As a legal window of opportunity opened for creators of much of Marvel’s groundbreaking 1960s superhero line, they and their estates unleashed a tsunami of copyright terminations in recent weeks that threatened Marvel’s ownership of: Spider-Man, Doctor Strange, Black Widow, Ant-Man, Iron Man, Thor, the Falcon, Hawkeye, Blade and Marvel’s version of Captain Marvel.
The terminations were filed on behalf of Larry Lieber and the estates and heirs of Steve Ditko (brother Patrick), Gene Colan (daughter Nanci Solo and son Erik Colan), Don Heck (cousin Keith Dettwiler) and Don Rico (Michelle Hart-Rico and Buz Donato Rico III) by attorney Marc Toberoff, a veteran of the comics-industry copyright wars. They cover certain characters, stories and story elements that were introduced by the above co-creators in issues of Tales to Astonish, Journey into Mystery, Strange Tales and Tales of Suspense between 1962 and 1964. Toberoff’s arguments are based on a provision of the Copyright Act of 1976 that allowed copyright terms to be extended only if the original authors have a chance to reclaim the rights during a five-year window beyond the copyright renewal date. If upheld by the courts, these terminations would take effect in 2023, two years after notice was filed. Marvel’s immediate response in this opening skirmish has been to file for declaratory relief from each of the terminations on the grounds that all the characters identified in the terminations were created under the same terms of work for hire that led the courts to dismiss Toberoff’s terminations on behalf of Jack Kirby in 2011 and 2013.
News of the Ditko filing broke last week, and the rest of the terminations were revealed as Marvel/Disney’s requests for declaratory relief were made public. Ripples of shock spread through the Twitter-verse as superhero-movie fans panicked at the prospect of an imagined world without Spider-Man.
“Let Marvel keep making films with the characters and making literally millions of people happy,” pleaded one poster.
Another commented, “If the guy wins … WE are the ones who loose [sic].”
Rest assured, Marvel movies aren’t going anywhere, regardless of how these litigations play out. For one thing, Lieber and the heirs want to board the gravy train, not derail it. This is all about Toberoff’s clients making a bid to share in the immense profits generated by properties that these creators made possible. Secondly, the terminations only concern copyrights; Marvel/Disney would still own the trademarks, the recognizable symbols of the entertainment properties. The worst-case scenario for Marvel/Disney is that it would end up in partnership with Lieber and each of the heirs. Neither Lieber nor the creator estates would be able to prevent use of the trademarks by Marvel/Disney even if they were so inclined. Furthermore, even if it were to lose these copyright battles, Marvel would still be the most powerful member of any partnership that might emerge. The artists and writers named in these terminations are co-creators and can only claim ownership of their shares of the characters and stories. In virtually every case, Stan Lee would have been a co-creator and no terminations have been filed on behalf of Lee, which means any rights he would have had would still reside with Marvel. Although co-owners of an intellectual property can each independently license the property under U.S. law, it would be hard for any project to proceed without the approval of the trademark owner, Marvel. (Some countries require co-owners to unanimously agree on any projects.) And that’s if Lieber and the creator estates actually win — and as Toberoff well knows, successfully terminating these copyrights is an uphill battle.
That a comics creator can reclaim a copyright under the Copyright Act of 1976 was proven when Joanne Siegel and Laura Siegel Larson — Superman writer Jerry Siegel’s widow and daughter, respectively — served DC with a termination notice regarding Superman copyrights in 1997. That began a negotiation between DC and the Siegel family, in which DC/Warner Brothers offered the Siegels $3 million, an annual stipend of $500,000, a six percent royalty on Superman-related licensing income and a one-percent royalty on Superman publications, as well as employee medical benefits, in exchange for regaining full rights in the Superman character and story. The Siegels’ attorney Kevin Marks signed off on a 2001 agreement, but Toberoff, who had his own ambitions for Superman and had formed a movie production company, offered the Siegels $15 million for their share of the Superman rights (50% since Siegel had been half of the creative team) and persuaded them to disavow the agreement. In 2008, Judge Stephen Larson ruled that the terms of the Siegels/Warner agreement had changed so much in the course of back-and-forth negotiations that it was unclear exactly who had agreed to what and declared the agreement unenforceable. “After seventy years,” Larson wrote, “Jerome Siegel’s heirs regain what he granted so long ago — the copyright in the Superman material that was published in Action Comics, Vol. 1.” On appeal to the Ninth Circuit, however, the ruling was reversed and Judge Otto Wright declared that the Siegels were bound by the terms of the 2001 agreement, effectively returning Superman to his corporate owners in 2013.
