Clearing Rights-An Essential Step!

 

Joshua Kaufman, Esq. ©1998

 

 

When do you need permission to use trademarks, art, text, name, voices, music, likeness of an individual, product or an entity? What rights do you need and from whom do you acquire the rights? These questions can be often daunting and difficult ones to answer but are at the heart of any licensing transaction. It is imperative that you acquire the necessary rights and from the appropriate parties. While you want to clear all the necessary rights, you do not want to pay for rights that are in the public domain or to the wrong party.

For example, you want to publish a poster of three NFL players. You contact their respective agents, enter into strenuous negotiations, come to an expensive conclusion but you've secured the players permission to include them in your poster. You now want to begin publishing your poster...you have all the rights you need. Not by a long shot! 

You'll need to acquire consent from the three players' teams in order to use their trademarked team logos. Next you'll also need to get permission from NFL Properties due to their exclusive licensing arrangement with the league. And since this is a group of three or more, please don't forget to acquire the necessary approval from the Players Association. 

You find a movie poster that you want to reproduce. You contact the celebrity whose image is the key element of the poster and get permission from them. You got all your rights? Probably not. There's the studio that owns the rights to the movie, its title and the studio's trademark. Please don't forget ever important photographer who also has rights to the photos that make up the poster. On the other hand, it's very possible that if went to the studio, you would have found that they own all the rights in the photograph, poster, trademarks and the necessary publicity rights of the celebrity had been assigned to it as well.

Rights clearance if not done properly is a mine field and a recipe for disaster. However, it is a necessary exercise that must be under taken as part of every licensing deal. Often you will find that when people tell you that they have the rights to properties that they don't or that they only have partial rights or their rights may have expired or their rights might be in controversy. Due diligence must be undertaken. 

In order to secure the necessary permissions, one has to look at the bundle of rights that make up the package. These rights are comprised of copyrights, trademarks, trade dress and publicity rights. Very briefly, copyrights protect the actual imagery (photograph and/or art work), music, film, video and text. Trademark rights will cover the use of a logo, slogan, phrase or jingle. Trademark also covers issues of the appearance of an association or affiliation. Trade dress rights protect the overall style or "look and feel of a property. Finally, the right of publicity deals with the right to use the name, likeness, signature or other representation of a celebrity.

Copyright.

Copyrights vest in the creator(e.g. writer or artist) at the time of the creation of a work and last for the artist's life plus 50 years. Registration is not necessary but highly recommended as it provides important additional rights. If employees are working within the scope of their employment or an independent contractor is hired with a special written agreement (and then only in a very limited number of situations) their work is be considered to be works-for-hire. In such cases the employer not the creator is the copyright owner. A derivative work, which is a work derived from the original (e.g. most licensed products) can have its copyright owned by

the creator of the derivative work (Licensee) or in the name of the original artist (Licensor). If you find a licensed product and it has a copyright notice on it in the name of the Licensee most of the time they have only the rights to that product and would not be the person to grant you a license for other products. If a work was created before Marc 1, 1989, and was published (multiple copies were offered for sale) and it did not have a copyright notice on it (© Name 19xx), the work fell into the public domain and/or the artist and/or author of the work lost all rights to it and it's available for anyone to use.

To make the situation more complicated, if the artist or author was European and lost their copyright because it published without notice, under the new GATT Treaty, their copyrights have been restored. You should also know that the copyright period in most of Europe is life plus 70. If you have a work created by someone from Europe and the author died somewhere between 50 and 70 years ago, it may be in the public domain and useable by anyone in the United States, just don't try to sell a licensed product in Europe because the copyright will still be in effect and you will be violating the copyrights of the artist's heirs (the current copyright owners).

You have all seen works by old masters which are clearly in the public domain yet they have copyright notices on them. How is this possible? First, the copyright claim would be valid only to materials added to in the derivative work (licensed product) and not in the underlying work. Second, the photographer (or their employer) who took the photograph of the work from which the licensed product was created, may claim a copyright in the photograph. If there is restricted access to the work you may find that the only photograph available from which you can reproduce the work for your products have claims of copyright. If the claims are valid, to use the photograph without permission may violate the copyright in the photograph even though the underlying work is in the public domain (this issue is very much in dispute and in litigation). 

Trademark.

