© Copyrights and Businesses Willow Misty Parks Anderson School of Management University of New Mexico Albuquerque, NM © 2012 Willow Misty Parks IMPORTANT NOTICE • General legal information. • This presentation is NOT legal advice or legal representation. • This presentation sets out general concepts and some of the basics of copyright law as it relates to business. • Anyone determining that they need legal advice or representation should seek counsel and advice from an attorney or law firm. Significance of Intellectual Property Law to Business • Important to businesses! • Violations of others’ rights can be costly, even if done by an employee of the company • Understand the basis of ownership of Trademarks, Patents and Copyrights as business property and assets • Understand resources and legal uses available under the law • Understand when employers own employees’ works Why This is Important Current Issues • Pirating and illegal downloading of music and movies • Borrowing images from the Internet • Making copies for the classroom • Business liability for customer and employee infringements Because of the Ease of Obtaining Rights and Infringing on Rights This is becoming an even greater issue today due to: -the myths about what constitutes a violation -violations being inadvertent or due to misinformation -expanded employer/business liability for violations by customers and employees © is a Property right • This is an intangible property right composed of 6 separable rights. • Infringement is often difficult to define, detect, deter and enforce. • Identifying ownership: single owner, joint owners, businesses/employers • Rights may be transferred: bought, sold, rented, through assignments and licensing. • Rights may be exclusive or non-exclusive, written or not. • Rights may be inherited or given in wills and trusts. Intellectual Property is Property • Property is property: whether tangible or intangible • Important to have respect for property rights • Would not steal a tangible item from the store, yet many download music and movies with no remorse. IP Law is Changing and Evolving • Constitution of the United States • The Copyright Act of 1976 • Sonny Bono Copyright Term Extension Act of 1998 • Digital Millennium Copyright Act (DMCA) • Federal Trademark Dilution Act of 1995 The Copyright Clause The Congress shall have Power . . . To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries . . . —Article I, Section 8, U.S. Constitution Overlap & Intersection Intellectual Property Laws Patents Trademarks ™ 1. 1. 2. 3. 4. 5. 6. 7. Covers systems, processes, discoveries, etc. Stronger protection 14 to 20 years Must research history New, obvious and useful Requires registration Patent attorneys (Patent Bar) 8. Generally Expensive 2. 3. 4. 5. 6. 7. Protects words, slogans, phrases, logos, symbols, etc. that identify products in the marketplace Unlimited time Established through actual use or registration “Likelihood of confusion” Cyber squatting Dilution May be registered with State and/or Federal Do You Own Any Copyright Rights? Acquiring copyrights is easy! You can do it without even being aware of it. Does anyone have a cell phone? With pictures? You acquired copyright ownership in those! Acquiring © Copyright Rights “original works of authorship fixed in any tangible medium of expression” Original & Fixed Element 1: Originality “original works of authorship” 1. Some minimal degree of creativity. 2. The requisite level of creativity is extremely low; even a slight amount will suffice. 3. A creative spark. 4. Owes its origin; not copied. Examples that Do NOT Meet Originality • Phone books: the white pages; alphabetical order is not enough! • Maps: based on facts (unless the cities were imaginary or false) • There is NO “sweat-of-the-brow” doctrine in Copyright Element 2: Fixed “Fixed in any tangible medium of expression” Fixed: is sufficiently permanent or stable for it to be perceived or reproduced for more than a transitory duration. Some examples of works NOT fixed: Choreographic works, not notated or recorded Improvisational speeches, not recorded Performances, not written or recorded Broadcasts, if not being simultaneously recorded Pictures, writing or poem in the sand Skywriting Jazz improvisations Improvisational political skits Independent Creation • A legal doctrine in which two or more may own copyright in essentially the identical work. • Because of the ease of getting copyright rights this may occur often. • Unlike patents, each cannot stop the others from using the other’s work. • They must not have “copied” or known of the other work. Ideas Are Not Protected Under Copyright • Copyright does not protect ideas, only the expression of ideas. • They may be protectable under Patent Law. • The particular design or expression of the idea may be protected. The Copyright Rights: What Do You Get? Reproduce the work in copies Prepare