Who Owns Your Content?

http://www.xbiz.com/articles/19639/fattorosi

Copyright is an extremely broad subject that could literally require an entire textbook to fully discuss and debate, but taking stock and questioning the very ownership of your content library is crucial.

Work-for-hire agreements and how they affect your business — whether you contract for or shoot adult content for any media — is a major first step toward defining what you own and securing your future as a producer and purveyor of adult content.

Most studios, directors and cameramen truly believe that the person who pays for the content owns it. This is not necessarily true.

Works created as part of one’s job, referred to as “works for hire” are treated differently than those works created by independent authors and independent contractors. An employer is entitled to the fruits of his or her employees’ labor. Section 101 of the Copyright Act of 1976 defines a work made for hire as:

1) a work prepared by an employee within the scope of his or her employment; or a work specifically ordered or commissioned for use as a contribution to a collective work, as part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.

There are two ways to create a work made for hire. The first is through an employment relationship between the commissioning party and the creator of the work. For example, a studio hires a director-cameraman and editor and places that person on salary paid through a payroll by the studio with taxes being withheld and deducted from his or her pay. This is a typical employer-employee relationship, irrespective of the industry.

According to Section 201(b) of the Copyright Act: 1) [T]he employer or other person for whom the work was prepared is considered the author for purposes of this title, and, unless the parties have expressly agreed otherwise in a written instrument signed by them, owns all of the rights comprised by the copyright.

From my experience, many studios hire directors, cameramen and editors as independent contractors and not payrolled employees. This can and will create a relationship that cannot be classified as an employer-employee, which then means that unless the studio has a signed work-for-hire agreement from all parties that had creative input into your scene or movie, they, not the studios, actually jointly own all the rights pertaining to that work. Further it should be noted that the director, cameraman and editor have merely granted the studio a nonexclusive license in the content, which can be rescinded and revoked at anytime by the joint copyright owners.

Independent Contractors
An independent contractor can be defined as a person who renders service in the course of an independent employment and who follows the employer’s desires only as to the results of the work, not as to the means whereby it is to be accomplished. Further, it is a common practice within the industry to claim that anyone on an adult production set is an independent contractor and not an employee. In an effort to save the studio on payroll taxes and the necessary workers compensation insurance, this is a common mistake that can have dire consequences when it comes to who owns the copyrights to the content that has been procured.

Without a work-for-hire agreement signed by the director-cameraman and editor, a studio will not own the content they have paid for. With every independent contractor agreement, a corresponding work for hire agreement must also be executed. Without a signed agreement, copyrights cannot be waived.

For years the debate as to whether a specific work was a “work made for hire” was a source of great confusion. However, in 1989 the U.S. Supreme Court resolved much of the confusion surrounding the issue of who was an “employee” and who was an “independent contractor.”

The court concluded that “common law agency principles” must be used to determine whether the work was prepared by an employee or an independent contractor. The court enumerated several factors in determining whether a hired party qualifies as an employee or is instead an independent contractor: (1) the hiring party’s right to control how the work was accomplished, (2) the skill required, (3) who provided the materials and tools, (4) where the work was performed, (5) length of relationship between the parties, (6) whether the hiring party could assign additional projects to the hired party, (7) extent of hired party’s discretion over when and how long to work, (8) method of payment, (9) who hired and paid assistants for the project, (10) whether the work was part of the hired party’s regular business, (11) whether the hiring party is in business, (12) did the hiring party pay employee benefits, and (13) the tax treatment of the hired party.

The Supreme Court also stated that these factors were not an exhaustive list. No single factor was determinative of whether a hired party would be considered an employee. The significance of this Supreme Court decision was its conclusion that the two prongs of the “work made for hire doctrine” were mutually exclusive. Furthermore this decision restricted the “work made for hire” doctrine under the first prong to “actual” employees while the second prong was held to be only applicable to independent contractors.

As an aside, it should be noted that the Copyright Act imposes two requirements to create a work-for-hire situation for specially commissioned works created by independent contractors that apply to the adult industry. The first relevant aspect is (1) a contribution to a collective work and (2) a part of a motion picture or other audiovisual work. Obviously these two do apply to the industry. Therefore, without a signed release that is unambiguous as to the agreement waiving copyright, the independent contractor retains all copyrights.

What does this mean for you? Well, if you are a director who owns his or her own production company and have shot content for numerous studios and have not signed a work-for-hire agreement, you may still own the copyrights to all that content and could revoke the studio’s rights to use, display and profit from your work.

