Legalities 10: Questions About Making Greeting Cards from Photographs; Copyright for Old Works; Publishing Contracts; Agents

Q. I am starting a small business making greeting cards. I have used some color photographs from a book and then changed them using Photoshop to alter them. They are now black and white and highly stylized and combined with a patterned background. Have I infringed copyright here? Also, is using old fabric in my designs an infringement?

A. Unfortunately, some cases have held that the mere act of making a digital copy of an image makes you liable for copyright infringement, regardless of any changes you make to it in order to create your own final image. This is called “intermediate” or “precursor” image liability. Similar rulings have been issued with respect to music sampling. There is a good argument that precursor image liability is not consistent with the meaning and purpose of U.S. copyright infringement laws (which were written before digital scanning became possible). Digital copying is merely a more high tech way to use another work as reference material — analogous to the creative process in traditional media of making a manual sketch of the photograph on your canvas, which you then revise and alter as you evolve the final painting. Under this argument digital technology is just another artistic tool in the process, and it shouldn’t matter what any such intermediate images look like (high tech or not). What should matter is whether your final image is so similar to the photograph that it constitutes infringement. However, I’m not aware of any cases that have endorsed this argument. So for now, it is not safe to create greeting cards by digitally altering photographs without permission from the photographers (or other copyright owners of the photographs).

With respect to old fabrics, the answer depends first on whether the fabric is old enough to be in the public domain, and if not, whether you’ve used it in a way that qualifies as fair use.

Under U.S. law, if the fabric was published or registered before 1923, it is in the public domain. After that, it gets complicated:

– Works published or registered 1923-63 may have copyright protection for 67 years, depending upon whether renewal registration was made.

– Works published or registered 1964-1978 have copyright protection for 95 years.

– Works created in 1978 or later have copyright for the life of the author plus 70 years.

Generally, the first step to try to determine how old the fabric is would be to contact the manufacturer or seller of the fabric and ask them what information they have. You can also have the U.S. copyright office do a search for copyright registrations. See, Circular 22. However, you’ll need some sort of verbal identification to enable a copyright office search — such as the name of the fabric design or the manufacturer — they cannot search by imagery.

See Legalities 5 re: fair use of fabric patterns in artwork.

Also note: copyright liability varies from country to country. Other countries may not agree with U.S. jurisprudence regarding high-tech scanning or fair use. If you are using photographs or fabrics created or published in another country, you should consult a lawyer in that country for the applicable law. See below.

Q. I may be illustrating a book for a small publisher in Latin America. I’ve never worked with them before and I’m debating whether to do the job as work-for-hire or on royalty basis. Are there international copyright laws the publisher must abide by?

A. There are no international copyright laws. Each country has its own copyright law with variations in rights and remedies. However, there are international treaties that require the member countries to give each other’s citizens the same copyright protection that they give to their own citizens.

Your contract with the publisher should have a “choice of law” or “governing law” provision that says which country’s law applies to your publishing contract. If it says U.S. law governs, then you definitely need to worry about the work-for-hire issue. Generally, work-for-hire is a U.S. concept that most other countries don’t honor. However, you or your lawyer would have to check the specific law of the foreign country identified as the governing law to find out if they have a work-for-hire concept of copyright ownership. You should also check if that country is a member of one of the international copyright treaties.

For more about work-for-hire, see Legalities 4.

Q. How does a licensing agreement affect an author’s copyright? I queried signing over all my copyrights and moral rights to a publisher and they suggested a licensing agreement for four years. Does this mean I maintain copyright of my work?

A. A license grants the publisher a limited right (or permission) to publish your copyrighted artwork in certain ways under certain conditions, rather than giving it entire control over your artwork through a copyright assignment. Generally, licenses are much better for the copyright owner than an assignment, and it sounds like the better alternative in your situation.

Under a license agreement, you keep your copyright. When the license term expires, the publisher would need to renew the license in order to continue publishing your artwork. Unless there are terms in the contract controlling its option to renew, that gives you the chance to negotiate for better compensation, or to switch to another publisher if you’re not happy with this one. Another advantage is that under a well-written license agreement, if you don’t get paid, you would have the right to cancel your permission to publish the artwork before the license expires. This gives you more bargaining power to collect overdue royalties.

Under an assignment, the publisher gets all control over your artwork including the exclusive right to publish it for at least 35 years (at that point, you have the opportunity to cancel the assignment). Sometimes the publishing agreement includes a provision to revert the copyright ownership back to you if the book goes out of print, but it can be burdensome to get them to do so. It’s generally better not to give up all your rights in the first place. Also, if the publisher fails to pay your royalties, you would only have the right to sue for monetary damages; you would not have the legal right to stop publication or to get your copyright assigned back to you.

“Moral rights” refers to a set of rights that stay with the artist regardless of whether your copyright is assigned. These include the right to be accredited as the creator of the work, and to prevent it from being destroyed or altered. Currently, such rights are limited in the United States to original works of visual art. They do not apply to commercially published copies of your artwork. (Moral rights are much broader in Europe, where this concept originated.) However, many publishing contracts are including assignment of moral rights to cover any potential future applicability to commercial reproductions.

Q. A few years ago I was represented briefly by an agent who is now no longer in business as an agent. We ended our business relationship, but because she repped a book for me and it sold, we are still “contractually” tied by that book. Each royalty period, she gets the check from the publisher and sends me a money order for my cut. I suspect she would like it if I would “buy her out” of the contract since I’m sure she doesn’t like keeping up with the paperwork, etc. I would like this, as well, but I think we should sign a joint severance with no money changing hands at this point. It’s quite frustrating, because after she sends the money order then I have to write or call her back and ask for a copy of the royalty statement since she doesn’t just automatically send it with the money order. Also, she has never sent me a 1099 for my taxes. What kind of options do I have to end this contract so that in the future I can deal directly with the publisher?

A. You can end the current arrangement by mutual agreement. Normally, this means a new contract in which you set an amount to buy-out your rep’s rights to receive future revenues under the old contract, and then you both notify the publisher that it should send future royalty checks directly to you. The buy-out amount is usually based on a projected estimated amount she would likely receive over the life of the book, discounted to reflect the benefit to her of getting a lump sum now instead of smaller amounts over time. If you want to end the relationship without paying her any money, you need to have a rationale for arguing that she is not entitled to future revenues. Generally, that would mean a material breach of the original contract. A material breach is something pretty severe, such as failure to timely pay you your royalties. I doubt that her failure to timely send the royalty statements, or the 1099s, amounts to a material breach, especially since there may be an argument that you’ve waived your right to complain about that by acquiescing to such conduct over time. I suspect the wiser approach would be to negotiate a fair buy-out amount and sever the relationship amicably.

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Legalities is a service mark of Linda Joy Kattwinkel. © 2005 Linda Joy Kattwinkel. All Rights Reserved. The information in this column is provided to help you become familiar with legal issues that may affect graphic artists. Legal advice must be tailored to the specific circumstances of each case, and nothing provided here should be used as a substitute for advice of legal counsel.

See the index of previous columns for more answers to your questions.