NXIVM Corp. v. Ross Institute
2004 US Federal Court of Appeals decision / From Wikipedia, the free encyclopedia
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NXIVM Corp. v. The Ross Institute, 364 F.3d 471 (2d Cir. 2004),[1] was a United States Court of Appeals for the Second Circuit decision that held that the defendant's critical analysis of material obtained in bad faith, i.e., in violation of a non-disclosure agreement, was fair use since the secondary use was transformative as criticism and was not a potential replacement for the original on the market, regardless of how the material was obtained.[2][3]
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NXIVM Corp. v. The Ross Institute | |
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Court | United States Court of Appeals for the Second Circuit |
Full case name | NXIVM Corporation and First Principles, Inc. v. The Ross Institute, et al. |
Argued | November 19 2003 |
Decided | April 20 2004 |
Citation(s) | 364 F.3d 471, 70 U.S.P.Q.2d 1538 |
Case history | |
Prior history | Preliminary injunction denied (United States District Court for the Northern District of New York 2003). Appealed to United States Court of Appeals for the Second Circuit |
Subsequent history | Certiorari denied (Supreme Court of the United States 2004) |
Holding | |
Defendants’ use of material for critical commentary was fair use despite bad faith on the part of the defendants in obtaining the material. | |
Court membership | |
Judge(s) sitting | Chief Judge John M. Walker, Jr.; Circuit Judges Dennis Jacobs and Chester J. Straub |
Case opinions | |
Majority | Walker, joined by Jacobs |
Concurrence | Jacobs |
Laws applied | |
17 U.S.C. § 107 |
NXIVM, (pronounced NEX-ee-um)[4] was a sex trafficking cult that claimed to offer a life-improvement seminar called the "Executive Success Program" (ESP). At the time of the court case, NXIVM's status as a sex trafficking cult was not widely known to the public, and would not be until key leaders were indicted in 2018.[5] NXIVM sued the Ross Institute and several individuals for posting quotations from a NXIVM training manual on Ross Institute's website in the context of two written critiques of the manual and NXIVM's training program. NXIVM's lawyers attempted to argue that the fair use doctrine did not apply since Ross had obtained copies of the manuscript in bad faith, i.e., he obtained them from a former ESP participant who had signed a non-disclosure agreement. Both the district court and the appeals court ruled in Ross's favor. An appeals judge stated, "Certainly, no critic should need an author's permission to make such criticism, regardless of how he came by the original; nor should publication be inhibited by a publisher's anxiety or uncertainty about an author's ethics if his secondary work is transformative."[1]