Wal-Mart learned the hard way that unless there is a contract stating it is work for hire or assigning ownership of a video, the person who creates it owns it. About 30 years ago Wal-Mart hired a production company to shoot video of internal corporate meetings and executives. The hiring of Flagler Productions was done on a handshake.
Under Section 201(b) of the Copyright Act, “In the case of a work made for hire, the employer or other person for whom the work was prepared is considered the author for purposes of this title, and, unless the parties have expressly agreed otherwise in a written instrument signed by them, owns all of the rights comprised in the copyright.”
If the videos were “works made for hire,” then Wal-Mart (the “person for whom the work was prepared”) should own the rights, unless both parties agreed otherwise in a written agreement.
But the fairly complicated definition of “work made for hire” in section 101 of the statute gives two alternatives:
A “work made for hire” is—
(1) a work prepared by an employee within the scope of his or her employment; or
(2) a work specially ordered or commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.
Flagler Productions is clearly not an employee and so if there is no written agreement about copyright, then Flagler owns the copyright!
Make sure there’s a clause in your contract that specifically spells out who owns what. This includes the raw footage, project files, EDL, etc. There should also be a clause explaining that copies of the material can be made at such and such a rate. Get this contract signed BEFORE any work begins.
Typically, the client owns just a copy of the finished work. But of course, you want to be fair with your client and build a good relationship that will result in more business for both of you. So discuss this with the client and make a contract that gives both parties what they want. For more information see The Harvard Law Blog – Wal-Mart Execs Behaving Badly: Who Owns the Videos? This article is not a substitute for legal advice.
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