UNIT #3 - AUTHORSHIP & COPYRIGHT OWNERSHIP |
As discussed in Unit #2, a work of authorship which is original and fixed in tangible form is protected by copyright. Copyright ownership arises automatically upon a work’s creation. In general, the person who creates a work is the author and copyright owner of the work. However, it is fairly common for more than one person to contribute to the creation of copyrightable works so ownership issues can become a bit more complicated. Finally, copyrighted works are sometimes created by one or more persons on behalf of another person or company such as when employees create works for their employers. In this unit, we will cover the main provisions of the law dealing with these and other issues involving copyright ownership.
Contents For Unit #3:
The material covered in Unit #3 corresponds to chapter 4 of Music Copyright For The New Millennium.
Copyright ownership arises from and begins upon creation of a work. The concept of creation or authorship is crucial to copyright's existence. Copyright law seeks to encourage creation by giving authors financial incentives to create. While copyright gives author's the potential to make money from their creations, its ultimate purpose is to insure that many works are created and made available to the public. The idea is that the more literary and artistic expression flourishes, the better off all of society will be.
Many people confuse copyright ownership with copyright registration and assume that you have to register a work in order for it to be copyrighted. In reality, a work is automatically protected by copyright from the moment it is created as long as it is original and fixed in tangible form (as discussed in Unit #2). Although registration of a work does provide certain benefits to the copyright owner, copyright ownership is not conditioned upon registration. From my experience teaching copyright classes as well as dealing with clients, it seems that people have an exceptionally difficult time accepting the fact that registration is not required to own a copyright. So I'd like to make it perfectly clear:
YOU DO NOT HAVE TO REGISTER A COPYRIGHT TO OWN A COPYRIGHT!!!
This is not meant to imply that registration is not important. There are some very important benefits you gain from registering your copyrighted works promptly which will be covered in Unit 5 of this course. However, you own a copyright in a work simply by virtue of having created it. Consequently, it is perfectly logical that section §201(a) of the Copyright Act provides that the author of a work is the initial owner of the copyright. Although in most situations it is obvious who the author of a work is, there are some situations where this is not totally clear such as when there is more than one author and when one person creates a work on behalf of another. In general, the author of a work is the person who creates the work or translates an idea into fixed, tangible expression. The Supreme Court has stated that the term "author" should be interpreted in a broad sense and defined the term author as "he to whom anything owes its origin."
Examples:
Note: The screenplay is a derivative work based on the novel and the movie is a derivative work based on the screenplay. Derivative works are discussed in Unit #6. I didn't think the movie was all that great, but quite a few reviewers did. A scene from this movie was filmed at the University of Memphis law school while I was a law student there. A group of my law school friends tried to convince the production director to let us be in a scene as extras where Tom Cruise takes the bar exam. He wouldn't let us since he believed "we didn't look like law students." Instead, they bused in extras dressed in yuppie Hollywood law school attire. Turned out it didn't matter since the scene didn't make it into the final version of the movie. |
In the entertainment industry, it is quite common for works to be created by more than one author. For example, songwriters often collaborate in the composition of songs and writers collaborate in writing books. Movies and television programs are usually the result of creative collaborations of many individuals and entities. Under copyright law, a joint work is a work prepared by two or more authors with the intention that their contributions be merged into inseparable or interdependent parts of a unitary whole. Authors of a joint work are considered co-owners of copyright. 17 U.S.C. §201(a).
There are two requirements necessary for the creation of a joint work:
1. Intent to Create Joint Work - Authors must intend to combine their contributions into a unitary whole. It is not necessary that authors work together at the same time and place as long as each intends that his or her contribution will be combined with someone else’s contribution to form a single work.
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2. Copyrightability of Individual Contributions - In addition to having the intent to create a joint work, each contributor must make an independently copyrightable contribution. In other words, each contribution must be copyrightable on its own. This does not mean that the contributions of co-authors must equal, just that they must each contribute copyrightable expression rather than non-copyrightable elements.
| Question 3.2: Jack writes a song called "Little Ditty" which he intends to be recorded by Diane, a famous singer. Before recording the song, Diane changes a few words in the lyrics to the song to suit her performance style, but do not change the meaning of the song. Little Ditty is a joint work owned by Jack and Diane. |
1. Equal, Undivided Ownership Interests - Joint authors are co-owners of copyright in equal, undivided interests unless they agree to unequal ownership shares in a written agreement. If co-authors do not contribute relatively equally, it might be appropriate to have a written agreement specifying unequal ownership shares.
| Question 3.3: Elton composes the music to a song and his friend Bernie later writes lyrics to the song which is called Someone Saved My Life Tonight (Elton and Bernie have been writing songs this way for several decades). Elton and Bernie never discuss ownership of the song or sign any documents regarding the song’s ownership. Someone Saved My Life Tonight is a joint work owned 50% by Elton and 50% by Bernie. |
2. Right to License - Since each joint owner of a copyrighted work owns an equal, undivided interest in the work, each joint owner has the right to use the work or to authorize others to use the work. This rule applies regardless of whether the author authorizing the use has the consent of the other authors. For instance, if three songwriters collaborate in the creation of a song, each would be free to record the song themselves. Further, each of the songwriters would be free to issue mechanical licenses authorizing someone else to record the song. The only exception is that a joint owner cannot grant an exclusive license since that would prevent its co-owners from granting licenses. Practically, this rule can present licensing problems, but, as with all of the joint ownership rules, co-owners are free to agree otherwise in writing. Even though one joint owner can grant non-exclusive licenses, many licensees will want to obtain a license from all joint owners.
