Intellectual Property Archives - ALAC

What do I own now that I’ve created my masterpiece?

Tyler Kowalchuk — Thu, 22 Feb 2024 14:17:19 +0000

Written by Sarah Zivoin

What do I own now that I’ve created my masterpiece?

In addition to the physical work that you’ve created, you’ve also established various economic and non-economic rights in it which are protected under Canada’s Copyright Act in Canada and under copyright legislation elsewhere.

Economic Rights

As the creator of an original work, you may have the right to produce, reproduce, publish, perform or telecommunicate (e.g., broadcast) any version of it as well as to authorize others to use these and other rights. These rights may be transferred by an assignment or an exclusive licence to another person in exchange for “consideration”. In this instance, “consideration” is legal terminology meaning something of value received by the creator in the exchange with the other person, usually money. The Copyright Act provides that in order for this transaction to be legally binding, it needs to be in writing and signed by you as the owner of copyright or signed by another person authorized by you.

Non-Economic Rights

Non-economic rights, otherwise known as “moral rights”, can be broken down into two rights that you may have as the creator of an original work:

Right of accreditation or attribution for the work. This is the right of the original creator of the work to be credited, if reasonable in the circumstances. For example, you can choose to be named as its creator, to use a pseudonym or to remain anonymous.
Right to maintain the integrity of the work. This right enables the original creator of the work to preserve its integrity to the extent that there will be no “prejudice” to their honour or reputation, including the authenticity of a work. In the case of a painting, sculpture or engravings (“sculpture” and “engravings” are defined in the Copyright Act), the work may not be changed in any manner without the original creator’s permission, but a court would probably view and treat changes to some other artistic works similarly. This right also allows you choice as to whether you want your work to be associated with products, services, causes or institutions. For example, you may be able to claim moral rights infringement if, without your permission, your work is displayed together with things that are contrary to what you would wish your work to stand for and this threatens your good name as a result.

Why moral rights are “non-economic” is because they cannot be sold or given away. Even if you were to sell the copyright to your work, you still retain your moral rights in it. The only way for you to give up your moral rights is to “waive” them generally or in favour of a named person or entity. The waiver does not need to be in writing – it may be oral or it may be implied in some circumstances. It can be for all or some of your moral rights and for any length of time up to the end of your work’s copyright protection.

Keep in mind that the economic and non-economic rights provided by copyright ownership are also different from the ownership of a physical work. For example, you might sell a sculpture to someone but that does not necessarily mean that you have sold them your economic rights or waived your non-economic rights in that physical work. The buyer can sell the physical work, but whether they have acquired the right to make or sell copies of it, use photographs of it on postcards, or make any changes to it or to reproductions of it, will depend on whether that buyer also purchased the copyright or obtained a waiver of some or all of your moral rights. Using written agreements with buyers helps to keep clear exactly what they have purchased or obtained from you.

This article is informational and not intended as a substitute for legal advice.

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Who owns my work – my employer or me?

Tyler Kowalchuk — Wed, 21 Feb 2024 20:31:16 +0000

Written by Sarah Zivoin

Who owns my work – my employer or me?

Generally, when you create a literary, dramatic, musical or artistic original work, you own its copyright. Such copyright allows you to produce, reproduce, create different versions, perform, publish or distribute all or part of it including by telecommunication (e.g., TV or radio broadcasting). However, Canada’s Copyright Act provides an exception to this general rule when the work was created in the course of your employment if the following conditions are met:

There is an employment or an apprenticeship relationship. You must be an employee and not a freelancer or independent contractor. Where there is a question of whether you are an employee, an analysis would be conducted surrounding the circumstances of your being hired. Factors to be considered in such analysis would be the control the employer has over your work, whether the employer provides you with tools, equipment and space to create it, and if you are paid a salary from which taxes are deducted and remitted on your behalf to Canada Revenue Agency. The more of these factors which illustrate control by the employer of your work are present, the more likely that you will be found to be an employee and that this condition would be satisfied.

