Contract Accord 8: Copyrights
Accord Revision Date: October 2019
Page Updated: January 2020
©2020 University-Industry Demonstration Partnership (UIDP). Please refer to the copyright and disclosure statement for UIDP Contract Accords usage and rights.
OVERVIEW AND BACKGROUND
The purpose of this Contract Accord is to promote the practice of making clear differentiation between clauses governing copyrighted works (i.e., works of authorship) developed in performance of the projects supported by the sponsored research agreements (SRAs) from those governing patentable inventions¹ and other research results.² For the purpose of this Contract Accord, SRAs will include Sponsored Research Agreements, Material Transfer Agreements,³ and other types of sponsored collaborative agreements. While computer programs, i.e., software, are also protectable via copyright, there are related issues sufficiently different to warrant treatment under a separate Contract Accord.4 This distinction among types of results of an SRA, including those described as deliverables, should assist the parties in clarifying their rights and obligations and in mutually benefitting from copyrighted works created under the SRA.
Copyright can be a confusing area of law. As defined by federal statute,5 copyrightable works include any original works of authorship that are fixed in any tangible medium of expression,6 now known or later developed. The categories of works eligible for copyright protection include:7
- literary works, including aspects of software that can be fixed in any tangible medium of expression (examples of “medium of expression” are found at the end of this Contract Accord.);
- musical works, including any accompanying words;
- dramatic works, including any accompanying music;
- pantomimes and choreographic works;
- pictorial, graphic, and sculptural works;
- motion pictures and other audiovisual works;
- sound recordings; and
Ownership of copyright is different from ownership of the object in which the copyrighted work appears. For instance, owning a book does not give the owner any copyrights to the writing in the book; owning a website does not necessarily give the owner all of the copyrights in the works that are presented on said website.8 Copyright does not protect ideas, procedures, processes, systems, methods of operation, concepts, principles, or discoveries, regardless of the form in which they are described, explained, illustrated, or embodied in a copyrighted work.9
The initial owner of a copyright is the author. If the author is employed and the work is created within the scope of employment, the copyright is presumed to be owned by the author’s employer.10 A written agreement signed by both the employer and the employee will overcome this presumption.
Copyright is actually a bundle of rights. The owner of a copyright has the exclusive rights to:
- reproduce the work;
- make derivative works based on the work;
- distribute copies of the work to the public;
- perform the work publicly; and
- display the work publicly.11
The owner of the copyright may license each of these five rights either non-exclusively or exclusively and either individually or together.
COPYRIGHT VESTING AND REGISTRATION
Registration of a copyright with the U.S. Copyright Office is not necessary for copyright to vest.12 Copyright exists automatically as soon as a work is created and fixed in a tangible form. Note that tangible does not equate to physical, so works that are in an electronically readable format, e.g., on the web, in email, in electronic posts (blogs), in multi-media works, are fixed in a tangible form for copyright purposes and are protected by copyright.13
Some copyrighted works have more than one author. A joint work has more than one author, and the authors intended that their contributions be merged into inseparable or interdependent parts of a unitary whole.14 All authors of such a joint work own an undivided interest in the entire work without the need for any transfer of rights or obligation to the other owners to share income from the exercise of these rights. The intention to create a joint work does not need to be written, but it does help to establish expectations of the parties and their roles, particularly in collaborative projects.
Copyright law (non-statutory) requires that co-authors of a joint copyright account to the other owners for profits made from exercising the copyrights.15 Notably, co-owners can sue for infringement of the copyright in the joint work without permission and without the need to join the other co-owners as plaintiffs in the suit.16
Other works with more than one author are collective works or compilations in which data or a number of contributions are compiled or assembled into a collective whole.17 Authorship of a collective work may be either of the collective work as a whole, including revisions, editing, compilation, and putting the work into final form, or authorship of an individual part or contribution to the collective work.18
However, note that facts and data points cannot be copyrighted, as discussed under Databases below.
