The Law of Anime Parts I & II: Copyright and the Anime Fan

by Sean Thordsen, Esq., Feb 15th 2013


About the Author: Mr. Sean Thordsen is a general practice attorney located in Orange County, California where he specializes in intellectual property and entertainment law. He represents clients in obtaining copyrights and trademarks as well as successfully defending those accused of violating them in federal court. His additional areas of practice include corporate law, employment law, and wills & trusts. He earned his undergraduate degree from Vanderbilt University in Nashville, Tennessee. He earned his legal degree from Chapman University School of Law in Orange, California where he earned distinction in Copyright and Trademarks at Chapman School of Law in Entertainment Law and Working with Film Makers Legal Clinic. Mr. Thordsen is a member of the California and Nevada Bar Associations. Additionally, Mr. Thordsen has been an invited speaker at SMU on tax incentives in the video game industry at the “Games Business Law Legal Summit.” Sean Thordsen may be reached at the Thordsen Law Offices located in Santa Ana, California.

SESSION 1 – WHAT IS A COPYRIGHT AND WHAT DOES IT DO?

Copyright is a topic that frequently produces cringes and ire in anime fans. Hearing this word frequently summons images of faceless corporations looking to stifle the creativity and freedom of smaller, weaker companies or persons. The discussion of copyright brings up taboo topics such as fansubs, the legalities of fanart, cosplay or anime music videos or legislation like SOPA and PIPA. For the average anime fan, a copyright is something they want to stay far away from – however, like it or not, copyrights and copyrighted material is such an engrained part of media and daily life that running into it or running afoul with it is nearly unavoidable. And although the idea of copyrights creates ire in the eyes of anime fans, it is generally a very misunderstood concept that, in the right circumstances, can be of great benefit to a community that so frequently includes people looking to break into the anime or manga production industry.

What is a copyright?

Copyrights are a form of intellectual property, and are codified in Title 17 of the United States Code. A copyright is created when an original creation is fixed upon a tangible medium – however an idea is not copyrightable. So long as the creation, story, character or song rests within the head of its creator this means it is not subject to copyright. Only when someone first commits their idea to paper, computer or other tangible medium has the idea has taken a tangible form and is copyrighted. This process is commonly known as a “common-law copyright.” While it does not afford the same protections as a copyright that is registered with the United States Copyright Office, it does bestow upon the original author a degree of creative control and security. It is precisely these protections that make obtaining a copyright important to aspiring creators.

Copyrights create a form of protection that lasts a literal lifetime. Once created, a copyright (presently) lasts for the lifetime of the author plus an additional seventy years. If the creator is a corporation then the copyright lasts the shorter of 95 years from the date of publication or 125 years from the date of creation. This length is to afford the creator and their estate sufficient time to profit from the copyright. After this period, the copyright officially moves to the public domain. All items in the public domain are usable by anyone for any purpose without having to pay the creator of the work.

At its original inception, the public domain was devised to create a pool of creative works that could inspire future generations. However, its intent has been diminished by the ever-lengthening duration of the copyright which keeps existing works from moving into public domain. Presently, only the following are within the public domain: All works prior to 1923, works between 1923 and 1989 depending on if the work was published with a notice of copyright registration and if it was renewed, after March 1989 all copyrights last the aforementioned lifetime plus seventy years. Presently, all works created after 1989, baring unusual circumstances, are not in the public domain.

When a copyright is the creation of more than one person, say for example two friends who decide to create a manga with one writing the story while the other draws the artwork; they have what is called a “joint work.” In a joint work the copyright is owned by all persons that contributed to the work regardless of their level of contribution. Creators have to be very careful about the production of their work as any creative input by another person can potentially impact who owns the copyright and may greatly affect their ability to sell and/or profit from the work down the line. Additionally, joint works change what type of control each author has over the work. Owners of a joint work are free to sell and distribute the work independent of one another provided that the other owners of the work receive profit for it. However, there is one exception to this rule. The sale of exclusive rights to a work requires the consent of ALL PERSONS who have a stake in the work. It is for this reason that creators and artists need to be careful as to who has a stake in the copyright as any other person who may have a stake in it could prevent their ability to properly profit off of the creation in the future. If, the aforementioned two friends publish a manga together, neither may sell the exclusive rights to a movie or TV series based on the book without the signed consent of the other.

