Introduction

Welcome to the Simplifying Legal podcast, brought to you by Businessese. I’m your host, Danielle Liss.

Many years ago, someone told me I was the least lawyer-y lawyer she’d ever met because I helped make legal easier to understand. To this day, it’s one of the best compliments I’ve received in my professional life.

If you’ve ever felt legal was too scary, too overwhelming, too complicated, or just plain incomprehensible, you’re not alone. The Simplifying Legal podcast was created to help. 

In each episode, we’ll do a deep dive into a legal topic and give you concrete next steps so you can apply it to your business. 

My goal is for you to walk away from each episode thinking, oh, that was easier than I thought it would be.

Let’s get started. 

Episode Content

Hey there, I’m Danielle. Welcome to episode 13 of Simplifying Legal for Small Business Owners. In Episode 8, we kicked off a series on contracts and we’ve discussed a number of different contract clauses, like confidentiality, payments, and termination. In this episode, I’m focusing on content ownership. Often, these sections are filled with confusing legalese, so it’s important to know what the clauses mean and how they can impact your business. 

Disclaimer: As always, before we get into today’s topic, a quick disclaimer. This podcast is meant to provide you with legal information only. It’s not legal advice and does not create any type of attorney-client relationship between us. Please don’t take any action without consulting your lawyer first. 

Now let’s talk about content ownership. 

Content Ownership in Agreements and Contracts  

Content ownership impacts many types of business owners, especially creatives, like graphic designers, photographers, and copywriters, or those who are hiring creatives. Content ownership is also a big part of influencer marketing agreements. 

Even if you aren’t a creative or influencer, you’ve probably entered an agreement that has some type of content ownership provisions. For example, logo design, website design, and headshot photography are very common things that you may have dealt with if you have a website. In each of these fields, content ownership is important because it governs how you can use the original content that someone’s created for you. 

Protecting Your Intellectual Property

Before we can get into the specifics of content ownership, I need to do a brief overview of a couple of intellectual property concepts since they are often involved in content ownership provisions and sometimes get confused. And, as always, don’t worry, we’ll be doing a deep dive into both of these in a future episode. 

The two concepts are trademarks and copyrights. I’ve heard a lot of people in the past either use these terms interchangeably, but they are very different. 

Copyright and Trademarks

A trademark is something, like a word or words, logo, or name that represents a business as the source of a product or service. For example, Businessese is the name of my business and it is used in all of my product branding. 

An example of a logo mark that is far more famous than Businessese would be the Nike swoosh. 

Like I said before, some people confuse copyrights and trademarks, which is why I wanted to get more specific about what a trademark is. Because, very simply, a trademark and a copyright are different, so you need to know which term is applicable in your agreements. 

For the topic of content ownership, we are usually talking about copyright. 

The US Copyright Office defines a copyright as “a type of intellectual property that protects original works of authorship as soon as an author fixes the work in a tangible form of expression.” I know, that definition isn’t exactly clear. 

The key pieces are that, first, there’s an original work and, second, it’s fixed in a tangible medium, such as a photo, a book, a video, or a computer program. 

It’s important to remember: anyone who creates an original work in a fixed tangible medium can own a copyright. Whether they are a business or an individual. 

Copyright owners have several exclusive rights. You can: 

• Reproduce the work; 
• Prepare a derivative work based upon the original work; 
• Distribute to the public by sale or another type of transfer; 
• Perform the work; and, 
• Display the work.

To understand content ownership, we aren’t going to discuss all of the nuances of copyright law, but it is important to understand the basics of copyright and what types of rights are included. 

Like I mentioned before, there will be an episode in the future on copyrights. If you want to read more about this topic, there is an article on the Businessese blog, Intellectual Property: All About Copyrights, which I’ll link in the show notes. 

But, for today, it is important to discuss how copyright rights work since this is frequently involved in content ownership. 

Usually, you’ll hear people describe a copyright as a bundle of sticks, and each of the rights I listed above is one individual stick. But, for me, I would rather think about rainbow packs of pens than sticks, so we’re going with that for this episode. 

My favorite pens are the Pentel Energel Line and you can buy them in a bunch of rainbow packs. (Which I do buy. A lot.) Think of the full box of pens as your copyright. Each pen inside that pack represents one of the individual rights listed above. So, your purple pen might be the right to distribute the works to the public through a sale. The pink pen might be the right to display the work. 

You can keep all of your pens, or you can give away the entire pack. Or, you can also give individual pens to other people. And, it might be that someone can keep the pen and use it forever. Or, it might be that they are able to use the pen for a certain period of time and then you get the pen back from them. 

Content Ownership Provisions

The idea of pens and copyrights may seem a little silly, but it will make it a lot easier to understand the most common types of content ownership provisions. 

There are typically three important terms you need to know and understand in a content ownership provision. They are: work for hire, license, and assignment. Let’s review each of and then I’ll discuss specific examples of how these show up in contracts. 

Work for Hire

First, work for hire.  A work for hire is defined in the US Copyright act, which provides two categories for works for hire. 

1. First, a work prepared by an employee within the scope of their employment, or
2. Second, a work specially ordered or commissioned for certain types of uses, like a contribution to a collective work, a translation, compilation, or instructional text. 

