Feb 11, 2020

What happens after an intending licensor dies before signing licence agreement? | Infusion Lawyers


Dear IP ABC

I am James Bede, MD of WOKE Animations, a leading animation company in Nigeria. Recently, my company was in negotiations with Maxwell Obi, a renowned cartoonist and creator of the very successful comic book, ‘Nigerian Mom.’

After weeks of negotiation to obtain an exclusive licence to adapt Nigerian Mom into an animated comedy TV show, we finally reached an agreement. All that was left was to sign the licensing contract by both parties. On the morning of the scheduled date to sign the contracts, we received terrible news that Maxwell Obi was involved in a fatal motor accident. It was a shock to us. While we sincerely mourn the loss of Maxwell Obi, we wish to know if from the current circumstances, we have a deemed exclusive licence from late Maxwell Obi?



Answer
Dear James Bede
You want to know if WOKE Animations has a ‘deemed’ exclusive licence of copyright from late Maxwell Obi since he intended to enter the licence agreement but could not sign the agreement before his sudden death.
The answer is NO.
Maxwell Obi, before his death, had copyright in his work, ‘Nigerian Mom’. By section 6 of the Nigerian Copyright Act, he had the exclusive right to control reproduction of the work in any material form; publication of the work; performance of the work in public; translation of the work; making of any cinematographic film or record in respect of the work; distribution of the work to the public for commercial purposes by way of rental, lease, hire, loan or any similar arrangement; adaptation of the work; reproduction, publication, performance, making of a cinematographic film or record, and distribution for commercial purposes any translation or adaptation of the work.     
Under copyright law, when a person has passed away, his or her copyright does not immediately become public domain. In Nigeria and most countries, copyright lasts 70 years after the year of the author's death. If the copyright was owned by an organization or corporate entity, copyright lasts 70 years after the end of the year the work was first published.

Copyright is an intangible property and it is a type of personal property because it attaches to the creator or author. This makes copyright transferable.

Section 11(1) of the Nigerian Copyright Act provides that “copyright shall be transmissible by assignment, by testamentary disposition or by operation of law as, movable property.”
An exclusive licence as defined in the Act means “a licence signed by or on behalf of a copyright owner, authorizing the licensee to the exclusion of all other persons (including the person granting the licence), to exercise any right which would otherwise be exercisable exclusively by the copyright owner.” Because of the decisive nature of an exclusive licence, it cannot be inferred but has to be in writing. Section 11(3) of the Act provides that unless in writing, no assignment of copyright and no exclusive licence to do an act, the doing of which is controlled by copyright, shall have effect.
For the above reasons, even if your company had made necessary preparations to go on with the production of the TV Show, your company does not yet have the exclusive right to do so.
 
Is there a way forward for WOKE Animations?
Yes, there is.
When an author dies, copyright ownership changes. Copyright is personal property, so the person who created the work could choose whom to pass ownership of copyright. This means that ownership in a copyright can be passed to an heir or to a third party via a will.
Like any other asset in the estate, it would pass in accordance with the will of the copyright holder. If the holder died intestate (without a will), then it would pass in accordance with the laws of intestacy of that state.  
If your company still wishes to proceed with the production of the TV show, you would then have to find out who Late Maxwell Obi’s copyright has devolved to either by express transfer or by operation of law. Whether his heir or other third party, you will need to re-negotiate with the new copyright holder.
 
Can a copyright owner transfer some or all of his or her specific rights?
Yes, a copyright owner can transfer some or all of his or her rights.
If a copyright owner transferred all of his rights unconditionally, it is generally termed an ‘assignment’.
When only some of the rights associated with copyright are transferred, this is a ‘licence’.
An exclusive licence exists when the transferred rights can be exercised only by the owner of the licence (licensee) and no one else—including the person who granted the licence (licensor).
If the licence allows others (including the licensor) to exercise the same rights being transferred in the licence, the licence is said to be ‘non-exclusive’.
 
Authors or creators can (and should) prepare for the future.
Copyright lasts 70 years after the death of the author or creator of a work of copyright. An author or creator who would like his or her copyright to go to a choice beneficiary or person—say a family member—it is important that this instruction is included in the author's or creator's will. If there is no will, the author or creator is considered to have died intestate and his or her estate would be distributed in accordance with the rules of intestacy in the author's or creator's state. Even when there is a will but the will fails to specify who will receive copyright in the author’s or creator's works, copyright would be distributed along with the ‘residue’ or remainder of the estate among the beneficiaries of that residue.
Because most often beneficiaries intangible assets by operation of law fail to exploit the IP in these intangible assets, the author's or creator's work almost always suffers neglect. Consequently, the deceased author's or creator's loved ones are unable to benefit or fully benefit from the deceased author's or creator's creative industry.
In other to find out how to best navigate copyright in testacy or intestacy state, consult an IP lawyer firm to arrange your affairs before it’s too late.
IP ABC
Reactions: