The Paraskavedekatriaphobia Precedent: Why Friday The 13th Decision Raises Fear Of Slashing Long-Held Copyrights

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Admittedly, the second word in that title is a mouthful—but Paraskavedekatriaphobia is a real word, with an etymology and definition.  It even has a synonym, friggatriskaidekaphobia.  Each means “fear of Friday the 13th.”  Though I am tempted to write this October piece about Halloween (whether it is the day or the movies by that name, including one out again this season), I cut over instead to a different set of haunts and howls caught on film.  (But I will pause along the way to note that the Seuss/Star Trek mash-up case about which I have written before has recently settled, which I had to mention, of course.)

Fear of a weekend kicking off a baker’s dozen (or perhaps in this post more fittingly, to take another movie’s name, a “Devil’s Dozen”) days into the month is a phobia upon which the well-known 1980 horror film Friday The 13th played.  That film started a forty-plus-year, multi-film “iconic horror movie franchise,” as Dan Grant notes.  And, in part, the central conceit of the film rested in, and was reflected by, the equally, now archetypal, famous last scene of the first 1980 film:

“’Jason’ …emerges from the depths of the lake as a disfigured child, and reaches out of the water to pull one of the main protagonists into the lake.”–Horror Inc. et al v. Victor Miller (hereafter at times “Op.”) (2d Cir. 2021), at 7-8.

“[T]he music is serene and reassuring, the lake is calm, the weather is beautiful and everything seems like it’s going to be okay for the poor girl after her horrific ordeal.  And then a corpse filled with seaweed and mucus, emerges from the lake to take Alice down with him…It’s one of the most unexpected and terrifying moments of the entire Friday the 13th franchise.” –Dan Grant, The 13 Greatest Moments In The “Friday The 13th” Movies.

It is a defining scene included in Dan Grant’s list of greatest moments, in part, because it was so unexpected and jarring.  Yet it foretold so well the predictable retellings, sequels, and possibilities to follow—no matter how well the fight had been fought and how well the protagonists had defended themselves, Jason could come out of the lake.

But the scene is in many ways also, now, not only iconic but ironic.  This scene was suggested (and indeed demanded) by someone who got no writing credit on the film and was accorded no copyright rights as an author. Op. at 7-8, 28-29. Nevertheless, that scene is now a fitting metaphor depicting how screenwriter Victor Miller has emerged from beneath, and behind, the scenes to claw back copyright rights over the decades-old franchise and its intricate ever-evolving story.  This post, therefore, analyzes the September 30, 2021 decision of the United States Court of Appeals in Horror Inc. et al v. Victor Miller, explains why there should be some fear of “the Friday the 13th precedent,” and how perhaps to combat those fears.  Though the exact origins of the general fear of Friday the 13th are unclear at best (with a few common, interesting theories), the legal story in the United States and a few other countries have a clear, if underpublicized, origin.

In the United States, an author, artist, or other creator can terminate a previous assignment of copyright by statutory right.  These rights are outlined in 17 U.S.C. §203 and related regulations under 37 C.F.R. 201.10, as well as in 17 U.S.C. §304, as Kike Aluko explains in Terminating the Struggle Over Termination Rights (2020), (at pages 119-122).  This so-called reversion right allows creators to terminate a licensee’s or assignee’s copyright rights and reclaim them as the author/creator’s own by serving notice on the assignee:

You have a period of five years in which to terminate; however, notice needs to be served before the proposed date of termination. Generally, notice must be served no less than two, nor more than ten, years before the date of termination specified in the notice. Meaning, the earliest you can serve notice of termination is 25 years after you granted the use of your copyright to someone and the latest is 38 years, so you have a 13-year window to serve your notice.

The reason for this is that the guidelines surrounding when you can serve notice have to do with the date of termination that you specify in your notice. You have a five-year window to terminate and you can pick any day within that period to do so. However, once you pick a date and write it on the notice you have to serve that notice somewhere in-between 10 to 2 years prior to the date you picked. [FMC and Adam Holofcener, The Right to Terminate: a Musicians’ Guide to Copyright Reversion (emphasis added)]

In the United States, this creates rights to terminate assignments or licenses exercisable by live authors, their successors, and heirs, as nicely depicted in Holofcener’s charts.

Though not necessarily as clearly defined as it is under US law, some other countries provide for reversion or reversion-like rights for authors and creators.  For instance, the United Kingdom Copyright Act of 1911 provided that copyrighted works granted to a third party automatically revert to the author’s heirs, successors, or legal representatives twenty-five years after the death of the author when: (i) the author is the first copyright owner of the work, and (ii) the grant being terminated (e.g., the publishing agreement) was made by the author (grants made by the author’s heirs are not terminable under Copyright Act of 1911). As one practitioner has noted, “The Copyright Act of 1911 applied to all of the so-called “British Reversionary Territories” or “BRTs”– that is, all countries that were part of the British Commonwealth as of 1911,”  and that includes approximately 70 countries or sovereignties (from Anguilla to Zimbabwe alphabetically).  Further:

Over in Europe, Dutch law gives authors the right to void contractual clauses that provide for ‘unreasonably long’ terms. German law enables authors to convert exclusive-licenses to non-exclusive ones after 10 years, where their payment was a fixed sum instead of royalties. Polish law enables authors to terminate contracts of five years or longer, as well as indefinite contracts, upon giving one year’s notice (unless the contract stipulates otherwise).

Reversion upon failure to exploit

European countries widely protect authors from investors’ failures to exploit. Such ‘use-it-or-lose-it’ provisions exist broadly throughout Europe, including in Germany, Spain, Belgium, Austria, Luxembourg, Portugal and the Nordics. The German law, for example, provides that an author can terminate a contract and get their rights back if there has been no appropriate exploitation within two years of a contract being signed. There’s also an EU-wide equivalent for music performers (which kicks in after 50 years) where record producers aren’t effectively exploiting their recordings.

Reversion where exploitation is contrary to author’s interests

Rights also sometimes exist allowing authors to terminate where their works are exploited in ways counter to their wishes. In Poland for example, authors can bring contracts to an end if the exploitation is contrary to their ‘fundamental interests’. France and Germany also have similar laws in place. (For a fuller description of European reversion systems, see Dusollier at 77-79.)

[Giblin (2018), Author-protective copyright: How’s it done by other countries?]

But not all countries allow for express, time-specific terminations of previous copyright assignments or licenses.  As the issue of whether to allow such reversions gets debated, the private and public benefits and costs of such a regime are often debated, as Heald has shown in his recent article in the Journal of Intellectual Property Law on the Canadian consideration of such rights.  Others take the approach that the French system of droit d’auteur is preferable to regimented reversion schedules found under US law.

Importantly, and this is where the Second Circuit decision resurfaces, the reversionary right in the United States does not apply to “works made for hire.”   Such works for hire are among the clear exceptions to the reversionary right, as Holocenfer notes. Aluko states more emphatically (at 121) that “As previously mentioned, it is important to restate that these copyright termination rights do not apply to works made for hire under the statute.”  Horror Inc. v. Miller then goes directly to whether or not this exception applies.

To know whether that exception applies, one must know what a work for hire is:

A ‘work made for hire’ is

(1) a work prepared by an employee within the scope of his or her employment; or

(2) a work specially ordered or commissioned for use as a contribution to a collective work, as part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire….

[17 USC § 101]

“[A] work can only be considered a work for hire if it was created within an author’s scope of employment or if it was a commissioned work created by an independent contractor in one of the nine specifically enumerated categories in the statute.” Aluko, at 121.  The Second Circuit’s decision deals only with whether it was created within the author’s scope of employment because the movie production parties “concede, as they must, that the Screenplay does not qualify under the ‘specially commissioned work’ definition.” Op. at 15.  As the Court made clear, “although the parties entered into a written agreement,” the “contract that they signed does not provide that the Screenplay is a work for hire.” Id. Though we will analyze the question of whether Miller was an employee who produced the work within the scope of his employment, it remains important to cut to the heart of things here and now.  A properly couched work for hire agreement would have precluded Miller from ever re-surfacing with a claim, whether as an employee or independent contractor and eliminated all reversionary rights because, as Arnold and Ginsburg, Foreign Contracts and U.S. Copyright Termination Rights: What Termination Rights: What Law Applies? – Comment  (2020) (at 441) have stated unequivocally “[t]here is no termination of a grant in a work made for hire.”

But it is nonetheless important to understand how to make the best arguments around facts that may not include agreements as clear as crystal (or perhaps that are as murky as that body of water at Camp Crystal Lake). So, assuming that you don’t have an express work for hire agreement, how do you go about proving that your screenwriter, composer, or other artist/author acted within the scope of employment?  Looks like there are at least three important takeaways.

