“Copyrights are at the core of most SMEs and quite simply, they are the easiest right across the spectrum of IP rights to solidly acquire.”
Discussion around intellectual property strategies for small and medium enterprises (SMEs) often focus chiefly on patent and trademarks. But the benefits of copyright to a small business should not be underestimated.
Copyrights protect the expression of ideas in works that are tangible. Copyrightable subject matter is very broad—all “original works of authorship, fixed in a tangible medium” are protected immediately from creation. The U.S. Copyright Office lists these categories as subject to copyright protection: literary works, musical works, performing arts, visual arts, other digital content (including computer software code), motion pictures, photographs, sound recordings, and architectural works. 17 U.S.C. Section 102.
The public’s exposure to copyrights is mostly in the form of written works, songs, and the visual arts. The copyright symbol (©) is ubiquitous, but beware that adding this symbol to your works does not confer the benefits available from formally filing your copyrights (called registration) with the U.S. Copyright Office. However, use of the © symbol is also not legally required in order to claim copyright, because copyright is automatic from fixation (unless the author otherwise dedicates the work to the public domain). The rights of copyright owners generally enable protection from copying and foster commercialization of the work, such as distribution, reproduction, display, and performance, and authorize others to do the same.
Copyright is at the Core of Most SMEs
Copyrights cover work that is written down or otherwise “fixed”, or captured, like a photograph. Copyright protection subsists immediately from that moment of fixation. For the entrepreneur and SME, copyrights are a part of every business. Many businesses have important copyright cores, such as content creation, design, fashion, or entertainment businesses. All of those enterprises have expression at their heart, just as copyrightable source code is the heart of a software enterprise.
As long as the work is (i) original (e.g., not copied, even if not unique); and (ii) fixed in a tangible medium of expression, then copyright attaches from the moment of fixation, and the author can control commercial exploitation of that work for the long copyright term. 17 U.S.C. Section 102. Businesses should consider all of the works that contribute to the business as candidates for express copyright recognition and protection.
Although copyright comes into existence automatically, the U.S. Copyright Office does offer registration, and business owners should avail themselves of this option as a core IP asset for their companies. However, even without registration, authors are still copyright owners. Every American is granted a copyright by virtue of their works; every email and photograph is protected by copyright, whether or not it is the subject of a registration.
Copyright registration provides authors with the opportunity to gain a strong advantage in copyright litigation. Timely registered copyrights afford the option for statutory damages, plus the potential for attorneys’ fees in copyright litigation. 17 U.S.C. Section 412. These statutory benefits are the showstopper for the value of copyrights within the IP spectrum.
What Is Timely Registration?
The optimal timing for the copyright owner is at or before publication. After publication, which is under the control of the owner, there is a 90-day grace period after publication to retain full benefits under the law. As a result, copyright owners should:
- Pursue timely copyright registration by filing at the U.S. Copyright Office.
- File for copyright registration as or before a work is published.
Quite simply, copyrights are the easiest right across the spectrum of IP rights to solidly acquire.
Statutory damages are part of the law for registered copyright owners. Statutory damages are a monetary award that can be selected by the copyright owner without proving actual damages from infringement; they act as a deterrent to infringement of works where the act of infringement itself causes little marginal monetary damage. Under statutory damages, the damages are set as a baseline for relief as a function of a quantity of infringing acts. Where registration occurs prior to the act of copyright infringement, statutory damages from at least $750 up to $30,000 for non-willful infringement, and up to $150,000 for willful infringement, are available for each work infringed. 17 U.S.C. Section 504. Statutory damages are a very important option for the copyright owner, because the proof of actual damages in an infringement suit is expensive and sometimes difficult. Instead, once infringement is proven, the copyright holder has the option to present no further evidence regarding monetary damages. Predetermined damages and less evidence mean less ammunition for litigation gamesmanship.
Copyright registration sets up the potential of reimbursement of litigation attorneys’ fees in a successful copyright infringement litigation. Where litigation has to be pursued (with a suggestion of pursuit solely when it is a last resort as a requirement for your business), you may get your attorneys’ fees back. The impact of a heightened chance of attorneys’ fees on litigation strategy cannot be over emphasized – because without a timely registration, the copyright owner is prohibited from seeking attorneys’ fees, even if the infringement is willful. The risk of fees also may be used in settling the litigation before trial, changing the dynamic of the course of litigation in your favor – even a tactic for the falsely accused defendant.
Where these statutory benefits are not available due to a failure of a timely filing, only an award of actual damages and profits is available, and attorneys’ fees are not available for any copyright claims. This can squeeze the copyright holder into having few practical avenues for enforcement of works with even moderate commercial value – without a timely registration (and thus no possibility of attorneys’ fees) practically speaking, only very lucrative infringement can be enforced.
A Good Investment
There is another basis for registered copyrights being such a valuable asset: cost. The benefits presented above for copyrights are attainable at a de minimis cost. In fact, the investment in spending hours with an attorney considering copyrights is proportionally greater than the range of costs for a copyright filing, from filing it yourself for a fee of $45 (or $65 for a corporate owned copyright) or on an average flat fee basis of less than $1,000 for an ordinary filing using an attorney. Copyrights do not have any maintenance fees. When we compare copyrights to their best-known companion in the IP spectrum – patents – copyrights are stronger from a cost basis. While patents can add thousands to the up-front cost of initially obtaining the right thanks to maintenance fees over its 20-year lifetime, the one-time cost for a copyright’s term of the life of the author plus 70 years makes it an outstanding investment and IP asset.
Probably the best reason to rush to the U.S. Copyright Office, though, is not what you get, but what you miss by failing to leverage this asset.
On a broader societal level too, copyrights embody the fundamental human activity of expressing ourselves. Expression enables a notice function to society of your personal expression, which you are entitled to own, versus general ideas, free for everyone to use, with their own expression. In this way, copyrights reflect the balance of intellectual property generally between protecting the work of an author versus ideas available to the public.
Copyright policy also respects its foundation in the Limited Times Clause of the U.S. Constitution – arts and sciences are advanced by the provision of the limited monopoly. Society enjoys access to the works as they are protected, and then society enjoys the works even more once the monopoly is extinguished. Indeed, on January 1, 2024, the copyright on Walt Disney’s masterpiece, “Steamboat Wille”, and with it the beloved character Mickey Mouse, will enter the public domain – free for public use (as long as the use is not confusing in a trademark manner). We are sure to expect many works of authorship about it.
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