Replying to Jessica: Judge Evans in Georgia State did NOT set a "bright line". She said that her rule (10% or less of a book with 10 or fewer chapters, 1 chapter of a book with more chapters) defined a "distinctly small," i.e. safe amount. An argument could clearly be made that 12% or 15% was needed in a particular case. She balanced this with other factors, so that in one instance she found a "distinctly large" amount of copying to be infringing, because it did not in her opinion affect the market (there was no service providing licensing for excerpts from that work, I think).
Also, I reread what I wrote and I admire Farhad for figuring out the following sentence: "What [Judge Marshall] said was that the UCLA defense that using creative works in an educational context was interesting enough that the "nature of the work" factor did not in her opinion weigh in favor of either party." The UCLA defense, obviously, was that using creative works in an educational context *is transformative,* and she said that was an interesting argument. Judy
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