Working Paper No. 13-40:
An Exclusive License is Not an Assignment: Disentangling Divisibility and Transferability of Ownership in Copyright

Author(s):

Christopher Newman

Date Posted: June 2013

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Abstract:

Is there any difference between an exclusive copyright license and an assignment?  Many believe that any distinction between the two was obliterated by the Copyright Act of 1976, which included the term “exclusive license” within the statutorily-defined term “transfer of copyright ownership.” In the much-criticized decision Gardner v. Nike, the U.S. Court of Appeals for the Ninth Circuit held that while the statute granted exclusive copyright licensees the “protection and remedies” accorded to “copyright owners” by the 1976 Act, it did not abrogate the preexisting presumption that copyright licenses are not transferable without the consent of the licensor.

This article takes the position that Gardner’s critics are mistaken, and that there is a strong case the Ninth Circuit’s decision was both correct as a matter of statutory interpretation and consistent with the legislative history.   More fundamentally, I argue that Gardner’s critics are making a number of mistaken assumptions in their thinking about ownership and divisibility, assumptions that underlie and explain their erroneous reading of the statute.  Properly understood, the policy of divisible copyright is perfectly compatible with the view that exclusive licenses are nontransferable ownership interests.  Moreover, there are reasons to think Gardner may be beneficial as a matter of copyright policy, because on the margins it should tend to reduce fragmentation of title and enhance authorial control.