Note: Unlike the U.S., the law of many other countries requires that all co-owners of a copyright consent to the issuance of licenses. Consequently, many licensees prefer to obtain the consent of all co-owners.
| Question 3.4: John and Paul write a song called Nowhere Man together. John wants to issue a license allowing Yoko to make a recording of the song. However, Paul wants to license the song to Linda and consequently refuses to agree to license the song to Yoko. John can issue the license to Yoko despite Paul's objection. |
3. Duty to Account to Co-Owners - Unless co-owners agree otherwise in writing, each co-owner is entitled to an equal share of the profits resulting from a jointly owned work's use. If one co-owner of a copyrighted work authorizes a particular use and receives a fee, he must account to his co-owners and pay them their shares of the fee.
| Question 3.5: Universal Pictures asks Jerry for a license quote for the use of a song jointly owned by Jerry and Miller in a movie. Jerry issues the license for a fee of $10,000 which Universal pays to Jerry. Since Jerry granted the license, he doesn't have to pay Miller a share of the license fee. |
Tip: It can be mutually beneficial for co-authors to enter into collaboration agreements governing the ownership of co-authored works. The Copyright Act provides default rules for joint copyright owners, but authors are free to make their own rules. Doing so can often prevent disagreements and disputes from arising.
As covered above, a copyright is initially owned by the work’s creators. However, there is an important exception to this rule provided by section 201(b) of the Copyright Act which applies to what are known as "works made for hire." If a work qualifies as a work made for hire, the "author" of the work is not the person who actually creates the work. Instead, party that hires the creator is considered the work's author and copyright owner.
A work’s classification as a work made for hire is important for several reasons. First, the initial ownership of a work made for hire belongs to the employer or commissioning party rather than the person who actually creates the work. Second, works made for hire have a different copyright term than other works (95 years from publication or 120 years from creation, whichever expires first). Third, there is no termination right (see below) applicable to works made for hire.
There are two ways a work can be created as a work for hire:
1. Works Created By Employees Within The Scope of Employment - Under the work for hire definition of section 101(1), if an employee creates a copyrightable work as part of his or her job, the employer will own the copyright to the work. It is not necessary for the employer to tell employees that such works will be works made for hire nor is it necessary to have a written contract stating so (although it may be advisable to do so).
2. Certain Specially Ordered or Commissioned Works - If someone is not an employee, but they are hired by someone else to create a copyrightable work, the work may still be a work made for hire if it is one of the types of specially ordered or commissioned work specified in section 101(2) of the Copyright Act. Specially ordered or commissioned works can be works made for hire if the parties agree in writing and the works fits one of the following nine categories:
Tip: It is extremely important to have a written "work for hire" agreement if you have someone other than an employee create a work for you. Among other provisions, the agreement should state that the work to be created will be a work made for hire owned by the hiring party. To be safe, it should also state that if the work created for any reason does not qualify as a work made for hire (i.e., it doesn't fit 1 of the 9 categories listed above), the creator transfers the copyright to the hiring party. The agreement should also be signed before the work is created (some courts absolutely require this while others uphold work for hire agreements even if they are signed after creation).
| Question 3.6: An art gallery owner hired a painter to create a painting for exhibition in the gallery. The gallery owner and painter sign a contract which specifies that the painter will paint a painting in return for a payment of $1000 from the gallery owner and the gallery owner will own the copyright in the painting as a work made for hire. The painting is a work made for hire. |
Like any other type of property, copyright ownership can be transferred. In copyright lingo, a transfer of copyright ownership is often referred to as an assignment of copyright (as opposed to a license which merely authorizes someone to use a copyrighted work in a specified way). Copyrights can be transferred in whole or in part. For instance, in some situations, songwriters transfer partial copyright ownership (usually 50%) to music publishers under a contract known as a "co-publishing agreement."
Section 204(a) of the Copyright Act imposes a very practical requirement on transfers of copyright ownership. In order to transfer (or assign) copyright to someone, there must be a written agreement documenting the transfer. Why force people to have written agreements to transfer copyright? Without written documentation, there would be no effective way to prove transfers of ownership (disputes would arise and the only evidence would be one person's word against another's). The written agreement doesn't have to be anything fancy, but should at a minimum specify exactly what's being transferred (the work's title, full or partial ownership, etc.), who is acquiring the rights transferred and the duration of the transfer (a copyright assignment can be for the full copyright term or a lesser period).
Recordation of Transfers
Although you are not required to do so, its a good idea to record transfers of copyright with the Copyright Office. When a transfer is recorded, a copy is placed in the Copyright Office’s files which is indexed and available for public inspection. The Copyright Office will also send a certificate of recordation to the recording party. There are several benefits gained by recordation. Since copyright is intangible property which can be transferred without possession of any physical object, it is easy for unscrupulous copyright owners to attempt to make multiple transfers of the same copyright interest (I represented a music publisher who ran into this situation in regard to a catalog of songs the publisher purchased. It took over 2 years and a lawsuit to straighten out the mess). Recordation protects purchasers by establishing rules of priority between transferees when a copyright owner makes multiple transfers of the same interest. Most importantly, recordation gives constructive notice to the world of the facts specified in the recorded document. Constructive notice means that everyone is deemed to have knowledge of the transfer regardless of whether they actually have knowledge or not. The reasoning is that once a transfer is recorded, anyone can check the Copyright Office records and find out about it. Recordation, the process of recording transfers of copyright ownership, is not the same thing as copyright registration which is discussed in Unit #4.
For information on how to record transfers of copyright, see the Copyright Office's Circular 12.
Although American copyright law has given authors the right to transfer copyright ownership, Congress has at the same time tried to protect authors from transfers which turn out to be bad deals for the author. The 1976 Copyright Act gives authors the right to terminate transfers of copyright after a certain period of time. Section 203 of the Copyright Act gives authors of works created beginning in 1978 the right to terminate the transfer Works created before 1978 are governed by the 1909 Copyright Act as amended and are subject to a similar termination right. Termination can be made at any time during a 5 year time period between 35 and 40 years after the date of transfer. However, if a transfer includes the right of publication (as most do), termination may be made during the 5 year period beginning at the end of 35 years from publication or 40 years from the transfer date, whichever is earlier. Since most works are published shortly after they are transferred, 35 years from publication will usually be the beginning of the termination period rather than 40 years from the transfer date. The first terminations to be made under § 203 will occur in 2013 (35 years after 1978).
In order to make a termination, the terminating party must give written notice, signed by the terminating party (or his or her agent) to the transferee. If the transferee has transferred the copyright to another party, the termination notice must be sent to that party if the terminating party knows of that party’s identity. The notice must state the intended termination date and may be sent at any time between 2 to 10 years before the termination date. A copy of the notice must also be filed with the Copyright Office. Once a termination takes place, the copyright reverts to the author or the author’s heirs as provided by the Copyright Act.
Note: Publishers or other transferees who receive termination notices for valuable works may attempt to convince the author (or other terminating party) to re-transfer the copyright to them before the termination takes place. In order to do so, they will probably have to offer the author a better deal than the one under which they originally acquired the copyright (e.g., higher royalty rates, additional advances, co-ownership, etc.).
Even if a transfer is terminated, a derivative work made before termination can continue to be used by the transferee.
| Example: A record company which received a license from a publisher to make sound recordings of a song is allowed to continue to sell sound recordings containing that song after the songwriter terminates its transfer to the publisher. Although the termination allows the author to recapture ownership of the song, the author cannot prevent the continued exploitation of derivative works (such as sound recordings) based on the song. |
The termination right cannot be waived by an author. In other words, even if an author agrees in a contract not to exercise the termination right, he or she can still do so. Works made for hire are not subject to termination which is why many hiring parties want to have works created by employees and independent contractors treated as works made for hire.
Note: The termination provisions are very detailed and complex and it is important that they be fully complied with since the failure to do so can result in a loss of the termination right.
Unit #3 Question Answers
Answer 3.1: False - Sarah did not have any intention to combine her poem with music when she wrote the poem. Instead, the resulting song is a derivative work based on Sarah’s poem.
Answer 3.2: False - Merely changing a few words would not be a copyrightable contribution. If Jack (the sole copyright owner) chooses to, he could transfer partial ownership to Colleen. Although the song would then be co-owned, it would not technically qualify as a joint work of authorship.
Answer 3.3: True - Since Elton and Bernie do not have any written agreement specifying otherwise, each co-author owns an equal share of entire work. If they chose to do so and signed a written agreement, Elton and Bernie could own their contributions separately with Elton owning the copyright to his music and Bernie owning the copyright to his lyrics or they could own unequal shares. Copyright law presumes equality of authorship contributions unless co-authors agree otherwise. Copyright law insists that any such unequal agreements must do in writing since there would otherwise likely be many disagreements among authors fighting over what their respective contributions are worth.
Answer 3.4: True - Both John and Paul can issue non-exclusive licenses for the song. John's license allowing Yoko to records the song would not prevent Paul from issuing a license allowing Linda to record the song.
Answer 3.5: False - Co-owners have a duty to account for profits from licensing to third parties so Jerry must pay Miller half of the $10,000 license fee.
Answer 3.6: False - Although the gallery owner and painter have a written agreement, the painting does not fit one of the nine categories of specially ordered or commissioned works which can be works made for hire under section 101(2) of the Copyright Act. Although the contract would likely be construed to allow the gallery owner to display the painting in the gallery, the painter would own the copyright.
Copyright For The
Entertainment Industries: Unit #3: Authorship & Copyright Ownership
©
2004 David J. Moser