Who owns your website? – Part 2

Here is an interesting recent case regarding ownership of websites.  State v. Kirby, 161 P.3d 883 (N.M. 2007).  A small business owner hired an independent website designer for $1,890.00 to design and develop a web site for the business.  A written contract between the parties provided that ownership of the copyright in the web pages was retained by the designer, but that upon final payment the business owner would be "assigned rights to use as a website the design, graphics, and text contained in the finished assembled website."  The designer "was to develop the website from content supplied by the" business owner and then place it on web space owned by the business owner to which the designer would have access.

The designer fulfilled his end of the bargain, but the business owner then blocked the designer’s access to the site and never paid the designer.  The business owner was charged with criminal fraud.  The business owner unsuccessfully argued that there was no fraud because he owned the website and therefore he could not have obtained through deception a website belonging to another, as required by the criminal fraud statute.

The New Mexico Supreme Court ruled that ownership in the copyright of the website rested with the designer and not the business owner, based on the contract.  If there was no contract, ownership would still rest in the designer since he was the "author" of the work.  The court rejected the business owner’s argument that he owned the web space and/or domain name where the website resided, and therefore he owned the website regardless of who owned the copyright in the web pages.  The court said that the web page is the predominant portion of a website "that gives it life," and the domain name is merely an address.  Thus, the owner of the copyright in the web pages is the owner of the website.

This case illustrates the importance of having a written agreement up-front with website designers specifically setting forth who owns the copyright in the web pages, as I indicated in a previous post.  For that matter, you should have such up-front agreements with anyone inside or outside your business who creates content for you (e.g., graphic designers, computer programmers, marketing consultants, architects, engineers, etc.).

UDRP arbitration decision not entitled deference in civil action

A UDRP arbitration decision ordering transfer of a domain name is reviewed de novo in a later-filed action seeking a declaratory judgment of non-violation of the Anti-Cybersquatting Consumer Protection Act.  Stenzel v. Pifer, No. 2:06CV00049 (WD Wash 05/06); see also Hawes v. Network Solutions, Inc., 337 F.3d 377, 386 (4th Cir. 2003).