UNDERSTANDING ASSIGNMENT OF COPYRIGHT – COPYRIGHT ACT 1957

Copyright is a legal protection granted to creators of specific types of works to acknowledge their intellectual contribution to the creation. This principle is commonly referred to as the 'Doctrine of Sweat of the Brow'. It stipulates that a work is eligible for copyright protection if the author has applied 'labour, skill, or judgment' in creating it, regardless of its level of originality. The Doctrine of Sweat of the Brow was established in the Ladbroke v William Hill case ([1964] 1 All E.R. 465).

Copyright laws aim to safeguard creators' interests while promoting the spread of knowledge. Although the protection initially focused on authors' rights in their books, the advancement of technology has significantly altered the nature of work and its exploitation methods.

Economic rights are an integral component of copyright law, enabling owners to derive economic benefits from their intellectual creations. According to section 14 of the Copyright Act, 1957, different rights are recognized depending on the nature of the work. These rights provide exclusive control to the owner over the actions listed therein.

Copyright owners can generate wealth by exploiting their works or collaborating with others for mutual benefits. Such collaborations can be achieved through copyright assignment or licensing.

ASSIGNMENT v LICENSING

Copyright owners have two primary options for sharing their work with others: assignment and licensing. Assignment refers to a transfer of ownership, where the owner of the copyright entirely relinquishes their rights in the work and transfers them to another person or entity. The assignee becomes the new owner of the copyright, and the original owner no longer has any control over the work. Licensing, on the other hand, is a way for the copyright owner to grant permission to others to use their work while still retaining ownership. The licensor retains control over the work and can specify the terms and conditions under which it may be used. The licensee has limited rights to use the work in accordance with the terms of the license agreement, but ownership remains with the original copyright owner.

For the purpose of this Article, we will focus on what assignment of copyright is.

ASSIGNMENT OF COPYRIGHT

An assignment may be defined as the transfer of a particular right, leaving nothing in the assignor qua that particular right, and bestowing on the assignee the whole of the legal interest in the right assigned.[i]

SECTION 18

Section 18 of the Copyright Act permits the owner of a copyright to transfer or assign their copyright to another person. The assignment of the copyright grants the assignee all the rights associated with the assigned work. However, if the owner grants only the right to publish and sell the copyrighted work, it is considered a publishing right and not an assignment of copyright.

When the assignee of a copyright becomes entitled to any right that forms a part of the copyright, they are considered the owner of the copyright for those rights. The assignor retains ownership of the unassigned rights. In the event of the assignee's death before the creation of the work, the legal representatives of the assignee are entitled to the benefits of the assignment.

In the case of Video Master v. Nishi Production[ii], the Bombay High Court examined whether the assignment of video rights would encompass the right to satellite broadcast. The Court upheld the defendant's position that different modes of communication to the public, such as terrestrial television broadcasting (Doordarshan), satellite broadcasting, and video TV, constituted distinct copyrightable elements. Therefore, the owner of the film had a separate copyright in each of these modes, and they could assign them to different persons. Consequently, the satellite broadcast copyright of the film was a distinct right of the film's owner, and the video copyright assigned to the plaintiff did not include it.

AMENDMENTS TO SECTION 18 AND AUTHOR’S RIGHT TO RECEIVE ROYALTY

The Copyright (Amendment) Act of 2012 introduced two provisos to Section 18 of the Copyright Act. These make receiving of royalty an inalienable right and prohibit authors of literary or musical works that are part of cinematographic films or sound recordings from waiving their right to receive such royalties. Any such waiver is void, and the author is entitled to receive at least 50% of the royalties, which should be shared equally with the copyright assignee (if applicable). However, this rule does not apply to assignments made for (a) communicating the work as part of a cinematographic film in a cinema hall, (b) the legal heirs of the author, or (c) a copyright society for collection and distribution.