Derivatives Distribute copies to the public for sale, rental, lease or lending Perform publicly* Display publicly *“publicly” display or performance occurs if it takes place at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and social acquaintances are gathered. Copyright Notice • The symbol © • The year of first publication • The name of the copyright owner Example: © 2012 Willow Misty Parks © Once a work is created notice may be placed. No registration required. © Notice is not required to obtain copyright rights for works published after March 1, 1989. But highly recommended. © Registration required to start an infringement law suit. © Where there is valid © notice, no innocent infringers. How Long Does Copyright Protection Last? For works created after January 1, 1978: A. One author—life of the author plus 70 years B. Joint works—life of last surviving author plus 70 years C. Anonymous & works made for hire: – 95 years from publication, or – 120 years from creation, which ever is first Caveat: works created earlier or in foreign countries are outside the scope of this presentation. Copyright Registration: Why Bother? • Registration is NOT required to acquire rights! • Prerequisite to being able to file an infringement lawsuit in court. • Establishes a public record. • Timely* registration may permit statutory damages up to $150,000, plus attorney fees and court costs. • Evidentiary value of certificate of registration: rebuttable presumption that copyright is valid, shifts burden of proof to defendant to prove invalid. * “Timely”= 3 months from publication or before infringement. Who Owns Copyright? Three Types of Ownership 1. One author/creator – – Once it is fixed and original the individual creator owns it. For the life of the creator plus 70 years 2. Joint or co-authors/creators – – All contributors On death of the last owner plus 70 years. 3. Works made for hire – – If made by an employee, the employer/business owns it. 95 to 120 years depends on publication Joint or Co-Authors/Creators • A work is jointly authored automatically upon its creation if 1) two or more authors contributed copyrightable material to the work; and 2) each of the authors prepared his or her contribution with the intention (at the time the work was created) of creating a single unitary work. • • Each contributing author shares ownership of the entire work. Suggestion: a written agreement should be in place! Works Made for Hire In Scope of Employment A work prepared by an employee within the scope of employment is owned by the employer. How to tell if the worker is an employee: - Payroll formalities* - Right to assign additional projects* - Employee benefits* - Tax treatment* - Control manner and means of creation* - Skill required* - Instrumentalities and tools - Location of work * Most important factors Types of Transfers: Assignments & Licenses • Assignment: selling all your rights to another. – If no rights are retained, original creator may NOT use the work without permission from new owner. • License: “renting” your rights to another; giving permission to someone else to use your work. 1. You retain ownership 2. Licenses can be flexible documents 3. License specifics can limit: – – – – portion of work that may be used how/where the work may be used duration of license type of reproduction: i.e. film, VHS, DVD, CD, vinyl records, websites Note: License or transfer agreement can be recorded with the Copyright Office. Licenses: Permissions • Exclusive—register! 1. The rights granted may not be licensed to anyone else. 2. Must be in writing, and 3. Must be signed by the owner of the rights. 4. Can register the license with U.S. Copyright Office. • 1. 2. 3. Non-Exclusive No writing required. Can be implied. Cannot register with U.S. Copyright Office. 4. Others can be permitted to use the work. 5. Owner can license multiple users, and 6. Retain rights for themselves. Copyright Infringement Copyright is a bundle of exclusive rights. Section 106 of the copyright law provides the owner of copyright in a work the exclusive right: • To reproduce the work in copies; • To prepare derivative works based upon the work; • To distribute copies of the work to the public by sale or other transfer of ownership, or by rental, lease or lending; • To perform the work publicly; • To display the copyrighted work publicly • In the case of sound recordings, to perform the work publicly by means of a digital audio transmission. Copyright Infringement Section 501 of the copyright law states that “anyone who violates any of the exclusive rights of the copyright owner ...is an infringer of the copyright or right of the author.” • The law does not enforce itself. • You must bring own lawsuit. • Registration is a prerequisite to an infringement lawsuit. The Most Common and Confusing… • Derivative infringements Common, Unintentional Performance & Display Infringements • • • • • • • • • Key term is “publicly” A public display or performance: if it takes place at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and social acquaintances are gathered. Music’s special rules:* seek advice before playing in waiting rooms, restaurants, school dances, weddings, etc. Film festivals Book readings, etc. Fundraisers School dances Book covers Playing a movie in a classroom* Is limited by the “Right of First Sale”* • * See later slides for more details • Copyright Infringement Infringement means violation of any of the exclusive copyright rights Possible remedies for © infringement: –$ per violation of one work: $750-$30,000 as considered just by the court. –$ Innocent infringers: as low as $200 (this low penalty is not available if © notice is on work because infringement is considered intentional). $ Statutory damages: –$ At the court’s discretion for willful violations up to $150,000 per violation –$ Actual damages and additional profits –$ Impound & disposition of infringing articles. –$ Potential criminal offences where infringement is willful. Cease & Desist Notices • Have to police and enforce Copyright Rights yourself • Purposes: - lets infringer know that you believe they are infringing - establishes date of discovery - tells infringer to stop - gives a chance to explain, respond or negotiate • Usually includes: - Your name and contact - Name of work, publication, copyright registration number - Nature of activity that is in violation - Demand the infringer to cease and desist future activity and pay you for past damages. - Request for response by stated date. •Right of first sale Some to •Fair use,Exceptions including parody Infringements Resources •No blanket and educational •Public domain resources There are several limitations of the exclusive rights of the copyright owner. The copyright law provides exemptions from infringement liability by authorizing certain uses under particularized circumstances. These exemptions are enumerated generally in sections 107-122 of the copyright law. Some Exceptions to Infringements and Resources The Right of First Sale Right of “First Sale”: the owner of a particular copy of a work “exhausts” her economic rights therein—and thus loses control of the copy—by selling it (Lee v. ART) • • • • provides that the owner of the material object or copy can sell, give away and sometimes lend it to the public without the copyright owner’s permission (but cannot make additional copies) The purchase of the art object itself is separate from the copyrights. The mere ownership of a book, manuscript, painting, etc. does not give the possessor the copyright. The purchaser of a copy or object of art has the right: - To sell - To display (not publicly) - To give away - To lease, rent or lend to the public (except NOT computer programs and sound recordings.) Exception to Right of First Sale • The right of first sale might not be applicable to products produced overseas • Publisher filed a lawsuit against a Thai student who came to the U.S. and sold foreign-edition textbooks on eBay. Courts determined that right of first sale does not apply to this situation • Student found to be guilty of copyright infringement in lower courts • Issue being considered by Supreme Court • Could have significant implications for goods resold on eBay and other global companies that sell used goods Is It Fair Use or Infringement? First consider purpose: criticism, comment, news reporting, teaching, scholarship, or research and parody Four factors to be considered: 1. 2. 3. 4. Purpose and character of the use, including whether it is commercial nature of for nonprofit educational purpose The nature or the copyrighted work (creative, fact, useful, compilation) The amount and substantiality of the portion used in relation to the whole (a short quote or an entire article, the heart Y or the work) The effect of the use upon the potential market for or value of the copyrighted work. Beware! No reliable general quantitative standards. If you are relying on fair use to use someone else’s copyrighted work, be very, very careful. Ultimately, only a judge or jury has the final say on whether your use is “fair use” or not. Erasing the Blanket Educational & Nonprofit Myth • There is NO blanket educational or non-profit exception to the copyright. • Movies played in class: Performance or display of a legal copy of a work by instructors or pupils in the course of face-to-face teaching activities or a nonprofit educational institution, in a classroom or similar place devoted to instructional use is not a copyright infringement. • Textbooks: copies pose significant risks • Course packets: have been heavily litigated • Guidelines for copies of books or periodicals for classroom purposes by not-for-profit educational institutions: 1. Brevity, 2. Spontaneity, 3. Cumulative effect, and 4. A notice of copyright. Theft of Music