Copyright Ownership Can Be Transferred Through Terms of Use

A compelling copyright issue in the online world is whether a copyright owner can transfer ownership of the copyright to a new owner by agreeing to the terms of use on a website.  Metropolitan Regional Information Systems, Inc. (MRIS) provides a fee-based online multiple listing service to real estate agents and brokers.  Upon agreeing to the MRIS terms of use and paying the subscription fee, MRIS subscribers can upload their real estate listings and photographs to the MRIS database.  By agreeing to the terms of use (TOU), subscribers assign to MRIS all of their copyright interests in the photographs they upload to the MRIS database.  MRIS subscribers must click a button assenting to the terms of use before uploading photographs.  MRIS puts a copyright notice on all photographs in its database and registers the database with the Copyright Office every quarter.

American Home Realty Network, Inc., (AHRN) aggregates content from other sources, including the MRIS database, to display on its website.  After AHRN displayed photos from the MRIS database on its website, MRIS sent AHRN a cease and desist letter.  AHRN asked for a license, which MRIS refused.  MRIS sued AHRN for copyright infringement.  The district court granted MRIS’s motion for a preliminary injunction.  AHRN appealed, arguing that MRIS’s subscribers did not transfer their copyright interests to MRIS when they agreed to MRIS’s terms of use.  The Fourth Circuit Court of Appeals affirmed the district court’s ruling, holding that a copyright interest can be validly transferred through an electronic agreement. 

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