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Who Owns Copyright? My Company or Me? | Creative Law Center

Who Owns Copyright? My Company or Me?

As the author of a creative work, you are the one who owns copyright to it in the first instance. There are two exceptions to this rule. The first is if you are an employee and you created the work as part of your job. In that case, your employer is who owns copyright to the work. The second exception is if you created the work as a work for hire. In that case, the individual or company who hired you to create the work owns the copyright to it.

What about when you own the company? Who owns the copyright then?

You are Not Your Company

Many creative professionals operate their businesses through a company, usually an LLC or an S Corp. Individuals who own their own companies are not necessarily employees of that company. If you own a single member LLC, you are a member of the LLC, not an employee. If you own all the shares of an S Corp. you are a shareholder of that company and may not be an employee.  In either case, you own the copyright to any work you create and not your company. (NOTE: This may be different in a multimember LLC or an S Corp. with more than one shareholder. It depends on the language in the corporate governing documents.)

In the case of a single member LLC or a wholly-owned S Corp., the bigger question is not who owns copyright to the creative work, but rather who should own it? Does it make more sense to hold the copyrights as an individual or to transfer copyright ownership to your company? This is a strategic decision. You need to look at why you set up your company in the first place and what you plan to do with your copyrights in order to decide how copyright ownership should be held.

Creating Multiple Revenue Streams

Your copyrights have the potential to be income producing assets generating multiple revenue streams. A writer can license print book rights, audio book rights, foreign language rights, English language in foreign territory rights, and option the work for performance or a screenplay—each to a different entity, for example. Visual artists can license their work to fabric manufacturers, or for wallpaper, for calendars, coffee mugs, any number of consumer products for sale by retail chains, or as backdrops to ad campaigns or video productions.

When deciding who owns copyright—whether to keep ownership of your copyrights in your own name or to transfer copyright ownership to your company—you need to assess which option offers greater protection for those income streams.

Click the image to enlarge it.

Assessing the Risk to Decide Who Owns Copyright 

When making the decision about whether you or your company should own your copyrights, you need to consider the risks to which you and your company are exposed. In other words, how could you or your company get sued?

Almost all creative professionals—writers (fiction, non-fiction, and memoir), visual artists, filmmakers, musicians, graphic designers—have exposure to claims of infringement by a third party. If you infringe someone else’s creative work, that person is probably going to sue you personally, not your LLC. They may not even know about your LLC and in any event, they think you did the infringing, not your company. Creative professionals can also be sued for defamation, invasion of privacy, or violation of someone's right of publicity.  If you signed a contract, you could be liable for breach of contract. Simply put, operating through an LLC will not save you from being sued personally.

Your company could get sued for exactly the same things. 

Protect Your Income by Protecting Your Assets

The primary purpose of operating through a business entity is to protect yourself and your personal assets from liability. After all, LLC means limited liability company. If there is a judgment against the LLC (or an S Corp.), the creditor has recourse against the assets of the company. But the creditor can’t get to your personal assets. Copyrights owned by the company could be exposed to claims by the company’s creditors. 

On the other hand, if you hold your copyrights as a personal asset, they could be exposed to your personal creditors. For instance, Toni Braxton filed for personal bankruptcy and lost the copyrights to her portfolio of songs. 

Your membership interest in the LLC (or your shares in an S Corp.) is a personal asset.  But it is a personal asset that comes with another layer of protection. In most states, creditors cannot directly attach the assets of the LLC or an S Corp. to enforce a personal debt. Instead, the creditor can get a charging order which entitles them to the member's distributions from the LLC. This is a state law issue. Some states are more debtor friendly than others; plus, the answer may be different for single member LLCs.

Because in most states creditors cannot directly attach the assets of the LLC or an S Corp. to enforce a personal debt, it is easier to protect the revenue streams generated by your creative work if your copyrights are held by your company. Your personal creditor may get to the revenue itself, but not to the creative work that generates the revenue. Once the debt or judgment is paid, you still own the income generating asset—the copyright. 

How to Assign Copyright to Your Company

Apply for copyright registration on your work and identify yourself as the author and initial claimant. Then make an assignment of copyright to your company in which you "sell, assign, transfer, and set over to [your company] the entire United States, foreign and international right, title, and interest in and to copyrights, copyright registrations or applications pertaining to [the work]."  The transfer or assignment document can be filed with the Copyright Office. The transfer is effective even if the document is not filed with the Copyright Office. 

You can name your company in the rights and permissions section of the application. You can do this even if you decide not to transfer your copyrights. This manages the expectations of potential licensees—that they are dealing with a company and not an individual.

Copyright Practice Tip


Listing your company as the rights and permissions manager of your copyright helps to manage expectations of potential licensees—that they are dealing with a company and not an individual.