A director who does not own his or her own production company but still has worked for several studios and has not signed a work-for- hire agreement, then you also still may own your work and have the studio’s rights rescinded accordingly. Further, you very well might be entitled to a share of the profits from the sale of your work.

Agreements Are Key
If you are a studio or a party that commissions adult content, use work-for-hire agreements liberally. If you have not used such an agreement in the past and have not paid those with creative input via a payroll with taxes deducted, you might not own the rights to the content that you are profiting from. Eventually, your studio may be forced to share those profits with the director-cameraman and editor and/or be forced to stop distributing the content in question.

Basically anyone who has creative input into the final product could have a copyright interest in it. Therefore, work-for-hire agreements should be invoked liberally when attempting to decide who to provide one of these contracts or forms to.

It is better to have too many potential independent contractors execute them rather than make a mistake as to who may or may not have creative input into your content.

More specifically, the following guidelines should be followed to help you obtain and retain copyright ownership of creative works that are intended to qualify as a “work made for hire.”

1. Have a written contract between you (the studio) and any independent contractors who may be “hired” (directors, photographers, videographers, editors etc.).

2. Have a written “work made for hire” agreement with all freelancers and independent contractors who create works that you want to qualify as a work made for hire.

Merely stating that this is a “work made for hire” agreement does not make it one; all the requirements of the independent contractor prong must be satisfied.

3. Make sure the written work-made-for-hire agreement is signed by both parties before the creation of the work.

4. Include an appropriate “assignment” clause in the work-made-for-hire agreement that will serve as a backup if the work does not qualify as a “work made for hire.”

It is strongly recommended that you contact an attorney familiar with copyright law and work-for-hire agreements to further discuss the issues raised by this article in regards to your business or rights.

This article is not exhaustive on this particular issue, and there may be conflicting laws and standards depending on what geographical region in which you operate your business.

Model Releases

http://www.xbiz.com/articles/18924/fattorosi

It is likely that all of you reading this article who are in the business of producing adult content or performing as talent, whether it’s for DVD distribution or for website and Internet broadcast, have had to draft or sign model-release contracts.

From my experience this simple contract often is overlooked by content producers and talent alike. This doesn’t mean that they are not used in the industry; instead I mean that many do not spend much time drafting them, or in the case of talent, reading them. Who likes to read contracts? The answer is no one, not even attorneys, unless we are getting paid to do so. I recently rented storage space in Chatsworth, Calif., and was presented with the standard lease to sign. Did I read it? Hell no. Why bother? But this is an article of “do as I say” and not “do as I do.”

The model release is the core contract of every adult content shoot. It’s what allows the right of publicity to be transferred from the model to the content producer. This allows the photographer or videographer, or whomever he assigns his rights to, the ability to publish that video or photograph for commercial, moneymaking purposes. Failure to secure a signed model release would make it extremely risky for any producer to use that model’s image for commercial purposes.

I would even go so far as to state that based on the recent criminal case involving Cameron Diaz and a forged model release, I would suggest that all producers secure not only a signed release but also a witnessed signed release. As with any contract, a witness will always help establish your evidence supporting the validity of the release in case litigation later occurs.

John Rutter’s Role
Diaz at 19 posed for some explicit topless photos for John Rutter, a well-known photographer at the time. Eleven years later and just prior to her ascent to stardom for her role in “Charlie’s Angels,” Rutter approached Diaz about purchasing the photographs from him for $3.5 million or he would sell them to other purchasers for a tendered offer of $5 million.

Apparently, Rutter attempted to portray Diaz as the “bad angel” and profit off her upcoming movie premiere. Rutter claimed to have a valid model release signed by Diaz at the time the pictures were taken. Although it appears that the original photo shoot was a content trade where Diaz was provided copies for her agreement to pose for the pictures, she obviously denied that she ever provided a signed release to Rutter to use the photos for commercial purposes and declined his offer to purchase them.

In order to prevent Rutter from selling photographs of her, Diaz filed a civil lawsuit. During the case, Rutter presented and offered into evidence a signed model release, which he claimed was executed by Diaz. The police executed a search warrant and seized evidence from Rutter’s studio and home. Rutter was then charged with theft, forgery and perjury (based on statements made by Rutter, under oath, that Diaz’s signature was not a forgery). Eventually the case moved to the trial phase and expert witnesses were called in to authenticate the signature. Long story short, Rutter was convicted and is currently serving a four-year prison sentence. His appeal has been denied based on his forgery of Diaz’s signature on the model release and his perjurious statements regarding their authenticity.

