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Understanding the Copyright Act

If you are a multimedia developer or publisher, you should become familiar with the Copyright Act's
ownership rules. Multimedia works and many of their components - music, graphics, text, software, and
video, film, and television show clips - are protected by copyright. If you fail to deal with ownership issues
while creating a multimedia work, you may not have clear title to the work and all its components. If there is
uncertainty concerning your title to the work, it may complicate distribution of the work.
Example: April hired Don, a freelance software designer, to develop the software for April's
multimedia work. April and Don did not discuss who would own the copyright in the software.
According to the Copyright Act's "default" rule for works created on commission by independent
contractors, Don owns the copyright in the software.

The Copyright Act's default rules on ownership apply if the parties - employer and employee, employer and
independent contractor, developer and client, or developer and publisher - do not reach their own agreement
on ownership.
Initial Ownership
Ownership of copyright initially belongs to the author or authors of the work.
Example: Sarah, a photographer, took a photograph of the Lincoln Memorial. Sarah is the author of
the photograph and the initial owner of the copyright in the photograph.
The "author" is generally the individual who created the work, but there is an exception for "works made for
hire."
The Work Made for Hire Rule
The "author" of a work made for hire is the employer or hiring party for whom the work was prepared. This
default ownership rule is known as the work made for hire rule. Unless the parties have agreed otherwise in a
signed written document, the employer or hiring party owns the copyright of a work made for hire.
There are actually two branches to the work made for hire rule: one covering works made by employees, and
one covering specially commissioned works.
Works Made by Employees
A work created by an employee within the scope of his or her employment is a work made for hire. The
employer for whom the work is made is the "author" of the work for copyright purposes and is the owner of
the work's copyright (unless the employee and employer have agreed otherwise).

Example: As part of his job, John, an employee of Big Co.'s training division, created a training film
using Big Co.'s facilities. Even though John created the film, Big Co. is the author for copyright
purposes. Big Co. owns the copyright in the film (unless John and Big Co. have agreed in a signed
contract that John owns the copyright).

The work made for hire rule does not give employers ownership of works made by employees outside the
scope of their employment.
Example: Darryl, an engineer at Productions, Inc., wrote the script for Productions' newest multimedia
work on his own initiative on weekends. Because Darryl did not write the script within the scope of his
employment, the work made for hire rule does not apply. If Productions wants ownership of the
copyright in the script, it must get an "assignment."
Specially Commissioned Works
The second category of works made for hire is limited to eight types of specially ordered or commissioned
works. These are works commissioned for use as:
 A contribution to a collective work.
 Part of a motion picture or other audiovisual work.
 A translation.
 A supplementary work.
 A compilation.
 An instructional text.
 A test or answer material for a test.
 An atlas.
For these types of works, if the hiring party and independent contractor creating the work agree in writing to
designate the work as a work made for hire, the work is a work made for hire. If the parties do not have an
agreement to treat the independent contractor's work as a work made for hire, it's not a work made for hire.

Example: April hired Don, a software developer, to design the software for April's multimedia work.
April and Don did not agree in writing to consider the software a work made for hire, so the software is
not a work made for hire. Don owns the copyright in the software.

Even if the hiring party and independent contractor agree in writing to consider the independent contractor's
work a work made for hire, the work is not a work made for hire unless it falls into one of the eight special
categories listed in the first paragraph of this subsection.
Example: Sarah commissioned John, a freelance painter, to do an oil painting of Sarah's home.
Although Sarah and John agreed in writing that the painting would be considered a work made for hire,
the written agreement does not make the painting a work made for hire because the painting is not in
one of the eight categories of works that can be specially commissioned works made for hire.

The rules governing ownership of copyrights in works created before January 1, 1978 (the effective date of
the Copyright Act of 1976), were different from the rules described in this chapter. The 1909 Copyright Act
did not distinguish between employees and independent contractors (works created by both independent
contractors and employees were automatically owned by the employer or hiring party unless the parties
agreed otherwise). In a 1989 case, Community for Creative Non-Violence v. Reid, the U.S. Supreme Court
made it clear that the current Copyright Act does distinguish between employees and independent
contractors.

The issue in Reid was who owned the copyright in a sculpture created by the artist Reid for the Community
for Creative Nonviolence (CCNV). The Court concluded that the work made for hire rule did not apply for
two reasons: Reid was not an employee of CCNV, and the sculpture was not one of the eight types of works
that could be designated a work made for hire by written agreement of the parties.