on broad principles can create.  It also illustrates a meaning of the term “fair use” which has not been contemplated in the Issues Paper.
Question 16: 
See the answer to Question 15.
Question 17: 
See the answer to Question 15.
Question 18: 
STM does not believe that there should be changes to the moral rights provisions.  See also the answer to Question 15.
Question 19: 
Virtually all the journal content of STM publisher-members that has been published over the past several decades is available and accessible online (much of this content was “born digitally” in any event), and archival print content has been digitised retroactively so that historic journal issues and content are also accessible.  For this reason, the carve-outs to the library exceptions in sections 49(5AB)(c) and 50(7B)(e)(ii), (iii) and (iv) of the Copyright Act 1968 will invariably apply to STM content.
That notwithstanding, STM has learnt of incidents where certain libraries in Australia are using the privileges available to “remote” patrons in section 49(2A)(b)(iii) of the Copyright Act 1968 to justify the delivery of copies made by the library to beyond the borders of Australia.  Subject to any changes to limit the scope of the library exceptions,[1] STM submits that it should be made clear that the exceptions in sections 49 and 50 should only apply to patrons and libraries in Australia and its external territories.  

[1] It has already been suggested that the special arrangements prescribed for “remote” patrons in Section 49(2A) are redundant in the modern digital world.  See S. Ricketson, “The three-step test, deemed quantities, libraries and closed exceptions” at p. 104: “Given the wide availability now of facsimile and email communications, subsections 49(2A)–(2C) seem redundant: it is difficult to envisage remote users who would not have access to one of those forms of communication once they had access to a telephone line. If this is so, they will be able to comply with the requirement under subsection 49(1) for the making of a request and declaration in writing.”
Question 20: 
Question 21: 
STM supports the ability of libraries and archives to being able to make preservation and archival copies and to shift the format of items forming part of the library’s or archive’s permanent collection for these purposes where it is not reasonably practical to buy a replacement copy.
However, STM opposes the view that preservation copies may be used as “master copies” to serve beneficiaries of fair dealing exceptions or under any other exception, or to permit access on an insecure online platform, which could well distort the market. For preservation and archival copies to retain their legitimacy they must not become the source of further uses other than on-site consultation and/or inspection.
The STM publishing community has worked actively to establish digital preservation standards, including the European Union’s Parse project, and publishers have supported the creation of important archives through library initiatives such as the eDepot project at the Koninklijke Bibliotheek in the Hague, Netherlands, the Portico project, and LOCKSS.[1]

[1] See the STM site at http://www.stm-assoc.org/eu-project-parse/# for details on this important digital preservation standards project, the project at the Royal Library in the Hague as described at http://www.kb.nl/en/expertise/e-depot-and-digital-preservation,  the Portico project at http://www.portico.org/digital-preservation/ and the LOCKSS initiative at http://lockss.stanford.edu/lockss/Home.
Question 22: 
Question 23: 
See the answer to Question 24.
Question 24: 
“Orphan works” risk exclusion from the cycle of creation and exploitation, as copyright compliant users may prefer non-use over the risk of liability for infringement.  To counter this risk, STM strongly supports efforts aimed at enabling the use of orphan works. As both producers of copyrighted works and users of orphan works, STM publishers have experience with the issues from both sides.
To this end STM, together with other trade associations in the publishing business, released a Position Statement on 23 October 2007 setting out “safe harbour” policy for persons wishing to use content from orphan works, in which it may subsequently transpire that participating publishers are the rightsholders, in new works, course packs and compilations.[1]  This “safe harbour” policy was in turn based on STM’s Position Paper on orphan works issued on 1 December 2006.[2]  It is possible that STM will issue a revised position paper on this topic in 2013 in the light of the development of the debate on orphan works, such as the passage of the recent Orphan Works Directive in the European Union,[3] and we will inform you if such a revised position paper is issued. 
The question is whether orphan works should be dealt with as a matter of a copyright exception, a reduction in copyright penalties once a “parent” is located, or a blanket collective license.  The view of STM is that private market solutions are almost always to be preferred, since they are the most likely to provide tangible beneficial results.
STM believes that the following should be addressed in any regulatory initiative in this area:
1. Reasonably diligent, good faith search for the copyright owner:
2. Clear and adequate attribution
The user of orphan works should be required to provide attribution to the copyright owner(s) throughout her/his use of the orphan work as clearly and adequately as possible in the circumstances. For example, where a copyright notice is present in the orphan work, credit should be given in a manner which reflects the notice.
