David Rabinowitz

Partner

Contact Me

T(212) 554-7815

F(917) 206-4315

David Rabinowitz, Co-Chair of Moses & Singer's Litigation practice group, has been a partner with the firm since 1985.

Within a broad commercial litigation practice, David has focused in the substantive areas of financial industry litigation, including corporate trusts and letters of credit, trusts and estates, intellectual property, contracts and employment.

In the trusts and estates area, David has represented fiduciaries and beneficiaries in fiduciary accountings, will and trust construction and trust and estate administration. These have included representing large financial institutions in major Surrogate’s Court litigations including claims ranging up to $2 billion for mismanagement of trusts.  He has represented individuals and charitable institutions in disputes over dispositions from estates.  He has represented individuals in will contests, claims to restore allegedly alienated property to estates, and other claims against estates.  He has represented individuals as fiduciaries in claims of improper estate administration and claims to enforce dispositions under wills.

In the area of intellectual property, David has represented entertainment and media companies on matters concerning contracts and licenses, copyright, trademark and unfair competition, and right of publicity, defamation and related free speech issues.

David has represented both employers and employees in disputes concerning employment agreements, termination of employment and employment discrimination.

David represents clients in arbitrations and other alternative dispute resolution procedures as well as state and federal courts throughout the United States.

David has lectured and participated on panels before The Association of the Bar of the City of New York, the American Bar Association, the Practicing Law Institute, The Copyright Society of the U.S.A., the Licensing International Annual Convention and the Massachusetts Software Council. He has taught Copyright Law at Seton Hall Law School as an adjunct professor. He is a member and former trustee of The Copyright Society of the U.S.A. David has published articles which have appeared in Advertising Age, Entertainment Law Reporter, The Entertainment Publishing and the Arts Handbook, the Journal of The Copyright Society of the U.S.A. and Practical Lawyer. He has written a series of articles on Internet Law entitled "Web Site Story," which appeared in American Lawyer's Corporate Counsel magazine.

David is recognized as a New York Metro Superlawyer. He is an AV® Preeminent™ Rated lawyer and one of New York's Top Rated Lawyers in his field according to Martindale-Hubbell.

Presentations [View All]
  • Panelist, “Supersedeas LCs: An Explanation Through Dramatization.”  Letter of Credit Summit, October 2015
  • "Ethics for the Negotiating Lawyer," Practising Law Institute, January 2014
  • "Show Me the Money: The Essentials of Valuation of Copyrights in Transactions and Litigation" The Copyright Society of the U.S.A., New York Chapter, 2014
  • "Negotiation Ethics," The Copyright Society of the U.S.A., New York Chapter, 2012
  • "Negotiating...Ethically," Moses & Singer In-House Counsel CLE Program, 2012
  • "Ethics in Negotiations," WebCredenza Professional Education Broadcast Network Live Teleseminar, 2010
  • "Ethical Considerations In Licensing," Practising Law Institute, Advanced Licensing Agreements, 2007-2011
  • "Ethical Issues for the Entertainment Lawyer," The Association of the Bar of the City of New York, 2008
  • "Ethical Issues in Licensing," Practising Law Institute, Understanding the Intellectual Property License, 2008-2010
  • "Winning Ethics in Licensing," Licensing International, 2008
  • "Legal Bases for Civil Remedies-The Mid-Winter Meeting," The Copyright Society of the U.S.A., 2008
  • "The ‘Mid-Winter’ Meeting," The Copyright Society of the U.S.A., 2008
  • "Ethics for the Negotiating Lawyer," Practising Law Institute, Ethics in Context, 2008, 2010-2011
  • "Non-Traditional Fee Arrangements; Doing Business with Your Client," Current Ethical Issues for the Entertainment Lawyer in Music, Film, Television & Theater, New York City Bar, 2008
  • "Ethics for the Entertainment Lawyer," The Association of the Bar of the City of New York, 2008
  • "Non-Traditional Fee Arrangements and Doing Business with Clients," The Copyright Society of the U.S.A., 2007
  • "Ethical Considerations in International Patent Licenses," Practising Law Institute, 2006
  • "Know Your Boundaries! The Unauthorized Practice of Law," Practising Law Institute, 2005
  • Practising Law Institute's Eighth Annual Internet Law Institute, 2004
  • "Ethics for the IP Practitioner," The Association of the Bar of the City of New York, 2003
  • "Internet Law Institute," Practising Law Institute, 2003
  • Adjunct Professor, Copyright Law, Seton Hall Law School, 2001-2004
  • "Trademark Basics for Attorneys," The Association of the Bar of the City of New York, 2000-2003
  • "Get Wired 2000: Practicing Arts, Entertainment, Media & Sports Law in the Digital Age," The Association of the Bar of the City of New York, 2000
  • "Basic Ethics for the Negotiating Lawyer," The Copyright Society of the U.S.A., 2000, 2002
  • The Copyright Society of the U.S.A., 2000 Annual Meeting
  • "Internet Law," guest lecturer at Fordham University School of Law, 1998-2002
  • "Fair Use-Real, Virtual and Totally Virtual," Trademark Committee, The Association of the Bar of the City of New York, 1997
  • "Legal Issues in the Agency Business," American Association of Advertising Agencies, 1997
  • "Understanding The Intellectual Property License," Practising Law Institute, 1997-2001
  • "Look-Alikes and Sound-Alikes, the Legal Implications," American Corporate Counsel Association, 1996
  • "Dispute Resolution Provisions in Copyright Related Contracts," The Copyright Society of the U.S.A., 1994
  • Section of Patent, Trademark & Copyright, American Bar Association, Annual Meeting, 1993
  • "How to Handle Basic Copyright and Trademark Problems," Practising Law Institute, 1990
Publications
  • "Antitrust Law in the United States," co-authored, Anglo-American Legal Language 3, February 2016
Professional Affiliations
  • New York Super Lawyers
  • New York State Bar Association
  • Member, Former Trustee and Co-Chairman of the 1999 Annual Meeting, The Copyright Society of the U.S.A.
  • The Association of the Bar of the City of New York
Law School Activities/Honors
  • Harlan Fiske Stone Scholar

