Posts Tagged ‘copyright ownership’

Work Made for Hire Case

Friday, August 14th, 2020

To summarize two previous posts, copyright ownership and works made for hire, copyright is owned by the author upon the author’s fixation of the creative idea.  An author hired to create for another is still the owner of the copyright absent meeting the criteria for a work that made “for hire.”  The controlling case on this point is discussed herein.

The Supreme Court in Community for Non-Violence v. Reid, 490 U.S. 730 (1989) set forth the criteria for a work made for hire. The nonprofit association, the Community for Creative Non-Violence (CCNV) brought action against sculptor James Reid to establish copyright ownership of the sculpture “Third World of America.” CCNV hired Reid to create a statue for an event with the intent of affixing the resulting statue to a base created by CCNV. Reid agreed to create the work and this rendered the two pieces into an indivisible and interdependent whole. After the event CCNV wanted the statue to travel to different states to be part of different exhibits and Reid would not allow it. (One of the six exclusive rights of a copyright owner is the right to display.)  Reid objected to CCNV’s proposed means of display of the statue and asserted his alleged copyright ownership of the sculpture.  CCNV also alleged copyright ownership based on the position that Reid was an employee who created the sculpture within his scope of employment.  The U.S. Supreme Court held that the sculptor was an independent contractor and not an employee of the nonprofit, therefore the statue was not a work for hire. Ultimately, although Reid was found to be an independent contractor, and the work was not made for hire, upon remand, the 6thdistrict court held that CCNV and Reid might be joint authors of the statue since the statue and the base were attached and an indivisible whole and thus co-owners of the copyright. The U.S. Supreme Court affirmed that decision.

In coming to this decision and determining whether the statue was a work for hire, the Court first looked at whether or not Reid was an employee under agency law. He was deemed to be an independent contractor for the following reasons: (1) Reid worked in his studio in a different city than that of CCNV (2) His involvement with the company lasted for less than two months (3) He had absolute freedom as to when and how long to work (4) He was paid a sum that was dependent upon completion of the sculpture (5) He had the discretion to hire and pay for assistance in the completion of the project, and (6) He was not on CCNV’s payroll, nor was he provided with any employee benefits.

An independent contractor owns the copyright to their work unless the work is deemed a work made for hire.  The Court then analyzed whether the work was made for hire. In order for a work to be made for hire in this situation, it must meet four criteria. First, the work must fall within one of the nine statutorily enumerated categories of work that are eligible to be specially ordered or commissioned as works made for hire. (See Works Made for Hire post)  In this case, the work in question was a sculpture and did not fall within the nine categories of eligible works. Moreover, a work made for hire agreement must be in signed writing evidencing an express agreement that a work is “made for hire.”  In this case, the two parties entered into an oral agreement, and there was no written contract. Accordingly, Reid’s statue was not considered a work made for hire.

In the years since the Supreme Court’s decision, district courts of appeal have addressed the question of independent contractor versus employee in many contexts.  Some factors will be significant in virtually every situation:  (1) the hiring party‘s right to control the manner and means of creation; (2) the skill required; (3) the provision of employee benefits; (4) the tax treatment of the hired party; and (5) whether the hiring party has the right to assign additional projects to the hired party.  Factors three and four receive great weight in every analysis.

In conclusion, the copyright in a work created by an independent contractor, absent a signed “work for hire” agreement relating to one of nine specific categories of works (or an absent assignment) is not the property of the hiring party.  Rather, the work is considered by the law to have been authored by the independent contractor.

Works Made for Hire

Monday, June 15th, 2020

An earlier post discussing copyright ownership briefly went into the rights and authorship associated with a “work made for hire.” This type of authorship is the exception to general rules of copyright ownership, and the original creator is not the author of the work, nor is he the owner of the copyrighted work. Whether a work is made for hire is decided by the facts that exist during the time the work was created.