The work is created during the course of employment or an apprenticeship. A question to ask in determining whether this condition is satisfied is whether your work was created under the employer’s instructions, with the employer’s resources and at the time that you are expected to be working for the employer. Even if you were using your own tools, equipment and space to create the work and were doing so during your free time, a further consideration would be whether the type of work being created would have been the type that you would have been expected to create during the course of your employment. If so, then this condition would likely be satisfied.

If the above conditions are met, you should then question whether retaining copyright in your work is customary practice or if a Copyright Act provision applies to the kind of work you created. For example, professors normally retain the copyright of their works even though created during the course of their employment at a university or college. Canada’s Copyright Act also treats works contributed to a newspaper, magazine or similar periodical publication differently in that, like a freelancer, an employed author in the absence of any agreement to the contrary retains a right to restrain publication of their work otherwise than as part of such publication.

Even if you are clearly an employed journalist and your employer owns the copyright in your work, you still maintain moral rights in your work unless you have waived them. Moral rights include the right to the integrity of the work (to the extent that changes may prejudice your honour and reputation) and the right to be credited for the work. A waiver of moral rights may be in writing, oral or implied depending upon the circumstances. In any case, an employment agreement may also contain specific provisions related to use or non-use of your name or to allow or prohibit changes to a work that you have created. That said, it is nevertheless important to read your employment contract carefully to determine whether you are being asked to waive your moral rights. If you are, there may be greater value being provided to your employer and you may be able to negotiate higher compensation in exchange.

This article is informational and not intended as a substitute for legal advice.

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Moral Rights (To Waive or Not to Waive)

Tyler Kowalchuk — Wed, 21 Feb 2024 19:24:13 +0000

Written by Sarah Zivoin.

To Waive or Not to Waive Moral Rights

A creator of an original work acquires the right to protect the integrity of the work as well as the right to be associated with it either by name or pseudonym or to remain anonymous. These rights are considered “moral rights” of the creator. Moral rights cannot be transferred, whether by licence or assignment, even on the sale of the copyright of a work. They are personal to the creator and live with the creator until they eventually pass on to the beneficiary of the creator’s moral rights upon the creator’s death, and subsequently pass to that beneficiary’s beneficiary of the creator’s moral rights, and so on. After death, a creator’s moral rights continue to exist and may be exercised by those beneficiaries of the creator’s moral rights for 70 years after the end of the calendar year of the creator’s passing. There are, however, situations in which moral rights may not be exercised. According to Canada’s Copyright Act, moral rights may be “waived” in whole or in part by either the creator of the work or a beneficiary of the creator’s moral rights.

What is a waiver and how is it granted?

A waiver is a renunciation or a surrender of a right, privilege or claim. When a creator waives their moral rights, they can do so in writing, or orally or impliedly in some instances, given the nature of the work. A waiver need not be for all moral rights with respect to a work. For example, the creator may waive their right to have their name associated with the work for a particular purpose or project while still maintaining their right to ensure the integrity of the work – at least to the extent that there is, in the language of the Copyright Act, no prejudice to their honour or reputation. The waiver itself should be in writing for certainty, but need not be complicated. It could simply be stated that the creator waives their moral rights in the work “in favour of” a named person or organization for a purpose or project. However, a creator should always be cautious when deciding whether to waive moral rights as once they grant such a waiver, they cannot unilaterally reassert those particular waived moral rights.

Why is a waiver of moral rights important to your employer or purchaser of your work?

