Work For Hire: Do You Know Who Really Owns the Work?

With the help of the Internet, creative people are becoming more entrepreneurial and are serving as their own publicists, marketing teams, record labels, managers, etc. Some are doing this hoping to be discovered by a "major" player in the relevant industry, while others have found that "doing it yourself" is far more lucrative and allows you to retain more of your rights. But, does it really? The reality is, unless you are truly doing it ALL BY YOURSELF, you may not necessarily own the copyright in your works.

For example, have you ever hired someone to create a track for, design a website, write an article for your online magazine, or take photographs for your album cover? Or, maybe you've done most of the work, but asked someone to write the introduction to the book you plan to self-publish or write the hook to your new song. Sound familiar? This happens all the time. So, here's the question of the hour: When you hire someone to do creative work for you, do you legally own the work?

If you're like the countless people who have asked me about this issue, you may think that because you paid someone to do the work or because you did most of the work and they only added what you deem to be a trifling portion, that you own the copyright exclusively. But, like George and Ira Gershwin once said, "It Ain't Necessarily So". The general rule of copyright is, the person who creates the work, owns the work. But this is not always the case. As with most intellectual property laws, there are exceptions to rules.

The Copyright Act

The General Rule Determining who owns the copyright is very important because it determines who gets to claim ownership of the exclusive rights granted by the Copyright Act of 1976 ("The Act"), and ultimately who will get paid for exploitations of the work.

While a detailed discussion of the rights under The Act is beyond the scope of this article, here is quick list of the six exclusive rights that an owner of a copyright has or can authorize another to have under Section 106 of the Act: (1) reproduce the copyrighted work in copies or phonorecords; (2) prepare derivative works based upon the copyrighted work; (3) distribute copies or phonorecords of the copyrighted work to the public by sale or other transfer of ownership, or by rental, lease, or lending; (4) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, perform the copyrighted work publicly; (5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work, display the copyrighted work publicly; and (6) in the case of sound recordings, perform the copyrighted work publicly by means of a digital audio transmission.

Under The Act, copyright ownership vests initially in the author of the work. In general, the "author" is the person who actually creates the work. Therefore, when a third party such as a web designer, a writer, a producer, or a photographer contribute to your work, under the Act, they may be considered the exclusive copyright owner, or the work may be considered a "joint work," in which case the third-party might be considered a co-copyright owner and may also have the right to exploit the work.

An Exception to the Rule: "Work-Made-for-Hire"

Although the general rule is that he who creates the work owns the work, The Act provides certain exceptions, including the "work made for hire" exception (more commonly referred to as a "work for hire"). Under this exception, the employer or the person that hires an independent contractor to create certain works, rather than the employee or the independent contractor himself or herself, is considered the author and owner of the copyright.

In order for a work to be deemed a "work for hire" it must meet one of these two criteria: (1) the work must be created by an employee within the scope of employment; or 2) the work must be created by an independent contractor and must fall within one of the nine statutory categories of works. Within these two criteria, there are additional thresholds that must be met in order for the work to be deemed a work for hire.

Works Created By An Employee: Work created by an "employee" within the scope of employment is considered a work for hire. While determining who is and who isn't an "employee" is not always the easiest task, there are certain factors that courts have applied to determine whether an employer-employee relationship exists. These factors include: (1) whether the employer controls how the work is done by the employee; (2) whether the employer controls the employee's schedule in creating the work; (3) whether the employer is in the business to produce such works; and (4) whether the employer provides the employee with benefits and withholds taxes. If all or some of these factors are met, an employer-employee relationship may exist. Consequently, the employer would be the copyright owner of all the work created by the employee within the scope of employment.

Works Created By An Independent Contractor: Work created by an independent contractor who has been hired to create a specially ordered work may also be considered a work for hire. For this category of work to be deemed a work for hire, these conditions must be satisfied: (1) there must be a written agreement between the parties specifying that the work is a work made for hire, and (2) the work must fall within one of the following nine narrow statutory categories: (1) a translation, (2) a contribution to a motion picture or other audiovisual work, (3) a contribution to a collective work (such as a magazine), (4) an atlas, (5) a compilation, (6) an instructional text, (7) a test, (8) answer material for a test, (9) or a supplementary work (i.e., "a secondary adjunct to a work by another author" such as a foreword, afterword, chart, illustration, editorial note, bibliography, appendix and index). If these requirements are met, the person who hired the independent contractor is likely to be deemed the copyright owner.

Assigned, Seal, Delivered...It's Yours Since merely stating that a work is a work for hire in a written agreement may not be enough (e.g., the work may not fall clearly into one of the nine statutory categories), a well-drafted work for hire agreement should also always contain an assignment of the entire copyright by the independent contractor over to the person commissioning the work. Conclusion

In today's "do it yourself" environment, it is inevitable that more and more musicians, writers, producers and other content-creators will be spending time and money developing work, often times with the help of third parties. I mean, let's face it, we can't do it ALL BY OURSELVES. Just remember that when you bring in other people to help with your work that are not your employees or independent contractors as defined by The Act, they may be considered co-copyright owners or even worse, the exclusive copyright owner. Protect yourself. In order to establish your legal ownership and control of the work, be sure that you have a comprehensive work-for-hire agreement that includes, among other things, an assignment of copyright provision.

NOTICE: This article represents copyrighted material and may only be reproduced in whole for personal or classroom use. It may not be edited, altered, or otherwise modified, except with the express permission of the author. This article discusses general legal issues of interest and is not designed to give any specific legal advice pertaining to any specific circumstances. It is important that professional legal advice be obtained before acting upon any of the information contained in this article.

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Warning! Co-Creation Hazard Ahead

Brainstorming and collaborating frequently produces superior work. For that reason, it is not surprising that many creative works, in the art and literature world, as well as in the business world, are the result of co-creation. Unfortunately, it is common for disputes to arise over co-created materials. That is not to say you shouldn't collaborate. It is, however, essential that the collaborators agree upon the terms of the arrangement.

Whether you have a business partner, a co-inventor on a new product, or a co-author on a book, blog, or other writing, you should take some simple steps to avoid future disagreements over ownership. As human beings, we typically perceive our contribution to a project as being the most valuable. The financier always believes the key to the company's success is the financial capital, the visionary always believes it is the ideas and the person rolling up their sleeves to do the work believes that success is the result of hard work. Of course, a more objective observer knows that all of those were the ingredients of success.

The laws governing intellectual property do dictate the rights owned by co-authors and co-inventors, but those laws do not necessarily match the intentions of the parties. If two authors work together to author a book, they become joint owners in the copyright to the book. Unless the writing was separated in some easily discernable way, both authors own 50 percent of the work and each have all of the rights that a single author would have. For example, if both authors contributed to every chapter and worked together to decide on wording, there is no way to differentiate between their work and therefore no method to divide the copyright. On the other hand, if each author wrote certain chapters of the book and those chapters could be separated without destroying the work, then there might be a way to divide the copyright. Typically, that is not the case. The applicable federal law states that "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."

Similarly, joint inventors on a patent each have all of the rights of an inventor. There is usually no easy or accurate way to separate out the contribution of each inventor to the invention.

Co-authorship and co-inventorship can be problematic because both creators have the right to commercialize and monetize the product and can easily and frequently do, interfere with one another's efforts if there is a lack of cooperation.

When co-authorship is contemplated, my recommendation to my clients is that they enter into a written assignment of the copyright to avoid joint ownership of the copyright. One of the authors can assign their rights to the other author in exchange for compensation, recognition, and other negotiated terms. If the co-authors cannot agree on one owner, they can both assign the copyright to a company in which they both have an ownership interest. The company, such as a limited liability company, should be governed by a written agreement between the owners. That agreement should include the rights and obligations of the respective members, how to deal with contingencies such as the death of one of the owners, buyout provisions by one owner of the other's interest as well as other operational matters.

When a creation is only owned by only one person or one entity, there is a clearer direction for commercialization of the work and there are far fewer disputes over the respective rights and obligations of the parties. The next time you are collaborating on a project that involves intellectual property, make sure you discuss ownership of the resulting product and consider consulting an intellectual property attorney to assist you in memorializing your agreements and assigning the ownership to a single person or entity. The cost of this preventative step will be a fraction of the cost of resolving a dispute later.

This article is not intended to provide legal advice. This article only covers United States Law. Always consult an attorney for legal advice for your particular situation.

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Concept Of Intellectual Property In Islam And Western Law

Concept of property is the part and parcel of a structured society in this modern age. How the concept of property is viewed, determines the nature of society. These copy rights are well known phenomena of this age of modernization and of great impotence.

Intellectual property is defined as the specific legal rights over the property with is the result of one's intellectual effort for example patent, trademark, industrial design and copy rights. It is the property of intangible or incorporeal nature.

In western intellectual law of property has attained significant importance and is a well accepted concept and it comes under the domain of personal property. But in Islamic law the concept of intellectual property is disputed.

In Islamic law this concept of intellectual property is the one on which no extensive work has been done and jurists are at dispute. Some of them consider it as the property and others do not. The main reason for the dispute is the nature of property as intellectual property is intangible, and has no physical existence.

