The multimillion dollar question: who owns your logo design?
I know, I know, this sounds like a trick question. But don’t take it for granted that you own all rights to your logo design. Sometimes even business owners who have been using their marks for years face challenges.
As of early 2022, SweetWater Brewing finds itself in a dispute with Ray Scott Fuss, the graphic designer who created a trout drawing featured in its branding. Fuss drew the fish back in 1996 when he was a family friend of a SweetWater founder. Allegedly, Fuss sent an invoice for $500 and was paid in full decades ago. Now Fuss and SweetWater disagree about what exactly SweetWater got in exchange for that $500. Shortly after SweetWater was acquired, Fuss claimed he still owned the copyright rights in the trout design and was revoking any of SweetWater’s copyright licenses in the design. His demand? That SweetWater pay him $31 million.
Turkish chef and internet meme Salt Bae was sued for $5 million last year over use of his trademark. Allegedly Salt Bae hired two artists to create a mural for his steakhouse in Miami and loved the artwork so much that he started using images of it as his trademark on salts and seasonings and as his service mark on menus, takeout bags, and restaurant employee uniforms, among other things.
So how do multimillion dollar lawsuits like this happen, and aren’t copyright and trademark two different things? Let’s start with trademarks. We use marks to identify the source of particular products/services. They tell us where we can go to get more of the things we want from the sources we trust. In the U.S., you get trademark rights by using your mark out there in the real-world marketplace with your particular products/services. Copyright rights work a little bit differently. These protect original works of authorship – often creative works like drawings, paintings, songs, etc. Copyright protection is available from the first moment a work is created and fixed in a tangible form.
Here's where the two intersect. If a graphic designer creates an artwork, unless the circumstances fit an exception to the general rule, that graphic designer owns the copyright rights in the artwork. If a business owner starts using an image of that artwork on their product packaging, business cards, or any other place as the logo that tells people where their products or services come from, that business owner is trying to use that artwork as their mark. But, in general, if the graphic designer who created the artwork never transferred copyright rights in the artwork to the business owner, then every time that business owner reproduces the image of the artwork as their logo, they are violating the graphic designer’s copyright rights.
If there is no written agreement between the graphic designer who created the artwork and the business owner who is trying to use the image of the artwork as their logo, then it is unclear exactly what the business owner paid the graphic designer for and what rights they own in that image. The same is true even if there is a written agreement between them but that agreement doesn’t explicitly state what rights the business owner gets in the image in exchange for their payment.
One significant exception to this rule is the “work made for hire doctrine.” Although the person who creates a work is usually the author and owner of the copyright rights in that work, this isn’t true of works made for hire. There are two possible ways for a work to be a work made for hire. First, if the work is created by an employee within the scope of their employment, then the employer, not the creator, is considered the author and the owner of the copyright rights in that work. Second, if someone specially orders or commissions the work for use as one of a handful of specifically defined types of works (things like an atlas, test, or answer material for a test, for example), then the person or business who commissioned the work, not the creator, is considered the author and the owner of the copyright rights in that work. The problem here is that logo designs generally aren't within that limited set of types of work that, if specially ordered or commissioned, count as works made for hire.
Bottom line: if the graphic designer who created your business’s logo is in-house, you may be in luck; if not, you probably aren’t considered the owner of the copyright rights in that logo unless there’s an agreement that specifically transfers those rights to you. To avoid disputes over who owns the copyright rights in a logo design, business owners should make sure (a) they have a written agreement with their graphic designer, and (b) it clearly states that the business owner, in exchange for their payment, is getting all rights in the design, including copyright rights.
This information was posted on January 31, 2022 and was accurate as of the date of writing. However, the law changes frequently, and readers should not rely solely on general online information but instead should consult a licensed attorney by asking questions about their specific issues when they need legal advice.