By default, a copyright ownership belongs to the author or authors of the content; however, there are a multitude of exceptions to this general rule. One of these exceptions is the “work made for hire” exception, which would allow the person or company that hired the independent contractor to automatically own the copyrighted material. This exception states that:
‘A “work made for hire” is
(1) A work prepared by an employee within the scope of his or her employment; or
(2) A work specially ordered or commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.’ 17 USC § 101 – Definitions
Specifically, we would be looking at paragraph (2) above because it is the one dealing with Independent Contractors. We will begin by breaking this down into its simplest elements.
A work made for hire is:
(1) A work specifically ordered or commissioned,
(2) For use as a contribution to one or more of the following:
- A Collective Work,
- As part of a motion picture
- As part of an audiovisual work,
- As a translation,
- As a supplementary work,
- As a compilation,
- As an instructional text,
- As a test,
- As answer material for a test, or
- As an atlas,
(3) Only if the parties expressly agree
- In writing, and
- Specifically mentioning ‘work made for hire’, and
- Signed by both parties.
So, what does this mean? Now, we’ll flip the definition on its head and you’ll see what this means.
(1) If the agreement was not signed by both parties, it is not a work made for hire.
(2) If the agreement does not specifically mention work made for hire, it is not a work made for hire.
(3) If the agreement is not in writing, it is not a work made for hire.
(4) If the work is not one of the specific categories listed above, it is not a work made for hire.
(5) If the work is not specifically ordered or commissioned, it is not a work made for hire.
As you can see, there are five key points that must be followed in order to made the authored work by an independent contractor a work made for hire, and therefore automatically belong to the business that hired the independent contractor.
There are other ways in which a company can gain the copyright from the original author. For example, it is not uncommon for independent software companies to sign over the copyright upon final payment for the software. By signing over the copyright, it is a much simpler analysis than trying to claim something was a work made for hire.
If the copyright is important to you, make sure you’re going to get it before any of the work starts. The initial contract is the most important and will govern the relationship into the future. All too often businesses are too eager about starting a project to worry about what will happen once the project is done, and they may be losing out on a valuable item by not negotiating to receive the copyright.
Without the copyright, the company will have a specific license to use the copyrighted material for the purposes contained in the contract, or the ones that were anticipated when forming the contract if the contract does not specify. Unfortunately, this can be very unclear and can result in costly litigation or renegotiation should there be a dispute as to who owns the copyright and what licenses exist. Therefore, this is one of the most important provisions in a contract when there are copyright concerns.
For more information, please contact us at richard@lawplusplus.com or call (919) 912-9640.