If It’s Worth It, You Should Work It (As a Work Made for Hire)

intellectual property copyright patent trademarkFrom JDSupra, Ivy Clarice Estoesta and Monica Riva Talley discuss the importance of protecting intellectual property rights when engaging with independent contractors.  They write:

To avoid this issue altogether, companies looking to hire third parties should have written agreements that explicitly state that a company owners the third-party-made work. Two instruments that companies can use to obtain ownership of third-party made works are a “work for hire agreement” and an assignment.

A work for hire agreement is the preferred instrument for obtaining ownership of works that qualify as a “work made for hire” under Section 101 of the U.S. Copyright Act. Under the Copyright Act, a work made for hire includes “specially ordered or commissions for use (1) as a contribution to a collective work, (2) as part of a motion picture or other audiovisual work, (3) as a translation, (4) as a supplementary work, (5) as a compilation, (6) as an instructional text, (7) as a test, (8) as an answer material for a test, or (9) as an atlas.” If a work does not qualify as a work made for hire under the Copyright Act, companies may obtain ownership of the third-party-made work by way of an assignment. Written agreements between a company and independent contractors would, therefore, benefit from including a fallback assignment clause – in the event that a court (in later litigation) deems the work as a work for hire.

When a company has the choice of obtaining ownership via a work for hire agreement or an assignment, a work for hire agreement is encouraged. This is because a work for hire agreement cannot be terminated. An assignment – even if it includes language that the transfer is non-revocable – may be terminated by the author of the work, under Section 203 of the Copyright Act. This little-known provision allows the work’s author (or, if dead, his or her heirs) to reclaim ownership of a copyright, as early as 35 years after, and as late as 40 years after an assignment was made.

However, some methods of protecting intellectual property rights may undermine a worker’s classification as an independent contractor.  In California, a “work-for-hire” provision indicates that the worker is an employee.  The California “Work Made for Hire” Trap: Your Consultant May Be Your Employee

Read the full story at If It’s Worth It, You Should Work It (As a Work Made for Hire)

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