Author: Leslie Burns

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New Rules (probably)

The US Copyright Office is proposing new rules for registering photographs and it is asking for comments on these rules. There are three main categories with proposed changes: supplemental registrations, group registration of contributions to periodicals, and group registration of photographs.

The last one is likely the most important one for most photographers, so I want to talk about it, mostly, in this post. You can go here to read the official information(pdf), but I suspect most of you would rather poke yourself in the eye with a sharp stick as it’s written in governmental legalese. Here’re the basics you might want to know before wading into the Federal Register.

First, all group registrations of published photos (designated GRPPH) will have to be submitted electronically (no more paper options) with digital images submitted as deposit copies. Second, the maximum number of photos permitted in a single registration will be 750. Third, photographers would have to submit a separate list of all the photos being submitted as a part of the group “with a title, file name (matching the file name of the corresponding deposit copy), and in the case of GRPPH, the month and year of publication 29 (e.g., January 2016, February 2016, etc.) for each photograph in the group.” Finally, the deposit copies must be submitted in electronic form but you can send them on a disk or flash drive or upload them (with a 500MB limit per file uploaded).

Importantly, the last significant changeis that they are proposing a new category of Group Unpublished Photographs (designated GRUPH); before one could do an “unpublished collection” but this new category would replace that and have all the same requirements as the Group Published Photographs, including the 750 photos limitation and the list (but without publication dates, of course).

The only major difference between the two groups is that for published photos, the photos have to have been published within the same calendar year but the unpublished ones are not limited by time. Besides that, the groups must be only photographs and the photographs must be created by the same photographer–no mixing like 25 photos by Photo Bob and 32 photos by Photo Betty. Both the Group Published Photographs and the Group Unpublished Photographs registrations will be $55 per registration.

As always, you still may not mix published and unpublished in a single registration. That isn’t going to change with these rules chages, although I suspect that these changes may be a step in that eventual direction (maybe).

The Copyright Office is proposing to eliminate the pilot program for the Group Published registrations and to change the application process, to streamline it more. The Unpublished and the Published processes will be very much the same. Photographers will be encouraged to list the titles (and publication dates for published works) on the application itself as that will put them on the Certificate and that gives you advantages legally (I’m not going into that here, though–just do it) but, at a minimum, you’ll have to submit the list with all that information with the deposit copies (still, take the time to list the titles, it will be worth it).

Most importantly, the proposed rule would clarify that the single registration of a group confers full protection for each individual photograph in the group. That would eliminate the arguments that defendants use to try and limit the damages (or argue fair use) we see in court sometimes, like that using one image out of a registration of 500 items is de minimis since it’s only 1/500th of the whole. This is a very good thing.

To submit comments on these new proposed rules, first read the details in the pdf linked to above, then you can comment by going here. Note that comments are due by January 3, 2017.

The Supplementary Registration is used to correct errors or make changes to an existing registration. Hopefully, you’ll never need to file one, but if you do you’re very likely going to have to do it electronically in the future. For more information on the proposed changes or to make comments, go here.

If you make contributions to periodicals, you may use that form of registration (GRCP) and there are changes there as well. Mostly, it is about making the registrations electronic, much like the Group Photo options I described above (are you seeing a theme here?). Notably, the Copyright Office notes in the Group Registrations proposed changes that it encourages photographers to use those options instead of the GRCP as there are fewer limitations. Still, if you use this form of registration (and this applies to text as well as photos, by the way), you should go here to read about the changes and to submit comments.

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It’s not new if it’s the same

Here is yet another sad story of the timing ofregistrationbiting creatives in the butt. The short answer is that tattoo artists didn’t register the design in tats made on NBA players (including LeBron James) when theymade them, but instead after the first infringement of the tattoosby a video game company. That is, when the players were reproduced in video games, the tats were also reproduced, and since they weren’t licensed by the tattoo artists, the copyrights in the tats wereinfringed. In 2015, after the 2013 infringements (in NBA 2K14), the artists registered the work and when the same video game used the players (with tats) again but in the NBA 2K16game, theybrought suit seeking attorneys’ fees and statutory damages of up to $1.2 million.

The court said the “new”infringements weren’t actually new but rather the game was an iterationof the original one, with the original infringements. Sincethose started before the registrations, boom, statutory damages and attorneys’ fees were barred.

Ouch.

The artists are claiming the actual damages (still available under the law) are still significant, but they’regoing to have to prove up those damages; that is going to be a bear.

