THE TRANSFER OF RIGHTS IN A WEB DESIGN CONTRACT

IVAN HOFFMAN, B.A., J.D.


When designer and site owner contract for web design services, there are essentially 3 forms of transfers that may take place in and to the creative copyright and other proprietary rights of the designer Which form, or combination of forms that the parties agree to depends upon the relative strength of the parties' bargaining positions. It certainly is very important that each side know their respective rights but in the end, all deal making is about who wants who more, who needs who more.

The 3 basic choices, all of which presume that the site owner and designer are not in an employer-employee relationship, are as follows:

  1. A work made for hire.
  2. A transfer of all the rights of the designer for all purposes.
  3. A partial transfer of the rights of the designer for the limited purposes of the web site.

A Work Made for Hire

A work made for hire under United States Copyright law is a formal relationship that must comply with all the requirements of the statute. (For more on these requirements, read "Work Made For Hire Agreements"). In this form of relationship, the site owner becomes the owner of all the rights in and to the creative contributions of the designer and the designer has only those limited rights granted to the designer in the contract. Indeed, if the agreement is in the form of a work made for hire, then the designer has no rights under the statute in her or his creativity at all since the site owner becomes the "author" for the purposes of the copyright law and in such a case, the only rights that the designer can have are those granted in the contract. Therefore, if the agreement is in this work made for hire format, it is very important to the designer that the designer's rights be spelled out carefully.

This form of relationship is often entered into when the "site owner" is actually a broker for the actual site owner. The broker has presumably signed up the owner and entered into an agreement with that owner to have the broker create the site. But the broker actually has the work done by third party designers, with or without the knowledge of the site owner. In such an instance, the broker does not want and likely will not allow the designer to have any sort of credit on the site and in such an instance the broker must obtain all rights from the designer so that the broker can pass those rights along to the site owner. For additional information on this situation, read "The Gap Trap".

A Transfer for All Purposes

This relationship is much like the work made for hire relationship. The designer grants to the site owner all the rights of the designer in the designer's creations for all purposes. This means that the site owner owns the rights to not only use the designer's work on the web site but in all other media as well. If the form of agreement does not fit into one of the statutory kinds required by the United States Copyright law for a work made for hire, the site owner can end up with essentially the same rights via this assignment of all rights. There are some differences between the two deals, differences that deal with rights of termination and "moral rights" among other issues, but the important point here is that the designer is still giving up all rights to her or his creation not only for the web site but for all other uses as well. This means that if the web site becomes the basis for a feature length motion picture, or a video game, or is used in any other medium, the designer may not receive any money at all.

In this instance, as in the first, the terms of the deal as set forth in the written contract are all important. Even though the designer may be granting all the rights, it does not mean that the designer is not entitled to bargain for a participation in the income from the site owner's exploitation of those rights.

A Partial Transfer For Use On The Web Site Only

The most advantageous relationship for the designer, and the least advantageous for the site owner, is the one in which the designer grants to the site owner the right to use the designer's creativity on and for the web site only and for no other purposes. This means that the designer retains all other media uses of the designer's creativity. Should the site become successful and should the site owner wish to use the designer's creativity in the above-mentioned video game or as the basis for a movie or in any other form, the rights to those other works, called "derivative works" under the United States Copyright Law, belong to the designer and so the designer is in a position to capitalize on the exploitation of those rights.

It is of course important to note that the ability of the designer to achieve this sort of agreement depends upon how strongly the designer has marketed his or her talents. If the designer needs the work more than the site owner needs the designer, this form of deal may be hard for the designer to achieve. However the designer must keep in mind that all creativity is unique. Merely because there are a zillion other web site designers out there does not mean that all can do the same job for the site owner. Thus, it is up to the designer to create a sense that the site owner should use only this particular designer for no one else can do the work. If someone wants a Picasso, then only a Picasso will do. Art is not interchangeable.

CONCLUSION

These are but a few of the variations on the rights themes. There can be many others and many sub-variations on these as well. Both parties should keep in mind that nothing follows like day does night merely by a particular categorization. It will be the exact terms of the agreement between the parties that determines who owns what, who can do what with what they own, and how much each party gets from what they own.

It's all in the negotiation and the deal.

© 1997 Ivan Hoffman

****************

This article is not intended as a substitute for legal advice. The specific facts that apply to your matter may make the outcome different than would be anticipated by you. You should consult with an attorney familiar with the issues and the laws.

****************

No portion of this article may be copied, retransmitted, reposted, duplicated or otherwise used without the express written approval of the author.


FOR MORE INFORMATION:


EMAIL


Where Next? 

Ivan Hoffman Attorney At Law || More Articles for Web Site Designers and Site Owners || Home