First, according to the Second Circuit, you must understand that this analysis is done as a matter of copyright law, not employment/labor law.  That is because:

As the Supreme Court explored extensively in [Community for Creative Non-Violence v.] Reid, section 101 of the Copyright Act uses a more restrictive definition of employment, one aimed at limiting the contours of the work-for-hire determination and protecting authors—the individual creators of works whose foundational value the Constitution itself recognizes and Congress has expounded upon [citations omitted].  In “the labor and employment law context, in contrast, the concept of employment is broader, adopting a more sweeping approach suitable to serve workers and their collective bargaining interests[,]…their safety rights[,]… and pay rights[.]

[Op. at 17-18].

Perspective matters.

Second, although Reid has thirteen different factors under which to make the assessment of whether one was an employee acting within the scope of employment for copyright purposes, there are really five that drive the analysis:

In Aymes [v. Bonelli, 980 F.2d 857 (2d Cir. 1992)], we provided additional guidance on the Reid analysis. In that case, while assessing whether the plaintiff was an “employee” under section 101, we flagged five core considerations that “will almost always be relevant [to the Reid analysis] and should be given more weight in the analysis, because they will usually be highly probative of the true nature of the employment relationship.” Aymes, 980 F.2d at 861. Those factors are: “(1) the hiring party’s right to control the manner and means of creation; (2) the skill required [of the hired party]; (3) the provision of employee benefits; (4) the tax treatment of the hired party; and (5) whether the hiring party has the right to assign additional projects to the hired party.” Id.

[Op. at 25]

Finding four of these factors favored the screenwriter’s claim to be an independent contractor (and that eight of the overall 13 factors did as well), the Court found for Miller, allowing the reversion. Op. at 38.

Third, facts matter more than labels.  Miller, a union member who was part of the Writers Guild of America, had in fact signed something called an “Employment Agreement,” and it said that the production company “employ[ed] the Writer.”  Op. at 4-5.  The copyright registration application for the screenplay, submitted by the company, called it a “work for hire.”  Op. at 8.  But that was not enough to make it so, just like those references were not enough to make him an employee when he was not directed, controlled, paid, or taxed like one.  Op. at 27-34.

This leaves one with the firm conviction that documentation is the key.  That can take the form of documenting your screenwriter’s or songwriter’s true status as an employed creator under the thirteen Reid factors.  But that is, one fears, just a new form of triskaidekaphobia to be avoided every day, not just on certain Fridays every year.  That is because establishing that a writer is an employee acting within the scope of the writer’s employment requires vigilance and daily attention and documentation.  Documenting that a work has been specially commissioned as a work for hire, on the other hand, may simply be easier to do, as it is a single point of documentation, and templates for such agreements abound.

Templates, naturally, are starting points, and not finished products.  Of course, there are any number of issues that one should address in such documents.  Principal among them for this audience is the notion of choice of law, as reversionary copyright rights are not universally recognized, nor administered in the same manner.  Consequently, assigning worldwide rights in a work may allow a termination of US rights, and their reversion to the creator, but rights outside the United States may never return to the creator.  Given the international scope of movies and music, many like Chozick, in Help! Fixing The Problem Of Copyright Termination Inconsistencies Through Public And Private International Law (2018) (and the earlier cited Arnold and Ginsburg) have decried the frustrations springing from inconsistent copyright termination regimes. But an examination of that conundrum and its fixes perhaps best awaits this column’s sequel or some later episode in this franchise.

So we return to the notion of what is the best way for a long-time rights holder of a valuable franchise to escape from having its rights slashed, cut off, and terminated by someone re-emerging from the past.  Just as we know that Friday the 13th will occur at least once every year (and may occur up to three times a year), producers, publishers, record labels, movie studios, and even simple copyright rights holders know that the specter of copyright termination lurks in the proverbial lake.  Hopefully, this post helps them, and you, spot the issues and limit the harms that copyright reversions can occasion. When you start to hear in the background the well-known film score and you begin to fear that the current creator might resurface someday, much to your horror, just get in the running car that a well-crafted work-for-hire agreement can represent as a means of escaping reversion.  This avoids the sort of poor decisions that people in horror movies are said to make, like assuming that they could prove, absent an express writing saying so, that the 1980 screenplay for Friday The 13th was a work for hire.  Or, you could take your chance sorting through the 13 Reid factors and your proofs under them, which is, figuratively, a lot like choosing to hide behind the chain saws.

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