As mentioned, moral rights in a work cannot be transferred, even by sale of a work or if created by an employed creator. For example, in an instance where you sell your painting and copyright to your painting, the purchaser of your painting may “own” your painting but, if you did not waive your moral rights in the painting, you still hold moral rights in it. Similarly, in another instance, if you upload a photograph you’ve taken for your employer to your employer’s website as part of your duties as an employee but without waiving your moral rights in the photograph, you still hold moral rights in the photograph. As moral rights restrict how a purchaser or an employer may wish to use a work that they own, it is common commercial practice for creators to be asked to waive their moral rights in their work so it can be changed without their permission. Depending upon the circumstances, you may be able to negotiate a higher price for your work in exchange for waiving your moral rights in it. You may also be able to negotiate something less than a complete waiver. For example, in a written agreement you might allow changes to be made to your work but retain the right to be credited as the creator or a co-creator or you might decide to remove your credit or negotiate the right to keep the right to do so subsequently.

This article is informational and not intended as a substitute for legal advice.

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C.R.E.A.T.I.N.G.

Max Rothschild — Mon, 07 Sep 2020 20:25:14 +0000

By Paul Sanderson with Tony Duarte, Emmanuel Evdemon and Marian Hebb

The Origin of “C.R.E.A.T.I.N.G.”

The word checklist “C.R.E.A.T.I.N.G.” spontaneously sprang from a preparatory conference call prior to a seminar about licensing entitled “Playing Nice in the Sandbox”, held at the Duke of York Pub in Toronto several years ago. The event was an ALAS legal educational seminar about licensing that featured myself speaking about music licensing, Marian Hebb speaking about licensing in the book publishing field, Tony Duarte discussing licensing in relation to film law and Emmanuel Evdemon speaking about licensing in relation to video games.

I had come up with a made-up word that served as a checklist that used almost the same letters that now form the acronym CREATING. At the time, the word was a little jumbled and garbled, probably something closer to G.-R.-E.-A.-A.-T.-T.-I.-N.-C. I shared it with the other panelists. Tony asked what I meant. I said it was a word that I made up that signifies and outlines key points that should be considered before entering into a licence agreement. It was coined by me to serve as a short checklist.

Marian then responded by saying “Oh, you mean “C.-R.-E.-A.-T.-I.-N.-G.”. All four of us agreed. That’s how G.-R.-E.-A.-A.-T.-T.-I.-N.-C. became the word checklist C.R.E.A.T.I.N.G. and acronym CREATING.*

What does “C.R.E.A.T.I.N.G.” mean in relation to creators’ rights agreements?

1) The letter C stands for compensation for a grant of rights, which is usually a licence but may be an outright sale. (See paragraph 12 below on grant of rights.) Under a creator’s rights agreement with a producer, developer or publisher, this can be anything from nominal consideration of a dollar, credit or, more typically, monetary compensation in the form of a flat fee, a royalty percentage or share of net or gross receipts, or a combination of some or all of these forms of compensation, in return for the right to use or “exploit” the rights that are licensed or purchased. Further fees may be paid for repeat uses (see end of paragraph 4 below on residuals) and royalty percentages may escalate based on the number of sales.

2) The letter C also stands for copyright in a work or performance and for credit or attribution to an author or performer. It’s usually best for the creator to keep their copyright and to have a copyright notice in their own name on a publication or a production as well as a credit as author or performer, since giving up copyright takes away the creator’s right to authorize or, except as may be specified in a rights agreement, to control further uses of their work. But, even if a creator grants all of their rights of copyright to another person, likely to be a producer, developer or publisher, the creator retains “moral rights”, which include attribution rights. Waiving moral rights may deprive the creator of their right to a credit unless specifically provided for in the rights agreement. So a creator should always carefully consider any request either to transfer their copyright or to waive their moral rights.

3) The letter R stands for reserved rights. Often some rights in a work or performance are retained or “reserved” by the creator. For example, a literary agent will almost always reserve a book author’s translation, film, dramatization and interactive digital property rights in a novel or other work. An author representing themself to a book publisher should do so too in appropriate circumstances and reserve all rights not specifically granted to the publisher. A composer may reserve all rights to their music other than the right intended for immediate use by the licensee or purchaser. For example, licensing a piece of music for use in a single documentary film would not entitle the licensee to use the music in a video game, a web series or traditional television series.

