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Heroes Held Hostage in Film: How Old Copyright Deals are Getting in the Way of Superhero Team-Ups

On Behalf of | Mar 25, 2015 | Business Litigation

In February 2015, the Walt Disney Company ‒ which owns Marvel Worldwide ‒ and Sony Corp. reached an agreement that will permit the enormously popular web-slinger, Spider-Man, to appear in upcoming Marvel superhero movies.  To many Marvel comics readers and Spidey fans, the need for this deal may be quite confusing, given that Spider-Man is a member of the Marvel superheroes team, the Avengers, and first appeared in a comic published by Marvel.  Strange though it may seem, the complexities of intellectual property law ‒ particularly the severability of film and print rights associated with particular superhero characters ‒ make deals like this one a necessity when it comes to characters whose various entertainment rights are held by different companies.The copyright to a protectable property, like the character of Spider-Man, is actually made up of specific subsidiary property rights, such as print rights (the right to write about Spider-Man in books and comics), digital rights (the right to reproduce or use Spider-Man in digital media), film rights (the right to represent Spider-Man in TV shows and movies), foreign rights (the right to represent or market Spider-Man outside the U.S.) and derivative rights (the right to reinvent or reinterpret the character of Spider-Man).  For this reason, character copyrights are often spoken of in simple terms as a “bundle of rights” or “bundle of sticks.”  For any given copyrighted character, the sticks in the larger copyright bundle (the “film rights stick” or “derivative rights stick”) can be separated out, locked up, or given away by the original owner.

Marvel decided to begin breaking up some of its bundles of rights when it was faced with impending financial collapse in the late 1980s.  To obtain the funds it needed, Marvel lent out some of the sticks associated with characters like Spider-Man, the Fantastic Four, and the X-Men to different entertainment industry players for a certain amount of time.  The rub is that now, in the midst of the present comics industry boom, some of Marvel’s most valuable sticks are still on loan to other industry players.  Sony Pictures, for instance, presently holds the screen rights to Spider-Man, while 20th Century Fox holds the screen rights for the Fantastic Four and X-Men.  This means that while Marvel (and its corporate parent, Disney) retain the right to represent these characters in printed comic books and other media, it can’t put them in movies without getting permission.  This fact has led to such odd moves as Marvel’s recent decision to cancel its popular Fantastic Four comic series and forbid the creation of new X-Men characters in an apparent bid to trip up 20th Century Fox’s screen plans for the Fantastic Four and X-Men franchises.

Glamorous as it may be, the trade in characters and rights associated with them is a business, and as in all business markets, there is risk in play whenever an original owner decides to give some of its rights away.  Had Marvel foreseen the present superhero culture frenzy back in the 1980s, it might have chosen to license out the film rights to its characters in different ways.  As things stand now, Sony may maintain its grip on Spider-Man for quite some time, since the studio’s lockup on the character’s screen rights is kicked out every time the character is represented in a new film (hence, the multiple reboots the character has seen in recent years).

With entertainment juggernauts like Avengers 2: Age of Ultron and Batman v. Superman on the horizon, the present comics craze shows no signs of slowing down.  As things charge along, expect intricate behind-the-scene legal workings to continue playing a big role when it comes to which characters will hit the big screen, and which may have to wait until the old deals of the 1980s and ‘90s have run their course before they can be used to their full potential.

David Moon is a law clerk with Berenzweig Leonard expecting his J.D. in May 2015. Ryen Rasmus is an associate attorney practicing in the Entertainment and Music Industry Law Group of Berenzweig Leonard.  He can be reached at [email protected]