The copyright laws of many jurisdictions have long recognized the “moral rights” of creators of copyrighted works, including, for example, the right of attribution or the right to prevent unauthorized alterations to a work. Recent developments in French and Dutch copyright law underscore additional ways in which the law may favor copyright creators in the commercialization of their assigned or licensed works by other parties, which should be carefully considered when drafting copyright-related agreements.
France: Paris Court of First Instance Strictly Interprets Scope of Copyright Assignment
Royer v. Coty, Inc., No. RG 12/08938 (June 19, 2015)
In a recent decision, the Paris Court of First Instance applied a strict interpretation of Article L. 131-3 of the French Intellectual Property Code, which sets forth formal requirements for copyright assignments. Article L. 131-3 requires that each assigned right must be separately mentioned in the deed of assignment, and that the mode of exploitation of assigned rights must also be defined in scope, geographic coverage, and duration. Prior French case law had limited the application of Article L. 131-3’s formal requirements only to certain specific situations, including publishing and audiovisual production agreements. However, in recent years, French courts have begun applying a strict interpretation of Article L. 131-3 more broadly.
In line with this recent trend, the Paris Court of First Instance ruled largely in favor of individual freelance designer, Emanuelle Royer (“Royer”), in her dispute with beauty products manufacturer Coty (“Coty”). Ms. Royer had worked on the designs of several fragrance bottles for use by Coty with its licensed fragrances for Jil Sander, Bottega Veneta, and Chloe. Although the court held that Royer did not enjoy copyright in her modifications to Coty’s design for a Chloe fragrance bottle at issue, as Royer’s contributions did not meet the threshold for originality, she was successful in her other claims.
In particular, Royer’s design for the bottle of the Jil Sander “Jil” fragrance featured, inter alia, a rectangular shape with a clear glass face. The “Jil” fragrance, including Royer’s bottle design, was put on the market in 2009. In 2010, Royer discovered that Coty was marketing a new fragrance, “Sensual Jil”, using the identical bottle design that Royer had created for “Jil,” but with a different, deep blue color for the bottle’s glass face. Royer filed suit, alleging that this blue variation was not included in her initial assignment of copyright to Coty. The court agreed, holding that the sale of “Sensual Jil” in the blue bottle amounted to copyright infringement of Royer’s design, absent specific authorization or the transfer of copyright from Royer with respect to the design in a deep blue color. Where the agreement with Coty covered only the “Jil” bottle and was silent as to design modifications, including color, the court found that Royer had not assigned her rights to variations of the bottle in different colors.
In its holding, the court emphasized that agreements transferring copyright must be interpreted strictly. In particular, assignment agreements must separately identify each of the rights assigned, as well as the precise forms of exploitation and commercialization of the work that are contemplated by the assignment. All rights and all means of commercialization that are not expressly mentioned in the agreement are deemed not to be assigned by the creator of the work.
The Netherlands: New Copyright Contract Law Strengthens Position of Creators
On July 1, 2015, changes to the Netherlands’ copyright contract law, set forth in the Dutch Copyright Contract Act of 2015, took effect. The new law largely benefits creators of copyrighted works, seeking to strengthen their contractual position and assist them in recouping the economic benefits of exploitation of their works.
For example, the act follows Dutch case law in taking a strict view of the scope of copyright agreements, specifying that a whole or partial assignment of a copyright, or the grant of an exclusive license, “shall comprise only the rights that are stated in the deed or that necessarily derive from the nature and purpose of the title or the grant of the license.” Similar to the French courts’ recent approach, this provision favors copyright creators where new means of exploiting their work are developed after they have entered into a contract transferring their rights. However, on its face, the Dutch law also seeks to accommodate the interests of contractual grantees, including as part of a copyright grant any unspecified rights that, of necessity, arise from the “nature and purpose” of the original grant.
The new law also includes a “bestseller clause,” which ensures that a creator of a copyrighted work may obtain “additional fair compensation,” to be determined by the Dutch Minister of Education, Culture and Science, when contractual compensation is “seriously disproportionate to the proceeds from the exploitation of the work.” Although such terms as “seriously disproportionate” remain open to interpretation, this and other provisions of the new law strengthen the ability of copyright creators to benefit from their works, not only when new and unforeseen modes of exploitation are developed, but also where the works meet with unexpected success through the modes originally contemplated by the parties.
Considering the foregoing, of perhaps greatest significance is the choice-of-law provision of the Dutch act. This section mandates not only that a copyright creator cannot waive the provisions of the new law, but also provides that, regardless of the law actually selected by the parties to govern their contract, these new provisions of the Dutch copyright law will apply if (1) the contract would have been governed by Dutch law absent a choice-of-law clause; or (2) the exploitation of the copyrighted work takes place or should take place entirely or predominantly in the Netherlands.
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These recent developments in France and the Netherlands illustrate the necessity of precision in drafting copyright agreements, both in the EU and beyond. It is essential to carefully consider and specify the exact rights to be transferred, their geographic scope and duration, and the means of commercialization contemplated by the agreement. Absent specificity, rights not explicitly set forth in agreements are deemed by some local courts and statutes to remain with the creator. Even where copyright contracts are carefully drafted, the parties should bear in mind that private agreements are in many instances subject to local laws intended to protect and support the creator in benefiting from the commercial exploitation of their copyrighted work.