Decision of Note: <B>Writer is Co-Owner Of Rights in 'Spawn' Character</B>

The U.S. Court of Appeals for the Seventh Circuit ruled that comic-book writer Neil Gaiman was joint owner of the copyrights in characters he created for the “Spawn” series published by Todd McFarlane. Gaiman v. McFarlane, 03-1331. The appeals court reached its decision by finding that Gaiman's claim wasn't time-barred.

Gaiman began writing for Todd McFarlane under an oral agreement in 1992. Gaiman then created, named or described, and wrote the dialogue for three new characters ' Medieval Spawn, Angela and Count Nicholas Cogliostro ' that McFarlane illustrated. Gaiman filed suit in January 2002 in the U.S. District Court for the Western District of Wisconsin for, among other things, a joint ownership declaration. A jury ruled in favor of Gaiman and the district judge entered a judgment that Gaiman indeed was co-owner of the character copyrights.

McFarlane had argued that Gaiman's suit was barred by the three-year statute of limitations of Sec. 507(b) of the Copyright Act. McFarlane contended that Gaiman should have known since 1993, when “Spawn No. 9,” in which the characters first appeared, was published with a copyright notice of McFarlane's ownership of the compilation in the comic book. But the appeals court noted that a compiler's copyright notice isn't adverse to a contributor's copyright and thus doesn't place a contributor on notice of a copyright claim. That McFarlane had also published paperback books in which he claimed the copyrights in all related characters didn't place Gaiman on notice because, the appeals court noted, there is no obligation for authors to read the copyright notices of works in which their materials appear. Also, McFarlane's registration of the comics and books didn't give Gaiman constructive notice considering, the appeals court noted, that authors “don't consult the records of the Copyright Office to see whether someone has asserted copyright in their works.”

McFarlane further argued that Gaiman should have known that his claim accrued from the time his lawyer sent McFarlane a letter in 1997 asking for more compensation. But the appeals court noted: “The existence of a dispute over the terms of a publication contract does not alert the author to a challenge to his copyright. Quite the contrary, it presumes that he owns the copyright.” Thus, Gaiman's claim wasn't time-barred because it didn't accrue until he received a letter from McFarlane's lawyer in February 1999 that stated that Todd McFarlane Productions owned all rights in the characters.

On the joint ownership issue, McFarlane argued that Gaiman had contributed uncopyrightable ideas for the characters that were given copyrightable expression through McFarlane's drawings. But the appeals court emphasized that comic books are usually the joint work of writer, illustrator, inker and colorist. “The finished product is copyrightable,” the appeals court noted, “yet one can imagine cases in which none of the separate contributions of the four collaborating artists would be.”

Finding Gaiman to be a joint owner of the characters, the appeals court noted, for example, “Although Gaiman's verbal description of Cogliostro may well have been of a stock character, once he was drawn and named and given speech he became sufficiently distinctive to be copyrightable. Gaiman's contribution may not have been copyrightable by itself, but his contribution had expressive content without which Cogliostro wouldn't have been a character at all, but merely a drawing. The expressive work that is the comic-book character Count Nicholas Cogliostro was the joint work of Gaiman and McFarlane ' their contributions strike us as quite equal ' and both are entitled to ownership of the copyright.”

The U.S. Court of Appeals for the Seventh Circuit ruled that comic-book writer Neil Gaiman was joint owner of the copyrights in characters he created for the “Spawn” series published by Todd McFarlane. Gaiman v. McFarlane, 03-1331. The appeals court reached its decision by finding that Gaiman's claim wasn't time-barred.

Gaiman began writing for Todd McFarlane under an oral agreement in 1992. Gaiman then created, named or described, and wrote the dialogue for three new characters ' Medieval Spawn, Angela and Count Nicholas Cogliostro ' that McFarlane illustrated. Gaiman filed suit in January 2002 in the U.S. District Court for the Western District of Wisconsin for, among other things, a joint ownership declaration. A jury ruled in favor of Gaiman and the district judge entered a judgment that Gaiman indeed was co-owner of the character copyrights.

McFarlane had argued that Gaiman's suit was barred by the three-year statute of limitations of Sec. 507(b) of the Copyright Act. McFarlane contended that Gaiman should have known since 1993, when “Spawn No. 9,” in which the characters first appeared, was published with a copyright notice of McFarlane's ownership of the compilation in the comic book. But the appeals court noted that a compiler's copyright notice isn't adverse to a contributor's copyright and thus doesn't place a contributor on notice of a copyright claim. That McFarlane had also published paperback books in which he claimed the copyrights in all related characters didn't place Gaiman on notice because, the appeals court noted, there is no obligation for authors to read the copyright notices of works in which their materials appear. Also, McFarlane's registration of the comics and books didn't give Gaiman constructive notice considering, the appeals court noted, that authors “don't consult the records of the Copyright Office to see whether someone has asserted copyright in their works.”

McFarlane further argued that Gaiman should have known that his claim accrued from the time his lawyer sent McFarlane a letter in 1997 asking for more compensation. But the appeals court noted: “The existence of a dispute over the terms of a publication contract does not alert the author to a challenge to his copyright. Quite the contrary, it presumes that he owns the copyright.” Thus, Gaiman's claim wasn't time-barred because it didn't accrue until he received a letter from McFarlane's lawyer in February 1999 that stated that Todd McFarlane Productions owned all rights in the characters.

On the joint ownership issue, McFarlane argued that Gaiman had contributed uncopyrightable ideas for the characters that were given copyrightable expression through McFarlane's drawings. But the appeals court emphasized that comic books are usually the joint work of writer, illustrator, inker and colorist. “The finished product is copyrightable,” the appeals court noted, “yet one can imagine cases in which none of the separate contributions of the four collaborating artists would be.”

Finding Gaiman to be a joint owner of the characters, the appeals court noted, for example, “Although Gaiman's verbal description of Cogliostro may well have been of a stock character, once he was drawn and named and given speech he became sufficiently distinctive to be copyrightable. Gaiman's contribution may not have been copyrightable by itself, but his contribution had expressive content without which Cogliostro wouldn't have been a character at all, but merely a drawing. The expressive work that is the comic-book character Count Nicholas Cogliostro was the joint work of Gaiman and McFarlane ' their contributions strike us as quite equal ' and both are entitled to ownership of the copyright.”