Tony Duarte (B.A., LL.B.) practices exclusively in the area of entertainment law and is an Adjunct Faculty member of Osgoode Hall Law School.

Perhaps one of the most problematic rights clearance transactions for a producer of film or television production is the licensing of existing photos, film/video clips, or music to the producer for reuse in its productions.   At best, the process is expensive and cumbersome for it typically involves the producer's negotiation of multiple licenses one-to-one with a myriad of rights-holders with legitimate claims to rights in the same work.  For example, a single song may well have a number of copyright owners to be identified and located.  Thus terms of use of the song in the film or television production must be settled with each owner.  This approach is effectively dictated by copyright law, which recognizes the sole authority of the copyright owner to determine the instances and terms of licensed use of a copyright-protected work.  Many producers, therefore, become drawn to the relative ease and simplicity promised by internet stock sources of music, photos, and video content available for reuse in film or television productions and downloadable at the click of a mouse.  Upon closer inspection, however, many of these mass market internet alternatives are fraught with hidden transaction costs and legal risks of a different kind.

There are several principal kinds of internet stock content sources.  One type of website offers users content that has purportedly fallen into the public domain. Other websites offer users open access to their copyright-protected content under so-called "creative commons" or "copyleft" licenses.  Finally, some websites offer controlled access and use of their content on condition that users actively indicate their acceptance of what have been described as either "clickwrap" or "clickthrough" contracts.  These are essentially "contracts of adhesion" in that the terms of use are set out by the content-provider and are non-negotiable by the user.  Each of these internet sources provides its own hazards for any film or television producer intent upon using their offerings.

Websites offering works supposedly in the public domain often include notices disclaiming any representation or warranty by the site operator that the works presented are indeed outside copyright protection.  This would not be a serious obstacle to a producer's reuse of such material in a film or television production if the authorship of each work and all other relevant facts regarding its copyright status were accurately given to permit the producer to evaluate the basis upon which the work is asserted to be in the public domain.  Unfortunately, unlike reputable public archives, many of these sites do not provide such information.  This leaves the prudent producer with little choice but to discard many of these sites as unreliable sources.

The websites which offer users content subject to "copyleft" licenses initially seem very attractive for the perceived fairness of their licensing terms.  The fact that some of these are owned by reputable non-profit groups with the laudable goal of promoting the free exchange of new works adds some legitimacy to their license terms.  Upon closer inspection of their licenses, however, there are at least a few issues that make many such licenses highly problematic for a commercial film or television producer wishing to use their content.

First, many of the copyleft licenses expressly provide that, in return for the user's free use of the materials offered on the site, the user is deemed to agree that its own derivative work from such materials will, if released to the public, be made available to the public on the same copyleft license basis.  This aspect of copyleft licenses has been described as "viral", or less charitably "cancerous", in that, when using this content, some users may unknowingly put into the so-called "creative commons" all of the work they have added to the single, perhaps minimal, piece of copyleft source material they have used. 

Depending upon how one defines a "derivative work", some copyleft licenses may be entirely incompatible with use of copyleft works within commercial film or television productions if such content is combined with other works that have been licensed by the producer under customary commercial licenses.  The usual terms of commercial licenses restrict the licensed use to the new production only.  That kind of contractual restriction is entirely at odds with a copyleft license which requires the entirety of the new production to be put into a copyleft regime - including all of the new production's original material, copyleft material, and commercially licensed material combined.  Furthermore, most commercial productions are licensed by their producers for broadcast or distribution by licensees who typically contract that they are accorded exclusive exhibition rights, at least with respect to the original material of the production.  Works included in the production under copyleft licenses that apply the copyleft license to the entirety of the derivative work could put the producer in breach of these grants of exclusivity in the production.  Some copyleft licenses may also prohibit the derivative work from using any TPM (Technical Protection Measure), such as encryption in the DVD format.  Again, such license restrictions on the production as a derivative work may conflict with the right to use TPM measures licensed by the producer to the production's DVD distributor.

Many copyleft licenses were initially written as computer software licenses.  Over the years, as the works to which these licenses have been applied has broadened to text and images, the drafting of these licenses has not been fully adapted.   For example, one sometimes encounters stills on the internet which are annotated as "copyright: GNU General Public License", referring to the form created by the GNU Project and widely used.  The application of the GNU General Public License to images rather than software is a very awkward fit.  The license defines the work to which it applies as the "Program", a term and definition clearly more comfortably applied to software than to images.  In addition, within the terminology of this license, how does one consider the resulting new television production which incorporates a single image that is governed by this license?   Is the production closest in description to a "work based on the Program, or the modifications to produce it from the Program", in which case the new production must itself be subject to the GNU General Public License?  Or is the new work "a compilation of a covered work together with other separate and independent works", which does not cause the license to apply to the other works?  Given the ambiguities that sometimes result from these ill-fitting definitions, the prudent producer often simply opts out of using any content that is subject to a copyleft license.

Copyleft also suffers from the proliferation of unauthorized variations to the original copyleft licenses initiated by reputable sources.  Since copyleft licensing is largely self-regulated, website operators can pick and choose which copyleft license to adopt and effectively write or edit their own.  As more unauthorized license variations come into existence, the initial value of copyleft licensing as an efficient and effective alternative to traditional one-to-one copyright licensing is accordingly diminished.  If copyleft licensing is not quickly gathered under the umbrella of a small number of authoritative sources of licensing terms with the resources to issue equitable and tailored terms for a broad range of user applications over a wide range of content, then copyleft content may never achieve widespread use in the commercial sphere.  In that respect, copyleft could be marginalized to the non-profit sector and fail to fully realize its potential to expand circulation of its content over all forms of copyright use.

The dissemination of unauthorized copyleft license variants can easily render the copyleft license alternative little different from the typical "clickwrap" or other adhesion contract option.  Contracts of adhesion, whether those used in car rentals or copyright, raise well-known issues: they are non-negotiable, often not read by the user, and invariably one-sided in at least some aspect in favour of the party who has drafted them.  In copyright licensing, they have exploded in number with the increased availability of content offered over the internet.  Some of these adhesion contracts demonstrate extraordinary examples of both incomprehensible drafting and one-sided terms.  For example, I have encountered at least one commercial internet image archive whose adhesion contract terms permit "royalty-free" use of their content for a small processing fee on condition that the entire production in which the downloaded image is to be included is deemed licensed by the user back to the internet archive for its own use at its absolute discretion.  This is a more disturbing variety of the copyleft's "virus" because it raises all of the same alarming consequences for the unwary producer, yet cannot claim copyleft's non-profit public policy rationale.    These types of contractual landmines, buried deep within the small print, taint the entire adhesion contract practice, seriously undermine any kind of efficiency that could be gained by licensing in this manner, and erode the confidence of producers in using many of these websites.

Copyright laws have favoured one-to-one licensing between each copyright owner and copyright user and have not kept pace with the mass licensing opportunities afforded by the internet.  In this respect, these laws have failed to serve both legitimate copyright users, such as film and television producers, as well as the copyright owners seeking to effectively harness the new possibilities of internet distribution.  Owners and users have turned increasingly to copyleft and adhesion contracts to find an efficient and effective alternative.  However, these alternatives have serious legal hazards for the prudent user which demand vigilance by their legal counsel and seriously undermine their intended commercial benefits to both licensor and licensee.  These hazards also make evident, nevertheless, that perhaps there is room for concerted government regulation to provide a process for stakeholders to arrive at more balanced, authoritative, appropriate, and wide-ranging standard form agreements that can make special purpose mass licensing of digital material more effective, efficient, and reliable to the benefit of both licensor and licensee.