Copyrights and Agreements: Protecting Your Business

“The rules of friendship are tacit, unconscious; they are not rational. In business, though, you have to think rationally.”  
- Steven Pinker, cognitive psychologist, linguist and popular science author

A freelancer-friend recently talked to me about a gig that went wrong.  He was hired by a "friend" to create a custom design and print the approved design on clothing.  The only agreement between the parties was an oral agreement, i.e. no written agreement.  My freelancer-friend kept his promise under the agreement and created the design. The party who hired my freelancer-friend broke his promise: after a long radio silence, freelancer-friend learned that his employer copied the design without paying.

A brief discussion of copyrights is instructive.  The other party misappropriated my friend’s copyright.  A copyright is created when you reduce your original creative work to any medium, like a computer file or on a canvas.  So when my friend created the design and printed it to the medium - clothes in this case - he had a copyright in his design.  If my friend had filed an application to register his copyright then the other party’s liability for misappropriating the copyright would have been more significant.  But even without filing anything, you should know that you own a copyright in your original creative work - so you own an intellectual property asset!

Whether you are hiring or selling your goods or services, you should strongly consider having the other side sign a written engagement agreement.  I read somewhere that an agreement is like a seatbelt: you hope you don’t need it but you’ll be relieved you have one in the case that you ever do need it. The agreement doesn’t have to be complex or unreadable - a good agreement i) captures the essential terms of the agreement, e.g. the parties, scope of work, price and time for performance'; ii) is in writing; and iii) is signed by at least the other party, and at best, both parties.   This is especially true if you are not trying to work for free.  

If your intellectual property portfolio includes copyrights then you should consider the following:

1)   Register with the Copyright Office.  Registering your copyright claim is relatively inexpensive (less than $60 for most applicants), and more importantly, almost all rights against infringers under the Copyright Act are predicated on registration.  Note that if you have not registered previously, you must register within one month of learning of infringement to take advantage of enforcement mechanisms and remedies under the Copyright Act.

2)   Demand payment.  Your copyright is an intellectual property asset!  Infringement is stealing your asset without your permission and robs you of the fair market value of your asset.  If the other party pays you for the work then they are not liable for copyright infringement based on the “work for hire” doctrine.  If you find yourself in a situation similar to my friend then make a formal demand and send an invoice.  If the infringer does pay, consider forwarding an assignment of the copyright to make it official.  

3)   Cease and Desist.  Warn the party to stop infringing on your copyright or else face legal consequences.  There are fairly severe statutory damages for copyright infringement, up to $150,000 per work in cases of willful infringement plus attorney’s fees.

Ben Franklin is quoted as saying, “An ounce of prevention is worth a pound of cure.”  Prevent misappropriation with patents, trademarks, and copyrights. Cure with enforcement. Whether you need prevention or a cure, Tinch Law can help with both.  Schedule your consultation so we can get to work.  

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