Related Events View All

Related Articles View All

Blog Posts

August 26, 2013 - Clickthrough Terms of Use Effective to Transfer Copyright Of Posted Photographs

Copyrights in photographs posted by users of a real estate multiple listing website were effectively transferred under posted clickthrough terms of use. 

Metropolitan Regional Information Systems, Inc. (“MRIS”), a fee-based online real estate multiple listing service, offered real estate brokers and agents the opportunity to post listings, including photographs, of available properties.  MRIS’s terms of use, to which brokers and agents had to click assent in order to post properties, provided: 

All images submitted to the MRIS Service become the exclusive property of [MRIS]. By submitting an image, you hereby irrevocably assign (and agree to assign) to MRIS, free and clear of any restrictions or encumbrances, all of your rights, title and interest in and to the image submitted. This assignment includes, without limitation, all worldwide copyrights in and to the image, and the right to sue for past and future infringements.

 A competing multiple listing service, American Home Realty Network, Inc. (“American Home”), copied the photographs from the MRIS site and made them directly available to consumers on American Home’s real estate referral website. 

 MRIS sued American Home for copyright infringement and sought a preliminary injunction.  American Home defended by asserting that MRIS’s clickthrough agreement did not satisfy section 204(a) of the Copyright Act, requiring a writing signed by the transferor for a valid transfer of copyright, and that MRIS therefore did not have standing to sue for copyright infringement. 

 The federal Court of Appeals for the Fourth Circuit held that the clickthrough assent to MRIS’s terms of use by the owners of the photographs satisfied the Copyright Act.  Relying on the federal E-Sign Act, which validates electronic signatures under certain circumstances, the Court held that the users’ clicked assents to the terms of use were effective.  The Court found only one previous case applying the E-Sign Act to validate an electronic signature under the Copyright Act; in that case, the electronic signature was contained in an email.

 The Court noted that it was not the users who claimed that the copyright transfers were ineffective, but a third party infringer, a situation where courts have been leery of the defense of ineffective transfer.  However, the result appears to be based firmly in the E-Sign Act and seems likely to be followed.

Metropolitan Regional Information Systems, Inc. v. American Home Realty Network, Inc., No. 12-2102 (4th Cir. 7/17/13)

  Please click here to view case document.