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Lift & Separate

(updated 12/2020)

Long before I became a lawyer, I advocated for two things when it came to photographers fees: raise them (particularly the license fee) and separate the creative fee from the license fee. The big push-back was often that buyers don’t like it. Well, the buyer has its self-interests but you must respect your own.

I bring this up because I’ve seen it repeatedly in my practice: a photographer comes to me with a possible infringement and, not having timely registered the copyright in the work (grrr!), leaves me no option but to see if there are sufficient actual damages in the form of lost licensing fees to make the case worth my efforts. When asked what her/his usual and customary license rate is for a similar use, the photographer will respond with something like, “Well, I would have asked $2000.”

My next question is, “Do you have invoices to back up this rate?” And the responses are either “No, but that is what I would have charged,” (ugh) or I am presented with an invoice for the creation of the work with a combined creative/license fee of $2000 (ick), or, worst of all, I get the invoice for the creation and licensing of the work where the photographer only charged $500 on some sort of mega-discount but it only shows as a $500 total fee (hurl!).

Obviously, none of these are good answers to a lawyer’s ears.

In the first case, no history of licenses, it could be worse. I can at least argue for the fair market value of a license and then, using common metrics like Fotoquote and online calculators for stock license rates, get a number. Sadly, as we all know, those numbers are likely to be low, particularly since there are more and more cheap stock sites out there. But still, at least I’ve got nothing the other side can use against my client.

In the last case, you’ve just set you price, forever. You are never going to get anyone to believe that a license similar to the original one is worth anything more than a few dollars because you have told the word that you’ll make and license it for so little! Now, if you are going to offer a super-mega-discount (and that’s totally cool, sometimes), make sure that you spell it out on the invoice like:

Creative fee: $2500
One-time Discount: -$2300
License Fee: $4500
One-time Discount: -$4200
Total Fees: $500

That way you are saying “my usual price for this license is $4500” and that can be used as evidence later of your actual fees. That’s great! But, if you just list the discounted price, you’ve only got your word that you normally would have charged more. That won’t hold up.

In case #2 above, all bets are off. The other side can argue that $500 was the license fee and $1500 was the creative fee, or worse. It is almost impossible to argue successfully that the majority of a combined fee is for the license and not the creation of the work, unless it is spelled out in the paperwork. I’m good, but I can’t make butter with a toothpick and there are plenty of good attorneys on the other side who can present evidence that the fair market value of the license is only $200. If you’ve got nothing in your records to show otherwise, then it’s quite possible that all you can get for actual damages will be that $200. At the very least, in court, it would cost a hell of a lot more in expert testimony to try and prove up your damages, and the other side knows it, so they can stonewall in pre-suit negotiations. You got no bat, as they say. Go home.

The best business practice, both for now and to protect your values in the future, is to separate out your fees on your paperwork and, very importantly, to make your license fee the higher portion of those fees. Later on, you can use those higher numbers to support getting higher actual damages. Also, if you do timely register your work, the courts will often look to the actual damages in setting statutory ones (like maybe doing a multiple of actual damages). If you can prove up substantial actual damages (a high license fee), you are more likely to get higher statutory ones. Proof of higher fees will make it easier for your attorney to argue for higher pre-suit settlements as well.

As for the argument that your clients want combined fees, well duh–and you’d like a million bucks for the shoot. They don’t get to tell you how to run your business–they are not doing you a favor by hiring you. They’re hiring you because you are good at your job; moreover, you have to run your business your way, not how they want it. Besides, they can’t complain if you do as in the example above: that is, you can give a final number that is combined, just make sure that the line items are separate. If they argue for a higher creative fee and lower licensing one, you know they are thinking of the future when they want to re-license; so should you and a higher license fee now means higher re-license fee later.

Run your business like a business. That includes thinking about future value and long term effects.

It’s not hard, it just takes some guts. You can do this.

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Song? Dance? Seltzer in the Pants?

What do I have to do to get you people to register your copyrights?!?! Look, I love you creative types, but I’m getting a dent in my head from the repeated headdesking caused by cases that would be as close to perfect as you can get, except that the work was not timely registered and thus are either essentially worth nothing or proving up the damages would be a nightmare.

I want to be able to help you and this firm will take smaller cases than many other firms, but I can’t take cases for a contingency fee where actual damages are the only option and those are the lost license fee for use on social media which you’ve either never actually licensed or you have for almost no money. Proving up the damages, even if possible, won’t be worth the time and effort.

