IP: Paying for it doesn’t mean you own it

Companies can obtain ownership of the rights to a work through assignment or work for hire

This is an oft-discussed topic, yet several times a year those of us who practice in the field of intellectual property hear from clients that hired someone to create content, did not have the proper documentation in place and then discovered that the company did not own the rights to the content that was developed.

Copyright protects so-called “works of authorship,” which can be works of art, text, source code, music, etc. Companies frequently engage independent contractors to create copyrightable content for them—for example:

There are two ways that a work will be deemed to be a work for hire:

  1. If it is created by an employee within the scope of his or her employment. For example, a newspaper that employs reporters will own the copyright in the articles written by those reporters because that is what the reporters are hired to do. On the other hand, if a company has an employee working in its accounts payable department who happens to know something about web design and offers to work on the company website, that work will not be considered “within the scope of his/her employment” and would likely not be considered a work for hire. In determining whether a work was created by an employee within the scope of his or her employment, courts will look at several factors, including “the skill required, the source of the instrumentalities and tools, the location of the work, the duration of the relationship between the parties, whether the hiring party has the right to assign additional projects ... the hired party’s discretion over when and how long to work; the method of payment” and many others (Community for Creative Non-Violence v. Reid).
  1. If it is agreed in writing (signed by both parties) that it is a work for hire and it falls within one of nine categories listed in Section 101 of the Copyright Act. Those categories are: a contribution to a collective work, a part of a motion picture or other audiovisual work, a translation, a supplementary work, a compilation, an instructional text, a test, answer material for a test and an atlas.

Most of these categories are very specific. A few leave some room for a broader application, such as contributions to collective works and audiovisual works. Thus, even if both parties agree that a certain work is to be a work for hire, and document that understanding appropriately, it still will not be a work for hire if it does not fall within one of the nine categories.


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Lawrence Weinstein

Lawrence Weinstein is a Partner in Proskauer’s Litigation Department and co-head of the firm’s False Advertising & Trademark Group, resident in the New York office....

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Contributing Author

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Jenifer deWolf Paine

Jenifer deWolf Paine is a Senior Counsel in Proskauer’s Litigation Department, in the New York office.

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