August 20, 2013 - Invention "Conceived" During Employment Awarded to Employer's Assignee

An idea for using ultrasound to treat hypertension belonged to the bankrupt company that employed the scientist that had the idea, and in turn to the company that purchased its assets, rather than to the scientist, under a recent decision by the Delaware Chancery Court.

The Court construed a clause in the company’s inventions assignment agreement with the scientist that gave all inventions “conceived” during employment to the company. The Court construed “conceive” broadly in its ordinary English sense and not as a term of art from patent law.

Because the scientist witnessed the results of an experiment exploring the idea during his employment and filed two provisional patent applications for inventions using the idea 30 days after his employment terminated, the Court concluded that the idea was conceived during employment. It held that the inventions, including the resulting patent applications, belonged to the former employer and the company that bought its assets.

It may be of interest that the scientist was the CEO of the bankrupt company and that he formed a company to exploit the idea shortly after leaving the bankrupt company, although the Court did not enunciate a higher level of duty due to the scientist’s high position with the former employer.

RECOR MEDICAL, INC. v. WARNKING, CA #7387-VCN (Del. Ch. 5/31/13).

Please click here to view link.

August 6, 2013 - Non-Class Action Arbitration Compelled in Consumer Antitrust Case Based on Click Wrap Agreement

Users of online travel services must individually arbitrate, in the travel service’s home county, their claims that online travel services conspired with hotels to fix hotel room prices. The Federal District Court in Dallas enforced Travelocity’s clickwrap agreement containing the arbitration clause.

Plaintiffs contended that the arbitration clause was unenforceable because the litigation costs, including experts necessary to prove the antitrust violations, would make it prohibitively expensive to vindicate their rights.

The Court noted that Travelocity agreed to pay all costs of the arbitrator, including any proof or witnesses required by the arbitrator. The Court held that costs of “advocating the case” would not be considered in determining whether the arbitration clause made it prohibitively expensive for plaintiffs to vindicate their rights.

In re: ONLINE TRAVEL COMPANY (OTC) HOTEL BOOKING ANTITRUST LITIGATION, 12-cv-3515 (N.D. Tex. June 14, 2013). Please click here to view case document.

June 20, 2013 - Work Made For Hire Agreement Cannot Be Retroactive

Having independent contractors agree that a copyrightable work is a work made for hire can, under certain circumstances, allow employers to capture the entire term of the copyright. If a work is not a work made for hire, even if the full copyright is assigned to the employer, the individual creators or their successors can recover the copyright after 35 years. However, work made for hire agreements cannot be retroactive. A work that is not work made for hire when it is created cannot thereafter be made into work made for hire by a subsequent  agreement.

This rule was reaffirmed in the recent case of Gary Friedrich Enterprises v. Marvel Characters.

Gary Friedrich created the cartoon character Ghost Rider in 1971. Friedrich was a free-lancer when he created the character. Ghost Rider was picked up by Marvel Comics in 1972 and became a huge success.

In 1978, in response to the then-new Copyright Act of 1976, Marvel had Friedrich sign an agreement stating that all of Friedrich’s work for Marvel was work-made-for-hire. The agreement also assigned to Marvel all rights in any work governed by the agreement “forever.” The copyright in the original Ghost Rider character entered its renewal term in 2001. In 2007, Friedrich sued Marvel, claiming that the renewal term of the copyright belonged to him and that Marvel’s continued use of the character infringed Friedrich’s copyright.

The Federal District Court in Manhattan granted judgment to Marvel, holding that the assignment of all rights “forever” gave Marvel the renewal term of copyright. However, on June 11 the Court of Appeals reversed, holding that the agreement was ambiguous as to whether it applied to works created before it was signed.

Friedrich had cross-moved in the District Court for a judgment that he was the author of Ghost Rider (or at least a joint author). This raised the issue of whether Ghost Rider was a “work made for hire.” If it was, Marvel was the author in the eyes of the law and owned the renewal term of copyright. On appeal, Friedrich urged the Court of Appeals to hold that Ghost Rider
was not a work made for hire.

In response, Marvel relied on the part of the 1978 agreement, which allegedly created a work made for hire relationship. However, following established precedent, the Court of Appeals held the work-made-for-hire part of the 1978 agreement ineffective as to works created before the agreement was signed, including Ghost Rider. The Court of Appeals said that copyrightable works were either works made for hire when created or not, and subsequent agreements could not change their status. Nevertheless, the Court of Appeals remanded the case to the District Court for further fact finding because it was not clear from the record whether Ghost Rider was a work-made-for-hire when it was created.

