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What rights of use are due to the commissioner of creative works?

Published in: Intellectual Property
by Arlo Canella
Home > What rights of use are due to the commissioner of creative works?

By analysing the most recent case law, the article addresses the relationship between commissioning party and creative agencies and, more specifically, examines the issue of rights of use over works.

Summary:

Transfer of the work or only of the "executive files "?

The judgement analysed – Italian Civil Cassation, Sec. I, Ord., 15/06/2022, no. 19335 – makes a distinction between contracts having as their object the creation of works and those where only the “executives” (i.e. the final design/projects) are transferred and the creation remains only an aspect or a phase of the contract. When the contractual agreement concerns the executives, the intellectual property of the ‘creative concept’ (corpus mysticum) would seem to be retained by the creative agency.

The Italian Supreme Court analysed the case of a pharmaceutical company that had commissioned a creative agency to produce graphics for the presentation of its products.

It was stipulated in the contract that, upon payment of the price, only the executives of the graphic works would be transferred to the pharmaceutical company. In such a case, who is entitled to the exploitation rights? Let’s see the principles applied by the Italian Supreme Court.

The transfer of rights of use and the "written form"

According to the law, the rights of economic exploitation of works can be freely acquired, transferred or transmitted by means of typical contracts (e.g. work contract, contract of sale, etc.) or atypical contracts (defined by the negotiating freedom of the parties).  In the case of the transfer of rights, Section 110 of the Copyright Act, however, stipulates that “the transfer of exploitation rights must be proven in writing”.

Due to the common absence of a written agreement, a lot of controversy had arisen in the courts as to whether the commissioner of a work could also be deemed to have acquired the rights of use even without a written agreement. Eventually, the prevailing opinion was that the commissioner, by virtue of the commissioning relationship, acquired the right of use in its original form, without the need for a transfer and without the need for a written document.

Nevertheless, as to the exact scope of such rights of use arising in the hands of the commissioner, even if acquired by way of original title, it is still necessary to go back to the originally expressed will of the parties on the basis of which the content and extent of the right are to be identified.

Principal's rights of use according to the prevailing orientation

Article 2581 of the Italian Civil Code states that “Rights of use are transferable. Transfer by deed between living persons must be evidenced in writing“. The article is located in the fifth book (of labour) within Title IX (of rights on intellectual works and industrial inventions) and in particular Chapter I (of copyright on literary and artistic works). Well, the quoted article is in perfect agreement with the aforementioned Art. 110 of the Copyright Law.

The rights of use for a creative work, for example a television format, a graphic work, a drawing, etc., arise directly (as an original right) with the principal if that work has been expressly requested or commissioned by her/him. This occurs even in the absence of written proof of the assignment as the transfer of a pre-existing work does not take place but the (future) work will be created by the author specifically for the commissioner.

The assumption is the result of a well-established orientation of the courts: “the aforementioned Art. 110 is not applicable when the principal has acquired the rights of economic use of the work as a result of and in performance of a contract of intellectual work concluded with the author: and this is because, in such a case, there is no transfer, since such rights arise directly in favour of the commissioner. Now, the aforementioned principle is also applicable to the contract for the production of television programmes.” (see, e.g., Cass. civ., Sec. I, Sent., 27/07/2017, no. 18633).

The judgment of the Italian Civil Cassation 19335/22 and the transfer of executive files

In order to determine who is entitled to the rights of use in specific cases, however, in a contract between a commissioning company and a creative agency, the content of the contract must be carefully examined.

If the main object of the contract is the creation of the work, that right accrues in full to the commissioner.

If, on the other hand, the creation of the work is only an “operational phase” because the parties have clearly established that the commissioning party will only acquire the right to the “executive files” (corpus mechanicum), the exploitation right over the creative concept “corpus mysticum” will remain with the creative agency.

The judgment of the Italian Supreme Court, Sec. I, Ord., 15/06/2022, no. 19335 does not change the way the rule is interpreted, but better illustrates a still controversial principle. According to the court, one cannot “disregard the content of the agreement of will implied in the contract of supply or work and attribute to the principal […] all rights on everything carried out to provide the contractual service“.

The first and decisive obstacle to the approval of this proposition is that there is no proof that the object of the contract was the elaboration of an original work, and not merely the delivery of executive files reproducing the information necessary for the packaging and illustration of pharmaceutical products, as the Court held.

The elaboration of the work of art, as defined above, was only a step taken by the contractor to fulfil the contract and to provide B.B. Farma with what was referred to in the judgment as the corpus mechanicum, i.e. the executive files.

Thus, the references to the jurisprudential cases dealt with by this Court, in which the object of the contract was the creation of an original work, do not seem pertinent: a television format in the case decided by Sect. 1, 27.7.2017, no. 18633; an advertising slogan in the case decided by Sect. 1, 24.6.2016, no. 13171″ (Civil cassation, Sec. I, Ord., 15/06/2022, no. 19335).

How the judgment affects industry contracts

The contract for the creation of creative works must be carefully analysed or drafted. While the law requires the written form ad probationem, the Supreme Court emphasises above all the centrality of the will expressed by the parties in the context of the specific contractual relationship.

Even in the case of a contract for the creation of creative works, the specific contractual agreement could provide that the creation constitutes a mere phase of the work and that the rights of use, with the exception of the transfer of so-called executives, remain with the creative agency.

That is why, on the one hand, each commissioning party should carefully examine the contract to avoid such a hypothesis and to actually acquire the rights it needs in the context of its commercial activity. On the other hand, the creative agency should verify that the contract only provides for the assignment of the rights of use that it intends to assign, consequently commensurate with the actual assignment.

The Canella Camaiora Law Firm provides high-profile legal assistance in drafting and reviewing contracts for the realisation of creative works. The Law Firm’s legal services dedicated to this specific topic belong to the broader area of intellectual property.

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Publication date: 16 September 2022
Last update: 3 October 2022
Avv. Arlo Cannela

Avvocato Arlo Canella

Managing Partner dello studio legale Canella Camaiora, iscritto all’Ordine degli Avvocati di Milano, appassionato di Branding, Comunicazione e Design.
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