Vol. 13, No. 3, Pg. 12. Works made for hire and the independent contractor.

Author:By Michael A. Mann and D. Brian Shortell
 
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South Carolina Lawyer

2001.

Vol. 13, No. 3, Pg. 12.

Works made for hire and the independent contractor

12Works made for hire and the independent contractorBy Michael A. Mann and D. Brian ShortellIn the course of business, it is routine to use manuals, pamphlets, photographs, drawings, logos and software. Many times these materials are generated by employees and are therefore treated as "works made for hire" under copyright laws. 17 U.S. Code Ann. § 201(b). The employer of an employee who creates a work made for hire is deemed to be the "author" of the work and is therefore the copyright owner.

When an independent contractor is hired to create these works, the company can acquire copyrights through an assignment or by designating certain types of works as "works made for hire" in a written contract. Not every type of copyrightable work by an independent contractor can be deemed to be a work made for hire. To use this provision of the law, the business must determine if the work being created qualifies as copyrightable work made for hire. Acceptance of an assignment by the independent contractor will cause copyrights to be transferred to the business regardless of the type of work.

Is there any reason not to require an assignment in every case rather than determining if a work qualifies as the type of work that may be deemed to be a work made for hire? Yes. For long-lived works, a work made for hire agreement has distinct advantages over a simple assignment.

Normally, businesses will hire an author, a photographer or an artist to create these works. A savvy businessman, realizing that there's more to the work than its physical form, would also purchase the underlying copyrights. A boilerplate assignment clause in a contract is most often used to consummate the transaction; but in some cases, a simple assignment of the author's rights may not provide the new owner with all he needs. Under current legislation, authors have the right to terminate (reclaim) copyrights from any purchaser of the work after the thirty-fifth and before the fortieth years of its existence. 17 U.S. Code Ann. § 203 (also known as reversionary rights or "recapture"). For works having long-lived value, these termination rights present a potential problem, possibly finding the business owner unable to continue using the writing, picture or program without...

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