 

Work Made for Hire Under Current Law
The work made for hire issue in the Friedrich case arose under the copyright law as it was before 1978. Nowadays, work-made-for-hire applies to two categories of work: Work by employees within the scope of their employment and work by non-employees, such as independent contractors or consultants, if there is a written agreement specifying that the work is work made for hire and if the work is one of nine different kinds listed in the Copyright Act. If a work is not a work made for hire, the greatest duration of copyright that employers can obtain is the first 35 years of the term of copyright. The rights assigned to the employer can be terminated thereafter by the author or the author’s statutory successors, and no agreement waiving that termination right in advance is enforceable.

 

 

Best Practices:
1. If you engage someone to create what will be a copyrightable work, make sure that there is a written agreement before the work begins specifying that the work will be work-made-for-hire.

 

2. Because even a written agreement specifying work-made-for-hire is not effective if the creator is not your employee and if the work to be done does not fall within the nine statutory categories, include a back-up clause assigning all rights to you in any event. This will assure your ownership of the rights at least for the 35 years provided by statute.

 

April 12, 2013 - Cases That Caught My Eye

Avazpour Networking Services v. Falconstar Software, CV 12-3574 (E.D.N.Y. March 11, 2013).

Software services vendor allegedly mishandled upgrade of storage area network, causing loss of data and corruption of files.  On motion to dismiss by vendor, applying New York law, all claims other than breach of contract dismissed.  Held that there is no claim for professional malpractice by software services vendor and no claim for negligence or gross negligence in breach of contract duties, absent catastrophic harm or injury to the public interest.

It is likely that the non-contract claims were filed to avoid contract clauses excluding consequential damages limitation and exclusion of all warranties other than performance of services in a good and workmanlike manner.  The loss of data and corruption of files would likely fall into the category of consequential damages.

Biography

David Rabinowitz, Co-Chair of Moses & Singer's Litigation practice group, has been a partner with the firm since 1985.

Within a broad commercial litigation practice, David has focused in the substantive areas of financial industry litigation, including corporate trusts and letters of credit, trusts and estates, intellectual property, contracts and employment.

In the trusts and estates area, David has represented fiduciaries and beneficiaries in fiduciary accountings, will and trust construction and trust and estate administration. These have included representing large financial institutions in major Surrogate’s Court litigations including claims ranging up to $2 billion for mismanagement of trusts.  He has represented individuals and charitable institutions in disputes over dispositions from estates.  He has represented individuals in will contests, claims to restore allegedly alienated property to estates, and other claims against estates.  He has represented individuals as fiduciaries in claims of improper estate administration and claims to enforce dispositions under wills.

In the area of intellectual property, David has represented entertainment and media companies on matters concerning contracts and licenses, copyright, trademark and unfair competition, and right of publicity, defamation and related free speech issues.

David has represented both employers and employees in disputes concerning employment agreements, termination of employment and employment discrimination.

David represents clients in arbitrations and other alternative dispute resolution procedures as well as state and federal courts throughout the United States.

David has lectured and participated on panels before The Association of the Bar of the City of New York, the American Bar Association, the Practicing Law Institute, The Copyright Society of the U.S.A., the Licensing International Annual Convention and the Massachusetts Software Council. He has taught Copyright Law at Seton Hall Law School as an adjunct professor. He is a member and former trustee of The Copyright Society of the U.S.A. David has published articles which have appeared in Advertising Age, Entertainment Law Reporter, The Entertainment Publishing and the Arts Handbook, the Journal of The Copyright Society of the U.S.A. and Practical Lawyer. He has written a series of articles on Internet Law entitled "Web Site Story," which appeared in American Lawyer's Corporate Counsel magazine.

David is recognized as a New York Metro Superlawyer. He is an AV® Preeminent™ Rated lawyer and one of New York's Top Rated Lawyers in his field according to Martindale-Hubbell.

Presentations [View All]
  • Panelist, “Supersedeas LCs: An Explanation Through Dramatization.”  Letter of Credit Summit, October 2015
  • "Ethics for the Negotiating Lawyer," Practising Law Institute, January 2014
  • "Show Me the Money: The Essentials of Valuation of Copyrights in Transactions and Litigation" The Copyright Society of the U.S.A., New York Chapter, 2014
  • "Negotiation Ethics," The Copyright Society of the U.S.A., New York Chapter, 2012
  • "Negotiating...Ethically," Moses & Singer In-House Counsel CLE Program, 2012
  • "Ethics in Negotiations," WebCredenza Professional Education Broadcast Network Live Teleseminar, 2010
  • "Ethical Considerations In Licensing," Practising Law Institute, Advanced Licensing Agreements, 2007-2011
  • "Ethical Issues for the Entertainment Lawyer," The Association of the Bar of the City of New York, 2008
  • "Ethical Issues in Licensing," Practising Law Institute, Understanding the Intellectual Property License, 2008-2010
  • "Winning Ethics in Licensing," Licensing International, 2008
  • "Legal Bases for Civil Remedies-The Mid-Winter Meeting," The Copyright Society of the U.S.A., 2008
  • "The ‘Mid-Winter’ Meeting," The Copyright Society of the U.S.A., 2008
  • "Ethics for the Negotiating Lawyer," Practising Law Institute, Ethics in Context, 2008, 2010-2011
  • "Non-Traditional Fee Arrangements; Doing Business with Your Client," Current Ethical Issues for the Entertainment Lawyer in Music, Film, Television & Theater, New York City Bar, 2008
  • "Ethics for the Entertainment Lawyer," The Association of the Bar of the City of New York, 2008
  • "Non-Traditional Fee Arrangements and Doing Business with Clients," The Copyright Society of the U.S.A., 2007
  • "Ethical Considerations in International Patent Licenses," Practising Law Institute, 2006
  • "Know Your Boundaries! The Unauthorized Practice of Law," Practising Law Institute, 2005
  • Practising Law Institute's Eighth Annual Internet Law Institute, 2004
  • "Ethics for the IP Practitioner," The Association of the Bar of the City of New York, 2003
  • "Internet Law Institute," Practising Law Institute, 2003
  • Adjunct Professor, Copyright Law, Seton Hall Law School, 2001-2004
  • "Trademark Basics for Attorneys," The Association of the Bar of the City of New York, 2000-2003
  • "Get Wired 2000: Practicing Arts, Entertainment, Media & Sports Law in the Digital Age," The Association of the Bar of the City of New York, 2000
  • "Basic Ethics for the Negotiating Lawyer," The Copyright Society of the U.S.A., 2000, 2002
  • The Copyright Society of the U.S.A., 2000 Annual Meeting
  • "Internet Law," guest lecturer at Fordham University School of Law, 1998-2002
  • "Fair Use-Real, Virtual and Totally Virtual," Trademark Committee, The Association of the Bar of the City of New York, 1997
  • "Legal Issues in the Agency Business," American Association of Advertising Agencies, 1997
  • "Understanding The Intellectual Property License," Practising Law Institute, 1997-2001
  • "Look-Alikes and Sound-Alikes, the Legal Implications," American Corporate Counsel Association, 1996
  • "Dispute Resolution Provisions in Copyright Related Contracts," The Copyright Society of the U.S.A., 1994
  • Section of Patent, Trademark & Copyright, American Bar Association, Annual Meeting, 1993
  • "How to Handle Basic Copyright and Trademark Problems," Practising Law Institute, 1990
Publications
  • "Antitrust Law in the United States," co-authored, Anglo-American Legal Language 3, February 2016
Professional Affiliations
  • New York Super Lawyers
  • New York State Bar Association
  • Member, Former Trustee and Co-Chairman of the 1999 Annual Meeting, The Copyright Society of the U.S.A.
  • The Association of the Bar of the City of New York
Law School Activities/Honors
  • Harlan Fiske Stone Scholar
Education
  • Columbia University School of Law (J.D.)
  • Massachusetts Institute of Technology (B.S.)
Bar/Court Admissions
  • U.S. Court of Appeals, Fourth Circuit
  • U.S. District Court, District of Colorado
  • U.S. Supreme Court
  • U.S. Court of Appeals, Second Circuit
  • U.S. District Court, Western District of New York
  • U.S. District Court, Northern District of New York
  • U.S. District Court, Southern District of New York
  • U.S. District Court, Eastern District of New York
  • New York
Related Articles
Blog Posts

August 26, 2013 - Clickthrough Terms of Use Effective to Transfer Copyright Of Posted Photographs

Copyrights in photographs posted by users of a real estate multiple listing website were effectively transferred under posted clickthrough terms of use. 