The current term of copyright is the life of the author plus 70 years. If the author is a company, the duration of the copyright is 95 years from publication. With the approach suggested here, the math favors a creator who lives 25 years or more from publication. Depending on your age, your estate will have a longer period of time for controlling and licensing your copyrights with you as the author.

There are a number of considerations that go into deciding who owns copyright to your creative work. This post outlines one way of handling the issue. Add salt and pepper to taste.

About the Author

Kathryn Goldman helps artists, writers, and other creative professionals make a living from their art by teaching them how to protect their work and enforce their rights. She is an attorney who writes these posts to help you be more thoughtful about intellectual property and the law when you write your stories, create your art, and build your business.

  • Jennifer says:

    I am contemplating bankruptcy because of a lawsuit unconnected to my work as a writer. I hold copyrights, but my publisher has kept the books in print and holds certain rights by way of contract. My publisher is the licensee, yes? So are my copyrights at risk–can the BK trustee claim then as part of the BK estate–if my publisher has prior claim?

    • Jennifer,
      First let me say that I am not a Bankruptcy attorney so you need to double check this with one. Your copyrights may be at risk but I don’t think the rights can be taken from the publisher. The revenue stream from the publisher might be part of the bankruptcy estate, though.
      Kathryn

  • Julie says:

    Great information! I signed up for your mailing list today, then found you again in a Google search about a problem I have. In 2009 I set up a one-member LLC and registered a copyright for my new book to the LLC. A couple of years later I went out of business and closed the LLC. Now I am about to set up a new LLC to sell the book, but the copyright is still in the name of the closed LLC. Since the old LLC no longer exists as a legal entity, how do I transfer copyright?

    • You’d have to check your state’s law on this, but if all debts of your earlier LLC were paid when the LLCs affairs were wrapped up, then the remaining assets (the copyright) would be distributed to the member (you). It would probably take the form of a written transfer authorized by the person winding up the affairs of the LLC with an effective date of when the LLC finished winding up and before it was dissolved. Check with a local lawyer. It should not be that big a deal. The problem comes in if the LLC was never properly shut down.

  • John says:

    Hi Kathryn,

    This is incredibly useful. Can I just ask one thing: when you say that I or my LLC can be sued for a number of reasons (breach of copyright, etc) does that mean that I’m no better protected (in a legal sense) if the copyright is in my name or my LLC? Obviously I don’t plan on being sued, but I’d like to protect myself as much as possible early in my career.

    • John,

      If you are the author of the [allegedly] infringing material, you’re likely to get sued regardless of who owns the copyright. Using an LLC to hold the copyright to creative work does not protect against liability for infringement. If the copyright is held by a multi-member LLC and you find yourself in a personal bankruptcy situation, the copyright would be protected from your personal creditors. If the copyright is held by you personally and the LLC runs into financial trouble, the copyright would be protected from the LLCs creditors.

  • bruce arnold says:

    Hi Kathryn, I’m in New York City and have multiple copyrights for music and books in my name. These books are publishing by my company which is a C-Corp formed one year ago. Before that I was a Sole Proprietor and under that business setup most of the books/music was created. From reading your article it seems like I should switch all my copyrights to my C-Corp to protect them from being sold in a personal bankruptcy. Sound about right?

    • It almost sounds right (keep in mind that I am not a bankruptcy attorney). If you are the sole shareholder of the C-Corp, then the entirety of the C-Corp would become part of the bankruptcy estate if you filed for personal bankruptcy. The copyrights, as assets of the C-Corp, would end up there, as well. If there are other shareholders in the C-Corp, and you filed for personal bankruptcy, then only your interest in the C-Corp becomes part of the bankruptcy estate (your right to distributions, for example). The copyrights remain with the C-Corp and could not be touched by your personal creditors. A shareholders agreement may control what happens to your interest after filing for bankruptcy. This is worth double-checking with a bankruptcy attorney. It’s not a copyright specific issue.

  • Marie says:

    Hi, Kathryn,

    I am entering into a contract with a photographer to sell her photos through a third party site. She wants the contract to be with her LLC. It is not a single-member LLC, she owns it with her husband. Must she formally assign her copyright to the LLC in order to enter into a contract with my company through the LLC? I assume the answer is yes.

    • That would be the cleanest way to do it. You need to have a contract with the person or entity that controls the rights to the photos before you can license/market them for her. A transfer or assignment (these words are used interchangeably) of the copyrights in the photos to the LLC would accomplish that.

  • Diana Saillant says:

    Thank you Kathryn. The information is clearly stated very helpful.

