Effective Work For Hire Arrangements in Technology Agreements Require Attention to Detail

A recent case underscores the importance of paying attention to the conditions set forth in a technology services agreement, and how those may affect the notion of a “work made for hire” under the Copyright Act. Plaintiff web developer delivered a signed proposed contract to defendant customer on July 10, 2010. The proposed agreement contained the following provision:

To be valid, this agreement must be signed within 30 days of the date signed by [plaintiff], and be accompanied by an initial deposit.

The proposed agreement also provided that plaintiff was “producing this project as ‘works for hire’”.

Defendant did not sign the contract until seven months later, as negotiations on the scope of work continued. Plaintiff provided certain deliverables to defendant, but the relationship between the parties eventually broke down over payment disputes and whether plaintiff had met the development specifications.

Plaintiff sued defendant for copyright infringement because defendant continued to use the deliverables. Defendant countersued, claiming it actually owned the copyright in the deliverables pursuant to the agreement dated July 10. Plaintiff moved for summary judgment, arguing the July 10 agreement was never formed because defendant did not sign it within the required 30 day window.

The court agreed and granted plaintiff’s motion for summary judgment.

It found that plaintiff’s argument presented a threshold question of common law contract formation rather than copyright law. Viewed from the perspective of contract formation, the court observed, the July 10 agreement became a “dead letter” 30 days after plaintiff signed it, and defendant had not.

The fact the parties may have intended the deliverables to be works made for hire did not carry the day. The court held that “it does not matter what the parties intended, for Congress has rendered their intent non-determinative unless they expressed it in writing and signed it.” Under the Copyright Act, a “work made for hire” is one “specially ordered or commissioned ... if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire.”

In this case, under copyright law, ownership of the deliverables never vested in defendant because defendant did not meet the condition precedent in the July 10 agreement by signing it within 30 days.

Zenova Corp. v. Mobile Methodology, LLC, 2014 WL 415952 (E.D.N.Y. February 4, 2014)