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11/15/2004 |
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E. Scott Johnson Appeared in the Bar Bulletin Also reprinted by Women In Film & Video, April 2007 A wise attorney once asked: "Would you really rather beg for forgiveness than ask for permission?" That should be the touchstone for all those who use photographs, artwork, textual works, computer software, data, or an actual person's name or image in connection with a website, publication, product, or in advertising. Unauthorized use of such third party materials poses the risk of infringing intellectual property rights; even when such materials are created by employees or vendors, intellectual property ownership and scope of use license issues can arise. Common myths about intellectual property law, especially the prevalent misunderstanding of "fair use" as an affirmative right, rather than what it really is: a defense to an infringement claim (a "right" that can be very expensive to vindicate in litigation), can lead to serious legal problems, mostly avoidable. Intellectual property or "IP" is the term used to describe products of human intellect that are accorded property-like legal status. The term has long referred to copyrightable works of authorship, inventions, trademarks and trade secrets, but is more expansively used today, to include industrial designs, trade dress, integrated circuit mask works, domain names, rights of privacy and publicity, biological materials, databases, moral rights — and the list keeps growing. "Rights clearance" is the discipline of securing rights, permissions and licenses to use intellectual property owned by others. To use the photograph of an identifiable person in a print advertisement or on a website, one must first secure a license from the photograph's copyright owner, usually the photographer, or the photographer's stock photo house, agent or publisher. But a copyright license alone is insufficient. To use the photograph of an identifiable person in advertising, one must secure both the copyright license and a model release from the photograph's subject, or risk infringing that person's rights of privacy and publicity. Rights clearance is both art and science. "Rate cards" are not the rule, and savvy licensors will negotiate whatever the market will bear. License fees negotiated after usage has commenced can be much higher than fees quoted for prospective uses. An IP attorney should be tapped early to vet new products, promotions, and advertising, and to assist in securing needed rights, permissions and licenses. Developing a clearance process is important to insurers offering Errors and Omission or Media Perils insurance. Not all pre-existing materials must be cleared. For example, public domain works can be used without license. However, later adaptations of public domain works (e.g., Disney's animated film adaptation of Victor Hugo's "Hunchback of Notre Dame"), may be protected under a separate copyright, covering the material added to the public domain work. Unauthorized use of the later-added material would infringe the copyright in the adaptation, and must be cleared before use in a new work. Those involved in running nonprofits, especially tax-exempt charitable or educational organizations, often believe they are entitled to an extensive "fair use" copyright exemption. That is mostly incorrect. A few specific exemptions for nonprofits are provided in the U.S. Copyright Act, but non-profits generally must adhere to the same copyright laws as for-profits when using copyrighted works. When intellectual property is created by employees, vendors, or even volunteers, the organization that expects to own or exclusively exploit the work should ensure that it acquires the rights it needs. For example, an organization engaging a researcher to write a manual, likely expects to own the copyright, or at least the exclusive right to publish the manual. But unless copyright is expressly assigned or exclusively licensed in writing, the consultant retains copyright and is generally free to adapt, publish and re-license the manual. An even more surprising example is the company that engages a consultant to develop a computer program, pursuant to a contract that provides detailed specifications for the computer program deliverable but is silent on the issue of source code copyright. In that case, the developer owns the copyright, and may license the software to its other customers, including competitors of the business that paid for development of the software. The default rules under the Copyright Act, which apply when no written agreement expressly addresses copyright ownership or exclusive license rights, give specific and often unanticipated rights to the creators of commissioned works. In most instances, the copyright owner is the actual creator or "author" of the work. The person who writes computer source code owns the copyright in the code, unless it is created by (a) an employee within the scope of his or her employment, or (b) an independent contractor pursuant to a written contract that specifically assigns copyright to the commissioning party. If an employee is hired to write computer code, the employer automatically owns the computer code as a work-made-for-hire and is considered the "author" of those works under U.S. copyright law. If a contractor writes the code, the copyright must be expressly assigned in writing, or the most that is conveyed is a license, the scope of which may be subject to debate. If a copyrightable work is created by an employee, outside the scope of employment, such as when an employee hired to write marketing copy, writes a novel on weekends, copyright in the novel is not a work-made-for-hire for the employer. Sometimes, determining what is "within the scope of employment" is trickier, like the bookkeeper who develops accounting software at home. But in most cases, a review of the employee's job description will make it fairly obvious whether a particular work is a work-made-for-hire. If technically not a work-made-for-hire, the employer could acquire copyright ownership only by contract or written assignment. Attention to the legal requirements for acquisition of copyright is especially important when dealing with independent contractors. While a common sense understanding of the words "work-made-for-hire" might lead one to conclude that the copyright in a commissioned work would belong to the party paying for the work, under U.S. Copyright law, often that is not the case. Except for nine specific categories of works (a contribution to a collective work; part of an audiovisual work; a translation; a supplementary work; a compilation; an instructional text; a test; answer material for a test, or an atlas), works prepared by independent contractors are not works-made-for-hire, even if the contract says so, and copyright ownership must be acquired by written assignment. With respect to the nine enumerated works, copyright can be acquired by assignment or as work-made-for-hire, but express words of assignment, or words designating a qualifying work as a work-made-for-hire, must appear in a written contract signed by the parties, or the contractor retains copyright ownership. This aspect of the U.S. Copyright Act, which requires specific words of assignment, and denies work-made-for-hire treatment to commissioned works other than nine specific types of works can lead to significant problems. Ownership of intellectual property should be addressed in contracts that describe the nature of the work product and the allocation of rights in intellectual property created by employees, volunteers or independent contractors. For copyrightable works created by employees, employment contracts can clarify the scope of employment for purposes of copyright law. The rules are different under U.S. patent law, so if patentable inventions are anticipated, it is even more important to include intellectual property assignment provisions in employment agreements. Pre-existing materials adapted or otherwise incorporated in new works should be identified and evaluated early for IP clearance issues, and usage rights secured before investments are made in the new products or advertising. It is far better (and much less expensive) to seek permissions and negotiate licenses in advance, rather than be forced to respond to a cease and desist letter, or negotiate a license after an investment has been made. Ober, Kaler, Grimes & Shriver Maryland
Washington, D.C. Virginia |
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