When creating new media works, such as films, television shows, and other entertainment productions, in addition to the “who is the owner of the work” question – which includes issues of joint authorship – a separate question that often arises is – what is the obligation to identify someone who contributed to the work with a specific title, such as producer, associate producer, executive producer, and so on?
In FOCAL POINT FILMS, LLC, v. ARJOT SANDHU, 2019 WL 7020209 (N.D. California. 12/20/2019) this issue was resolved in favor of a film documentarian in a dispute with a person who made some contributions to a film, and who claimed the right to be listed as a “producer” of the film.
The plaintiff, Focal Point, had the idea for and had been working on a documentary film about Betty Reid Soskin, “a 94-year old African American woman who entered the public spotlight when she became the oldest National Park Ranger serving in the United States.” The owner of Focal Point met the defendant Ms. Sandhu at a film workshop, and she asked to work on the documentary film project. She did work “as an extra camera operator during a handful of shoots, always under Gibel’s supervision and with the understanding that Sandhu would be compensated on partially deferred basis.” Focal Point offered Ms. Sandhu “associate producer” credit on the film, however after exchanging numerous drafts of agreements, over several years, the parties could not agree in writing. Allegedly Ms. Sandhu “snuck unauthorized co-director and co-editor credits for herself into a “pitch deck” for the film” – even after her services were terminated, and her assertion of title or co-ownership over the film was preventing Focal Point from obtaining financing to finish the film. Focal Point sued for a declaratory judgment that it was the sole owner of the Film.
The issue for the court was whether Ms. Sandhu owned any part of the film, and whether she was required to be listed as a Producer.
There is no universally accepted definition of “Producer” – it is an industry term of art that refers to “the person responsible for finding and launching a project; arranging financing financing; hiring writers, a director, and key members of the creative team; and overseeing all elements of pre-production, production and post-production, right up to release.” See https://www.masterclass.com/articles/what-does-a-hollywood-producer-do-responsibilities-of-a-film-producer-and-how-to-become-a-producer#what-is-a-producer. Or, in words of the Producers Guild of America “A Producer initiates, coordinates, supervises and controls, either on his/her own authority, or subject to the authority of an employer, all aspects of the motion-picture and/or television production process, including creative, financial, technological and administrative. A Producer is involved throughout all phases of production from inception to completion, including coordination, supervision and control of all other talents and crafts, subject to the provisions of their collective bargaining agreements and personal service contracts.” https://www.producersguild.org/page/faq
The legal issue
Looking at the issue of Producer credit, the court noted that under Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23 (2003) a person who claims ownership in a copyrighted work does not have a claim for false designation of origin (or any other unfair deceptive trade practice claim, in most cases) because “the phrase “origin of goods” “refers to the producer of the tangible goods that are offered for sale, and not to the author of any idea, concept or communication embodied in those goods.”” Id. at 37. The court also cited Sybersound Records, Inc. v. UAV Corp., 517 F.3d 1137, 1143 (9th Cir. 2008) in which the court rejected plaintiff’s claim that a karaoke company misrepresented it had proper synchronization licenses from the plaintiff – noting that “Construing the Lanham Act to cover misrepresentations about copyright licensing status as Sybersound urges would allow competitors engaged in the distribution of copyrightable materials to litigate the underlying copyright infringement”
The court, relying on the above cases, but also many others including Friedman v. Zimmer, No. 15 Civ. 502, 2015 WL 6164787 (C.D. Cal. July 10, 2015) (which held that a musician who claimed his work was included in a movie that represented only the music of Hans Zimmer was included, did not have a claim for failure to attribute him and his music in the credits) – found that Dastar and Sybersound barred Ms. Sandhu’s claims, including her claims that her reputation was being injured by failure to credit her role in the Film. The court also rejected similar state law claims.
Why a written agreement is important
If not obvious from the above case, it is important for film makers – really, any creators that will collaborate with others, to have an agreement *before* that collaboration commences. In this case the parties made significant efforts to put their agreement in writing, but the fact that they could not agree should have been a red flag to the documentarian that troubled waters were ahead. In these cases it is almost always best to terminate the relationship and find another collaborator who will sign a fair written agreement. At least this case helps to resolve one issue that comes up in those cases where a written agreement is not present – the collaborator will probably not have Lanham Act type claims for “credit” that would survive Dastar and its progeny, even under state law. That leaves just the issue of co-ownership – which in this case was not at issue on the motion.
We meet a lot of clients that fail to obtain a written agreement, or blindly sign the form provided by the developer – and when a dispute arises, only too late realize the problems created by that lack of diligence. This post addresses critical provisions in a website development agreement.
First, you want to make sure you will own the material and content created by the developer. Thus, you want a provision in the agreement (which must be in writing) that recognizes that the developer’s work for you is considered a “work made for hire” and you want a copyright and intellectual property assignment as well. These clauses ensure that, although the developer is not your employee, you are the owner of the website materials and intellectual property rights. You do not want to find that your website designer created something unique for you only to discover the same unique layout on another website. Many businesses are surprised to learn that in the absence of this statement in a written agreement, an independent contractor (in this case the website developer) typically is the owner of work they create, and the business at most would be a licensee of the material. This means you don’t own the work; rather, you only have permission to use it.