The moral of the story is get your releases witnessed, if at all possible, so that a performer can never make a claim that you actually forged his or her signature. And if you ever even consider forging a performer’s signature on a model release — don’t do it! Even if that performer calls you and says it’s OK to do so. While obviously Diaz’s clout helped get the matter investigated and prosecuted, do not believe for a moment that you as an adult content producer would be immune from the same prosecution.

On the other side, if you are a performer and believe that a content producer is using your photographs or videos without a release — whether you want to call the police and get them involved or not — you certainly will want to contact an attorney and have them send a cease-and-desist letter to the producer informing them that you are challenging their use of your images and requesting compensation for their past use. If they fail to respond, then your next option would be to institute legal action against the production company as well as anyone else using your images.

Taster’s Choice Case
OK, if that hasn’t convinced you, let’s talk about the Taster’s Choice case. So you have a signed release, you’ve paid the performer, everything is great — right? Not exactly. On Jan. 27, 2005, a California jury awarded $15.6 million to a former model whose picture was used without his permission on Taster’s Choice coffee product labels. Russell Christoff posed for a photo shoot in 1986 for $250 and signed a modeling contract stating that he would be paid an additional $2,000 if his image was used on products sold in Canada. While shopping in 2002, Christoff noticed his image on Taster’s Choice coffee jars.

Claiming that he was never paid the $2,000 prescribed in his original modeling contract, Christoff filed a lawsuit in February 2003 against Nestle USA, the makers of Taster’s Choice, under California Civil Code § 3344, California’s right of publicity statute, which bars, among other things, the unauthorized use of a person’s image for commercial purposes.

This is an important development for any company dealing with rights and clearances, and it serves as an important warning as to the substantial damages a defendant faces if the appropriate permission is not obtained.

Section 3344 of California Civil Code is violated when a person or company knowingly uses another’s name, voice, signature, photograph or likeness for purposes of advertising or selling without such person’s prior consent.

Misappropriation of likeness is a serious claim that can have substantial penalties if a plaintiff prevails on a Section 3344 claim. A plaintiff may be able to recover significant damages.

Punitive damages as well as attorneys fees are allowed under a California Civil Code § 3344 claim. However, the California statute also has an additional set of teeth. A plaintiff may also seek to recover the defendant’s profits from the misappropriation, much like claims in copyright and trademark violations.

Nestle offered $100,000 to settle, but Christoff demanded $8.5 million. Finally, a jury determined that Nestle should have paid Christoff $330,000 for the use of his likeness and that Christoff should receive damages equal to 5 percent of Nestle’s profits from Taster’s Choice sales from 1997 to 2003, or $15.3 million — quite a princely sum for having your photograph appear on a jar of coffee. Nestle should have taken his offer and settled the case.

The moral to this story is never use a performer’s photograph or video without a release signed by that performer, and make sure to pay them the correct compensation they are entitled to. Finally, do not exceed the rights granted to you by the performer in that model release. Failure to do so might mean, at least in California, loss of any and all profits you might have earned from the use of that photo or video. In other states, misappropriations of likeness and right to publicity are viable claims but may not have the same far-reaching ramifications as they do in California.

In conclusion, whether you are a producer of DVD or web-based content, it is vital that your model releases are legally sufficient to withstand the scrutiny of review by a civil judge or jury. Therefore, if you are using a model release that has not been drafted or reviewed by your attorney, you are risking potential litigation and loss of profits.

If you are a performer, there is a different set of issues to be concerned with. First, do not sign a release without reading each word carefully. I realize that more often than not, these releases are given to a performer at the time of the shoot, and they are simply asked to sign them without much chance to have anyone, especially an attorney, review it. Do not assume that the producer has your best interests at heart. Do not sign a release unless it notes the production date of the scene. This ensures that there are at least two distinct places on the release where a date is noted. This is important in the event someone tries to reuse a release later on down the road. Having the date in two places just makes it a little bit harder to forge.

One last thought: If a performer presents themselves at the set or scene and they are clearly intoxicated or under the influence of some type of substance, do not shoot them. It is quite possible that the model release will not be valid since the performer may not be able to legally consent to or fully understand the contract he or she has signed.