Copyright Preemption of Contracts
54 Pages Posted: 30 May 2008
For more than ten years, a debate has been raging in copyright law over the enforceability of contractual license agreements that alter the delicate balance of rights that the Copyright Act strikes between owners and users of works of authorship. Courts and scholars are intensely divided on whether the Copyright Act should preempt such contracts. Recent cases show that courts virtually never preempt these contracts, no matter how much the terms of the contract conflict with the Act's provisions. Meanwhile, scholars are equally categorical in their opposing view, reasoning that contract claims can impede the objectives of federal law just as other state law claims can. Although courts and scholars disagree over preemption, they agree that copyright law needs a remedy for contractual overreaching. Unfortunately, preemption doctrine is under-utilized because no coherent model of preemption exists that accommodates both the interest in enforcing contracts as well as the interest in enforcing copyright policy.
This article argues that both courts and scholars are wrong in their categorical approaches to preemption of contracts under the Copyright Act, and it proposes an intermediate approach that recognizes the importance of both contract rights and federal policy in preemption analysis. It argues that the reason this issue has been analyzed incorrectly is that preemption law seems ill-suited to contract claims. Contract preemption cases are not concerned with whether a state regulatory scheme is likely to supplant a federal scheme. Instead, the issue is really whether individuals should be able to contract away rights granted by the federal Copyright Act. Thus, the article proposes a new model for addressing copyright preemption of contracts based on insights from the law related to contractual waiver of statutory rights.
The proposed waiver model for contract preemption helps courts to distinguish between contracts that interfere with the purpose of copyright and those that do not. As such, it keeps statutory purpose at the forefront of contract preemption analysis and harmonizes the interest in freedom of contract and the interest in federal copyright policy.
Keywords: Intellectual Property, Copyright, Contract, Preemption, First Sale
JEL Classification: K12, K20, K40, O31, O34, O38
Suggested Citation: Suggested Citation