and Movies • Illegally downloading music and movies is serious! • Many do not consider the seriousness of the crime until they get caught – Pirate Bay founder arrested – Boston University student fined $675,000 for illegally downloading 30 songs and sharing them on the Internet Parody & Fair Use • • • • • Practically by definition, you will NOT be able to obtain the author’s permission for this use. Indeed, the owner of a work seldom wants to license someone else to ridicule that work. “Fair use” is the guarantee of breathing space within the confines of copyright. Parody: a literary or artistic work that imitates the characteristic style of an author or a work for comic effect or ridicule—burlesque, satire, criticism, raunchy twist and spoof. Parody’s humor, its comment, necessarily springs from recognizable allusion to its object through distorted imitation. Its art lies in the tension between a known original and its periodic twin. Mostly, reflected in the application of Factor 3 of Fair Use; thus, allows more of the original to be used. Public Domain Sources: What Works Are in Public Domain? “Public Domain” are works that for one reason or another are not covered by copyright and are ordinarily free for all to use. • • • • Works out of copyright: created before 1924 in the United States Type of work not protected under copyright or patent/trademark Work dedicated to public domain by owner Improperly registered or not renewed works created before 1978 Examples: Hamlet, by William Shakespeare, Moby Dick by Herman Melville, The 5th Symphony by Ludwig van Beethoven, (except for recordings), Little Women, by Louisa May Alcott, Frankenstein by Mary Shelley, Pride and Prejudice by Jane Austen, The Adventures of Tom Sawyer by Mark Twain, etc. Examples of Public Domain Derivatives Public domain work: Still Available • Novel “Little Women” • Shakespeare’s “Romeo and Juliet” • 19th century oil painting New material: Protected • Dramatization for television • New introduction and forward • Reproduction of 19th century oil painting by photo lithography Lessons for Businesses • Businesses should train employees to understand infringement and not to violate • Have policies in handbooks as to ownership of employee works and violations • Provide notices for customers • Don’t depend on fair use, get permissions where possible, draw from public domain sources, or develop own sources and works made for hire Lessons for Businesses • Have clear employee contracts regarding IP ownership • Protect business property rights: – Businesses should register copyright and trademarks – Draft and send Cease and Desist Letters • Use copyright free and public domain resources for development Links • US Patent and Trademark Office http://www.uspto.gov/ • US Copyright Office: http://www.copyright.gov/ • Fees: http://www.copyright.gov/docs/fees.html • Registration Form: http://www.copyright.gov/forms/formco2d.pdf Non-exclusive License Permission Permission is granted under a non-exclusive license to copy and distribute this work to the Daniel’s Foundation for purposes of education and classroom instruction. Permission is specifically denied for commercial use, creation of derivatives, or otherwise for financial gain without specific written permission from the author. No other entity or organization is given permission to copy, distribute, make derivatives, display or otherwise use. You are welcome to reprint any of my articles/presentations with the following conditions: 1. Include all Copyright Notices and Cautions 2. Articles/PowerPoints must be used in their entirety. Excerpts are acceptable pending permission. 3. If you are using an article online, all the copyright notices must be included. 4. Email distribution of this article must be to an opt-in email list only. NO SPAM! Once you reprint or use an article/presentation, a courtesy copy of your publication or description of the use would be appreciated: Willow Misty Parks PO Box 25312 Albuquerque, NM 87125 [email protected] Willow Misty Parks, Owner of the Business Bookshelf, LLC ©2012 The Business Bookshelf, LLC & Willow Misty Parks Copyrights and all rights are reserved in aspects that are original and fixed by the author, and to compilation, organization and arrangement under the US Copyright Act, except where the copyrights are owned by another, are under GNU licenses, or do not have copyright as in Public Domain and Federal Government works. Some works may be used under the legal principle of Fair Use and the author makes no representations of ownership to works that are currently owned or protected under the Copyright Laws and therefore gives no consent to any further uses including but not limited to reproductions, display, distribution by any other parties. The author takes no responsibility and will not be liable for any unauthorized uses by others that may lead to violations of the Copyright Act.