Copyright Issues for Creators

III. Copyright Issues for Creators

A. Authorship, Joint Works, and Work-for-Hire

Federal copyright law vests initial ownership in the "author" of a work. 17 U.S.C. § 201(a). The "author" is, presumptively, the human being who fixed the original expression in a tangible medium. The two principal exceptions are joint authorship and work made for hire.

A "joint work" is one prepared by two or more authors with the intent that their contributions be merged into "inseparable or interdependent parts of a unitary whole." 17 U.S.C. § 101. The Ninth Circuit's controlling test is Aalmuhammed v. Lee (9th Cir. 2000) 202 F.3d 1227, which requires (1) an independently copyrightable contribution from each putative author; (2) intent to be co-authors, measured objectively (decisional control, billing, written agreements); and (3) a sharing of authorial control, not mere assistance. Id. at 1234. Jefri Aalmuhammed's substantial contributions to Spike Lee's Malcolm X did not make him a co-author because he lacked authorial control: he was a consultant without final say. Id. at 1235–36.

A "work made for hire" arises in two scenarios: (1) a work prepared by an employee within the scope of employment, or (2) a specially commissioned work falling within nine enumerated categories (including motion picture, audiovisual work, contribution to a collective work, compilation, and instructional text) where the parties expressly agree in a signed writing. 17 U.S.C. § 101.

The Supreme Court's controlling employee-status test is Community for Creative Non-Violence v. Reid (1989) 490 U.S. 730. Reid applies the common-law agency test using factors including skill required, source of instrumentalities, duration of the relationship, control over hours, payment method, and tax treatment. Id. at 751–52. Sculptor James Earl Reid was an independent contractor, not an employee; his sculpture was not a work for hire. Id. at 753.

The practical lesson: outside of formal employment, a hiring party's safest path to ownership is a written work-for-hire agreement fitting one of the nine categories, paired with a backup assignment of all rights — the assignment survives if the work-for-hire characterization fails.

B. Termination of Transfer Under 17 U.S.C. § 203

Section 203 of the Copyright Act gives authors a non-waivable right to terminate any grant of copyright executed by the author on or after January 1, 1978. 17 U.S.C. § 203(a). The termination right is exercisable during a five-year window beginning thirty-five years from the date of the grant (or, if the grant covered the right of publication, the earlier of forty years from the grant or thirty-five years from publication). Id. § 203(a)(3). The statute provides that the termination right exists "notwithstanding any agreement to the contrary." Id. § 203(a)(5). That language is the crown jewel: a contract that purports to waive the termination right is unenforceable.

The principal exceptions are works made for hire (which have no author-creator to terminate) and grants made by will. Id. § 203(a). The termination affects only U.S. rights; foreign-territory grants survive.

C. The 35-Year Window and Notice Requirements

Termination is not automatic. The author (or statutory successor) must serve a written notice on the grantee, identifying the grant, the work, the effective date of termination, and the basis for termination. 17 U.S.C. § 203(a)(4). The notice must be served not less than two nor more than ten years before the effective date, and a copy must be recorded with the Copyright Office before the effective date. Id.; 37 C.F.R. § 201.10.

The most consequential limitation is the so-called "derivative works exception": a derivative work prepared under the authority of the grant before termination may continue to be exploited under the terms of the grant after termination. 17 U.S.C. § 203(b)(1). A film made under a pre-termination novel option may continue to be distributed; new derivative works, however, require a new license from the recaptured copyright.

The Ninth Circuit's decision in Gardner v. Nike, Inc. (9th Cir. 2002) 279 F.3d 774 is the leading case on a related issue: the non-assignability (without consent) of exclusive licenses granted by a copyright holder. Gardner held that an exclusive licensee may not transfer the license to a third party without the licensor's consent, and that the same rule applies even after termination. Id. at 781. The case is a cautionary precedent for sublicensing structures and is regularly invoked in music-publishing M&A.

D. Music Industry Specific Issues (Sound Recordings, § 304(c))

For grants executed before January 1, 1978, the operative termination provision is 17 U.S.C. § 304(c), with a parallel provision at § 304(d) for grants whose original termination window lapsed unused. The § 304(c) window runs for five years beginning fifty-six years after the original copyright was secured. Id. § 304(c)(3).

Music presents unique complications. Sound-recording termination claims filed by recording artists against major labels since 2013 have produced settled-out litigation but no controlling appellate guidance on whether sound recordings recorded under a major-label contract qualify as "works made for hire" and thus fall outside the termination right. The label position is that sound recordings are works for hire under the "contribution to a collective work" or "compilation" categories of § 101; the artist position is that they are not.

The Second Circuit's decision in Davis v. Blige (2d Cir. 2007) 505 F.3d 90 is the most-cited authority on a closely related point: a co-owner of a musical composition cannot retroactively grant a license that defeats the rights of another co-owner. Id. at 104. Retroactive transfers and after-the-fact "ratifications" are ineffective to extinguish accrued infringement claims. Davis is the structural reason that music co-publishing deals must capture written consents in real time.

This analysis is for informational purposes only and does not constitute legal advice. Consult qualified counsel for advice specific to your situation. Attorney advertising.