The 2012 Amendments were necessary in so far as prior to the enactment of the Amendment Act, the Copyright Act (via Section 17(i)(b)) stated that the ownership of artistic works belongs to the owner, subject to any contract to the contrary. This had resulted in the widespread industry practice of the assignee or producer unconditionally acquiring the rights of the artists, effectively making the producer the sole author of the copyright instead of the artist. Consequently, all the profits earned from the utilization of the artistic work were enjoyed by the producer, depriving the artist of any share in the profits.

EQUITABLE ASSIGNMENT

A mere agreement to assign does not operate to pass the property right but gives equitable rights[iii], that is, it operates as an equitable assignment of the copyright as and when the work comes into existence[iv]

In a matter before the Madras High Court, P.R. Viswanatha Iyer vs A. Muthukumaraswami Pillai[v], a particular Panchangam had been published for over sixty years from manuscript furnished by defendant No. 1 and his father. The publisher was up to 1940 the plaintiff No. 2. The defendant No. 1 then quarrelled with plaintiff No. 2 and entered into an agreement with plaintiff No. 1. Under this agreement, the defendant No. I was to cast the almanac and deliver the manuscript to plaintiff No. 1 for printing and publication for a period of five years, for a certain consideration. The agreement fixed the date for the delivery of the manuscript in each year, and prohibited defendant No. 1 from writing or delivering a copy of the almanac to anyone else. The defendant No. 1, in breach of the agreement, gave the manuscript to another person for publication. It was held that the agreement did not operate as a legal assignment of the copyright, but it operated as an equitable assignment of the copyright as and when each manuscript came into existence. It was further held, that the plaintiff No.1 could maintain, as an equitable assignee of the copyright, an action for damages for infringement of copyright.

ASSIGNMENT OF FUTURE RIGHTS

In the case of Saregama India Ltd v. Suresh Jindal[vi], the court held that the owner of the copyright in a future work may assign the copyright to any person wholly or partially for the entire copyright or any part thereof. Once the assignment is made, the assignee is treated as the owner of the copyright under the Act.

The Bombay High Court has also recognized the said principle of assignment and observed:

"There is a proviso under Section 13 that in the case of the assignment of copyright is in any future work, the assignment shall take effect only when the work comes into existence.

Reading of this Section makes it clear that the prospective owner of copyright in a future work may also assign to any person the copyright in the future work. Though the proviso states that the assignment of copyright in any future work, shall take effect only when the work comes into existence, there is an antecedent assignment right created in favour of the assignee in respect of the future work."[vii]

Future Assignment can also be understood from an interesting decision of 1965[viii] that involved an infant and his wife who had entered into two contracts regarding the copyright in a book that was to be written about the infant's life story. One contract granted the copyright to the infant and his wife, while the other contract granted exclusive publication rights to the publishers. The infant later claimed that he was a minor at the time of the contract and that the book contained libelous material. He took legal action, represented by his wife, and obtained an injunction to stop the publishers from printing and publishing the book.

Finally, it was held that an interlocutory injunction to restrain the publishers from printing and publishing the book should not have been granted for the following reasons:

(1) The terms of the contract with the publishers constituted an assignment of the copyright in a future work to the publishers which would in case of an adult, be effective under the Copyright Act to pass the copyright to the publishers.

(2) The assignment of copyright, having been completed by the infant assignor, before he resiled from the contract, remained effective.

(3) The contract was binding on the infant, if it were for his benefit.

(4) The question whether the contract was for the infant's benefit must be judged at the date when the contract was made, and so considered the contract was prima facie for the benefit of the infant.

(5) The action was not properly constituted in that that the infant's wife was not a party to it in her own right.

SECTION 19

Section 19 of the Copyright Act outlines the requirements for a valid assignment of copyright. It mandates that an assignment of copyright must be in writing and signed by the assignor or their duly authorized agent. The written assignment should specify the work and the kind of rights being assigned, as well as the duration and territorial extent of the assignment. It should also specify the amount of royalty, if any, payable to the author or their legal heirs during the continuance of the assignment. The parties may revise, extend or terminate the assignment on mutually agreed terms.

If the duration of the assignment is not specified, it will be deemed to be five years from the date of the assignment. If the territorial extent is not specified, it will be considered applicable in the whole of India.

