Business Musings: Copyright Fun Part 2

This post is probably just for me and Dean and other copyright geeks out there in the world. And it’s mostly U.S. specific, although we will touch on Duran Duran and U.K. law farther downstream. Also, it’s important for you all to note that I am writing this blog in January. Some of the cases I mention here are ongoing and might have developments that I haven’t seen by the time this goes live, first on my Patreon account, and then weeks later, on my website.

What I want all of you blog readers to do is to think about possibilities. The possibilities exist on two fronts:

1. What can you do before signing a contract to protect yourself and your copyright?

And

2. What can you do after you signed a (bad) contract to protect yourself and your copyright?

Copyright law is a constantly changing beast, particularly here in the U.S. How we make money, as artists, is through the licensing of our copyright, not by “selling” our books. If you don’t understand copyright, guaranteed you will get screwed, maybe many times, throughout your writing career. This is why I recommend that writers buy The Copyright Handbook and read it.

I would also suggest that you learn to become a copyright geek, like Dean and I are, excited about the things you learn about copyright each and every year. Take a look at Part One of this series to see some ways to make your copyrights work for you.

This post, and the other two in this limited series, come from the copyright coolness that occurred in 2021. I was going to put this information in my year in review, but there’s simply too much of it. (If you want to read the year in review, start here.)

Copyright law in the United States comes from our founding document, the Constitution of the United States. Lawmakers have made significant changes to that original law throughout our history. Some of the changes are major. Others are minor until they’re used properly (or improperly) by someone.

We’re going to step outside of the book writing sphere to examine a few cases that have sent shivers through the spines of major corporations in 2021.

First, let’s talk about current law. The Copyright Act of 1976 gave creators the ability to reclaim their copyright, lost to a contract or some kind of agreement, 35 years after the agreement was signed.

This 35-year rule, as some call it, nearly upended the music industry as creator after creator tried to reclaim their copyrights from the music industry’s egregious contracts. Some major players in the industry stood to lose entire catalogs of works from artists like Billy Joel.

There were a lot of speculative articles written about 10 years ago, talking about the death of the larger music industry because of this. That was before the industry fought back, with all kinds of expensive lawsuits. The fight ended up being major, especially for artists who did not have the financial (or emotional) wherewithal to handle protracted litigation.

Billy Joel lost his case. Duran Duran lost theirs in 2016 and it made major international news, because the courts held that the British contract governed their copyrights, not the U.S. contracts.

After a bunch of high profile cases, the lawsuits went underground. No company wanted to be known as a company that would allow artists to reclaim their rights. So there are non-disclosures involved with artists who have sued and won, and no major press releases for artists who sued and lost.

(I went deep down a copyright rabbit hole as I was looking at these, and found a bunch of fascinating cases, including one between Cher and Mary Bono, Sonny Bono’s widow. Mary Bono is trying to use the copyright termination to stop paying Cher 50% of the Sonny and Cher royalties. It’s a complicated and probably bitter mess, and one worth keeping an eye on.)

Other industries have either fearfully watched the music industry grapple with this or chuckled behind their hands as they saw the lawsuits going by. But, they shouldn’t have chuckled, because they’re facing some serious issues on their own.

Under U.S. law, there’s a difference between works made for hire, and works that are independently created. Both can become, say, the basis of a movie or a comic book, but the question becomes who owns the copyright to the work.

A work made for hire is owned by the person who employed a writer to create the work. The word “employed” is essential here, and has specific definitions under copyright law.

Quite frankly, some of the book work that Dean and I did in the 1990s does not meet the standard for work-made-for-hire, even though the contract said the books we created were work for hire. That would take a lawsuit to settle, and there’s not enough money in that.

Some of the other books we did as work for hire (which we’ll now discuss as wfh) did fall under that definition.

Works made for hire do not (generally) fall under the 35-year rule, because the writer never owned the copyright in the first place. The writer was playing in someone else’s universe, under the guidance of the universe’s owner (or one of their employees).

But, wfh is not always easy to determine. And sometimes, big corporations just claimed product was wfh when it was not.

With that in mind…

In September of 2021, the 2^nd Circuit Court of Appeals decided a case concerning the Friday The 13^th franchise based on both the termination clause and California labor law. The 2^nd Circuit upheld a lower court’s decision that the screenplay that Victor Miller wrote was not work for hire.

The decision had to delve into the various ways that employment was defined in California, not just the way it was defined under copyright law. In other words, the court had to determine whether or not Miller was an independent contractor when he wrote the screenplay.

If he was, then he could reclaim his rights to that screenplay.

The 2^nd Circuit determined that Miller was an independent contractor. He could reclaim the rights to the Friday the 13^th screenplay and the way that screenplay was used under U.S. law.

What does this mean? Well, for the franchise, it’s a scary moment (pun intended). Because he could pull their right to use that screenplay, which means they might not be able to distribute the movie any longer.

