The copyright doctrine of "fair use" is a continual source of confusion for businesses and individuals who want to use copyrighted works created by others. Copyright protection is one of the most underestimated and misunderstood forms of intellectual property protection. Even knowledgeable attorneys and courts have struggled with the issue of fair use.

Copying tends to be considered fair use for purposes such as criticism, comment, news reporting, teaching, scholarship or research. But in determining whether copying is fair use, courts also look at factors such as the purpose and character of the use, the nature of the copyrighted work, the amount and importance of the portion used in relation to the whole work, and the effect of the use on the potential market or value of the copyrighted work.

People copying a protected work often operate under the misconception that they had the right to do so. They tend to use one of the following justifications, none of which is valid:

There was no copyright mark. Since March 1, 1989, inclusion of copyright notice such as the frequently seen (c) mark, the word "Copyright" or the abbreviation "Copr.," followed by the year of first publication and the name of the copyright owner, for example, (c) 2003 John Doe, has been optional. In general, a work is protected by copyright from the moment it is created in fixed form like a book, picture, videotape, recording or other medium regardless whether it displays a copyright notice.

It was only a paragraph. There is no numerical equation for what amount of copying constitutes copyright infringement. Copying even a small portion of a work (e.g., a single paragraph from a novel) can constitute copyright infringement, particularly if the copied portion is a qualitatively substantial or essential portion of the original work.

It was on the Internet. While material that is truly in the public domain (i.e., a work for which the copyright has expired, or something that is unprotectable such as, for example, ideas or facts) may be copied, nearly all material found on the Internet was created by someone and is, therefore, an original work protected by copyright.

I didn't make any money on it. Whether or not one is making money does not matter. Copyright law gives the owner the right to decide who may use the work.

I credited the source. Giving credit to the source of a copied work does not mean that the copier is not an infringer. It just means that he or she is not a plagiarist. Acknowledging the source of the copyrighted material does not substitute for obtaining permission to use it.

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I changed it. An individual who copies and modifies protected material most likely infringes the copyright owner's exclusive right to create modified versions of the original work. These modified versions are known as derivative works.

Understanding these copyright law basics is important because few people appreciate the potential consequences for committing copyright infringement in the United States. Under the Copyright Act, a copyright infringer is liable for the copyright owner's actual damages and any additional profits of the infringer that are attributable to the infringement.

In addition, statutory damages up to $150,000 and remedies such as injunctions, impounding or destruction of infringing items, as well as other remedies, may be available. In cases of willful infringement for purposes of commercial advantage, an infringer could even face criminal penalties including fines or imprisonment, or both.