3. Adequate remuneration of copyright owner and/or appropriate restitution:
4. Limitation on injunctive relief:
Any possibility of injunctive relief against the continued and future use of a previously orphaned work should be sufficiently flexible to take into account the efforts and investment made by a good faith user.
5. Non-exclusivity of use:
The use of orphan works is non-exclusive. A user of orphan works can only intervene against further uses of the same orphan work where the further use would infringe her/his new rights in derivative works (e.g. translations, adaptations).
STM’s position does not affect the right of copyright owners to ignore or refuse requests for licences for subsequent uses of the orphan works, including derivatives thereof.
6. “Orphan work” defined:
Care needs to be taken to ensure that works that are not “in print” but are still “in copyright” and have identifiable owners are outside of the definition of orphan works.

[1]“Orphan Works Safe Harbor STM ALPSP  PSP” dated 23/10/2007, link from http://www.stm-assoc.org/document-library/.
[2] http://www.stm-assoc.org/2006_12_01_STM_Position_Orphan_Works.pdf
[3] Directive 2012/28/EU, at http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2012:299:0005:0012:EN:PDF.
Question 25: 
SEE THE LETTER FROM STM DATED 29 NOVEMBER 2012 ACCOMPANYING THIS SUBMISSION
At present, no uniform understanding exists amongst interested parties as to what data and text mining is and what it is not.  This lack of common understanding undermines both agreement and disagreement over the conditions for its acceptability and its permissibility under contract.  It also hinders the development of best practices and guidelines.[1]  STM has worked with interested parties in industry (particularly the pharmaceutical industry) to come up with solutions for the demands for data and text mining, as appears from the rest of this answer below, and has used the following working definition as a starting point:
            A computational process whereby text or datasets are crawled by software that recognises entities, relationships and actions.[2]
Data and text mining solutions are best found in market-based initiatives, like proactive voluntary licensing, that offer faster and more flexible ways to adapt to changing market needs and preferences.  These solutions must be based on collaboration between users and publishers.  Value proposals and business models for publishers in the field of data and text mining are only now emerging, and publishers are experimenting with various contractual and operational models.  Although difficult to determine now, STM is confident that value to data and text mining will be determined as these projects proceed.
Exceptions on their own will not deliver the potential benefit of data and text mining, yet they would expose copyright-protected works to greater risks of piracy and abuse, and counter-act the incentive that is copyright for the very same organisations that invest in the creation and dissemination of valuable and innovative content.  Access and privacy as well as data and network security are the main issues and, whilst copyright exceptions on their own cannot harness the potential of data and text mining, these exceptions foment large scale and wholesale copying of entire collections of data and copyright-protected works threatening permanent damage and destruction of incentives carefully crafted by copyright.
The full potential of such techniques will only be obtained through active co-operation and collaboration among content owners, service providers and (commercial and non-commercial) research organisations, and technical experts – a precondition to deal with the need for standardisation and normalisation of text formats and data to make data and text mining valuable. What is needed is an open and transparent multi-stakeholder dialogue.  Exceptions, on the other hand, will not achieve an environment conducive to collaboration.
STM publishers actively provide products and services aimed at supporting the advancement of science through the dissemination and discovery of essential information and key relationships among that information.  STM and its members are currently engaged in evaluating or supporting a variety of initiatives, standards and policy approaches that concern research data and because of STM publishers’ heavy involvement in this area they know that issues concerning data and text mining and published journal articles require special consideration.  The 2011 report from the Publishing Research Consortium (PRC) entitled “Content Mining of Journal Articles” has identified the variety of data and text mining methods and purposes in which journal publishers and other stakeholders are currently engaged.[3]   The PRC Report noted that not all data and text mining requests come from the general public – many are from abstracting services, commercial entities, and scientific and medical researchers.  For researchers and other individuals with a scholarly or non-commercial purpose, it may be indicative that the PRC Report found over 90% of publishing respondents stated that they grant research-focused data and text mining requests.
Data and text mining for commercial purposes involves different evaluation criteria, but increasingly STM publishers are providing licensing options and arrangements for such ends. 
Publishers and collective management organizations are currently offering a variety of licensing options and permissions, and such offers and solutions should be encouraged and supported.[4]   Changes to current copyright law that would mandate extraordinary “rights”, particularly when proposed as copyright exceptions, might not be technically feasible or result in harmful untended consequences such as reducing the incentive for innovation in data and text mining solutions.
Data and text mining is not an end in itself but a research tool.  For this reason, STM publishers call for the public debate to recognize that the uses to which data and text mining can be put should affect how data and text mining is perceived and treated.
STM has already contributed to the practical implementation of data and text mining in collaboration with the pharmaceutical industry by developing a standard clause allowing data and text mining for insertion into licence agreements.[5]  By the same token STM and its members are willing to work with non-commercial research laboratories and institutions to find ways to accommodate the supply of high-quality text and data where markets are not viable mechanisms.

[1] To the extent that data and text mining is about access to raw data alone, it should be borne in mind that it is a fundamental principle of copyright law that it only protects the “expression of ideas” and not ideas or facts themselves. Thus, pure facts could be extracted from copyright-protected works, at least manually, without infringing copyright, and insubstantial parts may be reproduced, as long as these do not in the aggregate amount to a substantial part or involve the creation of unauthorised derivative works - Section 14 of the Copyright Act 1986.  In this sense, data and text mining is not an issue for copyright law.  STM has developed a best practices statement concerning the publishing of data, which is about to be published, and in June 2012 also issued a joint statement with DataCite on best practice recommendations to make research data easier to find, link to, re-use and cite - http://www.stm-assoc.org/2012_06_14_STM_DataCite_Joint_Statement.pdf.
[2] STM Statement on Text and Data Mining at http://www.stm-assoc.org/2012_03_15_STM_Summary_Statement_Text_Data_Mining_final.pdf.
[3] http://www.publishingresearch.net/documents/PRCSmitJAMreport20June2011VersionofRecord.pdf.
[4] See also the STM sample licence available at: http://www.stm-assoc.org/2012_03_15_Sample_Licence_Text_Data_Mining.pdf.
[5] http://www.stm-assoc.org/2012_09_12_PDR_ALPSP_STM_Text_Mining_Press_Release.pdf
Question 26: 
See the answer to Question 25.  To re-iterate the point made, exceptions on their own will not deliver the potential benefit of data and text mining, yet they would expose copyright-protected works to greater risks of piracy and abuse, and counter-act the incentive that is copyright for the very same organisations that invest in the creation and dissemination of valuable and innovative content.
Question 27: 
See the answer to Question 25.  Data and text mining solutions are best found in market-based initiatives, like proactive voluntary licensing, that offer faster and more flexible ways to adapt to changing market needs and preferences.  To the extent that data and text mining is only about raw data, best practices already exist in the STM community for access to research data.[1]

[1] Joint statement from DataCite and STM on the Linkability and Citability of Research Data - http://www.stm-assoc.org/2012_06_14_STM_DataCite_Joint_Statement.pdf.
Question 28: 
Question 29: 
Question 30: 
Journal articles, academic treatises and textbooks are published by educational, academic and STM publishers for the very purpose of contributing to education and scholarly communication. Universities and libraries for non-commercial research or non-commercial educational institutions are the primary purchasers of, and licensees for, these publications and services. They are therefore as much a supply to an educational institution of products or services as any other expense associated with information technology or expenses on training academic and teaching staff.
Copyright works that are available for sale or under license for education or to educational institutions must not be reproduced or made available under exceptions free of charge, as this would constitute interference and a conflict with the normal exploitation of these works. The educational market as a whole, for such works, cannot constitute a “special case”, as it is one of the main, if not sole market for these types of works.
In the digital world, licensing forms part of the primary use of a copyright-protected work and under-cutting income streams from licensing (whether collectively or individually undertaken) by way of exceptions, is not compatible with normal exploitation.
The current Australian provisions give unprecedented access to copyright material at very low cost per student, with minimal transaction costs, and the principal schemes (in Parts VA and VB of the Copyright Act, 1968) are subject to the independent supervision of the Copyright Tribunal.  STM is not currently aware of any compelling reason to expand the fair dealing provisions, but is looking forward to considering this further in light of submissions from other parties and in light of any proposals raised by the Inquiry in its Discussion Paper.
Question 31: 
Question 32: 
Question 33: 
Question 34: 
STM opposes the view that preservation copies may be used as “master copies” to serve beneficiaries of fair dealing exceptions or under any other exception, or to permit access to the general public. For preservation and archival copies to retain their legitimacy they must not become the source of further uses other than on-site consultation and/or inspection.
Question 35: 
Question 36: 
Question 37: 
Question 38: 
Question 39: 
Question 40: 
Question 41: 
Question 42: 
Question 43: 
Question 44: 
Question 45: 
Question 46: 
Question 47: 
If a new exception for quotations were to be under consideration, then STM would support an exception for academic use so long as it is a clearly defined, as contemplated by Article 10(1) of the Berne Convention, it meets the second and third steps of the three-step test under the Berne Convention and the author and the rightsholder are properly attributed in use under the exception.  However, STM could not support a broad quotation exception which would extend to “sharing” of the whole literary work on social networks or which would undermine the moral rights of the author or for the purpose of transformative use. 