Issues of authorship should not be confused with ownership of copyright. Authorship is determined based on contribution to the work. Ownership follows authorship except in works for hire, as discussed below, or assignment of authorship per agreement between the author(s) and another party.
WORK FOR HIRE
Work for hire is an exception to the law that provides that the author of a work is the copyright owner. There are two basic exceptions that designate a work as a work for hire and, therefore, not owned by the authors(s). The first is when a work is prepared by an employee within the scope of his or her employment; the employer then becomes the presumed owner of the work.19 The second exception applies if the work is specially ordered or commissioned, falls within the nine categories enumerated in the statute,20 and there is a written agreement between the initial owner and the party wishing to claim ownership. All three conditions must exist for the second exception to take effect. If a work falls within one of these two exceptions, the employer or other person for whom the work was prepared is the author to be designated on copyright registration forms and the employer or other person for whom the work was prepared is the initial owner of the copyright. This work for hire exception stands unless there is a written agreement otherwise designating ownership that is signed by both the author and the person who commissioned the work.21
A derivative work is a work based on or derived from one or more already existing works.22 Although a derivative work must incorporate some or all of the work it is adapted from, the copyright in the derivative work only covers the newly authored material that is added. Derivative works are common but often not well understood or recognized. Some common examples of derivative works are:
- revisions of previously published books or articles;
- new editions, translations, abridgements, and condensations of previously existing works;
- revisions of websites; and
- new versions of computer programs.
Since the right to make a derivative work is one of the bundle of rights of the copyright owner, it is not permitted unless granted to the author of the derivative work, but it also can be expressly excluded from the bundle of copyrights the owner grants to another person or entity. The copyright in a derivative work covers only the additions, changes, or other new material appearing for the first time in the work. Protection does not extend to any preexisting material, such as previously published works, previously registered works, works in the public domain, or works owned by a third party.23
Copyright protection requires that a work must meet at least a minimum standard of originality. The U.S. Supreme Court confirmed that a work must have “some minimal degree of creativity.”24 So, listings of data points or mechanical assembly of preexisting material alone are not protectable under copyright law. However, some original aspects of the work (such as layout, design, format, style, or even the specific selection of data points) might be protectable. While copyright does not cover the raw data points, the value of databases may be in the time and effort it would take to reproduce or recompile it. The SRA should address the parties’ rights to use, publish, and distribute data and data compilations, including any issues related to confidentiality, privacy, and export control.
When someone uses a copyrighted work (or any of the bundle of copyrights) without permission from the owner, they may be subject to suit for copyright infringement. It should be noted here that the owner of a copyright can enforce the copyright regardless of whether they have registered the copyright (in the U.S., the registration is done through the U.S. Copyright Office), although the copyright statutes include many provisions describing the variations in damages and recovery available to the copyright owner in these cases.25 The intent of the alleged infringer and the degree of the unauthorized use are considered by a court in reviewing the infringement claims. The first question the trier of fact will likely ask is whether the work is covered by a valid copyright.
Fair use is a defense against a claim of copyright infringement that is more available to non-profit entities, like Universities, than for-profit entities. One of the factors considered by a court in determining whether use of copyrighted material is fair use is “the purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes.”26
It should be noted that while registration of a copyright is not necessary for the copyright to attach to a work, a court cannot award attorney’s fees or statutory damages unless the work in question is registered within three months after the first publication of the work.27
Plagiarism is often confused with copyright infringement, but the concepts are quite different. Plagiarism is a type of misrepresentation that involves taking credit for someone else’s work. It is an ethical violation and a breach of norms that require proper attribution of authorship. There is no statute that makes plagiarism illegal. However, plagiarism is considered one of the three examples of research misconduct as defined by the U.S. Department of Health and Human Services Office of Research Integrity28 and grounds for disciplinary action. Plagiarism is an offense against the authors of a work regardless of whether the work is covered by a valid copyright or the copyright is owned by someone other than the author, while infringement is an offense against the copyright owner but does not protect the authors if they are not the copyright owner.
Moral rights protect the personal rights of the author to be credited as the author and to prevent the integrity of the work from distortion. While these rights have been recognized around the world for decades, they have only recently been formally reviewed in the U.S. In a 2019 report, the U.S. Copyright Office identified (but did not legislatively protect)29 the two principles of attribution and integrity as well as the importance of the First Amendment, fair use, limited terms, and diversity among industry sectors and types of work as parts of the U.S. framework for moral rights.30
FOREIGN RIGHTS AND TREATIES
Copyright is recognized throughout the world under laws that are enacted in each country. Use of a copyrighted work is subject to the laws of the country in which the work is being used. Given that, “International copyright conventions and treaties have been developed to establish obligations for treaty member countries to adhere to, and implement in their national laws, thus providing more certainty and understanding about the levels of copyright protection in particular countries.”31 The U.S. Copyright Office lists the treaties that affect international copyright. The scope and purpose of the various treaties and agreements differ, but they help to simplify the procedures for registration and enforcement and should be consulted if international use, creation, or enforcement of a copyrighted work is anticipated.32
COPYRIGHT UNDER FEDERALLY FUNDED PROJECTS
Copyrighted works are not covered by the Bayh-Dole Act and related regulations that deal with subject inventions. However, the Federal Acquisition Regulation (FAR) and agency policies describe rights that are granted to the grantee or contractor as well as the rights obtained by the government in copyrighted works produced in performance of a covered project. Typically, these government clause or agency policies address at least the following points:
- rights in data;
- public access requirements;
- limited and restricted rights; and
- government purpose rights
If a Company is the prime contractor for a federally-funded project and expects to issue a subcontract to a University, there may be a need for exceptions from standard clauses in the prime contract to accommodate University intellectual property (IP) (including copyright), publication, and export control policies. The University should review the solicitation and inform the Company about required exceptions, if possible, at the time a proposal for federal funding is submitted. Some federal clauses affecting copyright and publication are particularly troublesome for Universities.33,34
Industry-sponsored research almost always results in some form of copyrighted work, such as reports, databases or compilations, software, manuscripts, articles, or presentations. A Company requires access to these copyrighted works for commercial purposes. The Company will describe their intended use and need to retain control of these works in conjunction with the development of the statement of work for a project as well as in negotiation of the IP terms in the SRA. The rights to exclusive use, distribute, make derivative works, and sublicense a copyrighted deliverable may be of particular importance for some projects.
Companies may require assignment of the copyright to specified deliverables, such as reports, in order to be able to freely exercise all of the rights bundled into the copyright. Companies may choose to brand or modify the works for their purposes.
Collaborative projects may result in works that are jointly authored, or the Company may reserve the right in an SRA to contribute as an author to a work that is intended for publication.
Companies may require that the University demonstrate or warrant that copyrighted deliverables are authored by the University and are original works or that the University has the authority and rights to provide copyrights to the Company. The Company may ask the University to warrant the originality of a work to limit the risk of later allegations of infringement. These provisions may extend to obligations to protect the Company through indemnification provisions.
Since copyrighted works are frequently updated, Companies may request notice of updates or access to them. The intention or responsibility to maintain databases should be discussed if it is important to the parties.
University policies implement the first exception under Work for Hire, above, by providing that ownership of copyrighted works authored by its employees belongs to the University. Copyright may be addressed as part of the University’s IP policy or through a separate policy. Some of these copyright policies exclude software, which is addressed separately in their IP policy. Many of these policies extend to works of students, particularly those who author works as a result of participation in a sponsored project.
Universities may exclude a category of copyrighted works, commonly called “scholarly works,” from their broad copyright assignment policy or may have a provision reassigning copyright in scholarly works to the authors. Scholarly works usually are defined to include at least course materials, published articles, books, and aesthetic works.35 These policies generally do not apply if the scholarly work is written in performance of or as a requirement of a sponsored project. Since publications based on work done under an SRA would not generally be deliverables under the SRA and would often be written after the period of the SRA, they may fall within the University’s policy exception on copyright ownership by the University. This is a frequently overlooked nuance of SRAs, i.e., the clause providing the Company with the right to review a publication based on results of an SRA is actually placing a requirement on the investigators involved in the research, even though they are not likely parties to the SRA.36
Universities generally do not implement quality or infringement control processes, such as secondary review of copyrighted works or certificates of originality, for any copyrighted works produced by faculty or staff. (Universities may review some types of student works, such as theses, for originality, although this type of work is not likely to be a deliverable under an SRA.) Because of this (and because of statutory constraints on some public Universities), Universities are reluctant to accept provisions in an SRA that require a warranty of the originality of a copyrighted work or any liability for infringement. Universities frequently add a disclaimer asserting that they make no representations or warranties regarding the originality of works or that deliverables, reports, or information provided to the Company under an SRA do not infringe any third-party rights.
Universities do not allow the use of their name or trademarks in ways that may imply endorsement of products or services and, thus, restrict the Company’s use of copyrighted works in publicity and advertising. University faculty require that Companies appropriately acknowledge and attribute the work the faculty does for them. There are commonly accepted standards of attribution and authorship in the academic community and in some specific disciplines.37
Faculty authors may be concerned about the erosion of their work through the creation of derivative works based on their work. For this reason, Universities may control the ability of Companies to modify a work in any way that changes the initial meaning without approval of the authors or without notice to the reader that the modified work may no longer represent the views or opinions of the original authors. These provisions are attempts to protect the integrity of academic publication and the moral rights of the authors.
Many Universities maintain archives of their faculty’s published works to preserve the work and make it available to the public. Consider, for example, the open access policy set by MIT: “Each Faculty member grants to the Massachusetts Institute of Technology nonexclusive permission to make available his or her scholarly articles and to exercise the copyright in those articles for the purpose of open dissemination.”38 These repositories are often voluntary, and many include requirements that the depositor have the necessary rights to allow the deposit to the University repository and the University’s distribution of the work to the public. The SRA would need to include a provision for the Company to restrict or delay deposit of works resulting from an SRA, if such a policy is in place as a condition of employment (or otherwise), and the Company requires it.
COPYRIGHT TERMS IN SRA GENERALLY
The inclusion of a clause in an SRA that distinguishes rights in resulting copyrighted works from other types of intellectual property and other research results is strongly recommended. Copyright terms in an SRA typically would include:
- Definition. A definition of copyrighted work that is covered by the terms of the SRA or other agreement. The definition may apply only to works by University employees but could include works jointly authored by personnel of both parties. The definition may also include limitations, such as exclusion of software or scholarly work Joint copyrights and software may be defined separately.
- Ownership. This provision should describe the ownership rights of the parties in the defined copyrighted works. Generally, the copyrights will be owned by the party whose employees authored the work or jointly owned if jointly
- Disclosure. If the copyrighted works are detailed as deliverables, there may not be any other copyrightable works that are covered or likely to be authored under the agreement that require disclosure to the Company. This provision may state the form and timing of a disclosure of a copyrighted work as well as the person to whom the work should be
- Grant of Non-Exclusive Rights. These provisions describe the rights the parties will obtain in the defined and disclosed copyrighted works. The provisions often include an outright grant of rights at least for the internal use of the Company. Some common variations on non-exclusive commercial rights granted by the University to the Company in SRAs include:
- At a minimum, University grants the Company the right to a non-exclusive royalty-free license (NERF) to use the copyrighted works authored by employees of the University in performance of the SRA within its own organization for commercial research and development.
- The NERF may be extended for broader commercial purposes, such as sale of products based on the copyrighted works, the right to make derivative works, or the right to use the work in the provision of commercial services or on corporate websites that are accessible outside the Company.
- A non-exclusive license of broad scope may also be granted by the University in exchange for consideration (e.g., royalty, fully paid fee, or other fee).
