Federal Court Grants Default Judgment And Awards $78,000 In Statutory Damages In Copyright Infringement Action.

The recent decision in Rayman v. Red Crayon Inc, 2026 FC 951 is a useful reminder that companies do not own copyright in works created for them by independent contractors unless the contract provides for a transfer of those intellectual property rights, and ongoing use of the copyrighted works by the companies may expose them to liability when they do not uphold their agreement with the contractors.

The Plaintiff, Dr. Rayman, entered into a Consulting Agreement with the Defendant, a for-profit education franchise, to develop Science, Technology, Engineering and Mathematics (STEM) courses for the Defendant. Under the terms of the Consulting Agreement, the Defendant agreed to pay the Plaintiff in regular installments. The Consulting Agreement also expressly stated that the Plaintiff was an independent contractor, and no intellectual property rights were transferred between the parties.

The Plaintiff developed five Quick Reference Guides for use in conjunction with LEGO education kits and a curriculum guide for a STEM camp, for a total of six works. However, about two years after the agreement started, the Defendant stopped paying the Plaintiff’s invoices. The Defendant continued to make the six works available to its franchisees and tutors on its website and did not respond to the Statement of Claim.

In reaching its decision, the Court found that “[t]he Consulting Agreement does not grant the Defendant any licence or assignment to use the Works; its right to use and continue to display the Works was contingent on the payment of a fee for service.” The Court awarded $13,000 per work (out of a statutory maximum of $20,000) for a total of $78,000, noting a need to deter the Defendant from continuing to make the works available and a need to ensure the Defendant did not benefit from the infringement.

The full decision is reported here.