Do you sell your work? When you talk about your work, do you say, “I sold this photo for $2500 to Client X, for use on its website” or similar? Even more importantly, does your paperwork clearly state, for every transaction, that specific rights to use the work are licensed to your client or do you just say “Creative Fee = $2500” and list “usage” someplace? Or, worse of all, do you ever say an invoice is for a “buyout” of the work?
Well, stop that. I mean, stop selling your work.
If you aren’t making it clear that you are licensing your rights rather than selling your photography, I think a smart copyright defense lawyer could argue that an affirmative defense called the first sale doctrine applies if your client later resells or otherwise distributes your work beyond the scope of the license you thought you granted. That defense could gut your case.
This morning, I was reading up on recent cases in copyright when I came across this article. On first glance, it doesn’t seem like it really has anything to do with how you run your business and copyright law, but I think it may. The short version of the case discussed in the article is that Adobe sued someone who bought copies of Photoshop which it later resold (against Adobe’s usual terms); that would have been a clear case of infringement, except that Adobe hadn’t clearly stated that the defendant originally licensed the software from Adobe (even though Adobe always licenses rather than sells its software) so the purported infringer was protected by the first sale defense when he resold the software.
In the case itself (yes, I read the opinion), the court notes, “In digital copyright cases, the distinction between a “sale” and a “license” has become central.” (p. 11) and later explains:
To determine whether there is a legitimate license, we examine whether “the copyright owner (1) specifies that the user is granted a license; (2) significantly restricts the user’s ability to transfer the software; and (3) imposes notable use restrictions.”
(p. 13, internal citation omitted). Finally, the court emphasizes that “the precise terms of any agreement matter as to whether it is an agreement to license or to sell; the title of the agreement is not dispositive.” (p. 18, italics added).
This isn’t a slam-dunk defense against copyright infringement of a visual art like photography. There are differences in the cases (software isn’t photography, for example), but the analogy is worrisome. If you just substitute the word “photograph” where it reads “software,” you can see that the rest fits.
I think this case should, for your business, serve to remind you of the importance of making it clear that you are licensing rights, not selling photography (or any visual art). In other words, in your paperwork to your clients, make sure to avoid words like selling, sold, buying, or buyout and make sure to use terms like licensing the rights to reproduce, non-exclusive license to display, or non-transferrable unlimited license to copy and display. I’d make it clear on all documents, especially your estimates and invoices, that the usage rights granted under this license are limited to (fill in the usage here).
Drafting a license isn’t hard, but you do need to make it clear that you are only selling the limited license, and not your work. Later on, a clear license can help prevent an infringer from even trying to raise the first sale defense, saving you and your attorney (and the court) headaches, time, and money.