However, if the work is timely registered then I have a much larger stick to wield on your behalf: statutory damages of between $750 and $30,000 (for non-willful infringement) plus a good shot at attorneys’ fees if the matter is litigated.

Timely registration isn’t that complicated. A registration is timely only when one of the following is true:

  1. the effective date of the registration is before the infringement starts; or
  2. for published work only, the effective date of the registration is within three calendar months of the first publication of the work, and that could very likely be the date you provided the work to your client rather than the date when your client used the work.

Thats it. Thats all. Those are the law’s only options. You’ve got to register your work and the registration has to fit either #1 or #2 for you to be able to have access to awards of statutory damages and the potential for winning attorneys’ fees and costs in litigation.

So how can you make those rules work for you? First, for any new work that is likely going to be published in the sense the Copyright Act uses the term (and how I mean it throughout this post, which includes work you’re going to provide to your client for their consideration and possible use, as well as work you offer for license on your own website or elsewhere) either register it as unpublished before doing anything with it, or, provide it to your client or post it on your stock site (etc.) and then register your work as published within that three-calendar-month window.

I prefer the second option for photographers for a bunch of reasons, some of which are very nit-picky technical legal ones that I’m not going to bore you with here. Mostly, I prefer the register-as-published option because, these days, almost everything posted anywhere is published. So, I suggest a photographer should, for everything created AND in any way released to the world in any one month, register it all (as published) on the last day of that month, and that way you don’t have to worry about missing the three-month window*. For best protection be sure to remove any images you know weren’t published and register those separately as unpublished at any time before you publish them. Mixing published and unpublished is like crossing the streams in Ghostbusters, that is, bad.

If you’re a photographer, you can do group published photo registrations online for one fee ($55). Following the once a month plan above, for a year that would be 12 x $55, or $660. Group published photo registrations are slightly more complicated to do but, after you have done it once, youll see it isn’t that bad and, best part for now, is that your first time you will be supervised by the Copyright Office itself as a part of its pilot program, so theyll help you through it.

If you are creating other non-photo works, like illustrations, you should not let the work out into the world at all and, instead, register your pile of works as a “collection of unpublished works” once a month, for the same fee (then you can let the work out). Sadly, there isn’t yet a simple group option for multiple published works as there is for photographs.

Now, before you start whining about that cost, let me point out, again, that the minimum statutory damages award for a single infringement is $750. The math is totally in your favor.

So please, register your work. I beg you. I’ll do anything to get you folks to register your work. Someone get me a new seltzer bottle (mine is an empty antique as you can see above) and I’ll prove it.

(The subject line of this post is a reference to Chuckles the Clown’s philosophy)

 

*It also helps you avoid another rule that for a group published photo registration the work must be published within the same calendar year so, if you do it on the last day of each month, you won’t screw that up.

 

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Thinking Long

It’s been a couple of weeks since I’ve posted, mostly because my personal life has recently taken a large chunk of my time. I have an elderly parent who is dealing with some significant medical issues plus I had to say goodbye to my longtime furball companion (and imaginary law partner) Benito T. Katz-Burns.

I bring up these personal things because they’ve made me think about impermanence, my practice, and serving my clients. Basically, it all made me think that the best thing I can do for my clients it to encourage them to think long.

Thinking long means looking long term and taking small steps that can have a big outcome. For example, compound interest is a cornerstone of thinking long: a little put away early in life can be a lot later.

As the saying goes, none of us gets out alive. What you do as a creative professional, however, will live beyond you. The assets you create, the copyrights, will pass on to your heirs after your demise and they may be much more valuable than you think. Thinking long means planing for them.

Actually, those assets may be much more valuable than you think now, too. Let me give an example…
Imagine a photographer who has a ton of copyrights, because this photographer has created a ton of photos[1]. One of these photos is being infringed often; by often, let’s say at least 100 times (so far). This photo isn’t the photographer’s best work (it’s a fine photo, but the photographer has much better ones); if you had to pick out from a pile of 1000 of this person’s photos which one would be the oft-infringed one, you’d probably guess wrong, like, 990+ times. Nonetheless, this one photo gets ripped off more often than bikini wax in Hollywood.

The photographer has registered the copyright to this photograph, so that means the minimum award for an infringement (assuming the defendant cannot prove innocent infringement, which is very hard to prove)[2] would be $750. This photographer has a history of licensing and can prove up damages of more than that, but for the sake of space and time, lets just assume that the photographer settles, over some time, 100 infringements for an average, each, after legal fees, of $1000.[3]

For those of you playing along at home, thats $100,000.
Not small beans!

