Fair Use Doctrine

The fair use doctrine protects the right to create derivative works from original copyrighted works.

In deciding whether a derivative work is protected by the fair use doctrine, judges consider four factors.

    1 -  the purpose and character of your use
    2 -  the nature of the copyrighted work
    3 -  the amount and substantiality of the portion taken, and
    4 -  the effect of the use upon the potential market.

In other words, a work is protected by the fair use doctrine if:

The original work is presented in a new context, which differs significantly from the original context.
The original work can be characterized as a non-fiction or factual work.
Only a small portion of the original work is copied.
The potential market for the original work is preserved.

Example:  John Doe wrote an article called "The Formation of the Sun".  Subsequently, Jane Doe writes an article called "The Formation of the Solar System".   Jane uses Excerpts from John's work in order to characterize the impact of the Sun's formation on the formation of the solar system as a whole.

Jane's article is protected by the doctrine of fair use.

Jane presented the factual material in a larger context.  Jane only copied the small portion of John's work which involved the Sun's impact on the rest of the planets.  Jane's article does not negatively impact the potential market for John's article.

http://fairuse.stanford.edu/Copyright_and_Fair_Use_Overview/chapter9/9-b.html
http://www.copyright.com/viewPage.do?pageCode=cr10-n