Trademark rights are acquired by putting logos, symbols, words, etc. on products which are in commerce in a manner which identifies them with the source of the product . A trademark can also identify a service (servicemark). Trademark law also prohibits the creation of a false belief as to an association, affiliation or sponsorship relationship between two parties when none exists. 

Trademark rights last as long as the mark is used as a trademark. There is a presumption that after two years of non use that a mark has been abandoned. If you find an old trademark that you think hasn't been used in many years and you start to use it believing it has been abandoned be aware that there are persuasive arguments that can be made by the owner of the dormant trademark to show that even though it has not been used it has not been abandoned (in the legal sense of the word) and they still own it.

A common question is what type of use of a trademark is prohibited? Is it any reproduction of a mark without a license illegal? While trademark owners would like you to believe so not all reproductions of a trademark require permission or a license The use must be a "trademark" use. For example, if a photographer takes a photograph of Times Square and then produces a poster, very good arguments can been made that the photographer does not need to acquire permission from each of the thousands of entities whose trademarks appear in the print. However, if the use of a trademark is dominant in the image and presented in a way that there is a likelihood that members of the public would think there is an association, affiliation or sponsorship with the print and the company whose trademark appears in it, a violation may have occurred. 

The test is whether there is "a likelihood of confusion by the public" as to the origin of the product or of an affiliation, association or sponsorship.

Trade Dress is an expanding area of trademark protection. It provides protection to the "look and feel" of a product or its packaging. The critical question becomes how closely can you imitate the design or style of a well-know product without crossing the line. There is no simple test or percentage of similar material or any objective standard. It is based on the perception of the public and the opinion of the judge. We have all seen scores of private labeled products which clearly resemble the name brand that they are imitating. Some of these products have crossed the line and have been successfully sued; other products have withstood challenge by the name brand manufacturer. If one embarks on producing a product without a license in "look and feel" that is similar to that of another, the closer the get, they higher the risk. 

Publicity Rights.

If you intend to use the name or likeness of a celebrity for commercial or advertising purposes, you need their permission. That said there have been many arguments and lawsuits over what entails a likeness and what is a commercial and advertising purpose. This is a rapidly changing area of the law and where the courts have generally although certainly not without exception, been granting broader rights to celebrities. 

Recently, Vana White successfully challenged an electronics company for using the image of a robot which was intended to mimic her character on Wheel of Fortune. Bette Midler broke ground a decade ago in obtaining protection for her distinctive voice. A well-known race driver was able to successfully prevent other from using pictures not of himself, but of his car, under the argument that his persona was so linked to the image of his car that when people saw his car, he came to mind. Therefore, any use of his car in advertisements or for commercial purpose violated his rights of publicity. 

On the other hand, the use of celebrities images in newspaper or magazine stories certainly can be done without their permission. But what of an advertisement for the magazine that uses the same picture that appeared in the article? The courts have held that the magazines can use the celebrity picture used in their advertisement as long as the picture used was part of the earlier article. Arguments has been made for a "fine art exemption" to the right of publicity with some limited success.

The right of publicity is not based on federal law like copyright or trademark and therefore lacks uniformity. Each state has its own laws and interpretations. Some recognize the right in a limited way; other recognize it broadly. 

Once a celebrity dies, you are confronted with a whole new set of problems. After death publicity rights are known as, "post-mortem rights". They are also governed by state law. Not all states have laws or cases dealing with post mortem rights. Most states recognize some form but not all. The leading exception is New York, which does not recognize such rights. The regulations and duration of post mortem rights vary greatly between the states. For example, California requires heirs to register, some states require as a precondition that the individual had exploited their rights before death. The duration varies from ten year to life plus 50 year limit (copyright model) to indefinitely (trademark model). 

So what is a potential licensee to do in order to make sure they are licensing all the rights they need from the appropriate people. The basic answer is go through the appropriate due diligence and secure rights from everyone that might possibly make a claim. However, that is easier said than done; oftentimes heirs are unavailable; corporations with possible rights have long ago gone out of business or merged and no one knows who holds what rights. The truth is that it is not uncommon for deals to die because of rights clearance problems. As license expect a warranty from its licensor and it is not always possible to give the necessary assurances. All you can do is investigate, use people knowledgeable in the field and pray for a simple and uncomplicated license trail.