In 2009, Toberoff was also at the legal helm when Kirby heirs Barbara, Neal and Susan Kirby served Marvel with 45 notices of termination covering Kirby’s creations between 1958 and 1963. A key difference between the Superman case and the Kirby terminations, however, was that Siegel and Shuster had been documented as having created the first Superman material before bringing it to DC/National, whereas Kirby was doing regular work for Marvel during the period of his creations. The Copyright Act specifies that when a property is created during the course of work for hire, then the instigating employer/publisher is considered the author of the property. A work-for-hire creator, therefore, is not considered the author of his or her characters and stories and has no copyright to reclaim. The courts repeatedly ruled that Kirby did his creating under conditions of work for hire. In her 2011 summary judgment, Judge Colleen McMahon stated, “This case is not about whether Kirby (and other freelance artists who created culturally iconic comic book characters for Marvel and other publishers) were treated ‘fairly’ by companies that grew rich off the fruit of their labor. It is about whether Kirby’s work qualifies as work-for-hire.... If it does, then Marvel owns the copyright in the Kirby works, whether that is ‘fair’ or not.”
The Kirby rulings are the wind in the sails of Marvel’s filing for a declaratory-relief dismissal of the new terminations. In its response, Marvel stated, “In virtually identical circumstances, this Court as affirmed by the Second Circuit, granted Marvel summary judgment, finding that all of illustrator Jack Kirby’s contributions between 1958 and 1963 were done at Marvel’s instance and expense and thus were works made for hire... and there are no termination rights for works made for hire.”
So: an open-and-shut case, according to Marvel. But is it really? Though Toberoff and Kirby had lost in the Southern District Court of New York and on appeal to the Second Circuit, the case was still pending possible consideration by the U.S. Supreme Court when Toberoff and the Kirby estate reached an undisclosed settlement with Marvel. It’s possible then that there were questions raised by Toberoff’s arguments that were still to be played out in court. As Judge McMahon pointed out, the central question is: What constitutes work for hire? When there’s a contract covering the work, it’s clear-cut, but Marvel did not have written contracts with its artists at the time. Stan Lee was a salaried employee; the artists were freelancers. In the absence of a contract, the courts have been applying the instance-and-expense test, which provides that any creation that an employer/publisher assigns and pays for is considered to be work for hire. As comics fans know, however, the development of characters and stories under the so-called Marvel method was complicated in a way that the courts have had a hard time grasping. Marvel artists during this period purchased their own art materials and often came up with ideas on their own.
For example, it has been widely acknowledged, even by Lee, that Ditko brought at least the look and concept of the Doctor Strange series to Lee already complete. Lee OK’d it and provided dialogue. Now Strange is one of the characters the Ditko estate is proposing to reclaim. This may be an extreme case, but artists like Ditko and Kirby commonly designed characters and told stories visually, with Lee adding dialogue after the fact. The process of creation was frequently a collaborative affair. Lieber worked with Lee on the first Thor stories contributing scripts and many of the series’ key elements. Don Rico wrote the script for the Iron Man story in Tales of Suspense that introduced Black Widow, working with Lee’s plot and Don Heck’s art. But during the Kirby hearings, when industry observers Mark Evanier and John Morrow testified to the collaborative nature of story creation at Marvel, McMahon agreed with DC’s request to strike their testimony from the record. Instead, the courts have stretched the meaning of instance and expense to cover any work produced by a creator with the expectation of being paid by the employer/publisher and which the employer/publisher has the right to direct and supervise even if it chooses not to exercise that right.
In its response to the Lieber termination, Marvel stated, “Any contributions Lieber made to the Works were done at the instance of Marvel’s editorial staff, who had the right to exercise creative control over Lieber’s contributions. Any contributions Lieber made to the Works were done at Marvel’s expense because Marvel paid Lieber a per-page rate for his contributions, Lieber made those contributions to the Works with the expectation that Marvel would pay him, and Lieber did not obtain any ownership interest in or to his contributions.”
