Transfers and Exclusive Licenses

A transfer or exclusive license of any or all rights under copyright must be in writing and signed by the owner of the rights conveyed (or the owner's duly authorized agent). The writing should describe the nature of the rights conveyed. As a copyright owner, you should specifically carve out any rights that you wish to retain in the work, especially with regard to exploitation of the work in new media or technological formats developed in the future. 17 U.S.C. Sec. 204(a).

The U.S. Copyright Office does not have any special forms for the contract through which you transfer right(s). Copyright law provides for the recordation of transfers of copyright ownership in the Copyright Office. Although recordation is not required to make a valid transfer between the parties, it provides certain legal advantages, and may be required to validate the transfer as against third parties. For more information on recordation of transfers and other documents related to copyright, see the Copyright Office's Circular 12: Recordation of Transfers and Other Documents.

Writing is not required for a non-exclusive license, because by defining a "transfer of copyright ownership" to exclude non-exclusive licenses, 17 U.S.C. Sec. 101 relieves non-exclusive license from the operation of U.S.C. Sec. 204(a). The grant of a non-exclusive license can be oral or inferred from conduct.

No writing is required for transfers of copyright "by operation of law." 17 U.S.C. Sec. 204(a). The Act does not specify what is meant by "by operation of law", but in general a copyright is conveyed "by operation of law":

• when it is bequeathed by will;
• when it passes as personal property by the applicable laws of intestate succession; or
• by court order in bankruptcy proceedings.

Copyright is a personal property right, and it is subject to the various state laws and regulations that govern the ownership, inheritance, or transfer of personal property, as well as terms of contracts or conduct of business. For information about relevant state laws, consult an attorney.

Non-exclusive Licenses

Non-exclusive licenses do not require a writing in order to be valid, and the existence of a licensing arrangement can even be implied from conduct (an "implied license"). Your conduct may give rise to an implied license when it indicates that you intend to extend a license to those using your work, but you never agree to specific terms for the license. The user of your work acquires some right to use it, but only to the extent that you would have agreed to, had you negotiated an agreement.

Generally, the custom and practice of the relevant community or industry determine the scope of an implied license. For example, if you send a letter to a newspaper editor entitled "Dear Editor," under customary practice, the editor of the newspaper has an implied license to publish your letter in the newspaper. For more information about and examples of implied licenses in the Internet context, see Cyberspace Law for Non-Lawyers, Lesson 7 - Copyright 6.

Implied licenses may be important in situations where you hire a freelancer to create a work for you. Imagine, for example, that you hire a website designer to design your website. Neither of you knows much about copyright law, and you fail to agree (even orally) about who owns copyright to the designer's work. You would not own the copyright as a work made for hire because there is no written agreement (please see the Work Made for Hire section of the guide), but a court might still rule that you have an implied license to exploit the work for those uses reasonably within the contemplation of the designer at the time you both entered into the freelance arrangement (probably the right to reproduce and display the website, perhaps the right to create adaptations). Note that in this example, the web designer is the creator (and thus the owner) of the copyrighted work, and you are the person taking advantage of the implied license.

For another example, imagine that you prepare a weekly email newsletter that highlights your best postings for the week. This newsletter contains your copyrighted work (text, images, maybe video). If you email this to your subscribers, a court might find that you have granted them an implied license to share the newsletter with friends and colleagues through email forwarding.

As a general matter, it is a good idea to reduce a non-exclusive license arrangement to writing, just like an exclusive license or transfer. It helps you better protect your rights to the work, and allows you to structure your arrangement with licensees with greater clarity and precision. On the other hand, you might not want to bother users with a written license notice in the case like that of the email newsletter, so long as your subscribers' foreseeable uses don't particularly bother you.

In general contract law, the parties to a contract each have to give the other "consideration" in order to make the contract legally binding. "Consideration" is something that each party to a contract gives to the other party in exchange for that other party's promise or performance of the contract.

Transfers of rights under copyright, including exclusive licenses, do not require consideration in order to be valid. Therefore, while it is common for the transferee (the party obtaining the right or rights under copyright) to pay the copyright owner for the grant of rights, payment or other benefit is not required.

Nonexclusive licenses also do not require consideration in order to be valid. However, nonexclusive licenses are revocable (meaning the copyright owner can revoke the license at any time) in the absence of consideration. This means that, whether or not you set a fixed time limit for the duration of the non-exclusive license in the licensing agreement, you (as the copyright owner) can revoke the license at any point if you do not receive consideration for it. Conversely, if you (as the copyright owner) receive consideration in return for the grant of the license, then you cannot revoke the license unless you provide for revocation in the license agreement.

Note, however, that consideration for the grant of a license does not have to be something valuable, and it certainly does not have to be equivalent to the market value of the grant. Consideration is mostly a symbolic gesture. If the licensee gives up anything in exchange for the grant of the license, then that likely would qualify as consideration.