Shepard Fairey's case, setting aside his recent troubles for a moment, is one of these new areas. To "Warholize" someone else's photo (if that's the right verb) doesn't fall within an existing category of fair use. So the question is whether it should.
And it is in these novel situations that fair use has earned its opaque reputation—in which, as Supreme Court Justice Joseph Story said in 1841, we approach "the metaphysics of the law, where the distinctions are, or at least may be, very subtile and refined, and, sometimes, almost evanescent."
Oddly enough—and, to my mind, for no particularly good reason—other thoughts of Story's from 1841 on fair use remain the law. In Story's time, the Supreme Court heard a copyright dispute over an abridgement of a long biography of George Washington. Story wrote "we must often, in deciding questions of this sort, look to the nature and objects of the selections made, the quantity and value of the materials used, and the degree in which the use may prejudice the sale, or diminish the profits, or supersede the objects, of the original work."
Congress codified this sentence in 1976. Read it again and then look at this:
Is this fair use? Odds are, Story's general principles didn't answer the question for you. More probably, you have a gut reaction of some kind, which is, of course, how judging generally works—as Justice Oliver Wendell Holmes once put it, judges decide first and write their reasons later.
Story's language and the statute don't really get squarely at the central question of justification. Is there some public interest in infringement here that justifies what Fairey has done? In the big picture, answering that question means weighing, on the one hand, the broader freedom to produce art like this—the freedom to be Fairey—against the sense that too much of the original was taken without permission and that the original photographer or his employer, the Associated Press, deserves to be compensated.
Given the complications in Fairey's case, this time around we may not get the answer. But now you have an idea of how to frame the question.
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