Quite often, a Consultant or Individual (hereafter “Developers”) being hired to develop special effects for movies or computer software programs for businesses does not have a written agreement relating to the project. Many times, the special effects or software programs are developed, then the parties have a disagreement about payment terms and/or scope of use for the special effects or software programs.
Usually, Developers will try to assert trade secret misappropriation or copyright infringement against their own clients to prevent the use of their special effects in movies or software program in business operations. The Ninth Circuit, has applied the implied license to use defense in two such cases where Developers claimed Copyright Infringement.
See. Asset Marketing Systems Inc., v. Gagnon, 542 F.3d 748 (9th Cir. 2008) and Effects Assocs Inc. v. Cohen, 908 F.2d 555 (9th Cir. 1990). In the more recent case, Asset Marketing Systems, the court found that although the Developer retained copyrights to the software program, his client had an implied license to use the Software Program. Id. The Court said that there was no written transfer of the copyright as required under 17 USC 204 (a) therefore, the Developer retained the Copyright.
However, the court found an implied license was provided by the Developer based on his objective manifestations that indicated that the client was allowed to use and modify the software. The Court restated the basis for finding an implied license: 1) licensee requests creation of work; 2) the creator makes the work and delivers it to the licensee who requested it; and 3) the licensor intends that the licensee-requester copy and distribute his work.
This ruling only further demonstrates that Developers and clients need to have a good agreement in place relating to ownership and use of special effects and/or software for companies.