Might a children's pastime mean court time for Candy Land maker Hasbro?
You can pass through a peppermint forest, even swim in an ice cream sea. But too much sweetness can be cloying, and there's nothing like a copyright suit to bring a little sourness to the table.
So it appears for Hasbro subsidiary Milton Bradley, which has sold the popular Candy Land board game since the 1940s and now plans to use elements of the game in a movie starring Adam Sandler.
Columbia Pictures, Sandler's Happy Madison Productions and Hasbro announced the CANDY LAND movie adaptation in January 2012, stating, "The world of Candy Land offers an extraordinary canvas upon which to create a fantastical, live-action family adventure film."
But on hearing of Hasbro's plans, entertainment design firm Landmark sued, saying that this extraordinary canvas was largely created by Landmark, hired by Hasbro in 1984 to redesign the box and game board and to create the game's characters and storyline. According to Landmark's complaint, it created the copyright-protected material independently and licensed it to Hasbro.
Landmark's complaint claims that the original Candy Land game, which was created by a bed-ridden patient in 1945 and introduced by Milton Bradley in 1949, contained only an unnamed brother-sister duo, while the new Landmark created version has more than a dozen characters, with names like King Kandy, Lord Licorice, Princess Lolly, and Jolly, the Gumdrop Mountain Greeter. Landmark also claims that it developed a scripted audio cassette featuring voiceover actors in a short-story adventure that further delineated each character's personality.
Landmark says it developed these various materials and then licensed them to Milton Bradley, receiving a $50,000 nonrefundable fee, continuing royalties and several confirmations that Landmark would retain the licensed copyrights. On learning of the plans for the Sandler film, Landmark says it contacted Hasbro and reminded the games company that it had to obtain Landmark's permission to use its copyrighted materials. Hasbro refused, claiming that Landmark's 1984 project was work-for-hire. Hence, the lawsuit.
The Candy Land case highlights one of the most common misconceptions about copyright law: that if you pay someone to develop copyrighted material for you, it is a work made for hire and you own it.
This is not necessarily correct, and relying on this in error can result in your not owning material that you paid to have created. Copyright in a work vests initially in its author(s). In the case of a work made for hire, the employer or other person for whom the work was prepared is considered the author and, unless expressly agreed otherwise in a written instrument signed by the parties, the author owns all of the rights in the copyright.
It seems pretty straightforward then, that in the case of a work made for hire, the person for whom the work was prepared is the author and owner of the work. As a result, many people believe that if you hire an independent firm to develop copyrighted material for you that it is a work made for hire and you own it.
The catch is that most people do not fully understand the meaning of the term "work made for hire," which is specifically defined in the context of the U.S. Copyright statute. A work made for hire is not any work that you pay an independent contractor to create for you. Neither is it a work that you and your independent contractor agree is a work made for hire. Rather, "work made for hire" applies only when certain conditions are all met. If a work is specially ordered or commissioned and it is created by an independent contractor, then it can be a work made for hire — but only if there is a written agreement between the parties specifying as such.
This is the heart of the Landmark-Hasbro dispute. If Landmark's argument is correct, then it created the work, it is considered the owner of the copyright in the work, and it licensed the work to Hasbro. A license is a copyright owner's grant of permission to use a copyrighted work in a way that would otherwise be copyright infringement. A copyright license does not transfer ownership of a copyright. But if Hasbro is correct, it hired Landmark to create a work made for hire, and Hasbro owns the copyright.
The next move in this game is the court's. In the meantime, we can use this dispute as a teaching point: that if you are going to go to the expense of hiring an independent contractor to create copyrightable material for your company, make sure you have a written agreement specifying it is a work for hire and that all copyrights in the resulting material rest in your company.
Without a written agreement, the law will default to the copyright ownership as belonging to the independent contractor and you will be left holding the bag — without any candy in it.
Originally published by Inside Counsel Magazine.
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