STM has, together with publishing industry associations ALPSP and PSP, issued a position statement on quotations for academic use[1], which states, amongst others, “Copyright or an exclusive publication right is not inherently inconsistent in any event with academic or scholarly debate or discussion of published scholarly content. The principles of ... “fair dealing”, and the fact that copyright protection does not extend to the underlying facts or ideas, (but only the expression of them) means that academics and critics are always free to note and comment about research developments by criticizing and quoting published articles (without the necessity of obtaining consent). Of course such quotation should follow generally accepted scholarly principles concerning the quotation of just enough of the original to convey the critical point, and proper citation and crediting.” 

[1] http://www.stm-assoc.org/2007_05_01_Author_Publisher_Rights_for_Academic_Uses.pdf.
Question 48: 
Question 49: 
Question 50: 
In STM’s view exceptions are exceptions and not the rule. Therefore, it should be out of the question to consider importing all possible exceptions. The need to provide for an exception should be grounded in a well-founded aspect of business or social life in Australia and not an aim in or of itself.
In any event, the three-step test prescribed by Article 9(2) of the Berne Convention should also be included verbatim to qualify any such exceptions.
Question 51: 
Question 52: 
Australia is not substantially different in its emphasis on “fair dealing” purposes such as criticism, journalism or non-commercial research than are other jurisdictions, including the US.  Indeed “fair dealing” and the US “fair use” principles have much in common: they both derive from common-law principles that have evolved to take into account changes in the perceptions of uses that might be socially beneficial and do not distort the proper functioning of literary markets; and they both encourage the discovery and discussion of ideas, developments and news, while discouraging the copying of the entirety or substantial parts of copyright works. 
Although the Australian fair dealing doctrine (itself part of a broader common-law tradition of findings by courts that certain uses are “fair” and reasonable) and the US fair use doctrine have the same common-law parentage and orientation, the legal environments are quite different.  The US legal environment involves more risk and uncertainty, demonstrated in part by the higher volume of US litigation generally, and significant expense for both plaintiff and defendant, and thus an environment that may favour well-financed Internet-based companies who are prepared to take more legal risk than others might, and which facilitate insecure online access to the content of others as part of their own business.
More copyright infringement cases are brought and decided in the US and our analysis shows ten times the number of “Fair Use” decisions in the US than, for example, “Fair Dealing” decisions in the United Kingdom.[1]  The greater volume of decisions in the US has not always led to greater clarity about fair use analysis, however—in fact there is greater uncertainty about the legal analysis and resulting implications for US businesses (including for the publishing community) than might be commonly perceived.  US commentators and advisers constantly warn their clients and stakeholders that there are no “bright line” rules in fair use analysis, even in educational environments (even though educational purposes are considered an important fair use context).[2]
Judicial decision-making on fair use, although currently codified in Section 107 of the US Copyright Act,[3] is always understood to be a balancing of interests and factors, and over time the interpretation of and emphasis on certain factors has changed.[4]  US courts struggle in fair use cases to determine whether the use in question provides new information (or entertainment) in a fashion that transforms and transcends the original work, which has an important societal benefit, in the categories noted above, and which will not supplant the rights-holder’s ability to maintain a market, or develop new markets, for their works. 
To illustrate this difficulty, one can refer to the settlement of the long-running dispute, brought in 2005, between Google and publishers concerning Google’s mass scanning of books.  Google’s defence was to be a fair use defence, but the settlement has avoided a juridical decision on the question as to whether mass reproduction could be fair use.
Litigation costs are another element of uncertainty in US copyright cases, especially in matters that will involve significant evidence-taking and discovery, inevitable in legal analysis involving inherently fact-based issues such as fair use, and in matters with the complexity usually found in fair use cases.  Even less complex cases can easily involve many hundreds of thousands of dollars in costs, and importantly it is generally the case in the US that each of the parties bears its own costs (rather than being borne by the losing party as in Australia).  
Search engine companies such as Google have been at the centre of a number of copyright infringement cases brought and decided in the 9th Circuit in the US (the west coast circuit that includes California and thus a number of notable technology industries), concerning the republishing of copyright works available on commercial Internet sites that have paying access requirements (paid subscriptions or memberships). The Perfect 10 case (508 F.3rd 1146, 9th Circuit, 2007) is an example of this, with Google displaying “thumbnail” (reduced size) images from a membership site which included “risqué” photographs.  The 9th Circuit found in this case that there was no market for reduced-size images, and no practical method for Google to eliminate such display in its indexing of Internet sites (although the case was remanded in part), reasonably consistent with its decision in Kelly v Arriba Soft (336 F.3rd 811, 2003), and upheld Google’s fair use defence.  Google has since raised a fair use defence in the copyright infringement case brought against it by the Authors Guild in the New York District Court for the unauthorised scanning of millions of books (the Authors Guild case) on the basis of the “enormous transformative benefit” that its actions will bring.[5]
STM would be gravely concerned by any characterisation of “fair use” that would permit, for example, the digitisation of entire collections of printed works without permission or payment.  That was the situation in the Authors Guild case.  Google and its supporters relied on the “thumbnail” cases from the 9th Circuit and made the argument that the copying of the entirety of print works was a fair use given that it was only displaying “snippets” of such works online, and that in any event it responded to rights-holders’ requests for takedowns.  Supporters of the Google project argued that the scanning and indexing was more transformative than exploitative, and indeed that the project would create a new market for older content not yet available digitally.  It is our view that the assertion that such copying for commercial purposes could be fair use would represent such a distortion of the doctrine as to eviscerate it.
In the circumstances, STM’s view is that a fair use defence will not contribute to the success of the digital economy.

[1] Legal research has found, from January 1978 to the end of 2010, a total of 21 “Fair Dealing” cases decided in the UK compared to 223 “Fair Use” cases decided in the US.
Thus far, by mid-November 2012 in the US, 23 copyright cases have been filed in the federal court of appeal alone in the 2nd Circuit, and 52 cases filed in the court of appeal in the 9th Circuit—although these two circuits may not be representative (both represent copyright-heavy industries in publishing, film & entertainment, and software & other technology industries)—this does demonstrate the large number of copyright litigation matters arising in the US every year.  Listings of cases filed can be found at http://www.dockets.justia.com. 
The latest available case-by-case information analyzed by the Transactional Records Access Clearinghouse (TRAC) of Syracuse University showed that July 2012 was the fourth straight month where filings have reached close to 300 or more per month — higher than they have been since July 2008.  When monthly 2012 civil filings of this type are compared with those of the same period in the previous year, their number was up 41%. TRAC’s report can be found at http://trac.syr.edu/tracreports/civil/293/.
[2] See for example the “fair use” sections on sites such as the Washington State University and Stanford University that offer extensive guidance (although STM might not agree with all policy points mentioned on such sites, we at least applaud the understanding of complexity) at http://publishing.wsu.edu/copyright/fair_use/ and  http://fairuse.stanford.edu/Copyright_and_Fair_Use_Overview/chapter9/index.html
[3] The statutory language can be found at http://www.copyright.gov/title17/92chap1.html#107.
[4] In the 1985 decision by the Supreme Court, Harper & Row v Nation (471 US 539), the Court described the ‘effect on the market’ factor as being the “single most important element of fair use”; while the same Court less than ten years later in 1994 described the four factors as being essentially co-equal in Campbell v Acuff-Rose (510 U.S. 569).
[5] http://www.scribd.com/doc/102019445/Authors-Guild-v-Google-Redacted-Version-Plaintiff-Motion-for-Summary-Judgement-Memorandum-of-Law-in-Support
Question 53: 
See the answer to Question 52.
Question 54: 
SEE THE LETTER FROM STM DATED 29 NOVEMBER 2012 ACCOMPANYING THIS SUBMISSION.
STM believes that, in the 21st century, licensing has become the vehicle of choice for users and rights holders to agree on uses.
To the extent that Australian law reduces the ability of users and rightsholders legally to agree on permitted uses or create doubt over the enforceability of contractually agreed terms and conditions, Australian law becomes less attractive for rightsholders and users. Moreover, Australia may become less attractive as a hub for business.
STM believes that the following are key issues to consider on the relationship of contract and copyright:

Wishing to create simplicity for Australian users of licensed products and services is a valid goal, but should not come at the expense of greater legal uncertainty for rightsholders in Australia. Moreover, diversity of offerings in the market is generally indicative of an active competitive market and a diversity of licensing contracts contributes to this effect.
Where a limited market exists, e.g. only one or few significant users, STM and other trade associations have agreed to co-operate to creating standard terms and conditions or framework agreements that simplify rights clearance for licensees, eg the framework agreement endorsed by STM, the UK Publishers Association and the British Library for the overseas supply of copyright-protected works via libraries to non-commercial users.  STM is ready to offer such solutions in Australia as well.
Question 55: 
STM believes that contracting out of copyright exceptions should not be circumscribed.  See the answer to Question 54.
Other comments: 
File 1: 
2012-11-29_stm-australia_copyright-review_final.pdf
File 2: