Your Business: Rufus Brown
Avoid legal complications when marketing
Portland Press Herald, Friday, November 15, 2002
Today, marketing requires a presence on the Internet, a logo and
perhaps a brochure, catalogs and other branding and advertising
To produce that material, you may hire someone outside the firm:
a Web master, graphic-design firm, marketing specialist or
free-lancer. You pay good money. You are pleased with the product.
And you assume that your business owns the copyright to your
But it's vital that you make sure your assumption is correct. If
you don't own the copyright, you have no legal right to use the copy
without the permission of - and only under the terms and conditions
set by - the owner. You have no right to reproduce the copy, publish
it, change it, sell it, license it or do anything else with it.
The owner can demand "royalties" for uses beyond the original
price for creating the materials and can insist on being hired to
make any changes in the copy.
Most people in the business of creating marketing materials will
not interfere with your use of something you paid them to create.
Still, you are at risk if you don't own the copy - not only from the
person who created it, but from infringement by third parties that
you will be powerless to prevent without ownership and
The legal principle usually referred to as the "work-for-hire
doctrine" can block your ability to register ownership of your
marketing copy. The doctrine is both complex and at the same time
That combination can lead to surprises and legal complications,
which are the last thing you had in mind when you set out to promote
your market presence.
The work-for-hire doctrine is an exception to the general rule
under the Copyright Act of 1976 that the person who creates an
original work, expressed in a fixed medium, owns it. The doctrine
also is an exception to the assumption that if you hire someone to
promote your presence in the marketplace, you will own the copy you
The relationship between parties is key to determining the
ownership of a work's copyright.
An employer owns work created by an employee if that work is done
in the scope of his or her job. Conversely, the work is owned by the
person who creates it if the person who does the job is an
independent contractor or an employee working outside of his or her
normal job functions. This is true even though the party ordering
the work paid for it.
The task is to find the dividing line between two ends of the
One end is a traditional employee who has produced marketing
materials as a salaried worker, using the employer's equipment. This
arrangement clearly puts ownership of the copyright with the
The other end of the spectrum is when people produce copy on
their own time, in the manner they chose, with their own equipment,
and at their own location. This setup clearly places the copyright
in their hands, unless special arrangements have been made.
The situations falling between these two ends of the spectrum are
the grist of litigation.
If your business hires and pays an independent contractor to
create, say a Web page, your business will be considered the author
and owner of the copyright only if two conditions are met.
First, the work must be a sound recording or fall within one of
nine categories set out in Section 101 of the Copyright Act: a
collective work, part of a motion picture or other audiovisual work,
translation, supplementary work such as a work illustrating,
commenting on or assisting in the use of the work, instructional
test, answer for a test, or atlas.
In our example, a Web page may well qualify as a "contribution to
a collective work" if the Web page consists of content derived from
Second - and this is key - there must be a written agreement by
the parties. Some courts require that an agreement be reached before
the work is performed, explaining that the work is to be considered
a made-for-hire product.
Still, many firms producing marketing materials do not have a
standard contract. Few that do contain work-for-hire provisions
place the copyright ownership in the hands of the business that paid
for the project.
So how do you avoid these legal complications? When you have
marketing work performed for your business by someone other than a
person who clearly is an employee, insist on an agreement that the
work is to be considered a "work made for hire," either by an
employee or by an independent contractor performing a commissioned
Then add that, if for any reason the work is not considered a
"work made for hire" under the Copyright Act, the people creating
the work assign all copyright ownership rights to your business.
There are no special technicalities required for such an
agreement to work. It just has to be written, signed by all parties,
and express the described intent. By this simple agreement, properly
prepared or reviewed by an attorney, your copyright can be