Congress derives its power to enact copyright laws from the copyright clause, U.S. Const. Art. I § 8, which reads:

Congress shall have the power … To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.

Unfortunately, the music industry didn't get the "progress memo," and tends to believe that the Copyright Clause gives them a complete monopoly over the use of their material. For example - music publishing company, Bourne Co., the owner of the copyright to "When You Wish Upon a Star," objected to a parody of the song in the Family Guy episode, "When You Wish Upon a Weinstein." In the episode, Peter Griffin gets scammed into buying volcano insurance on his home in Quahog, Rhode Island. Lois gets fed up with the family's constant financial problems, so peter decides that he needs a "Jewish money guy" to help him.

The scene at issue in this litigation depicts Peter looking out of a window up at the night sky in a manner similar to that of the toymaker Gepetto in Walt Disney's Pinocchio when Gepetto is wishing for a "real boy." (Op. at 4-5)

Peter then sings the now-famous parody, "I Need a Jew" to the tune of "When You Wish Upon a Star."

Nothing else has worked so far
So I'll wish upon a star
Wonderous shining speck of light
I need a Jew

Lois makes me take the rap
Cause our checkbook looks like crap
Since I can't give her a slap
I need a Jew

Where to find
A Baum or Steen or Stein
To teach me how to whine and do my taaaaaxesss...

Though by many they're abhored
Hebrew people I've adored
Even though they killed my Lord
I need a Jew

While he sings the song, Jews are depicted "as magical creatures that come to Peter in the form of a magical spaceship that turns into a flying dreidel." (Op. at 5).

Family Guy's creators initially sought permission from Bourne Co. for a license to use "When You Wish Upon a Star," but Bourne refused. Therefore, the Family Guy creators decided to commission a song that would be close enough that the average person would recognize it as a parody of the original. When Bourne found out, from seeing a clip on YouTube, they filed a copyright infringement suit.

Any fool knows that parody is "fair use" under Section 107 of the Copyright Act, and constitutes protected speech under Campbell v. Acuff-Rose, 510 U.S. 569, 575 (1994) (finding 2 Live Crew's parody of "Pretty Woman" not an infringement upon the Roy Orbison original). However, there is a strange wrinkle in copyright law where many courts hold that parody is protected fair use, but satire is not. The difference comes down to whether the later work is criticizing or parodying the original, or if the later work is making a humorous commentary about something else -- but using the original work as a tool to do so.

I believe that this distinction is a false one, and I am in good company. However, in Dr. Seuss Enters., L.P., v. Penguin Books USA, Inc., 109 F.3d 1394 (9th Cir. 1997), the Ninth Circuit held that a book about O.J. Simpson called "The Cat NOT in the Hat," was merely riding on Dr. Seuss' work to make fun of Orenthal, not making any kind of commentary about the Dr. Seuss original. The Second Circuit has largely adopted this logic, finding that a Jeff Koons photograph was satire, targeting entire genre but not the original upon which he relied to do so. See Blanch v. Koons, 467 F.3d 244 (2d Cir. 2006). Compare Liebovitz v. Paramount Pictures, 137 F.3d 109 (2d Cir. 1998) (Naked Gun advertisement that mocked the Annie Liebovitz photo of a pregnant Demi Moore was parodical use).

Family Guy's attorneys argued that their use of "When You Wish," directly lampooned the original in two ways: 1) By skewering the saccharine nature of the original and by making a "sharp point about Walt Disney's reputed anti-Semitism. (Op. at 14). Bourne Co., argued that "I Need a Jew" merely "ridicules anti-Semitism and Jewish stereotypes," (Id.) but makes no criticism of the original Disney tune. The court found Family Guy's perspective to be more compelling:

The Court finds that by juxtaposing the "saccharin sweet" song "When You Wish Upon a Star" with "I Need a Jew" the Defendants do more than just comment on racism and bigotry generally, as Plaintiff contends. Rather, Defendants' use of "When You Wish Upon a Star" calls to mind a warm and fuzzy view of the world that is ultimately nonsense; wishing upon a star does not, in fact, make one's dreams come true. By pairing Peter's "positive," though racist, stereotypes of Jewish people with that fairy tale world-view, "I Need a Jew" comments both on the original work's fantasy of stardust and magic, as well as Peter's fantasy of the "superiority" of Jews. [I Need a Jew] can be "reasonably perceived" to be commenting that any categorical view of a race of people is childish and simplistic, just like wishing upon a star. (Op. at 15-16).

Bourne argued that the parody itself was unclear and unsupported by the evidence in the case. However, parodies are protected by the First Amendment, "even when they fail to speak clearly." Relying upon Campbell v. Acuff-Rose, the court reminded Bourne that First Amendment protections do not only apply to clear, funny, or successful parodies. Even "inside jokes" and parodic falures are protected if the "parodic character can be reasonably perceived." (Op. at 19).