Ironically, Lieber had been called by Marvel to provide a deposition in preparation for its case against Kirby. And Ditko had famously refused to support Kirby even in his attempts to regain his original art. As an Ayn Rand devotee, Ditko’s objectivist principles presumably would have prevented him from participating in any collective action in order to obtain justice: Every individual must fight his or her own fights, according to Rand. Ditko is also reported to have expressed the opinion that he was owed a share of licensing profits by Marvel publisher Martin Goodman. (This is a much-repeated story sometimes attributed to Mike Royer, who reportedly heard it from Kirby, but the Journal was not able to find a direct source at press time.) So it’s hard to speculate whether or not Toberoff would have been able to proceed with terminations of Spider-Man and Doctor Strange if Ditko were still alive.
Toberoff runs his own law office with a reportedly hands-on approach, acting as its lead attorney. Toberoff and Associates won an inheritance ruling in the South Carolina Supreme Court last year on behalf of singer James Brown’s children. He has generally represented comics creators on contingency in cases like this, meaning he charges no fee, but receives a share of whatever he’s able to obtain for the creators and their families. In a statement to Entertainment Weekly in response to Marvel’s declaratory relief filings, Toberoff said, “At the core of these cases is an anachronistic and highly criticized interpretation of ‘work-made-for-hire’ under the 1909 Copyright Act that needs to be rectified. We had tremendous support from the artistic community, the former Register of Copyrights, the former Trademark Commissioner, all the Guilds (WGA, SAG, DGA), PEN America, and 237 artists, including a dozen Pulitzer winners. The Kirby case went all the way to the U.S. Supreme Court, which showed keen interest, at which point Disney settled. At the time, I was asked whether I regretted not righting the legal injustice to creators — which I indeed did. I responded that there would be other such cases.”
Toberoff was quoted by Reuters as saying, “I felt that creators, particularly writers, are not given the respect or the economic rewards that they deserve. The last one to be invited to the premiere is the writer.”
In the other corner is Daniel Petrocelli, a corporate attorney with the firm of Melveny & Myers, who was also Toberoff’s adversary during the Superman case, when Petrocelli represented Warner Brothers/DC. Petrocelli, whose kids attended the same private school as Toberoff’s, is a former Trump attorney who defended Trump University against accusations of fraudulent marketing practices. Also on Petrocelli’s legal team: Molly Lens, Danielle Feuer and Kendall Turner.
The odds are in Petrocelli’s favor, given recent rulings by the court favoring corporate interests over individual creator’s rights. Disney, in a sense, was there at the beginning. The purpose of the Copyright Act of 1976 and its 1998 follow-up, the Sonny Bono Copyright Term Extension Act, was to counter the growing advantages Disney enjoyed as a result of a series of term extensions that kept Mickey Mouse out of public domain. Since the extended term potentially conferred a far greater value on copyrights than they had when an author like Jerry Siegel originally sold his creative work, this legislation was intended to give those authors and their heirs a chance to share in the benefits of that greater value. Arguably, that purpose has largely been undone by the courts’ willingness to treat a broadly defined work-for-hire status as a loophole that allows corporations, in almost every instance (and expense), to retain control of their properties.
Lieber told TCJ he preferred not to comment on the record while the terminations are in litigation. TCJ asked Marvel Entertainment Executive Director of Communications Timothy Cheng if Toberoff had proposed a settlement prior to filing the terminations, but Cheng declined to comment on the record. Cheng would only reiterate Marvel’s argument in its requests for declaratory relief, saying that the stories and characters cited in the new terminations are products of work for hire just as in the Kirby case and in many cases involve exactly the same comics. Asked about Marvel’s policy concerning the sharing of profits with creators, he said he could not comment on “ongoing conversations” between Marvel and creators. The other principals in the case, including Toberoff, Petrocelli and the Ditko family had even less to say, when contacted by TCJ. Toberoff has been willing to talk with the Journal in the past, but given the number of balls he’s currently juggling, it may be a while before he has that kind of leisure.
The next conference/hearing in the case has been tentatively set for Nov. 2.
