Those are points well taken Bruce!
The best way to understand copyright is to
1) Read about it on copyright.gov for example:
More information on Fair Use:
http://www.copyright.gov/fair-use/more-info.html
2) Review the decisions of the U.S. Supreme Court, circuit courts of appeal, and district courts here:
http://www.copyright.gov/fair-use/
Trying to define a set of rigid rules about how much you can copy and paste and if the use is commercial or not is fairly useless in my opinion. What is important is to determine what the goal of fair use is under the law as defined by the latest court rulings. Even if you are a for profit entity fair use applies. Is the new work “transformative?” creative expression? Does it affect the market of the original author? Etc. Are you taking the “heart of the work” thus rendering the original work less meaningful or profitable?
The “less than one page” rule of thumb came from Harper & Row v. Nation Enterprises, in which it was found that 400 words i.e. one page was enough to qualify as copyright infringement because the one page contained “the heart of the work.” That’s where that started. The courts have never found copyright infringement for less than a page. But the key isn’t the amount so much as are you stealing the author’s thunder? Some quotes longer than a page are OK if they are not the heart of the work. But I never post anything longer than one sentence to two paragraphs max and never the “heart of the work.
The second thing is are we creating something new? Yes, we are. For example I can post a very long section of a journal and if I criticize the author I have created something new and expressed myself freely. That is a proper use – even for a commercial entity. Or alternately am I creating a new work that encompasses a much bigger subject and the quote is just one data point within that new creation? Is it for education use? Those things are important even for “for profit” websites. Does our work advance knowledge through the addition of something new? Or are our works just a substitute for the original work? That’s really key.
The last point about the citation rule comes from the idea of rendering the original work less meaningful or profitable. If you post a snippet and point to the author’s work it may actually be helpful to the market of that work. So that is important to fair use. Judge Leval said that giving the name of the author, etc. can help. You want to promote the author’s market. But what you said above is correct. This is not the key to the whole thing but it is one *small* piece that should always be done so you can pass the hurdle of showing that you are not taking their market away.
What we want to avoid is taking an article and basically posting it as the profile biography in so many words even if paraphrased and not quoted exactly! The quotes need to be part of a new and much larger argument that’s of educational value with the quote being one piece of supporting evidence.
That's my opinion not legal advice - I am not a lawyer :)
But I think your point is on target. Citing the source doesn't make it fair use by itself.