Who Owns a Copyright?

Ownership of intellectual property (IP) should be easy to figure out. The author is the one who has exclusive rights to their original works and creative works, right? Generally, this is true. However, intellectual property law has exceptions regarding intellectual property rights (IP rights).

One of the types of intellectual property that has an exception to the general rule is a copyright created while working for a small business owner. This article will help you determine if your small business needs a copyright or trademark. It also explains who owns a copyrighted work created for your business. Lastly, it shows how to protect your small business's intellectual property.

Types of Intellectual Property

There are four types of IP:

1. Trademark: The United States Patent and Trademark Office (USPTO) accepts and reviews trademark applications. These federally registered trademarks allow the owner legal protection. They can use their federal trademark registration as proof of ownership in trademark infringement lawsuits. For international trademark protection, startups and entrepreneurs must submit trademark applications to the World Intellectual Property Office (WIPO). Types of trademarks include business names, brand names, company names, product names, taglines, logos, and colors.
2. Copyright: Artistic works are a form of intellectual property that occur in a fixed form. These works have intellectual property protection upon creation. Some examples of creative works allowed copyright protection are sound recordings, movies, books, computer programs, computer software, and recorded plays.
3. Trade secret: Confidential information specific to a company and not generally known by the public or competitors is a trade secret. There is no federal registration for IP protection, but there is a federal criminal law. The Economic Espionage Act of 1996 makes it a crime for someone to give a trade secret to a foreign country or government.
4. Patent: These are new, novel, and non-obvious inventions or processes. The three types of patents are utility patents, design patents, and plant patents. Entrepreneurs submit patent applications for patent protection to the U.S. Patent and Trademark Office.

Copyright Ownership Basics

Generally, only the author of a work can claim copyright. Once the work is in "fixed" form (e.g., a story written down on paper or a song recorded on tape), the copyright becomes the property of the creating author. Joint authors of a work are co-owners of the copyright unless there is an agreement otherwise.

A work created in fixed form is automatically protected by copyright under common law. The author immediately owns the copyright in the work. They are the only person or business that can enjoy certain rights. These exclusive rights include the right to reproduce the work or to transfer or license their rights to others.

Copyright registration through the U.S. Copyright Office grants the author additional legal protections. This registration is the only way the author can use the © symbol. It also serves as a notice to all other parties that another owns the rights.

Minors may claim copyright, but state laws regulate business dealings involving these copyrights.

Works Made for Hire

In the case of works made for hire, the employer, not the employee, is the author and owner of the work. Copyright law defines "work made for hire" as work prepared by an employee within the scope of their employment.

In the case where an independent contractor signs a written agreement stating that the work is "made for hire," the company owns the work if it is one of the following:

• A translation
• An atlas
• Part of a movie, like a screenplay
• An afterword
• An introduction
• A chart
• An editorial note
• A bibliography
• An appendix
• An index
• Part of a larger literary work, such as an article in a magazine or a poem or story in an anthology
• An instructional text
• A compilation
• A test
• Answer material for a test

For collective works — works composed of several independent works, such as a magazine or encyclopedia — the authors of each independent work hold a copyright for each contribution. There can also exist distinct copyright protection for the collective work as a whole since there is creativity involved in selecting the individual works and compiling them.

Protecting Small-Business Intellectual Property

If you have a small business, you must protect your intellectual property assets. One of the easiest ways to do this is to have employees or independent contractors sign nondisclosure agreements (NDAs) or confidentiality agreements. NDAs help protect things like:

• Trade secrets, including works created during the employment term
• Sensitive information discussed in meetings
• Vendor and customer lists

Need Help with Small-Business Copyright Ownership? Seek Legal Advice

You should make sure your IP assets have legal protection. If you work for a company and have created an artistic work, a copyright lawyer can help you know your rights to your work.