Now, if this photographer suddenly died (heaven forbid!) before settling those cases, the photographer’s heir(s) would get ownership of that copyright and, assuming they pursued the infringements, get the money. And that’s just the cases that exist now–that photo will likely continued to be infringed.

In other words, you could be sitting on at least one good-but-not-great creative work that, in the long run, could pay for your kids college (or a big chunk of that); or help pay off your mortgage; or provide for your loved ones after you’re gone. And don’t forget,that math is for just that one photo (and its copyright)–any creative pro has easily thousands.

This is the time for thinking long. Do the small things now that will enable you to reap rewards, long into the future.

Thinking long is why I nag at you to register your copyrights–so that you have the right to statutory damages of no less than $750. Little numbers add up over time. It’s also why I keep bringing up having an estate plan. Your work is worth more than you might think and you don’t want that going to your fundy brother instead of your beloved non-spouse.

Thinking long is also a big part ofwhat I do and the way that I do it–so that creative professionals (you) can have legal representation in a cost-effective way.

Thinking long can makea big difference in your business and your life (and your loved ones’); give it some thought.

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[1] While this hypothetical is based on a real client and photo, please remember that it is a hypothetical and that you should never rely on a hypothetical or any previous results when it comes to your own case(s).

[2] See, e.g., National Football League v. PrimeTime 24 Joint Venture, 131 F. Supp. 2d 458, 476 (SDNY 2001) (noting that a defendants burden to prove innocent infringement is a heavy one).

[3] Yes, this is not scientific but rather a very rough estimate based on a bunch of facts I’m not going to go into here. Also, some matters never settle, some settle for more and others less; I’m doing some whopping generalizations to make a point. In other words, just go with it.

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How to Work With Your Lawyer: Trust

Creative professionals are usuallyvery smart people. Whether formally educated or not, your brains tend to fire pretty well (even if some people think they fire, um, differently). This is generally a good thing (especially the differently bit) and can definitely make for better art, no matter what your medium. The downside is that sometimes some of you think you know more than you really do*, especially abouta very technically precise field like the law. That attitude can bite you in the ass.

When I was in law school, I wrotea post on my Burns Auto Parts Super Premium Blog about how, before law school, I thought I knew copyright law pretty welland how wrong I was. See, I learned that while I knew more than the average person, what I knew was actually very, very little, especially compared to, say, a copyright lawyer. There is so much more to copyrightlaw (and law in general) than I ever could have imagined without having gone through all of law school. There is the interplay between the statutory scheme and constitutional issues, and how it works in day-to-day business, and how the courts interpret all of it, and more.Unless you immerse yourself for three years in intensive, undistractedstudy (hello,law school) and then get out there in the trenches, you just can’t know. I sure didn’t. Even after all that, you still have to do what I do: spend a ridiculous amount of time reading cases and highly technical academic articles to learn more, every day, just to keep up.

But I was one of you before law schoolone of those who even debated the woman who would become my mentor, Carolyn Wright, on legal questions that appeared in places like the old APA Forums. I look back on those debates with more than a little embarrassment. I thought I knew the law well enough to challenge her opinions when, really, I knew just enough to probably frustrate the hell out of her when she was trying to help by teaching the community the (actual) best practices (I will always appreciate her grace–not once did she later say “Do you remember…?”).

Now, after practicing for years, I know what itfeels like to be challenged by people who think they know more than they do. I have the headdesk-induced scars to prove it.

The most frustrating thing that happens in my practice isnt when the opposition pulls some chicanery or even when I get called names by defendants. Nope, the worst is when someone comes to me with a question which I answer based on my expertise (and often I do additional research to make sure my info on that particular issueis current), and then s/he doesnt like the answer, saying, Well, I feel that youre wrong.

First, you dontfeelthat Im wrong, youthinkI am (language matters!); and second, if you arent going to trust my opinion, then you shouldnt ask for it. Thats not me being petty, thats me knowing that I cant do the bestfor you unless you trust me when it comes to legal issues. My job is to fight for you and to have your back, but I cant do any of that if you dont trust that what I am telling you is the best, most accurate answer and advice based inthe law that I can give you. I’m not making stuff up or telling you what I think you want to hear–I’m being 100% straight with you. Im happy to talk to you and explain what I can, but in the end, you just have to trust me.

