When you xor data with truly random data, the result is just as truly random as the original random data. Consider this: considering that xor is its own inverse

When you xor data with truly random data, the result is just as truly random as the original random data. Consider this: considering that xor is its own inverse, how would a court distinguish the original and the xored random data? Perhaps you're right, and the latter is legally considered copyrighted. However, on a practical level, this is completely unenforcable; so long as you never state the way the data came about, there is no way to acertain the connection (http://en.wikipedia.org/wiki/one-time_pad http://en.wikipedia.org/wiki/one-time_pad). This is what the lawyer of the article believes: the xored data is copyrighted. He explains it by introducing a metaphysical "colour" associated with the data. Given that litigation can only occur when you have stated that the data is a transformation of a copyrighted work, it seems much simpler to ascribe the litigation to your statement, rather than to "colour". I am under the impression that "copying", as far as copyright goes, really refers to distributing. You are legally entitled to make a single backup of copyrighted work you come into possession of. If this backup was stored in the cloud, I imagine no one would mind, unless you handed your password out to just anyone. This is why I believe that distributing an encrypted copy is safe - without the password, it doesn't constitute distributing the original. As you said, copyright is confusing, so I may be wrong on the previous count. However, the fair use claim is much easier than you make it out to be. One clause of fair use is that the work doesn't compete with the original. An encrypted file, being useless for consuming the original, surely doesn't compete with it.