This works slightly differently for corporations. Corporations use a system called “work-for-hire” from their artists, writers and staff. For example, once CAPCOM has an artist draw Chris Redfield on paper CAPCOM owns the copyright to the character, not the artist who drew him. This is a result of contract negotiation and employer agreements with their employees. Although many employees of comic book companies like Marvel or DC will place their work on websites such as Deviant Art, this is only done with the express permission of their employer. When working for a corporation such as Squire Enix or CAPCOM anything created by the employees using company materials or while on the clock is the intellectual property of the corporation, not the employee. This is a highly contested and litigated matter as sometimes corporations will argue that even things created on the artist's spare time still belongs to the company as it was done using the training and knowledge they gained while working for the corporation.

How is a legal copyright acquired?

A creator who wants to afford themselves the full protection offered by the government on their copyrighted work does so by filing an application with the United States Copyright office. This process is conducted via paper or electronic application wherein an author pays a fee to the United States Government and submits their work for review and copyright. The creator must declare precisely what kind of copyright they are filing for. These options include literary, musical, dramatic (plays), pictorial/graphic/sculptural (art), motion pictures and audiovisual works (TV, movies, games) as well as several others. The creator must declare who contributed to the work (if it is a joint work) or declare the work as their own (if they are the sole creator or a corporation) in addition to declaring aspects of the work that they are not claiming to own the rights to (public domain, licensed characters or artwork with permission from the original owner). If the Copyright Office finds a discrepancy or that the source material is not fully owned by the claimant that a copyright can be denied.

For example, someone cannot write a comic about Superman and claim a copyright over their comic as the character of Superman is owned by another entity. Someone CAN, however, claim ownership of that particular work provided they have the rights to use the character and are not claiming ownership over the parts they did not create. This is how works such as Production I.G & Funimation's Mass Effect anime can be independently copyrighted from the original Mass Effect which is owned by BioWare & Electronic Arts, without harming the original copyright. (Note: Mass Effect: Paragon Lost was not independently copyrighted by Funimation nor Production I.G, the example is by way of illustration rather than of literally what transpired). Collaborative works between studios generally settle via contract who owns what of a joint work so that a proper copyright can be made. Square Enix, for example, retains the rights to its Final Fantasy characters used in Kingdom Hearts while the Disney Corporation retains the rights to its characters and the original characters of Kingdom Hearts. Meanwhile the work “Kingdom Hearts” in and of itself is owned by Disney Enterprises, Inc (the official entity that owns the copyright).

What benefits does a copyright provide?

One might ask what the point is of filing for a copyright with the United States Copyright Office if the creative work is copyrighted upon taking form. The reasons are simple, security. Although the drafts and sketches of an author or artist are afforded mild protection upon creation, it is only through registration that the creator can sue if they feel someone has stolen their work. Additionally, a valid filing serves as proof that the creator has a valid copyright to begin with. A registered work is also afforded statutory damages (anywhere between $200 and $150,000 per act of infringement) and the creator does not even need to prove that someone who stole or infringed on their copyright caused any actual damages in order to recover a judgment from them. A common law copyright however would need to specifically show the actual damages the defendant caused them by infringing on their work.

Registered copyrights confer on the creator of the work a series of exclusive benefits. The holder of a copyright has the exclusive right to: reproduce their work (make copies), to create and distribute derivative works (such as spinoffs or other materials), to distribute the work (sell the work), to perform the work (live reading/show), to display the work publically, and the right to perform the work via digital audio transmission (broadcast over TV, radio or the internet). Any of these rights may be sold or exercised at will by the copyright holder.

A good example of how these rights can be exercised and managed is Hasbro, the rights holder for The Transformers. Hasbro has the exclusive right to air the show on TV, distribute it digitally, to have public viewings of the show, and to sell it and/or any related products, such as toys or figures. They are also free to license out these rights independently of each other to other parties; one such decision was when Hasbro sold the movie distribution rights to Universal Studios but Universal did not retain obtain any rights to distribute or manufacture Transformers toys. Alternatively, all the rights can be withheld from other persons or companies. Such is the case with Harmony Gold, who presently owns the rights to Robotech/Macross. They can deny the right to release and distribute from other parties and retain them for their own use. Harmony Gold has notoriously (in the anime community) exercised this right as it has blocked the release of series such as Macross Frontier and attempted to block games like MechWarrior Online, because Harmony Gold possesses the U.S. distribution rights to Macross, its characters and mechs and all related works. These scenarios are subject to contract negotiation and are best left for another discussion.