Different Islamic schools of thoughts advocate their opinion of acceptance and non acceptance differently. The Hanfi school of thought do not accept the intellectual property as a property but the Shafi consider it as the property because they consider the usufruct and the benefit too as the property while the Hanifi's only consider the corporeal property as the property.

The modern jurist has put the intellectual rights of property under the category of Haqooq-e-Urfiya( customary rights) and these are the rights which, according Mulana Taqi Usmani, are of such nature about which there is no proof found in sharia and the only basis of its recognition is the practice of these rights.

This is the time when this very concept of intellectual property is required to be defined and accepted. Importance of this very concept is inexorable at this stage of globalization. It is a challenge for the Muslim world to resolve this dispute of acceptance and non acceptance of intellectual property. Muslim jurists are greatly in need of ijtihad and ijma for the recognition of this concept undisputedly.

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Latest Legal Developments in the UK

1- ASA new online powers: e-commerce businesses and social media sites have six months to get ready!

The Advertising Standards Authority (ASA), the UK's independent advertising regulator, adjudicates on complaints about advertising made under the new Advertising Codes, in force since 01 September 2010.

ASA's current remit does not include regulation of general website and social media content but only paid-for online advertising and sales promotions.

From 01 March 2011, ASA will be able to regulate and intervene in relation to:

1) advertisers' own marketing communications on their websites, to ensure that their standard is as high as in newspapers and TV; and 2) marketing communications in non paid-for space under their control such as social networking sites like Facebook and Twitter to ensure that the principles of misleading advertising, consumer protection, protection of children and similar are implemented across all sectors and all businesses and organizations, regardless of size. ASA intervention powers will not apply to journalistic and editorial content and marketing related to ideas unless they solicit or encourage fundraising donations.

ASA will be undertaking an ongoing, quarterly review of the extended remit with the intention of carrying out a comprehensive review of its new powers towards to mid of 2013.

In addition to its current sanctions, from 1 March 2011 ASA will be able to impose the following sanctions:

1) to request, with the agreement of search engines, the removal of paid-for links to pages hosting a banned advertisement; and 2) to name and shame a non complying advertiser by placing its own adverts online highlighting continued refusal to comply with a ruling.

2- Equality Act 2010

The Government Equalities Office (GEO) has published a list of the provisions of the Equality Act 2010 that will come into force on 1 October 2010. The provisions in the Equality Act 2010 aim at updating, simplifying and strengthening current legislation in all areas including discrimination. The provisions in the Equality Act will come into force at different times to allow time for the people and organisations affected by the new laws to get ready, although the "vast majority" of the Equality Act 2010 provisions will come into force on this date.

3- A quick reminder of the importance of performing an intellectual property audit

Nearly all businesses have some form of Intellectual Property that is valuable and contributes to their success and profits.

By carrying out an IP audit you will obtain a systematic review of the intellectual property created, owned, used or acquired by your business.

There are essentially two types of IP audits: a preliminary audit and a comprehensive audit.

Remember that, when undertaking an audit, a number of issues must be addressed, including identifying your intellectual property and understanding the ownership and licensing arrangements you have in place. This will enable you to make an assessment of the type of intellectual property education your employees require.

IP Audits should be undertaken regularly as a part of general intellectual property management, a precursor to an acquisition, in preparation for a joint venture and in order to defend intellectual property infringement.

By carrying out an IP Audit, you look closely at your business to:

I. Identify where IP is used; II. Find out who owns the IP rights; and III. Assess the value of the IP.

This will not always be easy. Remember that, IP exists not only in patents, trademarks or designs rights you have registered. Valuable IP may be in trade secrets, in software, written material, domain names and customer databases.

An IP Audit should raise and answer the following questions:

a) Is my intellectual property protected? b) Am I infringing anybody else's intellectual property rights? c) Am I fully exploiting my intellectual property?

As stated before, an IP Audit is the first step of a correct IP Management and subsequent exploitation:

After an IP Audit is concluded, using the logbook (report) you created during an IP Audit, will help you to manage your IP. You can record in it all research, notes, designs and meetings related to your ideas in a dated, tamper-proof manner, with witness signatures where appropriate. This can serve as a powerful tool, helping you identify and protect your Intellectual Property later on, if you need to prove that, it was you who created the relevant IP.

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Can A Company Claim Exclusive Use of the Term?

Zynga Game Network Inc. is in the computer game software business. You may not recognize its products from its corporate name but it is the creator of Farmville®. Farmville® is an extremely popular online real-time simulation game available on Facebook® and the Apple iPhone®. When playing the game, users are responsible for managing a virtual farm. Zynga is also the manufacturer of other simulation games, such as, CityVille, FishVille, FrontierVille, PetVille, and YoVille.

