What is "Fair Use"?
Fair use is an exception to copyright codified at Section 107 of the Copyright Act. Under fair use, you may use copyrighted material without permission. The fair use statute allows for uses of a work when for purposes such as criticism and commentary (quoting a few lines from a book in a book review; teaching, scholarship, and research (copying a few paragraphs, with citation, from a news article for use by a professor in a class) and news reporting (replaying a small part of a taped concert in a news segment about the artist's performance).
The four fair use factors help determine if your potential use is fair:
Factor 1: Purpose - Purpose & character of the use.
Favors: Nonprofit, educational, scholarly or research use or a "transformative use"
Factor 2: Nature - The nature of the copyrighted work.
Favors: Published works over unpublished works. Creative works have more protection than factual ones; the more creative a work, the less likely the use will be considered fair.
Factor 3: Amount - Amount & substantiality of the portion used in relation to the copyrighted work as a whole.
Favors: Small or less significant amounts or using only the amount needed for a given purpose. Both a quantitative and qualitative factor.
Factor 4: Market - Effect of the use upon the potential market for, or value of, the copyrighted work.
Favors: Not possible to obtain permission or there is little to no market effect. If licensing permission exists for the use, this may lean away from a fair use.
Courts occasionally boil down the four fair use factors to these two questions:
1) Does the use transform the material, by using it for a different purpose?
2) Was the amount taken appropriate to the new purpose?