  • David Jeffers says:

    Thank you for this! This was exactly what I was looking for 😊

  • Ivy says:

    Complicated question…hope I can explain right….
    There was a copyright assigned to an corporation in 2012. With a creation date of 2000. Found out the corporation was not even in business in 2000….can the copyright still be valid?
    Then they filed a supplement, in 2015, to the first copyright naming a different corporation the author and the 2012 company as claimant. I don’t know if there is an agreement transfer be the company was no longer in business as of 2009…would the copyright still be valid?

  • Carl says:

    Kathryn, thanks so much for this valuable information. I was hoping you would entertain a follow on question about the creative work itself. When selling the creative work (the object itself) through a single member LLC and copyright remains with the author. What actually gives the LLC the right to transact the sale?

    Thanks in advance,
    Carl

    • Carl,
      With a single member LLC, there’s an implied transfer of the work itself from the creator (the sole member) to the entity. The entity can then sell what it owns, the work. You are correct that the bundle of rights that makes up the copyright stays with the creator in the absence of a written transfer. From a tax perspective, there’s really no issue because of the pass through nature of the entity. Great question.
      Kathryn

      • Carl says:

        Kathryn,
        Thanks again for your timely response. One last question if I may. Would that implied ownership constitute “Personal Property” or “Inventory” to the LLC?

        With great appreciation,
        Carl

        • Are you working on your taxes? I think it’s inventory because the entity intends to sell the work. Personal property is equipment and material the entity uses to run its business . . . like computers and filing cabinets. You should double check that with an accountant.

          • Carl says:

            Yes, working on Personal Property Taxes… You have been a great help! I will take your advice and confirm with an accountant and look forward to reading more of your post.
            Carl.

  • Andy says:

    Thanks for the info! I am wondering why you would want to first register the copyright to yourself (the individual) as the owner and author and then transfer it to your firm instead of just registering the copyright with the firm as the owner and author from the get go. Is there a difference between the two? I take it the firm owns all the rights at the end of the day either way.
    Cheers,
    Andy

    • The issue is less complicated if we’re talking about a single member LLC and you are the only member. In that case it’s a question of trying to maximize the duration of the copyright.

      Let’s do the math. Say you’re 50 years old and publish a book today. If you live to be 85 years old, the copyright will last for a total of 105 years. Your heirs will have the benefit of revenues generated by the copyright after your death. If you apply for the copyright in the name of your LLC as the author by a work for hire agreement, that copyright will last for 95 years. There’s an extra 10 years by registering the copyright in your individual name. The numbers are even better for younger authors.

      Also, the LLC only owns all the rights at the end of the day if you as the individual transfer them in writing.

  • Very helpful information! Thank you.
    Welwyn Wilton Katz

  • Irene Cuffe says:

    Thank you for this information. I will get on it a.s.a.p. I agree about how good your new website looks.
    Regards,
    Irene Cuffe.

    • I’d be interested to hear whether you decide to transfer your copyrights to your company, Irene.

  • Paula Adelsberger Simon says:

    Your information is so valuable to anyone doing creative work. Great job with the new website, can’t wait to see more!

    • Thanks for reading, Paula. The Creative Law Center gives me the flexibility to offer a broad swath of resources to creative professionals — from copyright protection to business building to trademark and branding guidance. I’m looking forward to developing it in many directions.

  • Debbie says:

    Thanks so much Kathryn! This is another valuable post. This is an area that definitely needs to be considered, especially since I plan on being a full-time author and having multiple income streams. It gives me a lot to think about.

    Again, thanks and I’m looking forward to your next post.
    Debbie

    • Hi Debbie,

      “Multiple income streams” is one of my favorite phrases. May you have great success with your plan to generate them. Upcoming posts will focus on establishing those revenue streams and protecting them.

      Kathryn

  • Very informative. Thanks for posting.

  • Thom Reece says:

    Perfect timing for me as I have been considering these very same concerns for a number of months. As always, Kathryn clarifies issues involved and options to consider. Excellent information from a pro. The self-publishing industry, of which I am a member, is fraught with legal exposures and opportunities in a variety of areas. Advance planning and arranging your business affairs properly will help you: (1) protect your intellectual property rights, (2) protect your personal assets (3) defend against the legal predators which see you as an opportunity, and (4) assure that your estate will survive intact and be there to provide valuable income for those you love.

    Thank you, Kathryn.

    • You’re welcome, Thom. There are lots of pieces to building a successful career as a creative professional. Once you lay a solid foundation for your business, it’s easier to work on the fun stuff, the actual creating.

  • Karl von Loewe says:

    An interesting analysis of an issue I’ve never considered. Every case is different, so your mileage may vary, but it’s no less important to think about.

    • It’s true, Karl. Everybody’s situation is a little different. The business structures and protection mechanisms are the same. It’s how they are pieced together that requires some thought. Thanks for the comment.

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