Is this a copyright violation? (ISP-inserted ads.)

Rundown here. In summary, some ISPs are inserting ads into web pages requested by their customers. Is this creating a derivative work, and is it a violation of copyright law?

A couple of random thoughts:

  1. The end user is not the copyright holder. In this sense end-user consent is irrelevant to the issue.

  2. Could the copyright holder sue for unauthorized creation of a derivative work? Possibly. It’s a lot like the cases involving framing of third-party content. I haven’t read any recent cases on point. I don’t think the law has developed sufficiently to draw any solid conclusions, but see:

http://www.bitlaw.com/hot/totalnews.html
http://www.dlib.org/dlib/april98/04orourke.html