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Question 4:

Several of our upcoming witnesses refer in their written statements to the impact s. 1253 may have on freedom of speech. It is unclear to me whether the provisions of S. 1253 will impede the free flow of information by imposing additional constraints on employer, or whether it might actually promote speech by protecting the artist. How would you expect these first amendment concerns to play out against one another?

Answer:

It has been argued that the copyright law, in effect, implements

the First Amendment.

Copyright insures enterprises an economic return on

copyright material which is popular and in demand. Without copyright, copyright enterprises would likely go out of business, and First Amendment

expression would be reduced to the expressions of the wealthy who could

afford to distribute works at a loss.

The "for hire" policy that best implements the First Amendment is

the policy that produces the least litigation.

If members of the copyright

community are spending considerable sums litigating "for hire" issues, these

monies can not be used to produce more works.

The "for hire" policy that produces the least litigation is, in my

opinion, the policy whose governing principles are easiest to understand.

Complexity inevitably leads to misunderstanding and litigation.

As long as

parties involved in the exploitation of intellectual property understand the

governing principles, the proper steps will be taken to insure the necessary

rights are secured.

Moreover, the basic purpose of copyright law is to stimulate the

creation of new works for the enrichment of society. S. 1253 should tend to

encourage authors to create new works, and this diversity carries forward the purposes of the Copyright Clause and the First Amendment,

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Mr. Oman, with regard to moral rights provisions generally, the written testimony of one of our upcoming witnesses suggests that the introduction of moral rights into the American copyright system would impair the right of fair use. The fair use provisions of copyright law allow limited taking from a copyrighted work for purposes such as education. Appellate courts have held that fair use is a First Amendment right. However, it has been suggested that taking short quotations or excerpts of an artist's work, as permitted by fair use, would violate the moral rights of integrity and paternity. Would you expect the introduction of moral rights into our system to cripple fair use?

Answer:

In essence, both fair use and moral rights are rules of reason.

while the doctrines focus on different issues, it is extremely unlikely that

they would ever conflict, except possibly in the case of unpublished works.

The fair use doctrine establishes a rule of reason for third party

use.

Section 107 of the copyright law carefully delineates the criteria

governing fair use.

A third party user who clearly falls within the

criteria will have such a limited taking that a charge of a moral rights infraction will usually be unsustainable. For example, in connection with

the paternity right, what is the value of classroom study of an author who

is unidentified ?

Moral rights infractions generally involve major takings that

threaten the honor or reputation of the author.

The limiting takings that

are

identified in section 107 would not generally meet this threshold.

However, if the Congress concludes that there is any doubt on the point, it

could clarify that the moral right is subject to the fair use limitation.

The visual artists' rights bill, S. 1198, contains such a clarification.

RESPONSES TO SENATOR'S LEAHY'S QUESTIONS

RELATING TO THE HEARING ON S. 1253 -

WORK FOR HIRE

September 20, 1989

Question 1:

Senator Cochran's bill would revise the definition of employees under Section 101(1) of the 1976 Copyright Act so that it reaches only "a formal, salaried employee" and would discard the agency test adopted by the United States Supreme Court in Community for Creative Non-Violence v. Reid. You have testified in favor of the "formal, salaried employee" test established by S. 1253. Why is that standard preferable to the Supreme Court's standard?

Answer:

I favor the formal, salaried employee standard because it is

simple, predictable and fair. Moreover, its clarity should discourage

litigation, and promote order and certainty in business relations.

Since,

in this context, the only real difference between authorship and ownership

status is the possibility for reclaiming the copyright after 35 years under

the termination provisions of the Act, this interpretation does no harm to

the commissioning party. A transfer of all rights under the copyright gives

an

owner sufficient exploitation rights during the ordinary commercial

lifespan of copyright works.

This legislative solution promises to provide

an equitable, common sense clarification in a previously obfuscated area of

the law.