It’s doubtful that will happen, for a variety of reasons, most of them financial. As The Hollywood Reporter wrote in its coverage of the case:

And there’s still reason for settlement given that the producer retains (nonexclusive) foreign rights as well as intellectual property derived from Friday the 13th sequels, including maybe the monstrous “Jason” character that showed up later in the franchise

In other words, if there is no settlement, then someone would have to figure out how to keep the movies out there, how to handle the foreign rights that probably do not belong to Miller (or maybe that’s a separate lawsuit) and how to handle all the derivative rights to characters, merchandise, sequels and more.

I couldn’t find much on the state of the case at the moment I write this. I’d be surprised if the Friday the 13^th franchise lawyers fail to settle this.

I actually hope they do settle, because that’s the best way to handle something this complicated. But the settlement will benefit Miller, because he’ll be asking for a new (and probably much bigger) payday for his 40-year-old work on the franchise.

Ah, copyright law. It’s rather fun, right? Unless it bites you in the ass.

Or it’s unclear.

Because the other big writer related rights termination story of 2021 involves comics and the world’s favorite superheroes.

It also comes from that pesky work-for-hire clause in the copyright law, only the copyright act that governs this particular corporate nightmare is the 1909 act, because all of the work took place before the Copyright Act of 1976.

I’m talking about the lawsuits Marvel faces from several of its Silver Age artists/writers and/or their estates. These estates believe that these creations (like Spider-Man, Thor, Iron Man and others) were not created as works made for hire.  The estates and heirs believe that the artists/writers were freelancers. Of course Marvel and Disney (who now owns it) feel differently.

Here’s how The Hollywood Reporter describes the difference between the 1976 Copyright Act and the 1909 one:

These days, when work is created as “made for hire” — meaning the employer is deemed the author — there’s a written document that spells it out. But back in the 1960s when everyone was operating under a copyright law from 1909, such paperwork often was never completed. And so, courts have created an elaborate test to figure out when older commissioned art are works made for hire. Supreme Court Justice Thurgood Marshall‘s 1989 decision in CCNV v. Reid addressed the proper test.

Just like the Friday the 13^th case, this is U.S. law only. And what’s really going on here is whether or not Marvel/Disney has full ownership of the characters. If they lose these cases, they’d have to share ownership with these estates/heirs.

What does that mean for the creators or their heirs? It depends. If they prevail, they might want to be paid a percentage of everything. Or they might take a (large, super large) settlement to go away.

Or some of them might want to participate in the direction the characters take, not just in the comics, but in the movies as well.

The exclusivity goes away. So the artist/heirs could license those characters to other studios or maybe even put out new stories themselves. The Hollywood Reporter explains it better than I can.

Here’s my favorite part of their analysis:

…least appreciated of all, is what happens outside of the United States. The termination provisions of U.S. copyright law only impact the domestic market. But foreign copyright laws might come into play if these superhero characters aren’t deemed works made for hire. Some countries aren’t as generous to authors’ heirs as the United States, but some countries are more generous. Take Canada, for instance. The northerly neighbor mandates automatic reversion of the copyright to the estate 25 years after the author’s death. And get this — in Canada, joint owners may not license jointly owned work to others without the consent of the other co-owners.  Could a future season of Loki be prevented from showing in Canada? The suggestion of something like this occurring seems crazy and dangerous to even broach, and yet …

See why I titled this series of posts “Copyright Fun”? Because when you start to delve into the possibilities, almost anything can happen. With big properties like these—or properties that become big years after they started, like we discussed last time—the payouts are huge, and the stakes even bigger.

Yes, sometimes it takes a lawyer or an army of them to sort this stuff out. Sometimes it requires deep pockets to go against even deeper pockets.

This is why I urge you all to understand copyright and know what you’re signing. Argue for yourself with success in mind rather than caving to bad contract terms because you think you have no clout. (Take a look at my book, How To Negotiate Anything, to start learning negotiation.)

I don’t expect any of you to end up in lawsuits like these. If you end up in contract or copyright disputes, it’ll probably be for other reasons.

But a goodly handful of you have done wfh work in the past or comics work or have written screenplays. There’s a chance, particularly if you worked in book publishing, that you really weren’t doing wfh.

If you want to reclaim your rights, hire an attorney, but expect to pay a fortune. And before you do it, think about the ups and downs of lawsuits. Not just the financial ones, but the emotional ones.

I’d rather write another book. Or a dozen more books.

Even with my book-related works, I wouldn’t receive a Victor Miller-style payout.

However, there is one place where the 35-year-rule can help you. If you signed a bad book contract on an original novel, and you do the work of reclaiming your rights (there’s a window you have to fit into and a bunch of other hoops to jump through), you might get out of that awful contract.

Remember, though, this is the law. And judges are human beings. So are lawyers. What do they call a C student who has graduated law school? In those states (like Idaho) where the student automatically passes the bar upon graduation, they call that C student a lawyer.

Just sayin.

So writer, beware.

But be informed. Know your rights—and how to use them to your benefit, whatever that benefit might be.

*****

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“Business Musings: Copyright Fun Part Two,” copyright © 2022 by Kristine Kathryn Rusch. Image at the top of the blog copyright © Can Stock Photo / 4774344sean.