Last Thursday, a district court ruled against the estate of Jack Kirby in its attempt to reclaim the copyright on his creations. (Full opinion here).
If you’re a comic fan, you don’t need to be told who Jack Kirby (1917-1994) is. The artist was a key figure at Marvel during the Silver Age of Comic Books, helping create many iconic characters that are as popular today as they were over 40 years ago.
On September 16, 2009, Kirby’s heirs served Marvel Comics with termination notices for 45 Kirby comics published by Marvel between 1958 and 1963, including comics that introduced many iconic characters like Spider-man, the X-Men, Iron Man, the Mighty Thor, the Avengers, the Fantastic Four, and the Incredible Hulk.1 Marvel filed for declaratory relief on January 8, 2010, claiming that the comics were works made for hire, making the termination notices invalid. Kirby’s heirs counterclaimed.2
On cross motions for summary judgment, the Southern District Court of New York sided with Marvel, ruling that the Kirby works were works for hire under the Copyright Act of 1909. Kirby’s estate has announced that it intends to appeal this ruling.
Litigation like this inevitably can lead to strong reactions among comic fans. The District Court commendably begins its opinion by making an effort to separate the emotional aspects of this case from the pragmatic:
At the outset, it is important to state what this motion is not about. Contrary to recent press accounts and editorials, this case is not about whether Jack Kirby or Stan Lee is the real “creator” or Marvel characters, or whether Kirby (and other freelance artists who created culturally iconic comic book characters for Marvel and other publishers) were treated “fairly” by companies that grew rich off the fruit of their labor. It is about whether Kirby’s work qualifies as work-for-hire under the Copyright Act of 1909, as interpreted by the courts, notably the United States Court of Appeals for the Second Circuit. If it does, then Marvel owns the copyright in the Kirby Works, whether that is “fair” or not. If it does not, then the Kirby Heirs have a statutory right to take back those copyrights, no matter the impact on a recent corporate acquisition or on earnings from blockbuster movies made and yet to be made.
Work for Hire
Copyright protection initially vests with the author or creator of the work. The exception to this rule is when the work is a “work made for hire” — in that case, the employer or entity commissioning the work is considered the author under the law.
Whether a particular work is a work made for hire depends on which copyright act applies to it. Works made before January 1, 1978 are governed by the Copyright Act of 1909, works made after are governed by the Copyright Act of 1976. Sometimes courts have to look at both Acts in one case.3
This point is key since each Act has a different definition of what makes a work a work for hire.
The 1909 Act only mentions the doctrine once: “[i]n the interpretation and construction of this title … the word ‘author’ shall include an employer in the case of works made for hire.”4 The Act doesn’t define “employer” or “works made for hire” separately. Courts generally applied the work for hire doctrine only in cases involving a traditional employer/employee relationship until the mid-1960s.5
However, courts also recognized that work for hire can apply when a work is commissioned — the creator is an independent contractor rather than a traditional employee.6 In 1965, the 9th Circuit first expressed what became known as the “instance and expense” test for works made for hire:
[W]e believe that when one person engages another, whether as employee or as an independent contractor, to produce a work of an artistic nature, that in the absence of an express contractual reservation of the copyright in the artist, the presumption arises that the mutual intent of the parties is that the title to the copyright shall be in the person at whose instance and expense the work is done.7
The “instance and expense” test was adopted by other Circuits, most notably the 2nd Circuit, where a majority of copyright cases are litigated.8 Under this test, courts find a work made for hire when “the motivating factor in producing the work was the employer who induced the creation” and the employer has the right to “direct and supervise the manner in which the writer performs his work”.9
The work made for hire doctrine under the 1976 Act is more specific and limited. The Act defines a “work made for hire” as:
(1) a work prepared by an employee within the scope of his or her employment; or
(2) a work specially ordered or commissioned for use as a contribution to a collective work, as a 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…10
Based on this definition, the Supreme Court held that the “instance and expense” test doesn’t apply for works created under the 1976 Act, though it rejected the idea that the first definition only refers to “formal, salaried” employees.11 Instead, courts must look at common law rules of agency to determine whether a work was made within the scope of employment — these rules place the actual nature of the relationship between two parties above whatever language is used in written agreements between them.
Factors that a court might consider include “the skill required; the source of the instrumentalities and tools; the location of the work; the duration of the relationship between the parties; whether the hiring party has the right to assign additional projects to the hired party; the extent of the hired party’s discretion over when and how long to work; the method of payment; the hired party’s role in hiring and paying assistants; whether the work is part of the regular business of the hiring party; whether the hiring party is in business; the provision of employee benefits; and the tax treatment of the hired party.”
Whether a particular work is a work made for hire or not has numerous implications, but the doctrine is especially significant when it comes to the question of a creator’s termination rights, which is the issue at play here.
