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In United States copyright law, transformation is a possible justification that use of a copyrighted work may qualify as fair use, i.e., that a certain use of a work does not infringe its holder's copyright due to the public interest in the usage. Transformation is an important issue in deciding whether a use meets the first factor of the fair-use test, and is generally critical for determining whether a use is in fact fair, although no one factor is dispositive.
if [someone] thus cites the most important parts of the work, with a view, not to criticize, but to supersede the use of the original work, and substitute the review for it, such a use will be deemed in law a piracy.
The standard of "supersed[ing] the use of the original work" would be widely cited as a standard for the degree to which a work was transformative when fair use had become more clearly fixed as a legal principle.
In the Copyright Act of 1976, Congress defined fair use explicitly for the first time, giving as one factor "the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes". This factor was later determined to hinge in substantial part on transformation. See, e.g., Campbell v. Acuff-Rose Music, a case in the United States Supreme Court:
Under the first of the four 107 factors, "the purpose and character of the use, including whether such use is of a commercial nature ...," the inquiry focuses on whether the new work merely supersedes the objects of the original creation, or whether and to what extent it is controversially "transformative," altering the original with new expression, meaning, or message. The more transformative the new work, the less will be the significance of other factors, like commercialism, that may weigh against a finding of fair use.
Campbell is important in large part because of this statement, ordering that commerciality should be given less weight in fair-use determinations and transformation great weight.
There is no "bright line test" to determine whether one work supersedes the purpose of another; like the determination of fair use generally, it involves significant judgment calls. However, there is substantial precedent that clarifies the nature of transformation in law.
Generally, use of a work to comment on the work itself somehow will qualify as transformative. Quoting portions of a work to criticize it, as in a book review, is transformative. Likewise, parody is transformative — repurposing a work to mock the work itself or the principles the work represents serves a very different purpose from that of the original work.
Repurposing a work to aid identification of the base work is also generally transformative. In Kelly v. Arriba Soft Corp. and Perfect 10 v. Google, the respective courts held that the creation and use of thumbnails to allow users of a search engine to easily browse through images returned by their search was transformative.
Of course, as noted above, no one factor of fair use is dispositive; all must be considered. Even transformative uses can be infringing, if other factors weigh against the defendant. For example, in Rogers v. Koons transformation was not even cited as the court found the use failed to meet any of the purposes in the preamble of 17 USC § 107. However, in Blanch v. Koons it was ruled that a collage painting including a close representation of a photograph was sufficiently transformative because "compared to Blanch’s original photograph, Koons completely inverted the legs’ orientation, painting them to surreally dangle or float over the other elements of the painting. Koons also changed the coloring and added a heel to one of the feet, which had been completely obscured in Blanch's photograph."