Metropolitan Regional Information Systems, Inc. (“MRIS”), a fee-based online real estate multiple listing service, offered real estate brokers and agents the opportunity to post listings, including photographs, of available properties.  MRIS’s terms of use, to which brokers and agents had to click assent in order to post properties, provided: 

All images submitted to the MRIS Service become the exclusive property of [MRIS]. By submitting an image, you hereby irrevocably assign (and agree to assign) to MRIS, free and clear of any restrictions or encumbrances, all of your rights, title and interest in and to the image submitted. This assignment includes, without limitation, all worldwide copyrights in and to the image, and the right to sue for past and future infringements.

 A competing multiple listing service, American Home Realty Network, Inc. (“American Home”), copied the photographs from the MRIS site and made them directly available to consumers on American Home’s real estate referral website. 

 MRIS sued American Home for copyright infringement and sought a preliminary injunction.  American Home defended by asserting that MRIS’s clickthrough agreement did not satisfy section 204(a) of the Copyright Act, requiring a writing signed by the transferor for a valid transfer of copyright, and that MRIS therefore did not have standing to sue for copyright infringement. 

 The federal Court of Appeals for the Fourth Circuit held that the clickthrough assent to MRIS’s terms of use by the owners of the photographs satisfied the Copyright Act.  Relying on the federal E-Sign Act, which validates electronic signatures under certain circumstances, the Court held that the users’ clicked assents to the terms of use were effective.  The Court found only one previous case applying the E-Sign Act to validate an electronic signature under the Copyright Act; in that case, the electronic signature was contained in an email.

 The Court noted that it was not the users who claimed that the copyright transfers were ineffective, but a third party infringer, a situation where courts have been leery of the defense of ineffective transfer.  However, the result appears to be based firmly in the E-Sign Act and seems likely to be followed.

Metropolitan Regional Information Systems, Inc. v. American Home Realty Network, Inc., No. 12-2102 (4th Cir. 7/17/13)

  Please click here to view case document.

August 20, 2013 - Invention "Conceived" During Employment Awarded to Employer's Assignee

An idea for using ultrasound to treat hypertension belonged to the bankrupt company that employed the scientist that had the idea, and in turn to the company that purchased its assets, rather than to the scientist, under a recent decision by the Delaware Chancery Court.

The Court construed a clause in the company’s inventions assignment agreement with the scientist that gave all inventions “conceived” during employment to the company. The Court construed “conceive” broadly in its ordinary English sense and not as a term of art from patent law.

Because the scientist witnessed the results of an experiment exploring the idea during his employment and filed two provisional patent applications for inventions using the idea 30 days after his employment terminated, the Court concluded that the idea was conceived during employment. It held that the inventions, including the resulting patent applications, belonged to the former employer and the company that bought its assets.

It may be of interest that the scientist was the CEO of the bankrupt company and that he formed a company to exploit the idea shortly after leaving the bankrupt company, although the Court did not enunciate a higher level of duty due to the scientist’s high position with the former employer.

RECOR MEDICAL, INC. v. WARNKING, CA #7387-VCN (Del. Ch. 5/31/13).

Please click here to view link.

August 6, 2013 - Non-Class Action Arbitration Compelled in Consumer Antitrust Case Based on Click Wrap Agreement

Users of online travel services must individually arbitrate, in the travel service’s home county, their claims that online travel services conspired with hotels to fix hotel room prices. The Federal District Court in Dallas enforced Travelocity’s clickwrap agreement containing the arbitration clause.

Plaintiffs contended that the arbitration clause was unenforceable because the litigation costs, including experts necessary to prove the antitrust violations, would make it prohibitively expensive to vindicate their rights.

The Court noted that Travelocity agreed to pay all costs of the arbitrator, including any proof or witnesses required by the arbitrator. The Court held that costs of “advocating the case” would not be considered in determining whether the arbitration clause made it prohibitively expensive for plaintiffs to vindicate their rights.

In re: ONLINE TRAVEL COMPANY (OTC) HOTEL BOOKING ANTITRUST LITIGATION, 12-cv-3515 (N.D. Tex. June 14, 2013). Please click here to view case document.