The post also discussed the two situations in which this type of copyright ownership may arise. In the first situation, a work may be made for hire when the work is created by an employee in the course of his or her regular duties. Second, a work may be made for hire when a third-party contributor and a hiring party enter into a written contract that clearly states that the work is to be considered a “work made for hire” and the work is commissioned or specially ordered for use as a compilation, a contribution to a collective work, a part of a motion picture or other audiovisual work, a translation, a supplementary work, an instructional text, a test, answer material for a test or an atlas.  This post will take a closer look at each of the two situations.

The first situation deals with works made for hire within the scope of employment. In this situation, for an employee’s work to be considered a work made for hire, it must fall within the employee’s scope of employment.  However, the Copyright Act does not define the terms “employee,” “employer” or “scope of employment.” Instead, in Community for Creative Non-Violence v. Reed (1989), the U.S. Supreme Court stated that Congress meant for these terms “to be understood in light of agency law.” This is the law that reigns over employer-employee relationships, and when determining if a work was made for hire, the courts should rely on the general common law of agency and not on particular state laws, as their meanings for these terms may differ.

In accordance with this decision, the Copyright Office set forth a series of questions that may be pertinent to consider: What skill was required to create the work? Where was the work created, and did the hiring party provide space, material or tools to create the work? How long was the relationship between the parties, and did the hiring party have the right to assign other projects besides the one under review? Could the hiring party direct the creator on when and how long to work? How was the creator paid, and did the hiring party offer employee benefits? Did the hiring party remove taxes from the creator’s pay? Does the creator have his or her own business, and was the creator able to hire and pay assistants? Was the work created as part of the regular business hours of the hiring party, and was the work created pursuant to the creator’s usual tasks? And finally, was the work created during the creator’s authorized work time?

The second situation handles scenarios involving a third-party contributor and a hiring party. In such situations, a work is considered a work made for hire if it meets the following four criteria: (1) The work must fall within the nine categories of works listed above that are eligible to be specially ordered or commissioned as works made for hire. (2) There must be a written agreement between the party that ordered or commissioned the work and individual(s) who actually created the work. (3) In the written agreement, the parties must expressly agree that the work is to be considered a work made for hire. (4) The agreement must be signed by all parties. If the work in question fails to satisfy any of the above criteria, it is not considered a work made for hire.

Copyright in works made for hire is different than in other copyrighted works, where the creator of an original work fixed in a tangible medium is automatically granted copyright under U.S. law.

Starting with the authorship of the work, as mentioned earlier, the authorship of a work made for hire is granted to the employer or hiring party of the commissioned work. Much like the authorship, copyright ownership of a work made for hire is instilled in the party that commissioned or special-ordered the work in question. However, this may not always be the case if the hiring party has entered into and signed a written agreement with the work’s creator stating the contrary. As discussed in the previous post, the duration of copyright for works made for hire is 95 years from the date of publication, or 120 years from the date of creation, whichever is shorter.

When registering a work made for hire with the Copyright Office, it is not the Office’s job to decide whether a work was made for hire. That responsibility falls on the registrant, who must make that decision based on the facts that existed during the time the work was created. Though the Copyright Office cannot provide legal advice about the status of a work, a questionnaire was created to help registrants decide whether or not a work that was created under the Copyright Act of 1976 qualifies as a work made for hire. The questionnaire can be found on the Copyright Office website along with the Compendium of U.S. Copyright Office Practices, from which the questions were derived.

Works made for hire are an exception to the general copyright rules, and there are two instances in which a work may be considered a work made for hire, either an employer-employee situation or in instances in which a third-party employer commissions or specifically orders a work to be created. In either scenario, there are certain criteria that must be met in order for a work to be considered made for hire. It is important to make an accurate decision in determining whether a work is a work made for hire because there may be unintended consequences associated with such a work. When a work is given this status, it affects its authorship, copyright ownership, duration, registration and termination.

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