The 1909 Copyright Act provided for an initial copyright term of 28 years with an optional renewal period of 28 more years of protection. The idea behind this set-up was to give authors, who may have been in a weak bargaining position when their work was first created, a chance to renegotiate licenses if a work became valuable. However, in 1943, the Supreme Court held that there was nothing in the 1909 Act that prevented authors from assigning the right to copyright renewal in their initial assignment.12 The result of this ruling was that it became common practice for publishers to insist upon an assignment of the renewal period when an author initially assigned his rights, effectively erasing the purpose of having two copyright terms.13
When Congress set its sights on revising the Copyright Act, it took another look at this issue of new and emerging authors and creators signing away their rights because of their weak bargaining positions. This led to the creation of a termination right in the Copyright Act of 1976, gives an author the right to terminate any exclusive or nonexclusive license or transfer of copyright.14 The termination right is inalienable — any agreement that takes it away is invalid.
The termination right does not, however, apply to works made for hire. Under the law, the “author” of a work for hire is the person or company doing the hiring. Since the actual creator never had a copyright to transfer, it follows that there is nothing to terminate. It should not be surprising then that most challenges to copyright terminations will hinge upon whether the original work was a work for hire or not.
The Court Decision
The court found the evidence that Kirby’s works were made at Marvel’s instance “overwhelming” — it pointed to only one conclusion: “Kirby did not create the artwork … until [Stan] Lee told him to.” Kirby’s heirs argued that there wasn’t a written agreement between Kirby and Marvel, meaning Marvel lacked the legal right and to control his work, but the court pointed out that a contract need not be in writing. When it looked at the actual relationship of the parties, it concluded that it was “undisputed” that “Marvel did control and supervise all work that it published between 1958 and 1963.”
The expense prong is in Marvel’s favor as well, since it was Marvel, not Kirby, who bore the risk of the comic books’ failure. The fact that Kirby was paid a flat sum for each page he submitted also favored Marvel, since the Second Circuit views a flat sum payment for work sufficient to meet the expense prong of the test.15 This made Marvel the presumptive author of Kirby’s creations unless Kirby’s heirs could rebut this presumption with evidence to the contrary.
Unfortunately for the heirs, the court found the evidence they presented thoroughly unconvincing. One piece, a 1972 agreement that was the first written contract between Kirby and Marvel, even contained a clause stating that Kirby agreed the works were made for hire.
The heirs pointed out, however, that the contract included a provision assigning “any and all right, title and interest [Kirby] may have or control” to Marvel. They argued that this provision made no sense if Marvel already owned the copyrights on Kirby’s creations as works made for hire.
The court disagreed, citing to several other cases where similar provisions were not sufficient to rebut the work made for hire presumption. In many situations, provisions like these operate like “quit-claim” deeds in real estate; that is, they aren’t warranties or admissions that a party has any rights to transfer.
In total, the facts and evidence presented convinced the court that Kirby’s creations were works made for hire. Marvel was the statutory author under the 1909 Act, making the termination notices filed by Kirby’s heirs invalid. This conclusion is, I think, on solid legal ground and consistent with previous cases.
- Marvel is no stranger to this type of litigation — in 2003, it settled a similar suit with creator Joe Simon over rights to Captain America, and has faced challenges to various other characters, including an ongoing dispute with Gary Friedrich, creator of Ghost Rider; see also In re Marvel Entertainment Group, 254 BR 817 (D. Dela. 2000) which covered a dispute over various characters. [↩]
- This litigation spawned an earlier decision, Marvel Worldwide v. Kirby, 756 F.Supp. 2d 461 (SDNY Nov. 22, 2010), where the court dismissed several of Kirby’s counterclaims. [↩]
- For example, in Playboy v. Dumas, 53 F.3d 549 (2nd Cir. 1995), the works at issue were made between 1974 and 1984. [↩]
- 17 USC § 26 (1976) (repealed). [↩]
- Playboy at 554. [↩]
- Yardley v. Houghton Mifflin Co, 108 F.2d 28 (2d Cir 1939); Grant v. Kellogg Co, 58 F.Supp. 48 (SDNY 1944); Dielman v. White, 102 F. 892 (CCD Mass 1900). [↩]
- Lin-Brook Builders Hardware v. Gertler, 352 F.2d 298, 300. [↩]
- See Brattleboro Publishing Co v. Winmill Publishing, 369 F.2d 565, 567-68 (2d Cir 1966); Murray v. Gelderman, 563 F.2d 773, 775 (5th Cir 1977). [↩]
- Playboy at 554. [↩]
- 17 USC § 101. [↩]
- Community for Creative Non-Violence v. Reid, 490 US 730 (1989). [↩]
- Fred Fisher Music v. M. Witmark & Sons, 318 US 643. The court noted, “We are asked to recognize that authors are congenitally irresponsible, that frequently they are so sorely pressed for funds that they are willing to sell their work for a mere pittance, and therefore assignments made by them should not be upheld … We do not have such assured knowledge about authorship, and particularly about song writing, or the psychology of gifted writers and composers, as to justify us as judges in importing into Congressional legislation a denial to authors of the freedom to dispose of their property possessed by others. While authors may have habits making for intermittent want, they may have no less a spirit of independence which would resent treatment of them as wards under guardianship of the law.” [↩]
- Marvel Characters v. Simon, 310 F.3d 280, 284 (2nd Cir. 2002). [↩]
- 17 USC § 203. Works that were already in existence when the 1976 Act was passed also received a termination right, 17 USC § 304(c). [↩]
- Playboy at 555. [↩]