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Thank you to everyone who sent me advice!
The original question was:

<Two 6th grade social studies teachers in the building have written a
grant (and have been awarded the funding) to buy a set of picture books
for each of their classrooms - four copies of each selected picture book,
each to go with a unit of ancient history. They have also included in the
grant the request to make a complete set of color overhead transparency
copies of each picture book (two sets in fact, one for each classroom).
They are planning to go to Staples to make the color transparencies. Is
this a violation of fair use (because they were copying whole works in
their entirety)? Or is it fair use, since they will be purchasing four
copies of each title anyway, and the overhead transparencies are not
intended to replace or circumvent the purchase of copyrighted material?>

Having been at a copyright workshop yesterday with Carrie Russell, I would
say the "cleanest" way to take care of it would be to ask permission of
the artists. It is clearly their work and they have the right of granting
permission to make "derivative" works.
There is a fair use checklist at http://www.copyright.iupui.edu 

This is a pretty clear that it would be a violation. The educational
print guidelines, in fact, say that you can only make copies of TWO
PAGES of a picture book. Since that is a very clear expression of
congressional intent, I don't see how a school could make a viable case
in court that doing that is fair use. If Congress had wanted to make an
exception for picture books, they certainly could have, but they went
out of their way to specify two pages only for this type of material.

Obvioulsy the transparencies WOULD substitute for a purchase of a copy
for each child, so that argument isn't going to go far on that fair use
factor (of course, we are mingling standard fair use and educational
exemptions in this argument).

While the grant provides the funding for the transparencies it does not
provide the authorization to do so.  YOu will have to contact the
copyright holder for permission.

Definitely NOT permitted.  And I doubt if any respectable Staples 
employee will touch it with a ten foot pole.  :>)

    I doubt very much if Staples will allow this; it IS a violation of
copyright.  Not only are your teachers copying a work in its entirety, but
they are also changing format.  That's a double violation, and is illegal
on both counts.  
     Sorry, but it's a no-no without permission from the copyright holder.
 Perhaps you could help them locate contact information so they could
write and get permissions?

Because the teachers intend to copy the entire titles I believe this is a
violation of the copyright unless they seek and receive permission from
the copyright holder as the law states specifically that you cannot copy
works in their entirety or change the format. I am not an expert, just a
practioner and would appreciate a reply if you find this is incorrect.
Thanks
Hope this is helpful.

Olive Woodward
Library/Media Specialist
Dover-Sherborn Middle School
155 Farm Street
Dover, MA  02030

woodwardo@doversherborn.org
(508) 785-0635 x7117

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