4) The letter R also stands for reversion rights, sometimes referred to as revocation rights. Typical grounds for a creator wanting to revoke or revert rights and terminate an agreement entirely include failure to publish or produce a work, non-payment of an advance against royalties or of earned royalties, failure to provide an accounting, failure to allow an audit or failure to meet some other very important term of the agreement. Whether a reason for revoking or reverting all or certain rights in an agreement is sufficient is often disputed, especially if not actually specified in the agreement. For example, a rights agreement, whether a licence or sale of rights, may say that the author is entitled to revert film rights if a film production has not been completed within a specified number of years following the producer’s acquisition of the film rights to the author’s novel. Or, a book or video game publishing licence may say that the author may revert all rights to a work if it is not published within a specified time following the agreed publication date, or may revert all translation or version rights to their work, or perhaps just rights for a particular language or version, if not translated or versioned and published within a specified number of years of first publication of the work in English (for example, a Japanese translation or console version of a game based on their novel if no such translation or version of the game is published within, say, three years of first English-language publication) or, similarly, a licence may say that the author is entitled to revert all publication rights for any territory where copies of their work have not been released or distributed after a specified time. Failure to make payments is frequently specified as a circumstance permitting a creator to revoke or revert all rights and terminate the agreement – but likely to be included only if requested by the creator! Before entering a rights agreement, a creator should give careful consideration to specifying circumstances in which they might wish to revoke or revert certain rights or to terminate the agreement and reclaim all rights.

And the letter R may stand for residuals – a term that should not be forgotten if a creator is entitled to further payments as compensation for repeat performances or other uses.

5) The letter E stands for exclusive. Exclusivity means that the creator cannot license elsewhere the same rights that they have already granted under another rights agreement. Not all agreements are granted on an exclusive basis. Many are non-exclusive licences. For example, use of pre-existing master sound recordings and pre-existing music used in synchronization with visual images in film and television productions are typically non-exclusive. So are licences to quote excerpts from a book in other publications. If non-exclusive, the same rights can be granted to many licensees. On the other hand, for example, a choir or a football club will likely require exclusive use of a song composed for it, or an advertiser may request exclusive use of a few bars from pre-existing music or even of an entire work for advertising a particular product or class of products. However, for example, a car manufacturer may just want to be the only car manufacturer permitted to use a song, but is unconcerned if the song is used in a film. Whether a grant is exclusive or non-exclusive is a key consideration when a creator is looking at entering a licence agreement and usually greatly affects the amount of compensation to the creator.

6) The letter A stands for accounting. Since the compensation set out in many rights agreements is based on a royalty or share of net or gross receipts, the accounting clause is very important. It typically specifies what and when accounting statements are to be provided to the creator by the producer, publisher or other distributor, including how royalties or receipts are calculated, what period of time is covered, when payment will be made, and other relevant details.

7) The letter A also stands for audit. An audit refers to the right of the creator granting rights and receiving royalties or other payments to verify the accounting statements provided by the licensee or the purchaser by an inspection or examination of its relevant books and records, usually by a professional accountant and subject to other conditions. The cost of the audit is often contingent upon whether or not an error in accounting is discovered during the audit. This is another very important term of a rights agreement. (Typically, the matters in this paragraph 7 and in paragraph 6 above appear in the same clause of a licence or purchase agreement, but they are conceptually different.)

8) The letter T stands for the term of a licence or any other rights agreement including an option to purchase certain rights. The word “term” in this context is the duration of the rights agreement, typically lasting for a specified number of years, but sometimes as long as the rights are being used by a licensee or for the duration of copyright, and so an agreement may outlive the author of a work. The length of the term, like many of the other points highlighted in this checklist, is often negotiable.

9) The letter T also stands for territory, meaning the country or area where the licence is applicable and the licensed rights may be used. For example, a licence for publication of a work or for a performance could be on a Canada-only basis, for North America or for the entire world, or even the universe, depending on its type and scope.

