Ownership and transfer

Eligible owners

Who is the owner of a copyrighted work?

The general rule is that the author of the work initially owns the copyright. As discussed in question 23, a corporate entity can be considered the author in the case of a work made for hire. The initial owner of copyright may assign its rights (see question 26).

Employee and contractor work

May an employer own a copyrighted work made by an employee?

An employer will be considered the author of a work, and will initially own the copyright, when the work is a ‘work made for hire’. A work will be considered a work made for hire if it is prepared by an employee within the scope of his or her employment. Traditional common law agency principles are applied to determine who constitutes an employee. As an alternative to the ‘work made for hire’ doctrine, an employer may own a copyrighted work as the result of an assignment from his or her employee.

May a hiring party own a copyrighted work made by an independent contractor?

A hiring party may own a copyrighted work made by an independent contractor either by assignment, or in some circumstances, as a work made for hire. If a work prepared by an independent contractor is considered a work made for hire, the hiring party will be considered the author of the work. For a work created by an independent contractor to be considered a work made for hire the parties must expressly agree in a written document signed by them that the work will be considered a work made for hire, and the work must be specially ordered or commissioned for use as:

  • a contribution to a collective work;
  • a part of a motion picture or other audiovisual work;
  • a translation;
  • a supplementary work;
  • a compilation;
  • an instructional text;
  • a test;
  • answer material for a test; or
  • an atlas.
Joint and collective ownership

May a copyrighted work be co-owned?

Copyrights can be co-owned either in the case of a joint work (described further below) or by assignment or other transfer of ownership (such as inheritance). In either case, unless the co-owners have agreed otherwise, a co-owner can exploit or license the work without seeking permission from the other co-owners, but owes the other co-owners a duty to account for the profits of such exploitation or licensing. A co-owner cannot grant a licence that is exclusive as to the interests of another co-owner without the agreement of the other co-owner.

When one or more people create a single work together, the result is a joint work in which the copyright is initially co-owned by the joint authors. A joint work is defined by the Copyright Act as ‘a work prepared by two or more authors with the intention that their contributions be merged into inseparable or interdependent parts of a unitary whole.’ Under this definition, all the involved authors must intend that their contributions be combined, and this intention must exist at the time the contribution is created. It is not necessary that the contributions be equal in effort or value. Nor is it necessary that the joint authors work in the same physical area or at the same time. If a joint work exists, then both authors are co-owners of equal, undivided interests in the entire work.

However, not everyone who makes any contribution to a work will be considered an ‘author’ of the work. Whether a contribution rises to the level of authorship generally requires that a person contribute copyrightable expression and play a sufficiently important role in the creation of the work to be considered an author (based on factors such as an intention shared with other authors of the work to be co-authors, control over the work, receiving credit commensurate with other authors, and contribution to the audience appeal of the work).

Transfer of rights

May rights be transferred?

Any or all of the copyright owner’s exclusive rights or any subdivision of those rights may be transferred. However, a transfer of exclusive rights (other than by operation of law) is not valid unless that transfer is memorialised in a writing signed by the owner of the rights conveyed or such owner’s duly authorised agent. The writing need not be made at the time of assignment. A letter or other writing confirming the agreement is sufficient. Transfer of a right on a non-exclusive basis does not require a written agreement. A copyright may also be conveyed by operation of law and may be bequeathed by will, or pass as personal property by the applicable laws of intestate succession.

Copyright is a personal property right, and is subject to state laws that govern the ownership, inheritance or transfer of personal property as well as the terms of contracts. Although the recording of a transfer in the US Copyright Office is not required to make the transfer valid between the parties, it does provide certain legal advantages against third parties, as described in question 31.

Licensing

May rights be licensed?

Copyright rights can be licensed on an exclusive or non-exclusive basis. The holder of an exclusive licence is the owner of the licensed right and as such is entitled to sue any party that infringes the right while the exclusive licensee owns it. A non-exclusive licence gives the licensee the right to exercise one or more of the copyright owner’s rights, but does not prevent the copyright owner from giving others permission to exercise the same right or confer standing to sue.

Are there compulsory licences? What are they?

The Copyright Act provides various compulsory licences (sometimes referred to in the US as ‘statutory licences’):

  • section 111 - secondary transmissions by cable systems;
  • section 112 - ephemeral reproductions of sound recordings;
  • section 114 - public performance of sound recordings by means of digital audio transmissions;
  • section 115 - ‘mechanical’ reproduction and distribution of musical works;
  • section 118 - use of certain works in non-commercial broadcasting;
  • section 119 - secondary transmissions by satellite carriers; and
  • section 122 - local retransmissions by satellite carriers.

These licences are all very different from each other, and the details of most of them are fairly complicated. The section 122 licence is generally royalty-free. Otherwise, royalty rates under these licences are determined, or subject to adjustment in certain circumstances, by the Copyright Royalty Board. Royalties under sections 111 and 119 are paid into the Copyright Office and distributed to copyright owners under the supervision of the Copyright Royalty Board. Royalties under the other licences are paid directly to copyright owners or to collecting societies representing copyright owners and creators.

In addition to these compulsory licences, section 116 provides special authority for collective negotiations between copyright owners of musical works and operators of coin-operated phonorecord players (jukeboxes), with the possibility of a rate determination by the Copyright Royalty Board if necessary.

Are licences administered by performing rights societies? How?

In the case of musical works, there is no requirement that licences be administered by performing rights organisations, but songwriters and music publishers generally have chosen to have a performing rights organisation grant and administer voluntary collective licences on their behalf. The American Society of Composers, Authors and Publishers (ASCAP), Broadcast Music (BMI), SESAC and Global Music Rights are the principal US performing rights organisations for musical works.

In the case of sound recordings, SoundExchange collects and distributes royalties under the sound recording statutory licences on behalf of the featured artists and copyright owners of such works, and also under some direct licence agreements.

Termination

Is there any provision for the termination of transfers of rights?

The Copyright Act has several provisions for termination of transfers. For transfers or licences executed by an author on or after 1 January 1978, the Act permits termination under certain conditions, generally between 35 and 40 years after first publication, by serving written notice on the transferee within specified time limits. For grants made before 1978 of ‘renewal’ rights to works under statutory copyright protection before 1978, the statute provides similar rights of termination, generally between 56 and 61 years after the date copyright was originally secured.

Recordal

Can documents evidencing transfers and other transactions be recorded with a government agency?

A document that transfers copyright ownership, and other documents pertaining to a copyright, may be recorded in the Copyright Office. To be recorded, the document filed for recording must bear the actual signature of the person who executed it or be accompanied by a sworn or official certification that it is a true copy of the original signed document. A recordation fee must be paid.

Recording of a document in the US Copyright Office gives all persons constructive notice of the facts stated therein (if the work has been registered), and recording a transfer also provides priority over certain conflicting transfers.