Opinion ID: 695159
Heading Depth: 3
Heading Rank: 2

Heading: Specially Ordered or Commissioned

Text: 74 Since we conclude that Legends B and C may meet the writing requirement of Sec. 101(2), we next consider whether the works created after September 1979 (the date at which Legend B was first used) were specially ordered or commissioned by Playboy. 75 In addressing this question, the district court found that Congress intended to incorporate the instance and expense test into the statute through the phrase specially ordered or commissioned. Playboy, 831 F.Supp. at 313. The Supreme Court has stated, the court noted, that a party who hires a 'specially ordered or commissioned' work by definition has the right to specify the characteristics of the product desired. Id. (quoting CCNV, 490 U.S. at 741, 109 S.Ct. at 2173). In a footnote, the district court stated: 76 This court interprets the language of the Supreme Court to mean that the exercise of the right of artistic control by the party for whom the work is being prepared can be highly indicative of a commissioned relationship. However, this court believes that the waiver or absence of exercise of that right need not negate the possibility of a commission relationship. See Nimmer, Sec. 5.03[B][d], 5-44, n. 171. 77 Id. n. 19. 78 The court went on to hold that no work created after January 1, 1978 was specially ordered or commissioned as required under the 1976 Act. The court found that the issue of who controlled the characteristics of the works, if it had any weight at all, weighed in favor of Nagel because by mid-1978, Playboy no longer controlled these characteristics. Id. at 313. The court also found that it could not determine whether the works were made at Playboy's instance because Playboy offered no evidence of special orders after 1976. Playboy argued that the course of conduct of the parties should be sufficient, but the district court found that determinations of works made for hire must be established on a work-by-work basis. Id. (citing Weissmann, 868 F.2d at 1317). Finally, the district court relied upon the fact that Nagel bore the expense of creation (because he supplied his own tools, etc., see Section I(A) supra ) as well as the risk because there was no commitment on the part of Playboy to purchase the works. Id. 79 Playboy argues that the instance and expense test is a relic of the 1909 Act, Appellants' Br. at 35, and has no place in an analysis of work for hire under the 1976 Act. It further urges that under the 1976 Act, [i]f the parties claim in an agreement that they contracted on a work for hire basis, and if the particular work falls within one of the nine enumerated categories, the creator has received all the protection the Act contemplates. Id. at 34. 80 We find Playboy's characterization of the requirements of the 1976 Act incomplete. The statute specifies that the work must be either a work prepared by an employee within the scope of his or her employment, or a work specially ordered or commissioned and falling within one of nine categories. The legislative history sheds considerable light on the intent of the drafters: The thought here is that, in the [nine] special cases specifically mentioned ... the work will be considered a work for hire, but only if it is in fact 'specially ordered or commissioned' for that purpose.... Supplementary Report of the Register of Copyrights on the General Revision of the U.S. Copyright Law: 1965 Revision Bill, 89th Cong., 1st Sess., Copyright Law Revision, pt. 6, p. 67 (emphasis added). The district court was thus correct to determine whether the paintings were specially ordered or commissioned by Playboy. 81 The issue, thus, becomes whether the district court properly interpreted the meaning of specially ordered or commissioned. We first examine whether it was proper for the district court to consider the fact that Playboy no longer controlled the characteristics of Nagel's work. Two well respected commentators on copyright law are agreed that under the 1976 Act, the issue whether a work is specially ordered or commissioned is unrelated to the issue of which party has artistic control over the product. Professor Patry, in discussing the changes to the Copyright Act proposed in 1965 which were incorporated into the 1976 Act, states: 82 [T]he status of a work created by an independent contractor as a specially ordered or commissioned work made for hire ha[s] nothing to do with whether the commissioning party exercise[s] any (or complete) supervision and control over the independent contractor's work. 83 William F. Patry, Latman's The Copyright Law at 121 (6th ed. 1986). The Nimmers agree. In the section of their treatise relied upon by the district court, they note that while the fact that an artist retains artistic control over a work is inconsistent with a 'for hire' relationship under the 1909 Act, it is not necessarily inconsistent with a commission relationship under the 1976 Act. 1 Nimmer, Sec. 5.03[B][d], n. 171. 84 We agree with these commentators that the hiring party need not possess or exercise artistic control over the product for a work to be specially ordered or commissioned within the meaning of Sec. 101(2). The district court took out of context the Supreme Court's comment in CCNV that a party who hires a 'specially ordered or commissioned' work by definition has a right to specify the characteristics of the product desired. A hiring party, the Court noted, has this right at the time the commission is accepted, and frequently until it is completed. CCNV, 490 U.S. at 741, 109 S.Ct. at 2173. In other words, a commissioning party may ask a contractor for any specific work at the outset of their relationship and may continue to make specific requests to the extent their contractual relationship allows. The Court explicitly rejected the actual control test that this court had articulated in Aldon Accessories Ltd. v. Spiegel, Inc., 738 F.2d 548 (2d Cir.), cert. denied, 469 U.S. 982, 105 S.Ct. 387, 83 L.Ed.2d 321 (1984), as being outside the scope of the statutory language. 