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David S. Poole: Don’t assume you own your Web site

It’s The Law

Posted: July 2, 2009 7:11 p.m.
Updated: July 3, 2009 4:55 a.m.
In an age where customers are beginning to rely on your Web site more than your telephone-book advertising to locate you, the value of your company's Web site as an asset has never been higher.

You probably assumed that when you hired XYZ Web Site Designer, Inc. to create that new Web site, the Web site belonged to you, lock, stock and barrel. Your assumption may be incorrect.

Although the law is certainly still not fully defined in this area, recent court decisions have held that the provisions of the federal Copyright Act will govern the issue of ownership of the copyright to Web site design.

As a general rule then, if your company's employee created the Web site, then your company, as the employer of the person whose job assignment was to create the protectable work, will own the copyright unless the employer and employee have entered into an explicit, written contract to the contrary.

However, if you've retained an outside company to do the work (a non-employee contractor), the copyright ownership will remain with the contractor even if possession of the contractor's work-product is with the company, unless the parties have contracted otherwise.

What does this mean for you? Basically, a company who retains an independent contractor to design a Web site and who wishes to retain all ownership of the Web site should enter into a "work for hire agreement" which explicitly grants ownership of the created copyrighted material to the company by virtue of an assignment from the creator.

There are, however, additional issues that can complicate the analysis of who owns a Web site when disputes arise. One of those issues is that a Web site is often a bundle of multiple property rights. For example, there are differences between the copyright in the design - the appearance of the Web site and the copyright in the content.

Uses of photos, colors, setup, hyperlinks, artwork and other elements that contribute to that design are often provided by the Web site designer and, assuming it was created by that designer and absent a work for hire agreement, would remain his or her property.

If, however, the client participates in making the underlying creative decisions, it can be argued that the copyright is owned jointly.

The United States copyright statute defines a joint work as: "a work prepared by two or more authors with the intention that their contributions be merged into inseparable or interdependent parts of a unitary whole."

If the respective contributions to the Web site are distinguishable, there may be separate copyright owners of each of those separate elements. In the joint contribution context, contributions must be "more than minimal" in order to qualify as a joint author.

To the extent that codes, design features, photos and other elements were downloaded from the Internet or otherwise obtained from the public domain, assuming that they themselves are free of copyright restrictions, neither the designer nor the company that retained the designer can claim a copyright in that which already exists within the public domain.

Of course, if the elements were created by someone else, you must obtain permission to use them on the Web site.

As to any text used on the Web sites, ownership of the copyright is generally with the author. However, it is not simply an issue of who wrote the text that appears on the Web site, it is also an issue as to the manner and style that the text is presented. So one may own the text but the designer may own the way the text is set up on the Web site.

The bottom line is that the question of copyright ownership as to each of those elements turns on who created them and under what circumstances.

As a general matter, the copyright owner has the exclusive right to copy, distribute or display the copyrighted work publicly. Obviously, when you have entered into an agreement to have your Web site created by an outside company, there is a license which entitles you to use the Web site that you paid to be created.

If you didn't contract to obtain ownership of the Web site from the outside company that you retained, then you may be limited from transferring ownership and use of that site to unrelated third parties.

Bottom line, if you hire any independent contractor to design or create all or any portion of your Web site, you should consider having a written agreement with that contractor that contains language by which the creator of the work assigns all of the creator's copyrights in the Web site to your company.

Some Web site designers may demand a higher price if ownership of the copyright is to be transferred to your company.

David S. Poole is a partner with Poole & Shaffery, LLP, a full service business, corporate and employment law firm. He can be reached at (661) 290-2991. His column represents his own views and not necessarily those of The Signal. "It's The Law" appears Fridays and rotates between members of the Santa Clarita Valley Bar Association. Nothing contained herein shall be or is intended to be construed as providing legal advice.


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