In this case, comic book industry Galactus, Marvel, filed a declaratory judgment action seeking a ruling that the Section 304(c) termination notices served by the heirs of legendary comic book artist and co-plotter Jack Kirby were invalid. The work for hire issue is crucial in termination cases because if work is made for hire, the employer or commissioning party is treated fictionally as the author in the first instance, and the individual who actually created the work can never terminate any transfer to recapture copyright ownership in his or her work.
Kirby, who jointly created many of Marvel’s greatest characters with Stan Lee (including the Fantastic Four as shown in the first issue cover by Kirby depicted above), was not an employee of Marvel at the relevant time period, but rather was an independent contractor, working for 12-14 hours a day and paid on a per-page basis. There was no written agreement. Together with Marvel editor Stan Lee, Kirby created several of Marvel’s most famous (and profitable) characters, co-writing the stories and drawing the artwork.
As noted above, the issue in this case was whether Kirby’s contributions to the Marvel canon were works made for hire under the 1909 Act, and the district court granted summary judgment for Marvel, holding that they were. This is a fairly remarkable result, though one becoming lamentably common in the SDNY, because work for hire status under the 1909 Act is an extremely fact-intensive inquiry. The Kirby heirs had a major challenge, because Stan Lee is still alive and testified on behalf of Marvel (having settled his own various disputes with Marvel in the past and obtained a significant ongoing participation in revenues from the characters he co-created with Kirby), while Kirby is deceased and therefore could not testify. Nonetheless, the Kirby heirs submitted the testimony of three living artists who worked for Marvel at the same time, and a written agreement between Marvel and Kirby from 1972, in which Kirby assigned his copyright interest in his work to Marvel (this was the transfer the heirs sought to terminate). The district court found that none of this created a triable question as to work for hire.
The court pushed the ball further down the path of eviscerating authors’ rights under the 1909 Act (and completely undermining the purposes of the termination provisions of the 1976 Act), by starting (and frankly ending) with the premise that the Second Circuit recognizes “an almost irrebuttable presumption that any person who paid another to create a copyrightable work was the statutory ‘author’ under the ‘work for hire’ doctrine.” This wrong-headed (but now self-fulfilling) statement has no basis in the history or the text of the 1909 Copyright Act, which states only that “employers” would be treated as the authors of works made for hire. Rather, this “almost irrebuttable presumption” was first announced by the Fifth Circuit in a 1987 case, and was then quoted by a plurality of the Second Circuit panel in the Edgar Rice Burroughs decision in 2003. Notwithstanding the total lack of any true support for this ersatz “almost irrebuttable presumption,” it has caught like wildfire. Courts seem to love “presumptions” like this, because it makes the analysis much easier. And presumptions that are “almost irrebuttable” quickly become completely irrebuttable in practice. Such seems to be the case in recent 1909 Act decisions.
The reasoning employed by the district court, and courts in other recent decisions, can only seem to make sense if the first fifty years of 1909 Act jurisprudence and the legislative history of the 1976 Act are ignored. In the Kirby case, the court did just that, beginning its discussion of work for hire with cases decided in the mid-1960s (most importantly the Brattleboro case, in which the Second Circuit first began the process of dismantling commissioned authors’ rights). This recitation ignores the fact that for the first fifty-plus years of the 1909 Act, court uniformly interpreted the work for hire provision as only applying to persons or entities that fit the usual, agency-law based definition of the term “employer.” Of course, this way of interpreting the statute is uncontroversial and is the very same way the Supreme Court interpreted the term “employee” as used in the 1976 Act’s work for hire provision in CCNV v. Reid, noting “In the past, when Congress has used the term ’employee’ without defining it, we have concluded that Congress intended to describe the conventional master-servant relationship as understood by common-law agency doctrine.” And for over fifty years, the courts were content to read the work for hire provision of the 1909 Act in this common-sense matter. It was not until the late 1960s that the Second Circuit began changing its reading of the statute in Brattleboro, expanding its reading of “employer” to include instances outside of the traditional employer-employee relationship. This change in the law was based solely upon (1) inapplicable precedent where the courts had found oral or implied exclusive copyright licenses, not work for hire status, and (2) fairness concerns raised by the particular facts of that case. But once the barn door was open a crack, later courts continued the expansion process to the point we are now.
By looking only at these later cases, and ignoring the earlier cases (and the Supreme Court’s discussion of how undefined terms like “employee” and “employer” should be interpreted, court are improperly following an “almost irrebuttable presumption” that should not exist, at least not for independent contractors. One can only hope that this issue will finally get back up to the Supreme Court, which could correct the obvious error in statutory interpretation that makes unfair results like the one reached in the Kirby case possible.
More on this decision, including how the court analyzed the “instance and expense” test and why the court found as a matter of law that the written copyright assignment demanded by Marvel could not be viewed as evidence of lack of work for hire intent, in a later post. For now, here is the decision: