Property, intangible

I’ve written before about a bunch of copyright infringement lawsuits brought by numerous photo agencies claiming that book publishers exceeded the scope of licenses granted, either by publishing in unlicensed territories or printing more copies than permitted by the license. The photo agency business model presents litigation challenges, though: only the legal or beneficial owner of an exclusive right has standing for the claim, but a licensing agent may not have exclusive rights to the photos.

In Alaska Stock, LLC v. Pearson Education, Inc., Alaska Stock tried to solve the problem by having the photographers assign their copyrights to it so that it could bring the infringement suit:

Alaska Stock v. Pearson Education Inc. Copyright Assignments

If you can’t read the embedded document, it is a number of assignments from various photographers that all say:

The undersigned photographer, the sole owner of the copyrights in the undersigned’s images (“the Images”) … hereby grants to Alaska Stock all copyrights and complete legal title in the Images. Alaska Stock agrees to reassign all copyrights and complete legal title back to the undersigned immediately upon resolution of infringement claims brought by Alaska Stock relating to the Images.

The undersigned agrees and fully transfers all right, title, and interest in any accrued or later accrued claims … brought to enforce copyrights in the Images, appointing and permitting Alaska Stock to prosecute said accrued or later accrued claims … as if it were the undersigned.

Any proceeds obtained by settlement or judgment for said claims shall, after deducting all costs, expenses and attorney’s fees, be divided and paid as per the photographer contract of 40% for the undersigned and 60% for Alaska Stock.

Defendant Pearson Education challenged the assignments, claiming they were of only “the bare right to sue.” The problem here was not so much the scope of rights granted—in a grant of “all copyrights and legal title in the Images” the photographer has clearly retained no ownership interest—but that the assignments were for the purpose of facilitating litigation and only temporary.

But the court didn’t buy that was a problem that affected the validity of the assignment:

[T]he “substance and effect” of the written assignments in this case reflect a true, albeit temporary, transfer of ownership interest. Indeed, even the copyright certificates themselves list Alaska Stock as the registered owner. Although Pearson points to evidence that the assignments were made for the purpose of facilitating litigation, including the fact that Alaska Stock has agreed to reassign ownership upon completion of the litigation, the photographers’ reasons for assigning ownership does not make the transfer of ownership any less effective. Property rights are transferred every day for any number of reasons and for varying periods of time; copyrights are no different. The Ninth Circuit has never suggested that the reason an assignment is made—even if that reason is simply to facilitate litigation—or an assignment’s temporary nature will transform an otherwise effective assignment of ownership into an assignment of the bare right to sue. Rather, the problem arises where the assignor labels an assignment a transfer of ownership, but expressly reserves the exclusive rights in the copyright to itself. Those are not the facts presented here.

Pearson’s challenge to Alaska Stock’s standing was therefore unsuccessful.

Alaska Stock, LLC v. Pearson Education, Inc., No. 3:11-cv-00162-TMB (D. Alaska Sept. 11, 2013).

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