Second, you want to have a provision in the contract that states that the work on the website is the website developer’s original work and/or that the developer has the necessary permission/licenses from the owners to use the work on your site. For instance, the website developer may place photographs on your website – you want the developer to represent that the developer has the right to use those photographs on your website (i.e. either the developer took the photos or it has the permission to use them). If the developer uses photographs owned by a third party on your website without the third party’s permission, the third party could claim you are infringing on their copyright by displaying their work on your website without their permission, and would demand you cease use of the photos and may demand damages as well. Thus, have your website developer represent the work is original or that he has permissions to use all work on your website.
Third, make sure to have an indemnification provision in your agreement. This provision should provide that the developer will indemnify you in the event you incur damages or a loss due to a third party claim that you are infringing their intellectual property rights – where they claim the work on your website is actually their material. For example, a business thinks the graphics on its site are original, however, it receives a cease and desist letter from a third party alleging that its use of the works on its website without the third party’s authorization is copyright infringement and demands damages. Under Copyright Law, if the third party is the owner of a registered copyright in the work, the business as an unauthorized user could be subject to statutory damages ranging from $700 to $30,000 for unintentional infringement, and up to $150,000 for willful infringement. Thus, if material placed on your website by your developer is subject to a claim or legal action for infringement, you want your developer to indemnify you for these actions since you are relying on their knowledge, creativity and skill in developing and designing your website.
Finally, it is important that you make sure that the developer periodically delivers all source codes and native files to you, and that you control all passwords and access to critical website assets, such as the domain registration. You want to make sure that such files and access rights cannot be withheld in the event of a dispute. Thus, if a dispute arises, the developer’s sole remedy should be money damages. You should not be prevented from transferring the work done (to the point of a dispute) to a new developer, so you can finish your site, and deal with the dispute separately.
For more information, please contact Kim Grimsley.
In GMG Health Systems v. Amicas, Inc., 1st Cir April 10, 2012, the court had occasion to address a dispute between a software licensor / developer, and a licensee, in which more typical contractual language was in issue (for example, use of the term “go-live” and the phrase “substantially conform to Documentation” and typical warranty limitations).
GMG is a medical services provider – they typically have several systems to manage their billing, processing and other business functions. Here, GMG contracted with a third party (Amicas) for its software – which had to interoperate with software from an already existing vendor used by GMG. Like so many disputes, this one arose because of finger pointing between two vendors as to whose software was causing the error. As an added twist here, and something we have litigated on at least one occasion here – GMG had decided to leave Amicas and go with another vendor, and was desperately trying to find a way out of the long term agreement.
Normally in such disputes, the licensee (client) makes some effort to produce a viable claim of breach of the agreement by the licensor / software developer. In this case, however, GMG, which had not negotiated the agreement and signed a pre-printed form provided by the software company, produced a sole witness to fight the motion for summary judgment filed by the software developer. This witness had no IT or software training, was not a project manager, was not familiar with the function of either of the software systems at issue, and could not provide any details beyond that the “interface did not work.” GMG feebly tried to argue that the merger clause – a clause that states that all prior agreements including verbal understandings between the parties are “merged” into the agreement, did not apply because it had not negotiated the agreement. The court dismissed that argument without any discussion.
Without the ability to provide evidence of what the parties intended – the so called “seamless integration” with the other system – GMG was unable to overcome the warranty limitation in the agreement, which stated that Amicas did not promise that the software would work for GMG in its environment. Not surprisingly, GMG lost on all counts . . . and that loss was affirmed on appeal.
What is the moral of the story?
First, negotiate large scale enterprise resource planning agreements! Yes, the negotiation can be expensive, but far, far less than the litigation costs and potential damages. For example, in the GMG case, it was forced to pay an additional $700,000 for software it had abandoned, it was subject to an attorney fee award, it lost all kinds of time dedicating resources to fight the case, it had to pay its own lawyers, and it ended up taking 5 times as long to reach it s goal (of an integrated system).
Second, even if you do not want to hire a lawyer to negotiate, at least make sure that the party providing the service has stated clearly in the agreement, the deliverable, what it will do, and what you expect from the service. We have reviewed too many scenarios to count where a client has signed a pre-printed form that had NO promises or very light ones, like this agreement. If it is a critical result that software X must interoperate with software Y, state that in the agreement.
Third, consider the remedy. Many contractual negotiations can get hung up on the representations, warranties, disclaimers and so on – when they can be resolved by thinking in the opposite direction – assuming a performance representation is not met, what is the remedy? Remedies range from the “nuclear” option (total contract termination), to some form of “notice and cure” to a repair, re-perform remedy.
Fourth, consider the term of the agreement. In the GMG case, the parties amended their agreement and made it a longer term agreement. Many vendors will offer more significant fee discounts, or less escalation, if the term is longer. These can be attractive deals – but consider that as with GMG, you may desire to move away from that solution. So, my rule of thumb on this point is . . . the longer the fixed term of the contract, the more closely you must negotiate it – and the more you must pay attention to escape hatches and “relief valves” if something changes. Technology changes very fast – locking into a vendor for 5 years (as was done in GMG) is almost unheard of. A three year deal presents enough technology-change-risk to be the outer limit of most of these deals.
I could go on, but if you made it this far . . . well, thanks!
For more information, contact Mike Oliver.