Licensing V. Assignment

Indian law provides intellectual property protection in the form of copyright to the creators of original works of authorship such as literary works (including computer programs, compilations and tables including computer databases which may be stated in codes, words, schemes or even in any other form, including a machine-readable medium), musical, dramatic and artistic works, sound recordings and cinematographic films.

The owner of copyright work can generate monetary profits not only by taking advantage of it himself but also by co-sharing it with others for mutual benefits. This can be done by way of licensing or assignment of copyright. For example, a small business interested in using a copyrighted work in its advertising will need to acquire the rights to that works either by buying them completely and getting an assignment or by buying a license to use the works for a particular purpose.

What is an assignment agreement?

As assignment agreement is a contractual agreement that assigns or transfers intellectual property rights from one person or entity to another. It is also a legal record that verifies the transfer of ownership of intellectual property rights. There are two parties in every assignment agreement, one party is the giving party i.e. assignor and the other is the receiving party i.e. the assignee.

It is the right of the owner of the copyrighted work to assign his copyright to any other person. The effect of the assignment is that the assignee becomes entitled to all the rights related to the copyright to the assigned work. Where the assignee of copyright becomes entitled to any right comprised in the copyright, he shall be treated as the owner of the copyright in respect of those rights. The assignor shall also be treated as the owner of the copyright for unassigned rights. If the assignee dies before the work comes into existence then the legal representatives of the assignee shall be entitled to the benefits of the assignment.

The Bombay High Court in Video Master v. Nishi Production considered the issue whether the assignment of video rights would include the right of satellite broadcast as well. The Court agreed with the contentions of the defendant that there were different modes of communication to the public such as terrestrial television broadcasting (Doordarshan), satellite broadcasting and video TV. The owner of the film had separate copyright in all those modes, and he could assign it to different persons. Thus, satellite broadcast copyright of film was a separate right of the owner of the film and the video copyright assigned to the plaintiff would not include this.

Mode of Assignment (Section 19)

Section 19 of the Act states that the assignment of copyright is valid only if it is in writing and signed by the assignor or his duly authorized agent. In assigning the copyright of a work, it should identify the work and the duration and specify kind of rights assigned and territorial extent of such assignment. Additionally, it should specify the amount of royalty payable, to the author or his legal heirs, if any, during the continuance of assignment and the assignment will be subject to revision, termination or extension on terms mutually accepted by the parties.

If the period of assignment is not mentioned in the agreement then it will be deemed to be taken as five years from the date of assignment. If the territorial extent of such assignment is also not stipulated in the agreement, it will be taken as applicable in whole of India.

In Saregama India Ltd v. Suresh Jindal, it was held that according to the provisions of this act, the owner of the copyright in a future work may assign the copyright to any person either wholly or partially for the whole of the copyright or any part thereof. If an assignment is made to the assignee then he is treated as the owner of that copyright.

What is a license agreement?

A license agreement is a contractual agreement that authorizes or licenses another person or entity to use the rights of a protected IP. A license is nothing but a contract that certifies the shared use of IP rights. There are two parties in a licensing agreement. The party that gives the license is called the licensor and the party who receives it is the licensee. The copyright owner also has the right to license the work to more than one person at the same time, meaning it can be granted on an exclusive or a non-exclusive basis. As a result of which licenses are more economical ways for small businesses to use copyrighted content. The conditions essential for grant of such a License are as follows:

(a) The work must have been performed or published in public.

(b) The author must have refused to allow the performance of the work in public or must have refused to allow the republication of the work and because of which the work is held back from the public;

(c) The author must have denied communication of a work to the public by broadcast on terms which the complainant considers reasonable.

Types of Copyright Licensing Agreement

  1. Voluntary License
  2. Compulsory licensing

Conclusion

The term ‘assignment’ and ‘license’ cannot be interchanged. A license is different from an agreement. Generally, in absence of any provision to the contrary, the assignee becomes the owner of the assigned work, whereas in case of a license the licensee gets the right to exercise particular rights only.

An assignment may be subject to limitations. It may be for the whole term of the copyright or it can be for any particular part. An assignment transfers an interest and deals with copyright. However, the license does not convey the copyright but only grants a right to do something, which in the absence of license would be unlawful. An assignment transfers title in copyright, a license merely permits certain things to be done by the licensee. The assignee being invested with the title in the copyright may reassign.

Author:   Parul Malik, student of VI Semester LL.B., Lloyd Law College, Greater Noida, intern at Khurana & Khurana, Advocates and IP Attorneys. In case of any queries please contact/write back to us at aishani@khuranaandkhurana.com.

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