Groklaw has a good analysis of the recent Harry Potter Lexicon smackdown. Fair use good, too much verbatim copying bad.
The fact is, Rowling and her editor led the defendant on with praise
of his website work, such that there was a suggestion by him that he
might be the editor of the official encyclopedia, a suggestion that was
turned down. Her prior praise of his fan site weighed against her. But
she did tell him he had no role as her editor, and he went ahead with
his own book anyway, with some marketing that the judge found
misleading. So the question was, is it fair use? It certainly could
have been, since a copyright owner can’t control transformative
derivative works totally, but where the defendant failed was in the how
of it, how he went about it.
The impression I get from the Order
is that if he’d been less of a fan and copied less and written more of
his own words instead, it would have worked out better for him. The
court, despite finding against fair use, found the defendant at the
time had a reasonable belief that it was fair, and that shows me how
close the call was, but in analyzing the four factors courts use for
fair use determinations case by case, this judge decided it didn’t pass
But he managed to do so without, in my view,
damaging the field for transformative fair use works. Let me show you
what I mean. You’ll see how carefully the judge annotates his ruling
with prior case law, and if you wish to understand his decision, you
really would have to read all the citations, because that is where the
judge tells you why he decided each element.