There are ethics rules that say we have to do what is best for you, sure, but I think most lawyers actively want to do what is best for our clients; that means telling you the truth, even the hard truth. None of us lawyers likes having to tell a (potential) client bad news. We know its unfair that a screwed-up copyright registration can scuttle an otherwise beautiful case and that the Copyright Office makes it damn easy to screw up (especially the published/unpublished thing). It sucksthat if we cant get you statutory damages (register, please) or documentthe value of yourlicenseis $10K we cant get $10K for you. It’s frustrating as hell that while any normal human can see your work has been knocked off, stylistically, proving its actually an infringement isn’t so clear and itwould cost gods own wallet to litigate and we could still lose, so we cant take the case on a contingency fee basis. And it’s not easy to tell you that you cant not do X now (without repercussions) because you agreed in your contract to do X.

Lawyerswant to be able to help people; thats why Ido what Ido (honestly, I think all good lawyers still hold that as their first principle). We look for ways to sayyesto whatever it is that you want, to enable you to achieve your goal, to fix the wrongs, promote the good, and to defend your rights, but sometimes we have to saynoornot like that you cantorwell, you can try it, but heres what youre risking, orit just isnt worth that much, or even,it sucks, but justwrite the check and move on. Your job, then, is to trust your lawyer; s/he is offering you the best advice possible.

I (and others) have describedlaw school like military bootcamp for the brain: a law student is stripped of her old way of thinking and taught a new way in her first year, then trained to use that new way to alevel of competence in the next two years. Then, we go out and apply it all in the real world, honing our knowledge and skills as we go. Maybe the Vulcan Science Academy is a better analogy, actually, because we learn toprocess a ton of data with dispassionate logic. But the best of us also reintroduce humanity to the practice and become weird hybrids of logic and compassion. That’s what I shoot for (and I know others that do the same).

The result of this training is that lawyers think strategically as well as tactically about each of your issues and formulate a plan to achieve yourobjectives, if at all possible; or to minimizethe bad stuff, if not. There is balance and judgment involved. Its tough work that requires more time and energy than you know. And that’s not me being egocentric–it’s just like howyour work is much more complicated and subtle than any outsider ever understands. Your work is pretty miraculous to me, even whenI don’t care for it aesthetically.

So, to have the best relationship with your lawyer, you dont have to like what you hear, but you do have to trust that it isseriously considered, bestadvice, with your best interests in first position.

Oh, and if you don’t think it really is, then don’t hesitate to get a second opinion from another lawyer.
But don’t be surprised ifthe answer is pretty much the same.

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*This is true for all of us–we all have those areaswhere we think we know more than we really do.

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I Do. What Did I Do?!

Ah, love. I love love.
Marriage, however, well, let’s say I am not such a fan. The idea of getting married gives me Humback-whale-sized willies, just as a concept. But I’m odd in that–most people want to get married at some point, including creative pros.

Many traditional wedding vows point out that a marriage shouldnt be entered into lightly or unadvisedly. Good advice, but it’s given too late, while you’re standing there in front of friends and family, sealing the deal. For creative professionals, there is an extra wisdom to that advice that you need to think about long before saying,”I do.” If you are a creative professional, particularly a self-employed one, then marriage may affect you in ways you never dreamed.

As a creative pro, you create intellectual property: copyrights. When a creative work is made, fixed in a tangible (including digital) medium, the copyright automatically comes into being. I like to tell photographers that every time the shutter clicks, a copyright is created, but its the same for any creation; when I finish writing this post, its copyright will come into being.

The initial owner of the copyright is usually the author/artist who made the work. There are exceptions, like if you are an employee and make the work as a part of your job, or if you have signed a work-for-hire agreement before creating the work; but, for independent artists, the initial owner is usually the artist. That means, if you are a self-employed creative pro, you automatically own the copyright in each work you make. You make art; boom, you make its copyright.

Copyrights are assets. They are property (there is a reason copyright, trademarks, etc., are called intellectual property). They have value separate from the art-object itself. You can buy a painting, but that does not mean you own the painting’s copyright[1]. Copyrights can be bought and sold all on their own, separate from the art-object, too. The rights associated with copyright, like to reproduce a work, can be licensed to others. If you register your copyrights (and, please, register your copyrights), you get extra tools if they are infringed but, even without registration, copyrights are valuable assets, just like a car or a house.

Because copyrights are property and are like any property acquired during a marriage, if you divorce, they can become part of the calculations for spousal support, child support, or even be a part of the actual division of assets.

If you live in a community-property state, except for California (where copyrights still matter, but differently so, and well get back to that bear–pun intended–in a minute), the value of your copyrights has to be included in the division of property calculations. They also may affect spousal support and child support, but I’m not going into those support issues in this post (trust me, it’s a nightmare). In a community-property state, virtually all assets[2] acquired (or created) during a marriage must be split 50-50 at divorce. Very roughly speaking, this means adding up the value of all the assets in the marriage and dividing by 2.

As a massively simplified example: imagine you created only 2 copyrights during your marriage and they are valued at $5000 and $45,000; your soon-to-be ex gets half that total value, that is, $5K + $45K = $50k 2 = $25,000[3]. Get out your checkbook.

Now, think about how many copyrights you create in just a month or a year. Yup, we’re talking a ton of potential value. Just determining the value of the copyrights is going to be costly. You don’t get to say They’re worthless! Nope, you will need to hire experts and it is likely your ex will as well, adding to the costs and the legal fees as this is all hashed out.

Now, if that isn’t bad enough, even more concerning is that if you get revenue from the copyrights, your ex may also be entitled to a share of that revenue. This may betrue even for future revenue, after the divorce, as long as the copyrights were created during the marriage[4]!

Turning back to the California bear, things here are even more troubling for the creator-spouse. In my adopted state, not only does the non-creator-spouse (if you split) get the (ahem) gift bag described already, the state courts have decided that the non-creator spouse, at the moment of the copyright’s creation, automatically owns an undivided half of the actual copyright in any work created by the creator-spouse during the marriage[5]. You read that right–you create and your spouse magically becomes the joint owner of the copyright, right then.

Whats the big deal with that? Well, lots (including that I think that is contrary to federal law) but, practically speaking, it means that, even without divorce, the creator-spouse loses control over her/his work. I don’t care how much you love your partner, this can really suck. The non-creator spouse in California can sell or bequeath his/her half interest in the work to anyone, without the creator-spouses permission. S/he can also license the work to anyone (assuming that thelicense is otherwise legal), again, without the creator-spouses approval; the only requirement is that revenues must be (equally) shared.

The final California insult: at divorce, if you are the creator-spouse, you’re going to have to negotiate ownership with your soon-to-be ex, which will likely mean buying him/her out. Ouch. If not that, then agreeing to transfer halves to each other, meaning that you lose ownership of some of your own work. Ouch again.

Most states are not community-property states, luckily. However, even under their various laws, the value of your copyrights may significantly affect any financial settlements in your divorce.

You can avoid much of this by getting a prenuptial agreement that includes provisions to keep copyrights as separate property and describes how revenues related to them will be handled, in the event of a split. If you are already married, you can still have such an agreement drafted (a post-nup) and (hopefully) executed by you and your spouse. As in all things, consult with your own attorney before doing anything–preferably one who does primarily family law (so, um, not me) but who understands IP law or who can collaborate with someone who does (like me).

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[1] Unless you bought that too, and that transfer has to be in a signed writing.

[2] There are some exceptions, depending on the state.

[3] See, e.g., Berry v. Berry, 277 P. 3d 968 (Hawaii 2012)

[4] See, e.g., Rodrigue v. Rodrigue, 218 F.3d 432, 443 (5th Cir. 2000)

[5] In re Marriage of Worth, 195Cal App. 3d 768, 241 Cal. Rptr. 135 (1987) is the controlling case in California.

 

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Pay Your People, NOW

If you are working in California and use crew (including models/cast) of any kind, you need to pay your crew before they leave on the last day of the project. UPDATE: As of September 5, 2019, you have up to the next REGULAR payday after the end of the project. Still, don’t screw it up. 

No, I am not kidding.

California’s labor laws are some of the most complex in the USA, but you probably already knew that. Maybe you’ve heard that some of those laws state that when you dismiss an employee, that employee must be paid in full on the day of the dismissal (that includes things like accrued vacation time, by the way). What you likely did not know is that when you hire a model or a stylist or an assistant (etc.) for a project, be that for 2 hours or 2 weeks, or 6 months, when that project ends, you are “dismissing” the person for the purposes of the applicable laws; that means that you must pay the person everything s/he is owed, on that very day. There is a minor exemption for motion pictures (it gives a little leeway) but, trust me, you don’t qualify for it.

