Under U.S Copyright Law When Is A Musical Work Created Implied Licenses and Ownership of Intellectual Property Rights in the United Kingdom

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Implied Licenses and Ownership of Intellectual Property Rights in the United Kingdom

B Robin Ray vs. Classic FM, The English High Court ruled that a contractor providing services owns the intellectual property in materials created for the client. The decision is a useful guide for contractors as it is one of the leading cases in determining whether an intellectual property commissioner may use intellectual property for purposes that are not explicitly involved in a written agreement.

Background

Mr. Ray was a highly respected classical music expert in England, known to have an encyclopedic knowledge of classical music. He was engaged by Classic FM in the UK in 1991 to compile the radio station’s repertoire, compile playlists, categorize tracks into playlists and rate their popularity in each category. The contract did not deal with intellectual property rights. The consultancy agreement was originally for 11 months, but Mr Ray’s work proved beneficial to Classic FM, and his services were extended until 1997. Some 50,000 tracks were eventually classified. The results of the work were integrated into a database that was used to select music on a rotating basis, and prevent overplaying.

The project was successful. After internal use for about 5 years, Classic FM offered to license the database to companies abroad. Mr. Ray objected and began proceedings to prevent Classic FM from being licensed for use outside the UK without his permission, on the basis that he was the author of documents included in the database.

High Court decision

Mr. Justice Lightman at the High Court ruled that in the case of consulting, the author retained the copyright in the absence of an express or implied expression to the contrary. When services of a consultant are performed for an express purpose, a court will easily imply a term in the contract for services that a client is entitled to use it for that purpose. In this case, Classic FM always intended to use Mr Ray’s work in the UK. It was only in 1996 that Classic FM intended to use Mr Ray’s work overseas. The court was unwilling to imply in the contract that Classic FM would be entitled to use his work overseas. Classic FM was prevented from using their database abroad without Mr. Ray’s consent, which would require the payment of licensing fees.

When implying licenses in this way, a court will only go so far as is necessary under the circumstances to give effect to the parties’ intention. If a license is required, the scope of the license will be the minimum required to give effect to the intention of the parties at the time of concluding the contract. An implied term that copyright would be assigned to the customer would be particularly rare, as an exclusive license would often have the same effect in law.

The judge ruled that the contractor retains the copyright in the event of an express or implied condition with the opposite result. The contract can explicitly state which of the parties is entitled to the copyright, and the fact that the contractor was commissioned – performed by a contractor – is not enough to grant copyright rights to the contractor. In the absence of express rights, it remains for the customer to establish entitlements within the express or implied contract.

Summary

The meaning of the decision is that the contractors retain the copyright in the absence of an implied or express condition. An implied license must be reasonable and fair; Necessary to give business efficiency to the contract, which has the ability to be clearly expressed and does not contradict any express terms of the contract, and is so clear that it goes without saying. Ownership of intellectual property rights and licenses to use rights should not be left to chance; This is preferable to unsolicited implied licenses that allow the client to use the work and precisely provide the stated purposes for which use may be made at the outset of the engagement. It is therefore important to document the purposes of the engagement and the intended use of the copyright work created during the engagement.

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