- NERFs are often granted for unlimited purposes with no further consideration beyond the research support if the copyrighted work is a research tool and otherwise precompetitive.
- The grant of the NERF may be subject to a confirmatory license.39
- Grant of Option to Obtain Exclusive Rights. These provisions give the Company the opportunity to obtain certain rights in copyrighted works that are not outright granted in the SRA. Generally, this provision includes a specified period of time during which the Company may elect to obtain exclusive rights in copyrighted works. Exclusive rights to the Company in University copyrighted works may include conditions or limitations such as payment of a royalty or fee and the obligation to indemnify the University for the Company’s use.
- Reservation of Rights. If the Company acquires exclusive rights in a University copyrighted work, the University typically retains the right to use the works for its own non-commercial research and educational purposes. These purposes may be described to include at least continued non-commercial research and education or deposit to the University’s public repository or the right to provide the work to other researchers outside the University.40 No commercial use by the University of exclusively licensed copyrighted works is anticipated under this provision. A provision reserving the federal government’s rights in any copyrighted works that is made at least in part using federal funds must be included if appropriate.
- Joint Copyrighted Works. The SRA should state the parties’ intentions to create jointly authored works, if applicable, and recognize that jointly authored works will be jointly owned or otherwise specify which party may acquire exclusive ownership and how that would happen. If a Company wishes to commercialize a joint copyrighted work exclusively, the Company typically is given an option to negotiate a license to the University’s undivided share of the jointly owned rights under terms similar to those described in point five above.
- Third-Party Rights and Sublicensing. For non-exclusive licenses, sublicensing of solely authored University works is not generally granted except to defined affiliates of the Company. For exclusive licenses, the right to sublicense is generally included in the rights available to the Company under the option clause or grant of rights clause. Affiliates of the Company as defined by the SRA have the same rights as the Company.
- Assignment of Copyright. Assignment of ownership by the University of its rights in copyrighted works, including assignment of the University’s ownership in joint copyrighted works, would be negotiated on a case-by-case basis highly dependent on unique circumstances of the project.
- Copyrights should be managed by clauses and provisions specific to their nature as distinct from clauses and provisions that manage patent rights or other forms of intellectual property or results.
- The SRA establishes the pathways for the Company to access copyrighted works and should include any limitations on the University’s continued access and use. Universities should be clear about any policy requirements to retain a minimum of non-commercial rights for academic and research purposes.
- University policies governing scholarly works may limit the ability of the University to grant rights in an SRA to copyright in such works or to assign or license them to the Company
- University policies require publication of work produced as part of a student master’s or doctoral thesis.
- Provisions regarding copyrights resulting from an SRA should address all five of the exclusive rights of the copyright owner.
- The University and the Company must clearly define rights to make and to use derivative works, if applicable.
- Deliverables to be created in performance of the Scope of Work (SOW), including the form of the work(s) that the parties desire, such as progress or final reports, specific type and format of deliverable, and whether rights are available in those works, should be addressed in the SRA.
- Universities and Companies have explicitly designated signature authorities. The University and the Company should be aware that administrators who negotiate copyright language in the SRA are often not the individuals authorized to transfer rights in copyrights that result from the SRA.41
- If the SOW of the SRA anticipates collaboration in creating a joint copyrighted work, there should be provisions in the SRA that address joint authorship and ownership of the work.
- Ownership of copyrighted works is a contractual determination, subject to the policies of the author’s respective employer, and, in some cases, other contractual commitments. Ownership of copyrighted works should not be confused with authorship.
- Typically, the types of works created under SRAs do not qualify as eligible for the “work for hire” designation as established by copyright law.
- The parties need to determine whether there are copyrighted works of either party or third parties to be used in the Such background copyrighted works will need to be handled differently than foreground copyrighted works. The parties should note how incorporation of an existing work into a work developed under an SRA affects the rights of the parties to use and to publish the new work.
- Title to the copyright of a work does not include title to the data or ideas described in the work. 42
This Accord does not address rights relating to software. See UIDP Contract Accord 16: Software.