I already know what you’re thinking: I’ll just have in my agreement with any crew that they will be paid within Xdays. Bzzz! No.Thank you for playing. The laws specifically prohibit contracting around this requirement.

This is a sneaky requirement and one that can cost you a pile of buckos (considerably more than the Benjis above), especially because there are often layers of players. For example, maybe you are contracted by an ad agency for an end client… you could end up holding the bag. The penalties are very steep–including having to pay the person’s wages for every day you haven’t paid, for up to 30 days, plus the employee can get attorneys’ fees. So, for example, you hire a stylist for $1500 a day, for a one-day shoot; then, you don’t cut the check for two weeks. You now could be on the hook for (on top of the original $1500 you’ve already paid) $1500 x 14 = $21,000, plus attorneys’ fees!

Apparently, models in particular are catching onto this and they are suing or threatening to sue photographers and their clients for these claims. To be clear, you are not out of the woods if you go through a modeling agency whichyou pay later, or a producer, or any agency. Also, trying to claim that someone is an independent contractor will also likely not save you–in California, you should assume that any individual working for you on a creative project under your direction is an employee under these laws (and others, like the workers comp laws).

Now, even if you aren’t in California, your state may have similar laws. It’s something you should definitely check on.

So, what can you do? Your best action is to pay your cast and crew on the final day of anyproject. If you are using an agency or a producer who will be paying others, still pay on the final day and have that person/entity indemnify you against any claims related to these laws (talk to your lawyer about this). Have your payroll company on notice that you need to pay on that day. Maybe arrange to pay electronically, on that final day.

In short, pay now,because you sure don’t want to have to pay later.Besides, it’s just good to pay your people immediately; stringing people on (even if you get strung by your client) is, in my opinion, a petty, nasty practice. Don’t do it. If you pay immediately, sure, you may be a bit cash-poor until you get paid but, in the end, you’re doing the right thing.

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Sit On Your Hands and Breathe

In some ways, law school is like learning to be Vulcan–you have to learn to think logically and keep your emotions out of it. It isn’t that we lawyers don’t feel (boy howdy, no!), but we have learned to be ledby logic rather than our emotions, at least when it comes to our cases. We learned to think rather than react. That difference can be rather crucial in legal matters.

My studies in Buddhism have helped me with this. I have learned to sit with thoughts and feelings, to observe them without judgement, and to make better choices from that. It takes a hell of a lot more to make me lose my temper than it used to. I still feel, and profoundly, but I can identify that as “feeling” and not let it interfere with my rational processing.

Creative clients are especially emotional sometimes. I think it is part of what makes you all artists–you make your livings by expressing emotions in some manner. For some of you, this can manifest as reacting before thinking. While that may be great for making your art, it can be very bad when faced with a legal issue.

Let’s take an infringement, for example. If you find your work being used without your permission, you’re going to be angry and hurt and you’re going to want to yell at someone, but that would be a poor choice. You could accidentally limit your recovery (or at least make it damn hard to negotiate a good settlement). You may throw a client under the bus because it accidentally shared your work (maybe if you knew that you’d forgive the client’s idiocy to keep that client). You might say something that isn’t true–my favorite is “The penalty for infringement is $150,000 per infringement!” (sigh…if only!). You may also be mistaken and the user does have a license you forgot about or it’s a legitimate fair use. If you go off half-cocked, you’re not going to catch any of that and, well, that would be bad.

So, when you find an infringement, here is what I think you should do:

  1. Immediately preserve evidence of the infringement (make screenshots, for example). Find every use you can and capture every URL, buy products that bear your work, take photos of your work being used, etc.
  2. Look up the company/person who controls the infringement, likethe website (try a Whois search, perhaps), or the manufacturer of the product. Save that info.
  3. After that, sit on your hands (i.e., do nothing) and breathe.

Do not call or email the infringer/bad actor. Do not call or email the entity you think may have “shared” your work. In fact, don’t even call or email yourattorney (yet). Nothing is going to get fixed immediately and no more harm is going to happen (in most cases)–you have time. You have three years to bring a suit for infringement in the US, so doing nothing for a couple of days after finding the infringement isn’t going to hurt your case. If your work isn’t registered and it is more than 3 months since you first published it, registering it now isn’t going to change anything for the better, even. So just sit and breathe.