Assignment

Next, let’s look at an assignment, which is the transfer of copyright rights from one owner to another. An assignment needs to be in writing, which is why this is incredibly important to understand for content ownership provisions since they are often included in agreements.

License

The last key term is a license. A license conveys permission to certain copyright rights to a third party. Back to my pen example. If I give someone my pink pen and say, here, you can use it, but here’s what you can do with it and when I need it back, that’s similar to a license. Someone can use my pen, but the rights are limited and I retain ownership of the pen.

In agreements, licenses are extremely common, so you need to know how to interpret them. 

Content Ownership Clauses

Now, let’s talk about how each of these key concepts shows up in content ownership clauses. 

If there is an original work being created and the agreement states that all content is created as a work for hire, that means that the non-creating party will own the content. 

A work for hire provision will typically state something like, “Creative agrees that all works of authorship created by Creative under the scope of this agreement shall be considered as works made for hire and Company will be considered the owner of all copyrights to such works.”

Rights can also be transferred to the non-creating party with an assignment. This may state something like, “Creative assigns all right, title, or interest in and to the works of authorship created under this agreement.” 

Assignments are very common in agreements with creatives; however, there may be additional requirements.

One thing to consider – an assignment may be conditional. It’s extremely common for a creative to include that the assignment is only effective upon clearance of the final payment. 

In this case, the agreement may state, “Upon clearance of final payment from Company, Creative assigns all right, title, or interest in and to the works of authorship created under this agreement.” 

An assignment may also be limited to certain content. For example, in a design agreement, it may be that only the final version is assigned, but any rejected drafts or iterations will still belong to the designer. This type of clause may state, “Creative assigns all right, title, or interest in and to all final approved versions of the works created under this agreement. Ownership in all rejected drafts and concepts is retained by Creative.” 

Now, let’s talk about licenses. As I mentioned before, these can get a little more complicated. Remember: a license is a permission for them to use a work of authorship in a certain way. 

A very basic license might state, “Creative grants company a license to display Creative’s work of authorship for a period of one year.” 

As I said, that’s a really simple example. The language can be a lot more complicated. Here’s a sample from an agreement that I recently reviewed for a legal client: 

“Creative shall retain all copyright rights to the content created for the Company. Company retains a royalty-free and non-exclusive license to use, reproduce, publish, distribute and display content created by Creative under this Agreement (in whole or in part) on the Company’s website or social media channels with attribution, such as a link back to Creative.” 

To understand the licensing language, it’s important to break it down into the various components that typically come up in this type of clause. Here are some areas you can consider:  

• First, how long does the license last? You can usually look for a specific duration or the word perpetual to determine how long the license will last. 
• Next, is it royalty-free during that period? 
  • Often, an agreement will include any licenses granted in the pricing, so it may not require payment of additional royalties. 
  • Some agreements will state that after a certain period has expired if the Company wants to continue the license, they may for a certain royalty payment. 
  • Depending on the agreement, this may include a new licensing agreement. 
• Next, is the license revocable or irrevocable? If it is revocable, this means that the Creative can revoke the license. Sometimes, the agreement may state that the license will be revoked in certain circumstances. 
• Next, is the license exclusive or non-exclusive? 
  • An exclusive license means that the license is granted only to the company. 
  • Non-exclusive means that the creative may grant a similar license to someone else. 
• Next, what rights are covered by the license? 
  • What can the license holder do? Are they able to display the content? Can they sell it? You only want to grant the rights that are necessary. 
  • Back to the pens for a second. If you are a photographer who is creating brand photography for a website and you only want them to have the right to display, you are giving them just that right. Just give them the one pen and make it specific to how it can be used. Make sure you state that the other rights (or, in my example, pens) are not included. 
• Next, are there restrictions on the license? 
  • An example of a common restriction comes from the influencer marketing world.
  • There, it may state that a company may display the influencer’s photos on their website or social media channels only. There could be additional fees for print ads. 
• And finally, is attribution required? In other words, do you need to give notice of the owner’s copyright, such as a link (if it is online) or a fine print listing of their name, like a photographer credit in print. 

Once you have all of those details, it should be clear (although perhaps slightly muddied by the potential amount of legalese involved) as to what can be done with the content. If it isn’t clear, be sure to clarify. 

When it comes to licenses, most creatives want to retain as much of the ownership rights as possible, so this may be an area that involves negotiation. Or, if you are a hiring company and you want more rights or a full assignment of the copyright, it may increase the price estimates. 

Action Steps

This wraps up our discussion on content ownership clauses. Now, let’s review today’s action steps. 

1. If you’re a creative, how are you addressing content ownership in your client agreements? Do you need to make any adjustments or to clarify any terms? 
2. If you are a hiring company, are you carefully reading the content ownership provisions so you can determine your rights to use any content created under the agreement? 
3. Are you tracking expiration dates on licenses to ensure that the content is not used outside the agreed upon parameters? An easy way to do this may be a spreadsheet that tracks all applicable dates and approved uses. 
4. If licenses are a regular part of your business, make sure you are tracking what rights are licensed and any other important details, which helps in the event of a potential dispute down the road. 

Thanks for joining me for today’s discussion on content ownership. In the next episode, we’re continuing the contract series with an overview of non-compete and non-solicitation clauses. 

I’d love to connect with you outside of the show. Visit Businessese at businessese.com. To find show notes for today’s episode, visit businessese.com/podcast.

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