I financed it so it's my copyright--well, not really

Kat friend Aaron Wood has provided an edifying summary of a recent case from the UK Intellectual Property Enterprise Court, Henry Hadaway Organisation v Pickwick Group Limited and Ors [2015] EWHC 3407 (IPEC),

concerning the vexing question that copyright practitioners know all too well: Who is the owner of the copyright in a recording where one party finances and the other is the creative/organiser? Here’s what Aaron writes:

“Mr Lorenz, a well-known musical producer, had entered into an agreement with a company called Pickwick (called Pickwick 1 in the case and not the same Pickwick as the defendant), which resulted in the making of recordings in various shows called The Shows Collection. The claimant’s position was that it was the exclusive licensee of various recordings from GLPL, the company through which Mr Lorenz operated before his death, and was the owner of copyright in the remainder of the relevant recordings by virtue of an assignment from the same.

It alleged that the defendant company Pickwick (called Pickwick 2 throughout the case to distinguish it from the earlier company) had infringed the copyright by copying, issuing copies to the public and communicating to the public the Recordings and adaptations of those recordings. Pickwick 2 acknowledged infringement if HHO made out its case on ownership and licence, but alleged that Pickwick 1 had been the owner of the rights from creation and never assigned the rights to GLPL. Accordingly, either HHO could not have acquired rights under the agreements with GLPL, or alternatively, GLPL was owner but it had not assigned rights, with the result that HHO could not enforce the licence since GLPL had given consent to the Pickwick 2’s issued recordings.

A major element of Pickwick 2’s case was that it was recognised in the CD liners as the copyright owner, invoking Section 105 of the Copyright, Designs and Patents Act 1988 (CDPA. Section 9(1) CDPA provides that the author is the first owner of copyright. Since these were sound recordings, the author is taken to be the producer. The case on ownership therefore required the Court to consider the meaning of Section 178 which defines producer as "the person by whom the arrangements necessary for the making of the sound recording… are undertaken".

Deputy Judge Clarke reviewed a number of precedents, and concluded that, while Pickwick 1 commissioned and financed the works, Lorenz/ GLPL was the person who undertook the arrangements necessary for the making of the sound recording. Given that it seemed likely that Lorenz would have produced the work with someone else if Pickwick 1 had not been interested, and given that Pickwick 1 did not otherwise have the means to create the recordings (being mainly a company which exploited others’ work), joint ownership was rejected. This was supported by the studio fees being paid by GLPL and the budget surplus being kept by GLPL as a producer fee.Pickwick 2 alleged that as a result of the claim in the CD’s it was to be assumed that it owned the copyright pursuant to Section 105 CDPA, and that HHO needed to demonstrate that on the balance of probabilities Pickwick 1 did not obtain the copyright some other way. Pickwick 2 said this was by way of the commissioning agreement from 1992, which was not available. As a result, the terms had to be determined on the basis of the evidence before the Court, and this pointed in HHO’s case that it was a mere exclusive licence. The Section 105 assumption was rebutted. As for consent, since this would have taken place after the date on which HHO acquired the bulk of the rights and it would have been in breach of the exclusive licences, the Court concluded that no defence of consent was available.

The case did not require the Court to consider any implied assignment of the rights to the benefit of the commissioner. Rather, the commissioner alleged a primary case of ownership, which was ultimately rejected. In rejecting the question of joint ownership, one sees traces of the idea/expression dichotomy influencing the result. Thus, whilst a party may feel that it has put substantial input into the work, if such efforts are merely of a commissioning nature, then it will not assist the party in asserting ownership.”