The use of large up-front fees and disproportionate deposits has already resulted in significant cost consequences for one care provider.
Many churches (and indeed other charities) do not realise that they potentially own a valuable asset in the form of intellectual property and that they are often not free to simply give it away – it has to be used to benefit the church, fulfilling its charitable purposes. In addition churches are often not clear on who actually owns the intellectual property – teaching materials, sermons, logos, the website etc.
In this article we are seeking to:
- explain what intellectual property is;
- how to make the most of it; and
- how to avoid the common pitfalls.
Intellectual Property Rights
Intellectual property is often referred to as ‘creations of the mind’. It is the things we create through invention, ingenuity and individual expression. There are a range of intellectual property rights that attach to the things we create, whether that ‘thing’ is a book, a website, a slogan or any other thing else that we create. Intellectual property is an asset in the same way as any other form of property but it is very often overlooked.
There are five main types of intellectual property rights:
- Confidential information;
- Patents; and
- Design rights;
Patents and design rights are often referred to as ‘hard IP’ because they are used to protect technological inventions or manufactured items.
Confidential information is exactly what it ‘says on the tin’. It is sensitive information that you do not want to be shared. Confidential information is usually/should be protected through a non-disclosure agreement, which is a contractual agreement between the parties governing how the information can be used. The sharing of confidential information commonly occurs when two organisations agree to work together on a joint project.
Copyright, trademarks and confidential information are referred to as ‘soft IP’ and focus on creative works, branding or merchandise. Copyright and trademarks are the rights that churches will most often make use of and, therefore, are the focus of this e-briefing.
Copyright is an automatic, statutory right that will attach to an original literary or artistic work or creation. The right is designed to prevent other people from copying your work or using it without your permission. As a general rule, copyright will last for 70 years from the death of the creator of the work.
A trademark is a sign or symbol, such as a logo, that sets your church apart and makes it recognisable. By registering a trade mark, you gain statutory protection and have the monopoly for the use of that mark. Not all signs used by organisations are registered as trademarks. Where you have an unregistered mark, it is possible to prevent others using your sign or symbol if there is goodwill attached to it and a third party has been using your sign to mislead the public. This is known as ‘passing off’ and is a common law IP right.
Issues of ownership
It is important to be clear from the outset who owns the intellectual property rights in any materials your church produces, such as recordings, CDs, DVDs, teaching materials and books. Where employees of the church have produced the materials in the course of their employment, the church will usually be the owner. However, where a volunteer creates the materials it will usually be the volunteer who owns the IP rights, not the church. So, if a member of your congregation volunteers to design you a logo or create you a website, they will own the IP rights to those.
This is relatively easy to resolve as the IP rights just need to be transferred across to the organisation using a simple Assignment Agreement. Alternatively, a Volunteering Agreement can be signed from the outset that deals with ownership of any IP that arises during the course of the volunteering relating to the church.
Both of these can ensure everyone knows who owns the IP rights and prevent disputes in the future especially if someone leaves the church and wants to use their logo etc. somewhere else.
Knowing the Value of your Intellectual Property
Without realising the value of their Intellectual Property some churches unwittingly agree to ‘give away’ the IP rights in their materials to their pastor/minister or another employee, for example, allow them to keep the royalties from a book they have written during the course of their employment. IP rights can be valuable the charity trustees of the church have a duty to act in the best interest of the church and only use its assets in fulfilment of its charitable purposes. Simply giving away IP rights to an individual would not usually be in fulfilment of a church’s charitable purposes. In addition a church’s governing document commonly contain restrictions on trustees obtaining benefits or payments from the church and this would clearly be breached if the pastor/minister is also a trustee and is making a personal financial gain from the sale of published materials he has written in the course of his employment by the church – the church should be benefitting from this.
A church, therefore, needs to think carefully about disposing of its IP rights – it wouldn’t usually just give away its church building and in the same way a church needs to think twice about giving away rights in Intellectual Property!
In relation to an employee, such as your pastor/minister, when the church first employs them the church could choose, as part of their employment package, to allow them to keep the IP rights from particular materials they may create in the course of their employment, for example, the royalties from a book they write. This would need to be clear in their contract of employment and you would need to consider how this in the best interests of the church, for example, are you, therefore, paying them a slightly lower salary?
Networks of Churches and Intellectual Property
Many churches work as part of a network and, therefore, there can be common branding and merchandise. As the network grows, it may be necessary to register trademarks and put in place formal licencing agreements so that individual churches within the network can access those registered trademarks. The licence will govern issues such as how the trade mark can be used, for how long and in what geographical area (if any such restriction needs to be imposed) etc. A Licensing Agreement will give the owner of the trade mark control over how it is used by other members of the network and in turn, the members will have greater certainty that they are complying with any branding requirements.
Avoiding the Pitfalls
Increasingly churches are using websites to interact with the community and to provide information about their faith and church activities. However, you need to take care when adding content to that website to ensure that you do not infringe someone else’s intellectual property rights. A common mistake is to ‘copy and paste’ images found on the internet believing that they are free to use because they are in the public domain. This is not the case! Copyright will still subsist in those images and by copying them onto your website you are potentially liable for a copyright infringement claim. To avoid this situation, it is best to use images that you have either created yourself, obtained a licence for or are from dedicated sites that allow free public use.
Another common issue is where a third party has been paid to create something for the church, such as a website or logo. The IP rights in the commissioned work will rest with that third party despite the fact the church has paid a fee. In this situation, the third party can impose restrictions on how the commissioned work is used or altered and can charge an ongoing licence fee for use of the commissioned work. When commissioning a third party to create any artwork or piece of writing for you, make sure that the IP rights are transferred to your church so that you will own it and can use it as you wish.
Intellectual property rights are an important asset and in an increasingly digital world it is important to realise the value of your church’s IP rights and the importance of respecting other people’s rights.
We have produced an IP Toolkit aimed at helping those operating in the not-for-profit sector. It contains a range of useful information about Intellectual Property, practical tips and template documents to help you manage your IP rights effectively. Please contact Rebecca Ward on 0121 214 3658, email@example.com or Sarah Webb if you would like any further information.
In addition we can advise you on putting in place Volunteering Agreements or Employment Contracts, for further information please contact Damian Ward.
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