June 20, 2013 - Work Made For Hire Agreement Cannot Be Retroactive

Having independent contractors agree that a copyrightable work is a work made for hire can, under certain circumstances, allow employers to capture the entire term of the copyright. If a work is not a work made for hire, even if the full copyright is assigned to the employer, the individual creators or their successors can recover the copyright after 35 years. However, work made for hire agreements cannot be retroactive. A work that is not work made for hire when it is created cannot thereafter be made into work made for hire by a subsequent  agreement.

This rule was reaffirmed in the recent case of Gary Friedrich Enterprises v. Marvel Characters.

Gary Friedrich created the cartoon character Ghost Rider in 1971. Friedrich was a free-lancer when he created the character. Ghost Rider was picked up by Marvel Comics in 1972 and became a huge success.

In 1978, in response to the then-new Copyright Act of 1976, Marvel had Friedrich sign an agreement stating that all of Friedrich’s work for Marvel was work-made-for-hire. The agreement also assigned to Marvel all rights in any work governed by the agreement “forever.” The copyright in the original Ghost Rider character entered its renewal term in 2001. In 2007, Friedrich sued Marvel, claiming that the renewal term of the copyright belonged to him and that Marvel’s continued use of the character infringed Friedrich’s copyright.

The Federal District Court in Manhattan granted judgment to Marvel, holding that the assignment of all rights “forever” gave Marvel the renewal term of copyright. However, on June 11 the Court of Appeals reversed, holding that the agreement was ambiguous as to whether it applied to works created before it was signed.

Friedrich had cross-moved in the District Court for a judgment that he was the author of Ghost Rider (or at least a joint author). This raised the issue of whether Ghost Rider was a “work made for hire.” If it was, Marvel was the author in the eyes of the law and owned the renewal term of copyright. On appeal, Friedrich urged the Court of Appeals to hold that Ghost Rider
was not a work made for hire.

In response, Marvel relied on the part of the 1978 agreement, which allegedly created a work made for hire relationship. However, following established precedent, the Court of Appeals held the work-made-for-hire part of the 1978 agreement ineffective as to works created before the agreement was signed, including Ghost Rider. The Court of Appeals said that copyrightable works were either works made for hire when created or not, and subsequent agreements could not change their status. Nevertheless, the Court of Appeals remanded the case to the District Court for further fact finding because it was not clear from the record whether Ghost Rider was a work-made-for-hire when it was created.

 

Work Made for Hire Under Current Law
The work made for hire issue in the Friedrich case arose under the copyright law as it was before 1978. Nowadays, work-made-for-hire applies to two categories of work: Work by employees within the scope of their employment and work by non-employees, such as independent contractors or consultants, if there is a written agreement specifying that the work is work made for hire and if the work is one of nine different kinds listed in the Copyright Act. If a work is not a work made for hire, the greatest duration of copyright that employers can obtain is the first 35 years of the term of copyright. The rights assigned to the employer can be terminated thereafter by the author or the author’s statutory successors, and no agreement waiving that termination right in advance is enforceable.

 

 

Best Practices:
1. If you engage someone to create what will be a copyrightable work, make sure that there is a written agreement before the work begins specifying that the work will be work-made-for-hire.

 

2. Because even a written agreement specifying work-made-for-hire is not effective if the creator is not your employee and if the work to be done does not fall within the nine statutory categories, include a back-up clause assigning all rights to you in any event. This will assure your ownership of the rights at least for the 35 years provided by statute.

 

April 12, 2013 - Cases That Caught My Eye

Avazpour Networking Services v. Falconstar Software, CV 12-3574 (E.D.N.Y. March 11, 2013).

Software services vendor allegedly mishandled upgrade of storage area network, causing loss of data and corruption of files.  On motion to dismiss by vendor, applying New York law, all claims other than breach of contract dismissed.  Held that there is no claim for professional malpractice by software services vendor and no claim for negligence or gross negligence in breach of contract duties, absent catastrophic harm or injury to the public interest.

It is likely that the non-contract claims were filed to avoid contract clauses excluding consequential damages limitation and exclusion of all warranties other than performance of services in a good and workmanlike manner.  The loss of data and corruption of files would likely fall into the category of consequential damages.