10) The letter I stands for irrevocable. Some rights agreements, whether a licence or outright sale of rights, are entered into on an irrevocable basis, meaning the grantor of the rights cannot revoke or take them back. For example, master use licences for master sound recordings and synchronization licences for music in a film are customarily granted on an irrevocable basis, and that is a fundamental condition of such agreements. If a grant of rights is described as “irrevocable”, it may be appropriate for the agreement to also specify that the creator is entitled to sue for damages for breach of the terms of the agreement. Also, even a grant of rights described as “irrevocable” may be subject to “revocation” and may be reverted by the creator in specified circumstances, for example, failure to produce or publish a work. (See paragraph 4 above on reversion rights.)

11) The letter N stands for net. A creator should always view the word “net” in a rights agreement with intense scrutiny! Net of what? Sometimes a producer, publisher, or distributor is permitted to deduct so many expenses from its gross revenues that there is very little if anything left on which to base the creator’s royalty or share of profits.

12) The letter G is last, but is certainly not the least letter in the word checklist C.R.E.A.T.I.N.G. It stands for the grant of rights, which should be very carefully scrutinized by a creator. A grant may authorize anything from a narrow temporary non-exclusive use to a very broad long-term or permanent exclusive use. Under a licence, which is more akin to a rental than a sale of rights, the creator always retains a right to their property (though unable to exercise any right of copyright in it until expiry or other termination of an exclusive licence of all rights). An outright sale or other complete transfer of rights is often referred to as an “assignment” of rights. From a creator’s perspective, licensing is usually preferable to an assignment, and most rights agreements can be drafted as licences. A grant of rights can include a great many things including, broadly, the form, technology, manner of use, purpose, media and languages for which rights are granted and may be used. A grant of rights may capture future technology or formats for use of the rights granted, or attempt to capture rights unknown or even unimagined at the time of the agreement. The grant of rights can also specify restrictions on the grant. For example, if the grant is for the use of music in a film, is it restricted to use in that film only? Can the music be used in the trailers and advertising, marketing, or other promotional material for the film? Can that music be used in a sequel to the film or a video game based on the film? Can it be licensed by the creator to a different producer or publisher for a video game related or unrelated to the film? Such questions and many more are key issues that are part of negotiations regarding the scope of grants of rights in licences and other rights agreements.

The letters C.-R.-E.-A.-T.-I.-N.-G. have proven to be a very useful mini-checklist that I have used when teaching and working with creators and that any creator can use when considering the basics of what should be included when negotiating and entering into a licence or other agreement granting rights. The word checklist C.R.E.A.T.I.N.G. or acronym CREATING is easily remembered and can be applied to any licence or other rights agreement. It often is relevant and valuable when analyzing and negotiating the terms of almost any such agreement. It should be noted that terms, for example, “net receipts”, “net revenue”, “net profits” or “reversion” or “termination” rights, amongst the many terms used frequently in rights agreements, may be defined specifically in a particular agreement, though sometimes buried in a long paragraph or in a schedule to the agreement. All definitions should be reviewed carefully as they can substantially affect the interpretation of the agreement and the extent of the rights granted in the agreement. And, however clearly this article may explain the concepts represented by the letters forming this acronym, it is not, nor is it intended to be, an exhaustive discussion of all points that a creator needs to consider before signing a rights agreement. Ideally, in any given specific legal situation, legal advice should be obtained from a lawyer who practises law in the field in which the creator works.

Paul Sanderson thanks Emmanuel Evdemon, Tony Duarte, Ken Thompson and Marian Hebb for their contributions and suggestions to this article and to Marian for her editorial assistance.

* Marian also coined both the names ALAS, which is a short form and acronym for Artists’ Legal Advice Services, operating since 1986 in Toronto and providing legal information, education and summary legal advice to all artists of all disciplines on a pro bono basis, and ALAC, which is a short form and acronym for Artists and Lawyers for the Advancement of Creativity, the federally incorporated not-for-profit corporation which co-ordinates ALAS.

