By Attorney Edward Jesson
Copyright and trademark are two different areas of the law that often intersect with each other. A trademark can be any word, phrase, design, or combination of these things that identifies a business’s goods or services. A copyright is an original work by an author with at least a minimum level of creativity, such as a book, painting, photograph, or song. A recent lawsuit involving SweetWater Brewing Company brings some of the nuances and risks involved in these areas of the law to light.
SweetWater Brewing has been using a trout image in its trademarked logo since 1996 after it paid a friend of the founders, Mr. Fuss, $500 to draw the trout in question. Mr. Fuss is now claiming he owns a copyright to the drawing of the trout, and that there was an “understanding” between himself and SweetWater that the value of his rights to the copyright would grow as the value of SweetWater and its intellectual property grew. When SweetWater was recently bought by another company, Fuss sued SweetWater, claiming that he was owed $31 million dollars for the value of the trout drawing. SweetWater has, in turn, sued Mr. Fuss in federal court requesting a declaration from the court that SweetWater can continue to use its trademarks moving forwards without interference from Mr. Fuss.
Had Mr. Fuss been an employee of SweetWater when he drew the trout, or had a comprehensive agreement been entered into between Mr. Fuss and SweetWater at the beginning, the current litigation could have been avoided, saving all the parties lots of money and time.
Generally speaking, under copyright law, the author of the original work owns the copyright. An exception to this general rule is where the work is made for hire. Thus, if the work was made by an employee in his or her scope of employment, the employer holds the copyright to the work. However, if the individual creating the work is an independent contractor instead, that independent contractor will own the copyright to the work. Therefore, it is very important that companies dealing with independent contractors have them sign agreements whereby the independent contractor assigns the copyrights to the company who is paying them.
The trout image was created long before SweetWater grew into the company it is today, and that spotlights a reason why planning for these eventualities before they become bigger issues is so important, even when a business is in its startup phase.
Should you need assistance with navigating the sometimes complex law surrounding copyright and trademarks, the attorney at Jesson & Rains will be happy to assist.
By Attorney Kelly Jesson
While surfing through social media, have you ever seen someone post a photo or video set to music and add the caption “I do not own the rights to this music”? We assume people are doing this in hopes of getting around copyright laws. We assume they think that, by disclaiming ownership, they won’t get in trouble, but that is incorrect.
A copyright protects an original work of authorship, whether in writing, video, or audio form. A person infringes on a copyright if the person uses the work without permission, even if they put out a notice that they don’t own the music. To be clear, simply using the work is infringement; not pretending you created it.
A copyright owner can seek damages if you use its work without permission. There is a narrow exception called “fair use,” but it only applies when people use a work for criticism, comment, news reporting, teaching, scholarship, and research. Most social media posts are not going to fit into this category.
Also, taking a picture from someone else’s website or social media and sharing it yourself is also copyright infringement. You may have heard of celebrities getting sued for posting pictures of themselves that someone else took.
Bottom line: If you didn’t create it, don’t post it without permission. If you have any questions about getting a federal copyright for your original work, please give Jesson & Rains a call!
By Attorney Kelly Jesson Rains
A copyright protects an original work of authorship, whether in writing, video, or audio form.
Like trademarks, a common law copyright is created as soon as the work is authored. People should use the copyright symbol © to deter would-be infringers. Also like trademarks, despite the existence of common law protections, there are still numerous reasons for registering federally. To rely on federal copyright protections (versus state court), the work must be registered. This is important because federal law provides statutory damages, whereas in state court you might have to prove actual damages, which is difficult. If a registration application is submitted to the U.S. Copyright Office within five years after first publication of the work, it will be presumed that the copyright is valid. Finally, registering puts the world on notice that you own the work (and who to contact if someone wants to use the work for a fee). Copyrights last for the author’s life plus seventy years.
Sometimes, the author of the work does not own the copyright. This is true in two situations:
1) Work made for hire, and
2) Work commissioned.
These are two very narrow exceptions that are improperly overused. For the “work made for hire” rule to apply, an employee must create the work in the scope of their employment. This is oftentimes up for interpretation and dispute. A work that was not created within the scope of a creator’s employment cannot be made into a work made for hire by way of agreement.
Specially ordered or commissioned work is limited to the following uses:
Of course, an author can sell a copyright to another person. If the copyright is assigned or licensed to another, the author may limit the purchaser’s use.
While the Digital Millennium Copyright Act (DMCA) did not expand copyright protection, in 1998, it did make available a procedure whereby a person whose copyright is being infringed upon can send a notice to an internet provider, webhost, or search engine who must then take down the offending material. The law has specifics about what the notice has to include for it to be valid.
If you’re interested in getting more information about copyright or other intellectual property protection, please give Jesson & Rains a call.
What is intellectual property?
“Intellectual” property refers to creative works used in business that have economic value. The four most common types of intellectual property (“IP”) are trademarks, copyrights, patents, and trade secrets. Trademarks protect words, names, symbols, and logos that are identified with a brand; copyrights protect artistic works like books, music, and photographs; patents protect inventions; and trade secrets are property that are valuable and have been kept secret and out of the public domain.
We’ll be starting a series explaining each of these types of property in detail over the next few weeks. As the word “property” signifies, intellectual property is an asset. Thus, it is important for both business planning and estate planning. In the business context, it is crucial to determine who owns the IP. Is it the individual who brought it into the business (and will take it with them when they leave) or does the business itself own it? If there is a possibility for litigation, it may be worthwhile to form a separate LLC to own IP so the other business assets stay separate and protected. Next time you look at fast food packaging, you’ll probably see that the company’s trademarks are owned by a separate business.
For estate planning purposes, we want to know about IP just like any other asset – how much is it worth? Who inherits it? So make sure to share this information with your estate planning attorney.
The next blog article will go into trademarks. Stay tuned!
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