Contracting to Address Joint Copyright Issues

Intellectual Property Law: Joint Copyright Ownership: As I previously discussed on this Blog, in A Work for Hire Agreement: A Critical Tool for Production Companies, work for hire agreements are a necessary aspect of the relationship between film production companies and their freelancers. As I alluded, the risk is that the freelance contributor could be deemed a joint copyright holder.

The law generally provides that all contributors to a work may be able to claim rights as a joint copyright holder. Importantly, this is based on creation of the work alone, and is separate and apart from copyright registration. Essentially, all contributors, including not only freelance contractors, but also a production company’s producers, sound technicians, photographers, etc., could arguably claim that they are joint copyright holders to the final product. The problem? The law generally provides that a joint copyright holder can act independently. This means that one joint copyright holder can contract, license, distribute or otherwise conduct business relating to the work separate and apart, and without permission from the other copyright holders to the work. This greatly impacts the other owner’s ability to control the work. For instance, a production company may devise a project that it wants to market as an art-driven, independent film. However, its joint copyright holder decides to instead exploit the film through “pop culture” in a manner that is contrary to the production company’s ideologies. As a joint copyright holder, that individual or entity can exploit their work in any way they deem suitable, and without the other’s permission. The fact that it is contrary to the production company’s original plan for the project or otherwise goes against its beliefs is irrelevant. From a common law perspective, either owner may act independently. One of the only limitations is a mandated sharing of profits. Though, notably the law provides that this is generally to be an even split.

The good news is there is an easy way to avoid this: utilize proper contracts. First, the fallback position should generally be that all contributors to a work enter into an agreement whereby they are assigning all of their rights to the production company, and acknowledge that all of their contributions are as a “work-for-hire.” In those rare situations where the company nevertheless wants to provide someone with rights as a joint copyright holder, it should contract to explicitly define what each of their respective rights are. By contract the parties can limit the rights that the law otherwise provides. For instance, the production company may want to limit the contributor’s ability to sell or otherwise contract or conduct business relating to the work without the company’s permission. Moreover, the company may want to establish a different split of profits rather than the default 50/50. It is critical that companies consult an attorney to draft an enforceable agreement to protect its rights and suit its particular goals.

Comments/Questions: ljm@gdnlaw.com

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