ARTISTS’ LEGAL ADVICE SERVICES invites creators to use the acronym CREATING
as a reminder that the letters C.-R.-E.-A.-T.-I.-N.-G. form a useful checklist:

C stands for copyright, compensation and credit
R for reserved rights, revoke and revert – and missing a residual will hurt!
E is for exclusive, but non-exclusive is swell
A for accounting, and audit as well
T is for term, and territory too
I for irrevocable – do be careful of that!
N is for net, which could be a bad trap!
G is for the grant of rights, don’t forget – since this checklist has no point without it!

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Intellectual property primer

Hillary — Sat, 12 Oct 2019 17:41:35 +0000

Intellectual property (IP) refers to certain rights that can be owned in certain types of creations and creative works. IP rights cover a broad range of subject matter, including artistic designs, business names, inventions, and written expressions. Generally speaking, the owners of IP rights may be exclusively entitled to usem, make, import, distribute, share, or modify the creations in which they own IP rights.

IP rights are protected by laws enacted so that creators can benefit when they choose to share their creations with the public. Laws protecting IP incentivize the creation of new, original, and useful works/inventions, which will benefit society as well as their creators. In general, IP rights allow creators to authorize the use of and benefit from their creations for a certain timeframe, after which the general public may use a creation without restrictions from the owner of the IP. However, IP rights in a creation are not always owned by the creator (for example, if the creator has sold their IP rights to someone else or created their work in the course of their employment).

It is also important to keep in mind that each country has its own IP laws, and so the IP rights that a creator may own can vary in each country. In order to understand what IP rights may apply, please keep in mind which country’s (or countries’) laws may apply. The ALAS Legal Database provides summary information about the laws of the province of Ontario in Canada, and may not include all of the information you require.

Below are a few of the different types of IP rights available to different types of creators. For more information, please see more detailed articles on each type of IP in the ALAS Legal Database:

Copyright
Certain types of creative expressions (known as ‘works’) may be eligible for copyright protection. The owners of copyright in a work are exclusively entitled to use that work (such as to publish, modify, or distribute the work), and it may be an infringement of copyright for someone else to use the work without permission. Copyright protection generally lasts for the lifetime of the author, and then for a further period that varies by country (in Canada, 70 years from the end of the year of the author’s death).

Trademarks
The providers of goods and services (such as companies or retailers) may use certain indicators to distinguish their goods or services from those of other businesses. These source indicators are known as trademarks, and can come in a variety of forms such as business names, logos, slogans, or packaging. If two businesses or proprietors offer the same types of goods and/or services using confusingly similar trademarks then this could be an infringement and/or passing-off (i.e. one business pretending to be another to fool customers).

Industrial Designs
IP law can be used to protect certain types of non-utilitarian visual designs, such as plans for three-dimensional objects or functional two-dimensional graphics (e.g. an app user-interface). This area of law generally only protects the non-useful, ornamental elements of designs, and not their intended function. For example, it could be possible to protect a distinctive and visually appealing chair, but not the concept of a chair. INdustrial design protection can help people creating goods to protect the unique visual elements that make their goods aesthetically appealing.

Patents
Inventors can sometimes protect their concepts for new and unique ways of doing things (i.e. an invention). This protection allows them to prohibit others from using the invention for a certain period of time, giving the inventor an opportunity to profit from their idea. The requirements for an idea to be patentable vary from country to country, but generally the invention must be novel and not obvious, as well as useful.

Trade Secrets
IP rights generally do not protect information per se, and so trade secrets refers to a protection strategy for information that is important to a business (such as concepts, ideas, formulas, recipes). Because IP rights do not prevent others from using the information, the business that owns it must keep the information secret. This is often accomplished by only sharing the information with select individuals, and entering into non-disclosure agreements (NDAs) with those individuals to ensure that they keep the information to themselves.

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