So you tweaked some code. Maybe you swapped out a few graphics, rearranged the layout a bit. Feels like an afternoon’s work, right? Wrong. Those seemingly innocent changes might have just created a derivative work—and that’s where things get legally messy for your company. Copyright law stopped being just about blatant copying years ago. Now it’s about how you transform what someone else made.
I’m going to break down where that line actually sits. We’ll dig into the real tests that judges apply in courtrooms, bust some persistent myths about “format shifting,” and examine why tech giants like Google and Oracle burned through a decade of litigation over what seemed like just a few lines of code. If you’re trying to keep your business out of court, these rules matter.
What Exactly is a Derivative Work?
The U.S. Copyright Act tackles this in Section 101. According to the law, a work counts as derivative if it’s “based upon one or more preexisting works.” The language is deliberately fuzzy. Why? Because it needs to cover a lot of ground. Basically, when you take an original work someone created and incorporate it into your project, that’s derivative territory. Like adapting a thriller novel into a film.Derivative. A Spanish translation of a technical manual? Also derivative.
The critical concept here is “recasting” or “adapting” existing material. But not every minor edit qualifies. For something to actually be a derivative work, the new version needs enough “original authorship” to stand independently. Fix a typo or swap out a font? That’s not creating anything new—you’re just buffing up the old stuff.
What the Law Specifically Protects
The U.S. Copyright Office identifies several categories that almost always demand permission:
- Translations: Converting a book from English to French
- Musical Arrangements: Transforming a pop song into a jazz interpretation
- Dramatizations: Adapting a short story for the stage
- Art Reproductions: Creating a lithograph from an oil painting with new artistic elements
- Abridgments: Condensing a lengthy textbook into a streamlined version
- Software Adaptations: Porting an application from iOS to Android
The Legal Yardstick: How Courts Decide
Judges don’t just wing it. They rely on specific frameworks to determine whether you’ve crossed the line, though it’s not some simple checklist. It’s more like an investigation into what makes the work tick.
The Substantial Similarity Test
So how do courts figure this out? They start with substantial similarity, which isn’t as complicated as it sounds. Imagine showing your work and the original to someone off the street. Would they go, “Yep, these are definitely related”? That’s the basic test. The Ninth Circuit uses something called the “extrinsic-intrinsic test” pretty regularly.
The extrinsic side is straightforward.Judges compare tangible stuff: plot points, settings, specific chunks of code. The intrinsic component deals with the “feel”—does your app share the same vibe and user flow as the original? If so, you’ve got problems.
The Originality Threshold
This one’s crucial. To secure your own copyright on a derivative work, you’ve got to contribute something substantial. Let’s say you swap an image’s background color and try to claim that as a new copyright. Won’t fly. Why? The Supreme Court tackled this in 1991 with Feist Publications, Inc. v. Rural Telephone Service Co. The takeaway was simple: you need what they called a “creative spark.” Even if you invested 100 hours manually retyping a phone book, that “sweat of the brow” alone won’t grant you copyright protection. You need genuine creative input.
Real-World Cases: When Big Tech Collides
Examining actual lawsuits clears up a lot of the confusion. These aren’t abstract theories—they’re multi-million dollar object lessons.
The Epic Battle: Oracle v. Google (2021)
This case became the heavyweight champion of copyright disputes. Google incorporated roughly 11,500 lines of code from Oracle’s Java API when building Android. Oracle claimed this constituted an unauthorized derivative work.
The legal world watched this unfold for ten years. The Supreme Court finally weighed in during 2021, ruling that Google’s use qualified as “Fair Use.” Their reasoning? Google used the code to create something transformative—an entirely new platform for smartphones. Developers celebrated this one. Why? Because it proved you’re not automatically toast for using preexisting work. If your creation is different enough and actually serves people, you may have protection.
The “Rocky” Mistake: Anderson v. Stallone (1989)
A fan wrote an elaborate script treatment for Rocky IV and shipped it off to the studio. When the actual movie was released, it bore a striking resemblance to his script. He sued.
The court didn’t care whether Stallone actually used his ideas. Why not? Because the fan’s script used Stallone’s characters without permission in the first place. The court ruled that the script itself was an unauthorized derivative work. Since the fan had no license to use Rocky Balboa, he had zero copyright over his own script. He basically gave his work to the studio for free because he violated the rules first.
Safe Zones: Modifications That Aren’t Derivative
Not every change triggers a lawsuit—you don’t need to consult a lawyer before sending an email. Some modifications are inherently “non-infringing.”
Administrative Changes
Correcting “their” to “there” in a blog post isn’t creating a derivative work. It’s editing. Similarly, updating a chart with 2025 data instead of 2024 data generally doesn’t qualify. These are functional changes, not creative ones.
Format Shifting
Converting a Word document to PDF? You’re safe. Changing a file from .PNG to .JPG is a technical process, not an artistic endeavor. Since there’s no “new expression” being added, there’s no new work being created.
The Fair Use Safety Net
Fair use is your strongest defense, but it’s complicated. Courts examine four factors:
- Purpose: Is it for profit or education?
- Nature: Is the original work factual or highly creative?
- Amount: Did you take the entire thing or just a portion?
- Market Effect: Does your version damage the original creator’s sales?
According to the U.S. Copyright Office, fair use gets decided case-by-case. There’s no “30-second rule” for video clips or “10% rule” for books. Those are complete myths.
Why This Matters for Your Career
If you’re a corporate executive or law student, the stakes couldn’t be higher. One wrong decision can tank an entire product launch.
The Cost of Getting it Wrong
Statutory damages for copyright infringement can reach $150,000 per work if the court determines you acted willfully (17 U.S.C. § 504). Imagine your company releases an app using ten unauthorized graphics. That’s potentially a $1.5 million problem before you’ve even paid your own legal team.
The Power of Registration
Registering your own work is inexpensive—typically $45 to $65. But the benefits are enormous. Register within three months of publication, and you can pursue those substantial statutory damages. Without registration, you’re limited to “actual damages,” which are significantly harder to prove.
Licensing is the “Easy Button”
Honestly? Just get the license. Whether it’s an MIT license for code or a Creative Commons license for an image, it’s infinitely cheaper than litigation. Most open-source software permits derivative works, but they typically require attribution. Ignore that attribution clause, and you’re right back in the danger zone.
Wrapping It Up
Navigating derivative work law is fundamentally about balance. You want to innovate and build on the work of those who came before you. But those predecessors have lawyers.
The boundary between a simple modification and a legal “transformation” can be razor-thin. Add significant new value, and you might be creating something original. Just “reskinning” someone else’s hard work? You’re probably infringing. Always verify your licenses. Document your creative process thoroughly. And when a project starts leaning too heavily on a competitor’s work, pause. Bring in an expert. Paying for a license today beats paying for a settlement tomorrow.
