especially with respect to caching of material from non-commercial websites that make material
available for free. However, even in the case of non-commercial sites, one or more of the
detriments of caching noted in subsection 2 above may be applicable, and the copyright owner
might use such detriments as the basis for an argument of harm to the potential market for the
copyrighted material. For example, a website owner might put promotional material up on its
site that is updated frequently. If caching caused the latest updated material not to be available,
the owner might argue that the “market” for its website material had been harmed.
With respect to commercial sites, one can more readily imagine instances in which
caching could cause harm to the market for copyrighted works. For example, if caching reduces
the number of page impressions generated by a home page containing copyrighted material on
which advertising is sold, the owner could argue that its advertising revenues for ads placed in
conjunction with such copyrighted material (which, in this instance, is arguably the very
“market” for such material) will be harmed.
In the Netcom case, the court held that potential harm under the fourth fair use factor
precluded a ruling that the OSP’s posting of the plaintiffs’ copyrighted material in its Usenet
service was a fair use. The plaintiffs had argued that the Internet’s extremely widespread
distribution of its copyrighted religious materials multiplied the potential effects of market
substitution for its materials by groups using such materials to charge for Scientology-like
religious training.^1543
In sum, it seems that the application of the fourth fair use factor will be highly fact
specific, and there may be instances in which a copyright holder could establish sufficient harm
to its potential markets from caching as to preclude a finding of fair use. It therefore seems
unwise to make a blanket assumption that the fair use doctrine will automatically protect all
forms of caching.
The potential harm to copyright owners from caching also introduces uncertainty with
respect to whether the implied license doctrine may apply to caching in various instances.
Courts often tend to construe implied licenses narrowly.^1544 A court might therefore be hesitant
to construe any implied license from a copyright owner based on its posting of material for
browsing on the Web to cover uses (such as caching) that cause palpable harm to the owner.
(^1543) Netcom, 907 F. Supp. at 1380.
(^1544) See, e.g., MacLean Assocs. Inc. v. Wm. M. Mercer-Meidinger-Hansen Inc., 952 F.2d 769 (3d Cir. 1991)
(defendant obtained an implied license to use a computer program prepared by an independent contractor, but
only in the furtherance of its business relationship with one particular client for which the contractor had been
engaged to support); Oddo v. Reis, 743 F.2d 630 (9th Cir. 1984) (scope of implied license included the right to
market an unmodified computer program to third parties, subject to an obligation to account for profits to the
developer, but did not include a right to modify); see also Microstar v. Formgen, Inc., 942 F. Supp. 1312, 1318
(S.D. Cal. 1996); Meadows, “Practical Aspects of ‘Implied License,’” Computer Law Strategist (May 1993) at
- See generally Barry & Kothari, “Other People’s Property: There May Be Implied Licenses for Content on
Web Pages,” San Francisco Daily Journal (Aug. 28, 1997) at 5.