Companies should take steps to secure copyright ownership in their design marks. While a distinctive design mark merits protections under trademark law, it also can be protected by copyright law if it contains the requisite originality and creativity. Obtaining and registering copyrights in design marks can provide a company with a powerful tool against infringers.
A design mark is any symbol or device that identifies a company’s goods or services and distinguishes them from those offered by others, such as the Nike Swoosh, the Starbucks green siren logo and the Morton Salt Girl. A design mark may be subject to copyright protection if it possesses at least a modicum of creativity. Mere variations of typographic ornamentation, lettering or coloring, for example, are not copyrightable.
Trademark and copyright protections differ in scope. Copyright owners have the exclusive right to control reproduction and other exploitation of the copyrighted artwork for a set period of time—generally, the life of the author plus 70 years. Unlike copyright protection, trademark protection in a distinctive mark lasts as long as it is used in commerce. Copyright law allows a copyright owner to prevent intentional copying of its work in any medium; whereas, a trademark owner may only prevent use of its trademarks in more limited circumstances, such as when that use creates a likelihood of confusion as to source or affiliation. Simply reproducing a trademark does not constitute trademark infringement.
In some cases, a copyright claim may be a company’s only course of action against an infringer. For example, a company that abandons use of its design mark may not have grounds for a trademark infringement claim against an infringer; however, if it owns the copyright in the design, it may have a claim for copyright infringement. Copyright law may also be used to prevent copying of a company’s designs in international territories where trademark law is less developed or where a company has not made use of the mark. And in cases where both copyright and trademark rights are infringed in a single act, a party may be entitled to monetary relief under both statutes.
While copyright protection in design marks has many benefits, the first step is securing ownership and registration. A company generally owns the copyright to artwork designed by its employees within the scope of employment. Oftentimes, however, companies hire independent contractors to create the artwork. Absent a written agreement to the contrary, simply commissioning an outside designer to design artwork does not give a company copyright ownership in that work.
Why? Because under the 1976 Copyright Act, copyright vests in the author at the moment the “original work of authorship” is “fixed in any tangible medium of expression.” Thus, as a general rule, the owner of the copyright is the party who actually creates the work. While copyright law provides some exceptions to this rule through the “work made for hire” doctrine those exceptions are limited and do not apply where a company commissions an independent contractor to create artwork for branding purposes. Thus, absent a written agreement to the contrary, copyright in the artwork vests in the independent contractor—not the company that commissioned the artwork.
The fact that the designer still owns the copyright in the work does not necessarily preclude a company from using it. A nonexclusive license to use the artwork is generally implied if the parties’ conduct indicates an intent to grant such permission. But the implied license may be limited in scope and, since it’s nonexclusive, it will not prevent the designer from licensing the image to another company. Moreover, nonexclusive licensees do not have standing to sue for copyright infringement. Obtaining all of the exclusive rights in the artwork afforded under copyright law ensures control over how often and in what manner the artwork is used.
Below are some tips to securing your company’s copyright ownership in design marks created by outside designers:
Choose a reliable designer. If you are engaging an outside designer, choose a designer or design firm that has a solid, longstanding reputation. While any written assignment should include a warranty clause stating that the artwork is original to the designer and that the designer owns all rights and title to the works being transferred to the company, it is important that the designer be a known and trusted entity. In any event, it is worth additional time and expense to ensure the artwork produced by the designer is original.
Enter into a consulting agreement. A company should enter into a consulting agreement with the designer before any work begins. The consulting agreement should outline the scope of the project and the parties’ expectations. The agreement should transfer and assign to the company and its successors the entire right, title and interest to all works (including drawings and drafts) created in performing the project. The designer also should agree to execute all documents necessary to secure the company’s rights in the commissioned work. If you are working with a sophisticated design firm, it may have its own general contract. Be sure to review it closely to ensure that the entire copyright is assigned to your company, and that it includes the appropriate representations and warranties. Once the work is completed, it is good practice to have a separate simple copyright assignment executed that specifically details the works that are the subject of the copyright assignment.
Apply for copyright registration. While registration is not necessary for copyright protection, it is required for a U.S. copyright owner to bring a suit for copyright infringement in U.S. federal courts. Moreover, there are substantive advantages for early registration. If registration is made within five years after first publication of the work, the registration constitutes prima facie evidence of the validity of the copyright and the facts contained in the registration certificate. Another incentive for early registration is that copyright owners may seek to recover statutory damages or attorney’s fees for any infringement that occurs after registration, but not before. If the designer already filed for copyright registration in the design, be sure to record the executed assignment with the Copyright Office.
Copyright protection can offer brand owners another weapon against infringers. Don’t wait until an infringer comes along to find out that your company does not own the copyrights in its design marks.