Copyright Ownership and Assignments – The Basics
Copyright Assignments – When You Need Them and When to Record Them
In modern business, an entity’s most important asset is often its intellectual property, which includes copyrights, patents, trademarks, trade dress, trade secrets, and other proprietary information and content belonging to the entity. However, before an entity can enforce or protect those assets, it must show it is the owner of the asset in question. In the case of copyrights, only “the legal or beneficial owner of an exclusive right under a copyright is entitled … to institute an action for any infringement of that particular right.” 17 U.S.C. § 501(b). See also Well Cell Glob. LLC v. Calvit, 2022 U.S. Dist. LEXIS 204742 at *6 (S.D. Tex. Nov. 10, 2022) (assignment was not complete until all payments were made pursuant to same and holder of assignment did not yet own the copyrights and, therefore, lacked ownership and standing to bring suit to enforce).
Do You Need a Copyright Assignment?
Under the law, copyright ownership “vests initially in the author or authors of the work,” that is, “the party who actually creates the work … [or] translates an idea into a fixed, tangible expression.” 17 U.S.C. § 201(a); Community for Creative Non-Violence v. Reid, 490 U.S. 730, 737, 109 S. Ct. 2166, 2171 (1989). A copyright assignment is an important medium for transferring legal ownership of a copyright from the initial holder, who may transfer all or a portion of their rights in the original work to a third-party. These rights include all those inherent to copyright ownership, including the rights to reproduce the work in copies or phonorecords, prepare derivative works, distribute the work, and publicly display or perform the copyrighted work.
Copyright assignments are especially important when a work is created in the context of independent contractors who create (or participate in the creation) of an original work. Because ownership automatically vests in the author or creator of the work, entities must be thorough in securing a written assignment of copyright from independent contractors in the initial stages of creation so that the parties are clear as to who actually owns the copyrighted work and has standing to enforce (i.e., protect) the copyrights in and to the work.
Copyright assignments also come into play when one entity (or individuals) purchases another entity. The express transfer of all intellectual property from the selling entity to the purchaser(s), including any and all copyrights owned by the seller, are important to ensure a transfer of ownership of the copyrights in connection with the sale.
And while not all copyright assignments are required to be in writing (though most are), it is recommended a written agreement be put place in all cases.
Does Your Agreement Need to Be In Writing?
As noted above, while it is always advisable that copyright assignments be in writing, there are some instances in which a written agreement is not required and an oral agreement could be enforced. However, anytime a copyright owner/holder transfers an exclusive right in that copyright, the assignment must be in writing. This would include situations where the author/owner of a copyright in a book assigns to a third party the right to distribute and sell that book or where a copyright license is issued, as between an author and publishing company.
The transfer of non-exclusive rights, however, may not be required to be in writing. For example, if an author grants a non-exclusive right to a movie company to develop his or her book into a movie, such an agreement may not be required to be in writing. Nevertheless, it is always advisable to secure any copyright assignment in writing to avoid further challenges to ownership.
What Are the “Next Steps” Once You Have Your Assignment?
As a matter of course, it can be helpful to file any copyright assignments with the U.S. Copyright Office through their online portal. While filing in the Copyright Office certainly is not mandatory, it is advisable and can offer certain legal benefits, including providing constructive notice of the change in ownership and conferring priority of ownership among conflicting assignments or claims of ownership. Such filing also establishes a public record of the contents of the assignment and registers a security interest in the copyright. In conjunction with filing the assignment with the Copyright Office, you will need to pay a filing fee for recording the assignment.
Possibility of Termination of Assignment – What to Know
One final issue to keep in mind is that a copyright assignment can be terminated by the author of an original work by following certain statutory requirements. These termination provisions are set forth in 17 U.S.C. §§ 203, 304(c), and 304(d), with the applicable provision depending on a number of factors, including when the assignment was made, who executed it, and when a copyright was originally secured for the work. Importantly, works assigned via a will or involving a work made for hire may not be terminated under these provisions. Of those assignments that can be terminated, termination may only occur during a specific statutory window of time and must specify the date that the termination goes into effect. The effective date must fall within a five-year “termination period,” which is based on factors set forth in 17 U.S.C. §§ 203, 304(c), or 304(d), as applicable. The notice must be served no less than two years and no more than ten years before the termination effective date and must be recorded with the Copyright Office before the effective date.
Key Takeaways on Copyright Assignments
Copyright ownership vests in the original author at creation. For any third party to own or enforce a copyright, a properly executed copyright assignment must be made. The basics for copyright ownership and enforcement include:
Document a copyright assignment to clearly define rights and ownership;
Obtain a registration of the copyright to be able to litigate against infringement and record the copyright assignment as a best practice; and
Be aware of the potential for assignment termination by the author under specific circumstances.
For more information about copyright protection, see our Software & Copyrights and Industry Focused Legal Solutions pages.