Section 19(8) of the Act provides that if the terms and conditions of the assignment of a copyright work are contrary to the rights assigned to a particular copyright society where the author is a member, the assignment shall be void. Additionally, Section 19(9) and Section 19(10) state that the assignment of copyright for creating a cinematograph film or sound recording shall not affect the author's right to claim an equal share of royalties and consideration payable with respect to the use of their protected work.

There is no such thing as copyright at common law. It is a species of property created by statute, and it has been decided repeatedly that copyright is not to be assigned except in writing.[ix]

ASSIGNMENT OF COPYRIGHT DIFFERENT THAN TRADEMARK

An assignment deed in relation to trademark relatable to the subject-matter of the copyright is of no avail. Trademark and copyright are two distinct intangible property rights. One cannot be taken in substitution of the other.[x]

SECTION 19A

Section 19(a) of the Copyright Act empowers the Appellate Board to revoke an assignment of copyright upon receiving a complaint from the assignor. The Board may revoke the assignment if the assignee fails to sufficiently exercise the rights assigned to them, and this failure cannot be attributed to any act or omission of the assignor. In the event of a dispute regarding the assignment of copyright, the Appellate Board may issue an appropriate order after conducting a necessary inquiry, including an order for the recovery of any royalty payable.

SECTION 20

Section 20 of the Act deals with the assignment of copyright by operation of law. When the owner of a copyright passes away, the copyright passes to their personal representative as part of the estate, provided that no will has been executed. If a person is entitled to the copyright of a work through a bequest, and the work has not been published before the testator's death, that person will be deemed to have copyright in the work to the extent that the testator owned copyright immediately before their death, unless the testator's will or any codicil thereto shows a contrary intention.

THOUGHTS IN CONCLUSION

The assignment of copyright is a legal process by which the owner of a copyright transfers their rights to another party. This process can be a vital tool for creators and publishers looking to monetize their works, as it allows them to sell or license their copyright to others for a fee. However, it is important to remember that assignment is a creature of the contract, and the terms of the agreement must be drafted carefully to avoid ambiguity and misunderstanding.

As is clear from the Copyright Act, the transfer of copyright must meet certain prescribed requirements to be valid and enforceable. These requirements include a written agreement signed by the owner of the copyright and the person receiving the transfer, and the specific details of the transfer, such as the scope of the transferred rights, the duration of the transfer, and the consideration exchanged. In addition, the transfer must be made explicitly, and the parties must intend to transfer the copyright ownership.

A well-drafted agreement will clarify the scope of the rights being transferred, avoid ambiguity and misunderstandings, and reduce the risk of litigation. It is also essential to ensure that the terms of the agreement qualify the law prescribed to avoid invalidation of the transfer.

In addition to the legal requirements, there are practical considerations to consider when assigning copyright. For example, it is essential to consider the potential value of the copyright, the nature of the work being transferred, and the financial or strategic objectives of the parties. These considerations will help the parties structure the agreement to achieve their goals while avoiding potential risks.

[i] Iyenger’s Commentary on the Copyright Act, 9th Edn [ii] 23 IPLR 388 (1998) [iii] Simms V Marryat, (1851)20LJQB 454 [iv] P.R. Viswanatha Iyer vs A. Muthukumaraswami Pillai, AIR 1948 Mad 139 [v] AIR 1948 Mad 139 [vi] 2007 (34) PTC 522 (Cal ) [vii] Mad Man Film Ventures Pvt. Ltd. vs. Reliance Entertainment Studios Pvt. Ltd. and Ors. (16.03.2022 - BOMHC) [Interim Application (L) No. 4439 of 2022 in Commercial IPR Suit (L) No. 4433 of 2022] [viii] Chaplie v Leslie Frewin (Publishers) Ltd. (1965) 3 ALL ER 764 [ix] Colburn v Duncombe, (1838) LR Ch D 151 [x] Pratap Sabun Udyog v Ramnagar Khadi Gramoudyog Vikar Samiti, 2009 (40) PTC 116 (CB)