The main concession which the book publishers sought to obtain in exchange for withholding their objections to the terms of the present bill on the subject of reversion, is the revised definition of "works made for hire," as set forth in the compromise joint memorandum of April 6, 1965. Now, Composers & Lyricists Guild of America, Inc., even though it had signed that joint memorandum and thereby agreed to the revised definition of "works made for hire" as set forth in that memorandum, seeks to upset the status of works made for hire, both under the existing law and under the bill, and as the Register says, "substitute the equivalent of the 'shop right' concept of the patent law." (Register's statement before this subcommittee on Sept. 2, p. 19) We agree with the Register in opposing the substitution. In this connection, the Register further stated in his testimony of September 2 (pp. 19-20): "The proposed 'work made for hire' provisions, which are based on this premise, represent a carefully worked out compromise whose effects are felt throughout the bill. The suggestions for changing them are put forward by authors who have already achieved some of the goals they are seeking in the bill by means of collective bargaining agreements, and on balance I believe that the arguments in favor of their suggestions are substantially outweighed by the practical difficulties they would present." As noted by the Motion Picture Association of America, Inc., in further reply, at pages 1012-1014 of the 1965 Hearings, in comments which apply equally well today to the pending Amendment: They "It was with great surprise that we noted the opposition expressed to the Register's compromise at the hearing before this Subcommittee No. 3 on May 28th last, by the Composers and Lyricists Guild of America, Inc. and the Screen Writers Guild, East. It appears that in the discussions and meetings under which this compromise was developed, they had reservations. now object to the very basis of the 56-year old concept of our present law concerning authorship in the employer in the case of works made for hire. What these Guilds for screen writers and screen composers have not been able to obtain over the years in their periodic collective bargaining negotiations with the motion picture producers, they now seek to obtain under statute. propose to take over from the patent system a sort of so-called 'shop right' whereby the employer or person for whom the work was prepared on special order or commission, would have only the They right to use the work for the specific purpose for which prepared. All other rights would be owned by the employee or person who prepared the work, as author. They do provide that the employee or preparer is not to make or authorize competitive use of his retained other rights (which itself would open up areas of conflict). They do permit the employer or commissioner of the work to continue to exploit the work (but without remake rights), despite recapture by the author under sections 203 and 304 (c), if the work prepared is a supplementary work, or a derivative work prepared on a pre-existing copyrighted work of the employer or commissioner. "While the word 'author' is avoided in the proposed amendment of the screen composers and writers for a substitute to section 201(b) of H.R. 4347, it is obvious that the employees or persons commissioned are to be deemed the authors, with recapture and other rights incident to authorship. It is conceded in the proposed amendment that the entire matter is subject to contract between the parties. That is precisely where it should remain--a matter of contract for their collective bargaining, as it now is. "Employees and persons commissioned to write for motion picture producers are a highly paid profession who do not assume any of the great financial risks of the producer, or guarantee any reimbursement if the film is a flop. The related rights in recordings, live stage and TV dramatizations, novelizations, sequels, etc. are factors which the producer takes into consideration in undertaking the great financial risk of the motion picture production, as well as factors going into its potential exploitation. Historically, screen composers have generally shared in performing society revenues; also in royalties from other sources if the music was published. Over years of collective bargaining, including that concluded only in recent weeks, screen writers and composers have secured by contract great inroads into the ownership of their contributions. Screen writers reserve, as to original materials written by them, live stage rights, novelization rights and additional payments for sequels. It would be different if the writer chose to be an independent contractor and to invest uncompensated time and effort in producing material for which he would thereafter take his chances in the market place by shopping for a possible purchaser. There is no question but that he should have the status of author in such cases. But where he seeks the safety of guaranteed high pay under an employment or commission, including the fruits of a long series of collective bargainings, and where the producer takes all risk, he should understand that the producer is entitled to the status and copyright effects of authorship." In the context of this Amendment, the comments of Angel & Tannenbaum, Works Made For Hire, supra, at 234 apply: In the motion picture industry today composers of soundtracks are often no longer on regular salaries, but are specially commissioned to compose music for a movie. It was considered that such independent contractors should be considered employees since their work is at the expense, direction, and supervision of the producer, who has to bring together many different people in order to complete his motion picture or other audiovisual package. THE 1965 COMPROMISE By 1965, the essential elements of the Copyright Act of 1976 had been worked out, other than the then cable/copyright, compulsory license/royalty problems, which took almost eleven years to resolve, and are now set forth in $111. of the Act. A comparison of the 1976 Act with the 1965 Bill will show that the legislative compromises of 1965 held together through 1976, when the Bill became Law. These compromises included the following key elements: First: A term of life plus 50 years for the author, with Second: Third: Fourth: Termination of transfers and Licenses, with rever- That, in the case of works made for hire, the employer or other person for whom the work is prepared, continues to be considered the author, and, unless the parties have expressly agreed otherwise in a written instrument signed by each of them, the "employer" owns all of the rights comprised in the copyright. $201.(b). That a work specially ordered or commissioned, for EMPLOYER OR OTHER PARTY AS AUTHOR UNDER $201.(b) Professor Melville B. Nimmer of U.C.L.A. Law School, in his recognized treatise on The Law of Copyright, states, in Volume 1, $1.06 [C], that: The employer is not thereby favored over the employee regardless of the intent of the parties. They may agree that the "rights comprised in the copyright" are effectively owned by the employee. The other legal consequences of authorship status, which are not subject to contrary agreement by the parties, do not favor the employer over the employee. They go rather to the copyrightability of the work, and to the term of protection. The same results could have been achieved even if the employee rather than the employer were deemed the "author." The fiction of the employer as author was employed for these purposes not in order to achieve substantive results that could not have been otherwise achieved, but rather because of the "convenience and simplicity" of this manner of achieving such results. 26 Professor Nimmer in turn cites at his note 26 the following statement of the law by the Register of Copyrights in his Supplementary Report, CLR Part 6 at 66: The 1961 Report recommended, in the case of a work made for hire, that the present rule vesting all rights initially in the employer be retained, but without identifying the employer as the "author." In the course of drafting, however, it became clear that there are great advantages of convenience and simplicity in assimilating employers to "authors" for all purposes. It was also pointed out that failure to identify the employer as "author" might have unintended consequences as, for example, with respect to the protection of motion pictures in foreign countries. Thus, since the advantages of making the employer an "author" for purposes of the statute outweigh any conceptual difficulties involved in doing so, subsection (b) of section 201 provides that, "[i]n the case of a work made for hire, the employer or other person for whom the work was prepared is considered the author for purposes of this title..." CONCLUSION I have not had the pleasure and opportunity, prior to preparing this Statement, of reading other prepared statements to be submitted to this Subcommittee, and hence request that the record be kept open for me to submit a Supplementary Statement within a reasonable time after my return to California. I now conclude this Statement with the following general observations. The Act was the result of a legislative process that began with the famous Copyright Office Studies of 1955-59, and culminated in 1976 in P.L. 94-553, the Copyright Act of 1976. If the supporters of the Amendment perceive any real problems, as indicated by the Honorable Senator from Mississippi's introductory statement when S. 2044 was introduced, and as may be indicated by other witnesses before this Subcommittee, it is my judgment that they are more appropriately the subject of contract negotiations between the parties, within the structure of the present Act, and do not indicate a legislative problem. It may also become appropriate, once the problems are aired before this Subcommittee, for all interested persons, upon reflection, to give further careful consideration to whether any new legislation is needed after less than five years of apparently successful experience with the Act. It is my opinion |