Question 2:

S. 1253 also requires that work for hire agreements under Section 101(2) must be signed prior to commencement of the work. How will it be determined when work on a project begins? If a contributor, intrigued by a commissioning party's idea, commences sketches or notes for a project before an agreement is reached, when does the project begin?

Answer:

Certainty in the law will give the parties an opportunity to anticipate this issue. The commissioning party could obtain a preliminary agreement from the contributor which could address whether or not any

substantial preliminary work exists.

If such work exists, the agreement

would assign appropriate rights to the commissioning party.

If no prelimi

nary work has been done, the agreement would acknowledge this fact and then

make suitable provision to constitute the future work as a work made for

hire.

As a practical matter, I anticipate few instances when the time

work commences will be at issue, once the law is clarified.

Since the

question would only arise where there is a signed agreement and the creator

of the work seeks to defeat the contract, the common assumption would be

that the creator became dissatisfied with the agreement after the fact.

With ordinary parol evidence rules, and appropriate consideration of who has

control of circumstances surrounding commencement of work, the creator would

bear a substantial burden of proof to overturn an agreement.

Question 3:

What effect would the requirement that work-for-hire agreements be signed in advance have on time-sensitive industries, such as the news media, that would find it difficult to draw up agreements with one-time contributors during coverage of fast-breaking news stories?

Answer:

General agreements to transfer can always be drawn up in advance,

with further provisions specified in supplementary documents. High-tech

communication methods such as faxes and telexes belie the conclusion that

news organizations would not be able to transmit and receive signed

agreements through agents as easily as they can transmit the fast-breaking

news stories themselves.

Senator DECONCINI. The original act lists the nine categories. Have you given any thought to a need to expand those categories? We have had testimony here by computer lawyers and others saying that computer software should be added to the list, and that maybe other things should be added to the list. Have you ever given any consideration to that list, in and of itself, in the existing law? Or if we do something with Senator Cochran's list, expanding that list at this time?

Mr. OMAN. Mr. Chairman, we have not formally considered that possibility but we have discussed it informally within the office. Certainly, the copyright laws are always being updated to accommodate new technologies and new forms of expression, and certainly we would want to examine the implications of work made for hire and this provision of the law in regard to those new technologies, particularly in the computer software area.

Senator DECONCINI. Could I ask you to submit to us your analysis of that list and whether or not there should be any additions, or if you have any recommendations?

Mr. OMAN. We'd be happy to do that.

Senator DECONCINI. Thank you. I will submit the balance of my questions. Thank you very much.

Mr. OMAN. Thank you.

Senator DECONCINI. We will now go to the first panel: Mr. Richard Weisgrau, executive director, American Society of Magazine Photographers; Mr. Jay Maisel, a photographer from New York; Mr. Don Martin, a cartoonist, representing the Graphic Artists Guild; and Mr. Tom Clancy, an author.

Gentlemen, we have a busy schedule here. We want to hear from all of you, but we are going to ask that you summarize your statements in about 3 minutes, if you can. Your full statements will be included in the record.

We will start with you, Mr. Weisgrau. Please proceed. STATEMENT OF RICHARD WEISGRAU, EXECUTIVE DIRECTOR,

AMERICAN SOCIETY OF MAGAZINE PHOTOGRAPHERS, NEW YORK, NY

Mr. WEISGRAU. Thank you, Mr. Chairman. My name is Richard Weisgrau and I am the executive director of the American Society of Magazine Photographers, an organization of over 5,000 freelance photographers who produce the best in photography for publishers, advertising agencies, and corporate clients.

The Copyright Justice Coalition, of which ASMP is a part, consists of 50 organizations whose over 100,000 individual members comprise the vast majority of freelance creative talent in the United States. In addition to these remarks, I am submitting detailed documentation on the need for corrective legislation through personal statements drawn from creators' experience and through sample contracts showing the types of abusive practices perpetuated by those who commission freelancers.

Mr. Chairman, I have noticed, in reading the statements of many of the publishing associations, that they seem to be very, very concerned about moral rights. I want to make it clear that we are not here to address moral rights. We are here to speak about the exist

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