By: Jeff Lippman & Farzad Panjshiri [3/16/22]

Chapter 2

Continued Exploration into the Copyright Journey

Welcome back, true believers! We continue our exploration into the Copyright journey of some of our most iconic heroes. It will make it easier to follow if the authors divide the most relevant aspects of this story.

1. The current actions:

Other the past several months, a number of co-creators (or their estates) filed actions to terminate the Copyright Rights of Marvel. Marvel was not unprepared for this as the Superman case (below) and the Kirby estate case (below) were known. Marvel more recently filed its own actions to preemptively disallow any similar termination claims for some of its most popular characters featured primarily in the MCU movies. Their basis was artists can’t terminate rights because the works were made for hire, and the contracts stated as much. Such contracts gives Marvel to those rights in perpetuity. The characters were primarily created between the 1950s and 1970s. Expect Marvel’s strategy to continue similar filings as other properties age into the time periods explored in Chapter 1 of this blog. Filings were made in multiple Federal Courts, and those are public record.

The creators’ attorney, Marc Toberoff, argued the lawsuits were based on “an anachronistic and highly criticized interpretation of ‘work-made-for-hire’ under the 1909 Copyright Act that needs to be rectified.”

Marvel’s attorney, Dan Petrocelli, said in a statement that “since these were works made for hire and thus owned by Marvel, we filed these lawsuits to confirm that the termination notices are invalid and of no legal effect.”

Under the specific aspects of the Copyright Act related to these works, an artist can terminate a copyright assignment after 35 years by giving notice at least two years in advance. The artists’ notices would terminate Marvel’s rights “along with all the characters, story elements, and/or indicia appearing therein,” and “all material” they authored that was “reasonably associated with these works” and registered or published in the termination window. The notices say the copyrights will revert to the artists beginning in 2023. Obviously, the movies and subscription-based television series’ play prominently in bringing these actions to the fore.

The Copyright Act’s termination provision is silent on works made for hire. It addressed Assignments. To the layperson, is there a difference? Did Congress consider the difference during the passage of the Act and its subsequent Amendments? Marvel argues the Act covers what the Act covers, and had Congress wished to include works made for hire, they had ample opportunity to do so. Thus, the argument remains that Copyright Terminations do not apply to works made for hire, and this prevents the artists from recovering the copyrights.

In the most recent complaints, Marvel argued that it assigned the artists stories to write and illustrate, had creative control over them, and paid them at a per-page rate. Marvel also said that these issues were previously resolved when a Federal District Court and 2nd U.S. Circuit Court of Appeals ruled in support of works made for hire, in “virtually identical circumstances”, against illustrator Jack Kirby’s heirs. The heirs had filed termination notices for works with characters he co-created, including the Hulk and the Fantastic Four.

That case was settled by an undisclosed Agreement, while the U.S. Supreme Court was set to consider whether hear the Appeal. The Supreme Court is not required to hear cases. It grants permission for a case to be put on its docket. It is unclear whether the Supreme Court would have heard the case, and only one Justice (now deceased) expressed openness to hearing the case.

The cases are Marvel Characters Inc v. Lieber, U.S. District Court for the Southern District of New York, No. 1:21-cv-07955; Marvel Characters Inc v. Ditko, U.S. District Court for the Southern District of New York, No. 1:21-cv-07957; Marvel Characters Inc v. Dettwiler, U.S. District Court for the Southern District of New York, No. 1:21-cv-07959; Marvel Characters Inc v. Colan, U.S. District Court for the Eastern District of New York, No. 1:21-cv-05316; and Marvel Characters Inc v. Hart-Rico, U.S. District Court for the Central District of California, No. 2:21-cv-07624.

2. The tale of Superman:

This case involved the heirs of the creators of Superman. In particular, Jerome Siegel and Joseph Shuster. Both gentlemen are deceased, but their heirs brought these cases. Superman is probably the most iconic and longest-tenured superhero in comicdom. However, his beginnings were humble. Two young men in tenements created the Man of Steel in their apartments and managed to get Superman published as a comic strip in a newspaper. Superman went through several iterations and became this god-like protector of mankind, currently portrayed in multiple properties. All controlled by DC Comics through their parent company. DC did not utilize “work for hire” contracts but did have the vision to obtain an Assignment of Copyright from the content creators. It was fairly early on that the creators realized that the deal they struck wasn’t equitable. Superman was worth a lot more than they got. Disputes started back in the 1930s and re-surfaced in the 1960s. DC prevailed for the most part, but newspapers once again factored in. The New York Times wrote articles in the 1970s addressing these items and the fact that the creators were destitute. As a result, DC and the creators entered into an agreement where Siegel and Shuster were paid annual stipends and provided health insurance. While no legal obligation was acknowledged, DC acknowledged a moral obligation. This resolution was temporary, and the estates brought new cases in the 1990s. After years of litigation and appeals, some of the earliest iterations of Superman Copyrights were reacquired by the estates, but not the vast body of comics and media versions. These matters were ultimately settled by the parties. The terms are not disclosed, but media depictions of Superman often include a credit stating more or less: “In Cooperation with the families of Jerome Siegel and Joseph Shuster.” Perhaps there was a concern on DC’s part that as time went by, the estates would continue to reacquire rights. Perhaps DC just felt settlement was appropriate. The legal status as of the most recent Court holding was that DC had rightly obtained valid Assignments, except for certain limited and early versions of Superman.

3. The tale of Kirby:

Jack Kirby is a legend in comic books. He and Stan Lee (Leiber) are considered the spiritual founders of Marvel Comics. They were a powerful creative dynamic duo, yet their fates diverged. Lee remained in various capacities with Marvel and had cameos in many of their movies, regardless of studio. Kirby was a work-made-for-hire contract creator and even worked for rival DC at some point. Nevertheless, it’s hard for comic fans to hear one name without immediately thinking of the other. This mental association is not law, and Kirby sued for Copyright rights. Despite the undisclosed settlement, the Court holdings were clear that the Kirby estate was not entitled to any rights due to Jack Kirby’s work made for hire status.

4. The tale of Captain America:

Alas, the tale here is not very different legally than that of Kirby. While the creator here was named Simon, his claims failed on similar grounds. While the case ruled in his favor on certain procedural grounds, the Court relied on a Settlement Agreement Simon entered into in 1969 wherein he expressly acknowledged that his contract status was as a “work made for hire” creator. As such, Marvel prevailed on the merits and retained the rights to Captain America. However, noteworthy to the curious is that another undisclosed settlement was entered into with the Simons.

It seems clear that unless there is some act of Congress, this dichotomy between Assignments and Works Made For Hire shall remain intact. That is good news for publishers. It might even be considered good news for fans who will not have characters disappear from their screens. Content creators need to be continuously aware of their status, value, and rights. They may need to have contracts better worded to adapt to circumstances where their work becomes a valuable property (unremunerative). Perhaps take some solace, that public opinion or other factors led to a number of undisclosed settlements despite Court victories.

In any event, your authors do not expect any Congressional action and feel comfortable that legal precedent will be upheld. Therefore, we expect Marvel’s affirmative actions will, sooner or later, be successful and they will retain all rights for the maximum time periods, barring some unknown creator’s status other than work made for hire.

If you would like to go back and read Chapter 1, click here.

To learn more about Dunlap Bennett & Ludwig and how we assist you, contact us by calling 800-747-9354 or emailing clientservices@dbllawyers.com.


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Posted in: Copyright, Intellectual Property

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