Blingville, LLC, another computer game software company, intends to launch a virtual game on Facebook® called BLINGVILLE. When Zynga found out about this it objected and sent a number of cease and desist letters to Blingville. In the letters, Zynga alleges Blingville is infringing on its trademark rights when it uses of the letters "ville" in its name and on its game. Zynga claims ownership of the term "ville" based on its family of games ending in the suffix "ville" (mentioned above). Zynga does not own any trademarks for BLING or BLINGVILLE but it believes Blingville's use of the suffix "ville" is likely to lead consumers to believe the two companies are somehow related or that Zynga endorses or sponsors Blingville's product. In response to Zynga's demand letters Blingville filed a law suit with the District Court of West Virginia. In the suit Blingville asks the Court to enter a judgment that declares use of the mark BLINGSVILLE is not trademark infringement.

Will Zynga has enough to claim exclusive ownership of the term "ville?" Looks like we will have to wait and see.

FARMVILLE® is a registered trademark of Zynga Game Network Inc. FACEBOOK® is a registered trademark of Facebook, Inc. APPLE iPhone® is a registered trademark of Apple, Inc. BLINGVILLE® is a registered trademark of Blingville, LLC

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What You Should Know About Copyright

Copyright (as opposed to patents or registered trademarks) arises automatically without the author having to comply with or observe any formalities. What it is required is that the work has certain requisites. In this case the protection arises automatically as soon as the work is recorded in electronic or paper form.

However, authors of copyrighted work should still identify and safeguard their copyright works. This can be done by (i) identifying all materials that are likely to have copyright protection; (ii) ensuring that proper ownership and licensing arrangements are in force; (iii) ensuring that appropriate copyright assignments and waivers of moral rights were included in the written agreements commissioning the materials and if this was not the case, arranging for separate copyright assignments and waivers to be obtained from the third parties; (iv) keeping proper records. Authors should sign and date their works and, where relevant to the term of copyright, the date of first marketing of articles should be recorded. These records can then be used as the basis for any infringement action. Actions can fail if the claimant cannot prove subsistence of copyright or ownership.

Although not necessary, as a matter of law, to gain protection, it is useful to include on copyrighted materials a notice in accordance with the Universal Copyright Convention, that is [year, "Copyright [name of publication]" copyright owner]. This serves to warn anyone using the work that copyright exists and that action may be taken if the work is copied.

Depending on the type of work involved, additional text can be included with the copyright notice. This might include: (i) text prohibiting the reproduction of any material whether by photocopying or storing in any medium by electronic means or otherwise (this does not affect the legal position but serves as a reminder and might also be useful in preventing any user from arguing that there was an implied licence in its favour permitting copying or storage);warnings stipulating that the doing of any unauthorised act in relation to the work will result in both civil and criminal liability; (ii) warnings that any copying will result in criminal or civil action; (iii) a form of disclaimer to provide protection for the author and the publisher if use is made of opinions or views expressed in written materials.

Increasingly, the onus is upon the rights-holder to enforce his rights and, unless he does so, he may lose the rights, at least against a persistent infringer (this is clearly evident in the field of trademarks, where rights can be lost if not asserted. It is therefore important to put the infringer on notice and to keep a record of doing so. Speed of notice and action may be important if immediate injunctions are required. A delay of, say, a month may be fatal to such an application. This is because in order to succeed the claimant will have to argue irreparable damage caused by the infringement and any delay in bringing proceedings may count against that argument.

An important part of the protection and exploitation process is to ensure that everyone within an organisation is aware of the potential value of copyright works and how to protect them. As suggested above, a system needs to be put in place to ensure that proper reviews and record-keeping arrangements are implemented on an ongoing basis, combined with sensible and appropriate use of copyright notices and warnings. The fact that there is no registration regime for copyright makes it particularly important to be proactive in dealing with potential infringements and putting third parties on notice.

In fact, increasingly, the onus is upon the intellectual property owner to enforce his rights and, unless he does so, he may lose the rights, at least against a persistent infringer (this is clearly evident in the field of trademarks, where rights can be lost if not asserted. Speed of notice and action may be important if immediate injunctions are required. A delay of, say, a month may be fatal to such an application. This is because in order to succeed the claimant will have to argue irreparable damage caused by the infringement and any delay in bringing proceedings may count against that argument.

This article is for general purposes and guidance only and does not constitute legal or professional advice.

Copyright 2010 Anassutzi & Co Limited. All rights reserved. Information may be shared or reproduced only if accompanied by the author's name and bio.

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