Legality Issues on the conceptual topics of
“fair use “ and “TEACH Act”
Whether an online instructor and a for-profit educational institution are liable for copyright infringement when relying on “fair use” or the TEACH Act to transmit copyrighted materials in an online course without permission.
Rule
Under the Copyright Act of 1976 (17 U.S.C. §106), copyright holders have exclusive rights to reproduce, distribute, publicly perform, and display their works.
Fair Use (17 U.S.C. §107) permits limited unauthorized use based on four factors:
Purpose and character of the use (including whether commercial and/or transformative)
Nature of the copyrighted work
Amount and substantiality used
Effect on the market
The Technology, Education, and Copyright Harmonization Act (17 U.S.C. §110(2)) allows certain digital transmissions of copyrighted works for distance education, but primarily applies to accredited nonprofit institutions and requires strict compliance with statutory conditions (e.g., technological controls, limited access, copyright policies).
Willful infringement may result in statutory damages up to $150,000 per work.
Application
If the instructor uploads or streams copyrighted materials without permission, this implicates reproduction and public performance rights under §106.
Regarding fair use, the commercial nature of a for-profit institution weighs against the first factor, though not dispositive. If substantial portions of expressive works (e.g., films or textbooks) are used and the use substitutes for purchasing licensed materials, the third and fourth factors likely weigh against fair use. A systematic practice of uploading entire works for enrolled students may significantly harm the licensing market.
Regarding the TEACH Act, a for-profit institution likely does not qualify for its protections. Even if it did, failure to implement technological safeguards (e.g., preventing download or retention) or institutional copyright policies would negate the exemption. Noncompliance removes the statutory shield, leaving the conduct subject to ordinary infringement analysis.
The instructor may be directly liable for infringement. The institution may face direct liability if it hosts or transmits the materials, and vicarious or contributory liability if it had the ability to supervise the infringement and benefited financially from tuition revenue.
Conclusion
If fair use does not apply and the TEACH Act exemption is unavailable or unmet, both the instructor and the for-profit institution may be liable under the Copyright Act of 1976. The instructor faces direct infringement liability, while the institution may face direct, contributory, and vicarious liability, including statutory damages, injunctions, and attorneys’ fees.
