Menu

Ownership of copyright in the Innocent logo

Print publication

11/03/2015

When logos are created, the artwork is automatically protected by copyright and under English law the designer is the copyright owner even if the work is commissioned. It is therefore standard practice for copyright ownership to be assigned to the commissioner who is then free to use the logo and register it as a trade mark. Copyright assignments are relatively straightforward agreements but must be in writing.

Unfortunately for Fresh Trading, the designers of its so-called “dude” logo (depicted in the judgement), claimed copyright ownership and challenged Fresh Trading’s Community Trade Mark on the basis that it conflicted with its copyright. The evidence showed that the individuals who set up the Fresh Trading business engaged a design agency (Deepend) to design a logo for the new business. Deepend were to be paid for their work by way of the allotment of shares in the new business and the agreement provided that Fresh Trading would “receive full intellectual copyright of any work”.

The agreement was never signed and Fresh Trading never allotted shares to Deepend. Deepend went into liquidation and assigned its interest in the copyright works it had created for Fresh Trading to the defendant in these proceedings.

Fresh Trading brought a claim for declaratory relief regarding the ownership of the copyright in the logo.

The High Court began by noting that an assignment of existing or future copyright must be signed by the assignor in order to be legally effective (section 90(3) of the Copyright, Designs and Patents Act 1988. Given the absence of a signature, Fresh Trading could not be the legal owner of the copyright. However, while the absence of a signature meant there was no formal legal assignment, it did not necessarily mean that there was no agreement to assign the copyright, which could give rise to an equitable assignment. From the evidence, the Court concluded that there had indeed been an equitable assignment as the parties’ conduct demonstrated an intention to act in accordance with the terms of the unsigned agreement. The parties had intended the agreement to be legally binding notwithstanding they had described it as a “heads of agreement” and “subject to contract”, the Court noting that the use of those terms did not necessarily preclude the coming into force of a binding legal agreement.

Regarding the argument that as no shares had been allotted, there could be no equitable assignment, the Court considered that these two actions were intended to be concurrent not conditional on one another so that the fact that no shares had been allotted did not mean that there could not be an equitable assignment of the copyright.

The case is a useful reminder of importance of ensuring that copyright in a logo is formally transferred to the end user in order to avoid future legal disputes arising.

The case is also interesting for what the Court said about assignments of future copyright where the Court made clear that an assignment of future copyright will not be effective if it is subject to further conditions.

____________________

[1] Fresh Trading Ltd v Deepend Fresh Recovery Ltd and another [2015] EWHC 52 (Ch)

Contacts