In the anime industry, the right to distribute a copyrighted work is the most common right involved in negotiations between U.S. and Japanese entities. Companies like Viz Media and Funimation can obtain the exclusive right to distribute manga, DVDs, Blu-Ray or TV broadcasts in the United States from the original rights holders in Japan. The contracts finalizing these deals are very explicit about what rights are conferred and what restrictions they entail. In no place is the limitations a rights holder can place on a licensee more noticeably present than in Blu-Ray production and sales. Since the United States and Japan share a region code for Blu-Ray (a Japanese Blu-Ray will play just fine on an American player and vice-versa) Japanese companies are leery of Japanese citizens importing cheaper American Blu-Rays with the original Japanese audio on them. As a result, anime Blu-Rays in the United States generally wind up lacking the Japanese audio track despite it being present on the DVD (i.e. Sentai's release of Persona 4 The Animation) or, the Blu-Ray can wind up coming out substantially later than the DVD or simply delay a release altogether (Viz Media's Tiger & Bunny – dub production time notwithstanding).

What can the consumer do with a copyrighted work?

Anyone may freely license the rights to use a copyrighted work by contacting the appropriate rights holder and negotiating a contract with them. If someone wants to sell their Supernatural artwork as posters, they may contact Warner Brothers and purchase or contract the right to do so. However, there are pitfalls to avoid when contracting the rights to use a copyrighted work from the original rights holder.

The first is that although a creator can freely license their work for use by other persons or companies, this right MAY or MAY NOT be exclusive. Companies such as Nickelodeon can freely license to more than one company the rights to make Avatar: the Last Airbender t-shirts. They can also license the exclusive right to develop t-shirts for Avatar and thus any subsequent licensee is a violation of the rights of the original licensee. Conflicting licenses results in lawsuits which was the situation in Twentieth Century Fox Film Corp. v. Warner Bros. Entm't, Inc. et al. cv 08-0889 GAF (AJWx) (2008) which resulted in the film Watchmen being unprofitable for Warner Brothers since the exclusive rights to film distribution were owned by Fox PRIOR to the film being produced by Warner Brothers.

The second pitfall is extremely relevant to to imported products such as anime. Although Viz Media may own the rights to distribute and produce the Tiger & Bunny DVDs in this country, they may not necessarily have the rights to distribute the action figures, gatchapon or other merchandise made for the show. Additionally, they may or may not have the right to sublicense the property. Sublicensing allows someone who licensed the rights (limited or not) to a property, to license it out again to someone else. Funimation can license One Piece for TV and DVD distribution in the United States and they may also sublicense the rights to produce One Piece merchandise in the United States – deals such as this are what allow One Piece key chains or coffee mugs to be made and sold in the United States without the keychain or coffee mug maker having to directly negotiate with Toei. Ultimately, the responsibility lies with the licensee to make certain their rights do not conflict with someone else's and they should contact the original copyright holder to make certain that the party they are dealing with has the appropriate right to sublicense the property.

Another method to use a copyrighted work is the aforementioned public domain. Works in the public domain are free to use by anyone for any purpose. However, as stated, the public domain is very limited presently as the only works that are certain to be in it are works created prior to 1923.

Alternatively, there is the creative common license. The Creative Common License - http://creativecommons.org – is a website where creators of otherwise copyrighted work place their work up for the public to use freely with specific restrictions. Each author chooses specifically what their work may be used for and what restrictions are placed on it. Musical artist Jonathan Coulton (who wrote the songs “Still Alive” and “Want you Gone” for Valve's video games Portal and Portal 2) places some of his work on this website for others to use. It is important however to note that the creative common license is NOT a government organization or an actual license and is merely a website where creators place their work for others to use out of the “kindness of their hearts.”

Takeaway

Obtaining and using a copyright are not as restrictive as one may think. There are ways to use just about anything provided someone goes to the lengths necessary to obtain the rights to use it. However although it is simple in concept, it can be difficult in execution and people creating new work need to be especially careful of what rights they can acquire and what they cannot. Next session we will see what this means for anime fandom.





THE OPINIONS EXPRESSED HEREIN ARE SUBJECT TO CHANGE DEPENDING ON LAW AND FACTS. ALL LEGAL ISSUES ARE DISCUSSED ARE EXPRESSLY NOT FOR THE PURPOSE OF HANDLING SPECIFIC CASES AND THE LAW MUST BE INDEPENDENTLY RESEARCHED. THERE ARE THOSE THAT MAY HAVE OPPOSING VIEWPOINTS.

THE INFORMATION HEREIN IS NOT LEGAL ADVICE.

AN ATTORNEY SHOULD BE CONSULTED IF YOU DESIRE LEGAL ADVICE.



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