work-for-hire contracts should own originals when parties using all rights contracts do not. Loss of the original is simply the loss of yet another source of future income for the creator. For this reason, we believe that the sale of an original should have to be embodied in a written agreement. We would therefore modify Section 202 to read: "nor, in the absence of a written agreement expressly conveying property rights in a material object, does transfer of ownership of a copyright or of any exclusive rights under a copyright or the entering into of an express agreement in a written instrument that a work shall be considered a work made for hire convey property rights in any material object." The states of California and Oregon have enacted legislation to require a written transfer of originals wher. creators are selling reproduction rights. C. WHO IS AN EMPLOYEE? Another constant problem is the question of who is an "employee" in clause (1) of the work-for-hire definition. Essentially, common law standards for distinguishing between an employee and an independent contractor must be used. This causes great uncertainty, since each case must be determined on its own facts. This issue is discussed in the recent case of Aitken, Hazen, Hoffman, Miller v. Empire Construction Company, 542 F. Supp. 252, 257-58 (U.S. District Court, Nebraska) in which an architect was found not to be an employee of a commissioning party. An employee who receives a salary knows that he or she is an employee. However, someone paid on a fee basis or in royalty form would not normally be aware that he or she might be an employee. For this reason, clause (2) of the work-for-hire definition requires a written contract if work is to be considered as done for hire. We believe that no third category of work for hire should be possible. That is, anyone other than a salaried employee should always have to sign a written instrument in order to do work for hire. Otherwise, the employer is essentially gaining the benefits of being an employer under the copyright law without fulfilling the obligations of being an employer under the social security, income tax and related laws. We would therefore change the clause (1) definition of work for hire as follows: "A 'work made for hire' is (1) a work prepared by a salaried employee within the scope of his or her employment..." D. WHICH CATEGORIES SHOULD BE STRICKEN? We are basing the categories to be stricken from the clause (2) definition of work for hire on the experience of our members, as documented in our original submission to the Committee. Thus, we would strike "as a contribution to a collective work", "or other audiovisual work", "as a supplementary work", and "as an instructional text". In each of these categories, the creator would be the author for copyright purposes. We would move the definitions of "supplementary work" and "instructional text" that appear in clause (2) into their appropriate places in the main body of definitions in Section 101 (so that "supplementary work" appears between "State" and "transfer of copyright ownership" and "instructional text" appears between "including" and "joint work"). As a matter of clarification, we would also want to limit the meaning of the term "atlas" by defining it in the definitional section as follows: "An 'atlas' is a bound collection of maps." Otherwise, atlas can have a broader meaning and might include a collection of pictorial representations of any subject such as an atlas of the parts of the human body. E. APPROACHING AN IDEAL SOLUTION Striking certain categories from the clause (2) definition can only be a first step, since neither creator nor publisher would be satisfied by such a result. The creator would simply face "all rights" contracts in every category which had previously been work for hire. At the same time, the publishers would face a 35-year termination right retained by creators that might interfere with exploitation of projects in which the publishers would reasonably expect to have a long-term interest because such projects were very expensive to nurture or involve input from many different sources (such as encyclopedias in the former case and some specialized textbooks in the latter). An ideal solution to this tension would be to have the creator retain all the rights which the publisher did not in fact use and also to insure that the creator is compensated for any uses by the publisher beyond those originally understood between the parties when they negotiated the consideration in their contract. This ideal solution can be approached from a variety of directions. First, it is significant to go back to the earlier part of the copyright revision process. In the 1964 Preliminary Draft for the revision of the copyright law, work for hire would not have included works prepared on commission. Moreover, under the termination provisions, any transfer except employee's work for hire would have been terminable within 25 years (or 20 years in the case of an unjust enrichment). The wisdom of the concerns reflected by these proposals is borne out by our experience since the inception of the new law. Another approach is to adopt certain presumptions as to what the parties intended, such as those already present in Section 201(c) with respect to contributions to collective works when no express transfer has been made. Such presumptions follow what might reasonably be implied to be the needs of the respective parties. It has been suggested that requiring the enumeration of all rights being acquired Iwith separate consideration for each right would be of benefit in cases in which small independent This could works are being acquired to be used in larger works. be joined with a principle of unconscionability much like that in the 1964 Preliminary Draft that might look to the size of the consideration in relation to the rights acquired in order to permit the reformation of certain contracts. Finally, the concept of limiting the commissioning party's exclusive license to reasonably contemplated uses at the time of entering into the agreement could also be manifested in a system which caused unexercised rights to either revert to the creator or become nonexclusive after a certain period of time. What was never contemplated was that publishers should be positioned to receive windfalls by the acquisition of rights that they did not contemplate using at the time payment for commissioned work was agreed upon. F. THE PROPOSED AMENDMENT Our approach fuses many of the foregoing concepts based on our experience with commissioned work for hire in the five years since the copyright law took effect. First, we would expand the presumptions of Section 201(c) to cover other situations in which a larger work is made from many different contributions. We would then impose certain restrictions and guidelines on what may be done in transactions regarding such contributions. Finally, we would add termination provisions to deal with certain needs of the publishers regarding these categories of commissioned works. Our version of Section 201(c) would read as follows: (c) Contributions to Collective Works, Contributions to Compilations, Supplementary Works, Instructional Texts, and Parts of Audiovisual Works.-- Copyright in each separate contribution to a collective work, each separate contribution to a compilation, in any supplementary work, To protect the needs of publishers whose works may last for longer than thirty-five years, Section 201(c) might continue: A transfer by an author in one of the categories covered hereunder shall not be terminable by the author pursuant to Section 203(a)(3) if a written contract signed by both parties prior to the commencement of work specifically enumerates certain rights which may not be so terminated. |