490 U.S. at 742, 109 S.Ct. at 2173-74. Thus, the district court was in error to the extent that it based its conclusion that Nagel's works were not specially ordered or commissioned on the fact that by mid-1978 Playboy no longer actually controlled the characteristics of Nagel's work. 85 The issue whether the instance and expense test was incorporated into the statute through the words specially ordered or commissioned is even more difficult. The starting point for the interpretation of a statute is always its language. Consumer Product Safety Comm'n v. GTE Sylvania, Inc., 447 U.S. 102, 108, 100 S.Ct. 2051, 2056, 64 L.Ed.2d 766 (1980). The phrase specially ordered or commissioned, the Court tells us in CCNV, denotes a commercial relationship in which a hiring party pays an independent contractor for his or her work. 490 U.S. at 742-43, 109 S.Ct. at 2173-74. This may arguably be equivalent to the expense prong of the old test. The words specially ordered or commissioned also imply that the hiring party has specifically asked the independent contractor for a work--arguably the instance prong. 86 The Nimmers, in their discussion of the meaning of specially ordered or commissioned, state: 87 In the ordinary case where one person is requested by another to prepare a copyrightable work, a commissioned relationship exists. The surrounding circumstances, however, may indicate that this is not the case. The key factor would appear to be whether the motivating factor in producing the work was the [person requesting preparation of the work] who induced [its] creation.... 88 1 Nimmer Sec. 5.03[B][d] (quoting Siegel v. National Periodical Publications, Inc., 508 F.2d 909, 914 (2d Cir.1974)) (footnotes omitted). The motivating factor test is, in fact, an interpretation of the instance and expense test under the 1909 Act. See Siegel, 508 F.2d at 914. 89 It appears, therefore, that the phrase specially ordered or commissioned has essentially the same meaning as instance and expense. The district court applied the instance and expense test, but relied erroneously, as discussed in Section I(A), on its conclusion that the works were not made at Playboy's expense. We have held above that the paintings were made at Playboy's expense, and we find that the method of payment used by Playboy is consistent with a commission relationship. Thus, in order to determine whether the works created after July 1979 were specially ordered or commissioned, the district court must determine whether the works were made at Playboy's instance--in other words, following the suggestion of the Nimmers, whether Playboy was the motivating factor in the creation of the works. 90 As discussed above in Section I(A), the district court found that sometime between January 1977 and August 1978, Playboy and Nagel had settled into a course of conduct whereby Nagel would produce paintings and Playboy would publish them. An employee of Playboy testified at trial that at some point we told [Nagel] we are going to be running this and it looks like this is going to be a regular feature, but there was no commitment on either part that it couldn't be stopped at any point. Playboy, 831 F.Supp. at 311. The question is whether under this course of conduct Playboy was the motivating factor behind the creation of the paintings. 91 The evidence presented at trial shows that Playboy made specific requests for illustrations until at least January 1977, and perhaps until mid-1978. During those years, Nagel painted illustrations to accompany specific articles or letters. After mid-1978, however, Nagel was free to draw anything he liked. Hugh Hefner described the evolution of the relationship as follows: 92 At first, we asked [Nagel] to illustrate a particular letter to the 'Advisor' every month, but soon it was clear that trying to funnel such a large talent so narrowly was like telling Irwin Shaw or Ray Bradbury what to write about. We asked him simply to give us a painting a month. As it turned out, the painting he gave us invariably illuminated one, two, three or all of that month's 'Advisor' letters in a way no commissioned illustration ever had. 93 Id. at 310. 94 The district court on remand may find that during the second phase of their relationship Playboy was not the motivating factor behind Nagel's paintings. Playboy no longer made specific requests for paintings, and Playboy had no commitment to purchase any of Nagel's work. The evidence further shows that during this time an independent market existed for Nagel's work. Hence, the district court may find that the works were not specially ordered or commissioned by Playboy, and therefore were not works for hire under the statute. 95 Alternatively, the court may find that although Playboy was not assigning Nagel specific projects, Playboy and Nagel had an implicit understanding that Nagel would submit at least one work per month to Playboy. The evidence at trial showed that every issue of Playboy from August 1975 to July 1984 contained at least one Nagel illustration. Additionally, the evidence showed that after 1978, Nagel was paid for approximately 20 to 30 paintings which he submitted but which Playboy did not publish. Playboy's payment for paintings which it did not publish would support the conclusion that the parties understood that Playboy implicitly requested paintings each month. The district court may, therefore, also conclude on remand that the paintings made after mid-1978 were commissioned within the meaning of the 1976 Act.