After you have calmed down, maybe days later if you are really upset, look at the evidence you gathered. Search for any license you may have granted that might cover the use. Find your registration materials (assuming the work is registered). Basically, get everything together to make your case file. Then re-evaluate your case and set your goals to make you whole. Then you can plan on how to achieve thosegoals. And then you can begin to act.

This is true for many matters–that is, nothing bad is going to happen if you don’t act right that very second but you can do harm by reacting without thinking. Instead, record the evidence; sit on your hands and breathe; think/re-evaluate; set goals; act.

Now, “act” may very well be “call/email my attorney” but, by taking the time to let the emotions cool off, you haven’t hurt your case and you have thought about what really matters to you in it. The slap-in-the-face you felt will have calmed so that you can think more rationally about what you want. And you have all the materials together to help your attorney evaluate your case.

You don’t have to become Vulcan-like, but if yousave most ofyour emotions for your art, you’ll likely get better results in both your art and the law.

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Breach or Infringement?

I’ve heard that some photo organizations may be suggesting that the way to avoid the costs of litigating an infringement claim is to have a liquidated damages clause in your site’s terms of service (TOS), because then (they say) it’s a breach of contract rather than an infringement. For example, if you put something on your site’s TOS like “If you use any of the work from this site without a license, you agree to pay to PhotoBob three times his usual fees for the license” and someone uses your work, then you can bring a breach of contract case in small claims court and avoid the cost of litigating infringement in federal court.

I have to say, I think this is very bad advice. I hope that pro groups are not recommending it. Short answer? It probably won’t work and, even if it could, it’s not a good choice. Let me explain.

First, it is very possible that your TOS are not binding on your visitors. There is case law that says that in order for TOS to be binding, a user has to either click to agree to those terms (called a clickwrap agreement) or those terms have to be so obvious as to, essentially, be on each page of your site–just having a separate page with your TOS won’t cut it. (Lawyers reading this, yes, I’m generalizing from the cases–we need to know the nitty gritty but creatives really don’t.)

Second, even if you could make the TOS stick, you would be limited to winning no more than your 3X number, and you’d have to prove that you usually got $X as a license fee in the first place. 3X is likely not going to be much money. In fact, it’s going to have to be under like $5,000 if you want to stay in small claims, depending on what the small claims court rules are where you are–that is, there are limits on how big a case you can bring in small claims. Oh, and you probably can’t use a lawyer (many small claims courts bar representation) so you’re going to have to do it all yourself.

Oh, and let’s say you win a judgment in small claims and the defendant doesn’t pay. You can’t then go marching into federal court claiming that it’s now an infringement and demand a lot more money. Even if by some miracle you did pull that off, that is that the court didn’t dismiss the case immediately, the court would likely say your damages are limited to the judgment you got already or darn close to it.

Third, how are you going to prove that the infringer got the work from your website? Have you posted it anywhere else, like Instagram? Good luck enforcing your site’s TOS, then.

Fourth, and this is the big one (yes, I buried the lede): copyright pre-emption will likely make your breach claim a loser. See, copyright is exclusively federal law and can only be adjudicated in federal court; so, if you bring a claim that is really an infringement claim, a smart defendant is going to tell the small claims court “Hey, this is really infringement we’re talking about here so you have to dismiss this case because this court doesn’t have jurisdiction.” I think a defendant is going to win with that and, boom, you’ve just waisted all your time (and filing fees).

There is one possible exception to pre-emption here, but it’s a narrow window and one I don’t like anyway. That is, if you agreed to license the work to the defendant and it later failed to pay for the license, then courts have said that is a breach of contract rather than an infringement (unless the terms of the written license stated that the license was contingent upon full and timely payment). See Effects Assocs., Inc. v. Cohen, 908 F.2d 555, 559 N.7 (9th Cir. 1990). Now, I think you should have written licenses and those licenses should specifically state that no license is granted until full and timely payment is received; but, if you have that, then the courts say it is not a breach of contract and, so, there you go… pre-emption again.

Really, I think it’s cutting off your nose to spite your face to try and convert an infringement claim into a breach of contract one. I mean, if you register your work in a timely manner (before the infringement) then you have the right to elect statutory damages and you have a decent chance at being awarded your attorneys’ fees as well. That is very, very likely going to be a much larger number than what you’d ever get in small claims court. More importantly, if you want to avoid litigation (and I always say: you want to avoid litigation), you have a better chance at negotiating a better result if you have statutory damages and maybe attorneys’ feesto back up your claim. A breach of contract claim is almost always some kind of wonky and the damages are limited–why do that to yourself?

 

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