Disney sues to keep complete rights to Marvel characters

Moving to defend its Marvel superhero franchises, the Walt Disney Co on Friday filed a flurry of lawsuits seeking to invalidate copyright termination notices served by artists and illustrators involved with marquee characters like Iron Man, Spider-Man and Thor.

Daniel M Petrocelli, a high-powered Los Angeles litigator, filed the complaints on Disney’s behalf in federal courts in New York and California.

The dispute started in the spring when a prominent intellectual property lawyer, Marc Toberoff, served Marvel Entertainment, which is owned by Disney, with notices of copyright termination on behalf of five clients. They include Lawrence D. Lieber, 89, a comics writer and artist known for his 1960s-era contributions to bedrock Marvel characters. Lieber’s older brother, Stan Lee, was chief writer and editor of Marvel Comics. Lee died in 2018.

Toberoff’s other clients are the estates of comics illustrators Steve Ditko and Don Heck, and heirs of writers Don Rico and Gene Colan. They are seeking to reclaim rights related to the Marvel characters they had a hand in creating, including Doctor Strange, Black Widow, Hawkeye, Captain Marvel, Falcon, Blade and the Wizard — several of which have become star revenue generators for Disney, appearing in films and television shows, along with a plethora of merchandise.

The reclamation attempts stem from a provision of copyright law that, under certain conditions, allows authors or their heirs to regain ownership of a product after a given number of years. Such efforts turn on whether authors worked as hired hands or produced the material on their own and then sold it to publishers. The Copyright Revision Act of 1976, which opened the door to termination attempts, bans termination for people who delivered work at the “instance and expense” of an employer.

“Since these were works made for hire and thus owned by Marvel, we filed these lawsuits to confirm that the termination notices are invalid and of no legal effect,” Petrocelli said by phone. (Petrocelli is also representing Disney in its legal fight with Scarlett Johansson, who sued the company in July over pay connected to ticket sales for “Black Widow.”)

For instance, Disney’s complaint against Lieber contends that “Marvel assigned Lieber stories to write, had the right to exercise control over Lieber’s contributions and paid Lieber a per-page rate for his contributions.” Those conditions render his contributions “work made for hire, to which the Copyright Act’s provisions do not apply,” according to the complaint.

Toberoff sharply disagrees. “At the time all these characters were created, their material was definitely not ‘work made for hire’ under the law,” he said in an email in response to Disney’s filings. “These guys were all freelancers or independent contractors, working piecemeal for car fare out of their basements.” Hence, not “traditional, full-time employees,” he said.

“At the core of these cases is an anachronistic and highly criticised interpretation of ‘work-made-for-hire,’ ” Toberoff said in a separate email, adding that the interpretation “needs to be rectified.”

The termination notices expressed the intent to regain copyrights to some creations as early as 2023. If successful, Toberoff’s clients would receive a portion of profits from new works based on any of the copyrighted material.

Rights issues have become a point of vulnerability in a film industry that is increasingly dependent on “branded entertainment” — anything based on popular material, including comic books, TV cartoons and classic toys. An existing fan base lessens a film’s financial risk.

Disney is no stranger to intellectual property fights. The company spent 18 years battling a rights-infringement case involving Winnie the Pooh, ultimately winning. Disney pushed so hard for an extension of copyright terms in 1998 that the resulting law was derisively named the Mickey Mouse Protection Act. Brothers who wrote the original screenplay to the 1987 film “Predator” are sparring with Disney over the franchise; the brothers, Jim and John Thomas, are seeking to recapture rights.

Toberoff has built a reputation in Hollywood for representing people who claim ownership over old television shows, films or comic book properties. In the 2000s, he scored a notable victory over Warner Bros. involving “The Dukes of Hazzard.” Then came a ruthless legal battle between Toberoff and Warner over Superman rights, with Petrocelli representing the studio. Warner ultimately won two favourable court rulings.

From 2009 to 2013, Toberoff represented the heirs of Marvel comic book artist Jack Kirby. They were attempting to reclaim the rights to dozens of characters created or co-created by Kirby between 1958 and 1963, including Hulk, Captain America and the X-Men. Two courts sided with Marvel — which argued that Kirby’s work was done at Marvel’s instance and expense — and the matter was subsequently settled as the US Supreme Court was considering whether to hear the case.

“At the time, I was asked whether I regretted not righting the legal injustice to creators — which indeed I did,” Toberoff said in an email. “I responded that there would be other such cases. Now, here we are.”

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