By: H.W. Pfabe | October 26, 2016

 


Work for Hire” is a phrase that businesses use a lot, and is extremely important in determining who owns Intellectual Property. Unfortunately, it is also VERY misunderstood.

 

As an example, you may have paid someone to create something for you. However, do you own the Copyright to it, or does it end up belonging to the person you paid to create it for you?

 

You might own the physical object that was created and delivered to you (a statue, a painting, a photograph, a video, a sound recording, a file with artwork, a file with computer code). However, the person that you paid to create it for you might STILL own the COPYRIGHT, and that means that they might still be free to do whatever they want with it, including licensing it to others or preventing you from doing so.

 

A case from this past summer recently came to my attention, and it presents a great example of the fundamentals of Work for Hire, and how not understanding them can get your business into trouble.

 

So, to learn about Work for Hire, who else would we turn to but Iron Man and the Wu-Tang Clan’s own Ghostface Killah.

 

 

The Case:

 

In 2000, Dennis Coles, aka “Ghostface Killah”, with Sony and Razor Sharp Records, released the album “Supreme Clientele”. This album included two tracks which featured the 1966 “Iron Man” theme song, written by Jack Urbont .


(The Ghostface Killah tracks can be found at https://www.youtube.com/watch?v=j4z1AZI2sYg and https://www.youtube.com/watch?v=KEuDwN7vV7Q , while the original can be found at https://www.youtube.com/watch?v=9EBar7BK8Mk )

 

Ghostface Killah has often used words and names which, arguably, infringe on Trademarks owned by Marvel Comics (now a subsidiary of Disney), including the aliases “Ironman” and “Tony Starks.” Marvel has never come after Ghostface for any Intellectual Property Infringement, and he even had a cameo (though deleted) in the 2008 Iron Man movie (https://www.youtube.com/watch?v=PnsWlBi8YPg ).

 

The issue here is that, according to Mr. Urbont, HE owns the Copyright to the Iron Man theme song, and not Marvel. As such, he brought suit against Ghostface, Sony, and Razor Sharp Records for Copyright Infringement.

 

The lower District Court had previously granted Summary Judgment against Mr. Urbont, essentially throwing the case out, stating that Mr. Urbont not have presented enough evidence to overcome a presumption that the song was Work for Hire. However, on July 29, 2016, the US Court of Appeals for the Second Circuit overturned that judgment.

 

 

The Issue:

 

The issue in this case is essentially: Was the song Work for Hire (and thus, who owns the Copyright?)?

 

Marvel believed that THEY owned the Copyright, since they paid Mr. Urbont to create the theme song. In their view, this was “Work for Hire”. “Work for Hire” typically refers to work which an employee does in the normal scope of their employment, though work done by someone who is NOT a regular employee can still be considered “Work for Hire.”

 

Mr. Urbont, on the other hand, does not consider this to be Work for Hire and argues that HE, and not Marvel, owns the Copyright to the song that he created.

 

 

The Verdict, and Why:

 

The Court looked to 2013’s Marvel Characters v. Kirby (yes, another Marvel case), stating that a work is made for hire when it is “made at the hiring party’s ‘instance and expense’”, arguing towards situations where the hiring party has control over the work. However, this is a bit of a generalization, and there are many cases which add a lot of gray areas to this determination. Some common factors include:


    1.  Did the employer have Control over the work;

    2.  Did the employer have Control over the employee (i.e., Where was the work done? With whose         equipment?); and

    3.  What was the Status and Conduct of the employee (i.e. business of the employee, whether taxes were         taken out, etc.).


There is no clear rule here, but just a number of different factors which all get weighed together.

 

Despite the fact that Mr. Urbont was hired to create multiple theme songs for Marvel, and knew nothing about the characters before doing so, the Court found that this was arguably NOT Work for Hire. The Court came to this conclusion because:


    1.  Mr. Urbont retained all creative control and Marvel was not allowed to alter the song;

    2.  Mr. Urbont approached Marvel looking for the contract work;

    3.  Mr. Urbont received royalties; and

    4.  Mr. Urbont used his own equipment to create the work, including renting a studio at his own expense (and         risked losing money if the song was not successful, despite getting paid $3,000 for the work regardless).

 

 

The Lesson:

 

I work with many Clients who hire someone to create work for them. It might be a photograph, artwork for a t-shirt, a company logo, a design for a product, or any one of a number of other types of work. 


Many times, they have used form contracts with state “This is a Work for Hire” or go through websites, with “Work for Hire” terms of use, where they find people who bid on a job. 


Just because a Contract says that something is Work for Hire does not mean that a court will find it so if the creator changes their mind down the road. This is especially relevant when you hire someone to use their own equipment, from their own home, to do the work for you.

 

As I always advise my Clients, go the extra step and make sure to have the person you hire sign a Copyright Assignment Agreement, assigning any Intellectual Property Rights that they may have in the work over to you.

 

As Ghostface Killah himself said, “Anything worth having is hard to keep” (http://genius.com/Ghostface-killah-you-know-im-no-good-lyrics ).

 

 

 

*    This case involves Marvel, and cites to another Marvel case that also dealt with a creator’s Intellectual         Property Rights.

        An upcoming blog post will discuss a Marvel-related case that is currently being litigated and could create         MAJOR shockwaves through Corporate Email Privacy.

        Last year, the Supreme Court decided a Marvel case dealing with Licensing of expired Patents.

        Let me know in the comments if we should just do a big Marvel Intellectual Property roundup!