Real estate is not one of those industries thought of as a hotbed of infringement. Entertainment? Sure. Luxury goods? You bet your Gucci® loafers. But most dirt lawyers wouldn’t know an intangible property right if they, well, tripped over it.
However, that is changing. Real estate is more and more an Internet-driven business. And what sells on the Internet? Images. Unlike the old days when agents collected home listings in big binders bulging with paper, today it’s all about how a home shows online. And that leads to copyright infringement of photos and videos of residences for sale or lease.
Academic studies, like the one sponsored by Internet broker RedFin, have proven that the better the photos, the faster a home will sell and the higher the price it will fetch. Snapshots taken with an agent’s smartphone simply don’t sell listings as well ashigh-quality professional pictures.
Smart real estate agents and brokers who hire experienced, independent real estate photographers typically receive a license to use the resulting stills and video. Most real estate photographers furnish photographs under a nonexclusive license. Whether the photographer uses extensive licensing language written by a lawyer, or no licensing language at all, the likelihood is that all the real estate agent receives is a license to use the photographs in connection with the real estate listing for which the photos were taken.
Rarely is copyright ownership transferred since doing so requires a specific written agreement signed by the photographer, and most independent photographers don’t like to give up copyrights to their images. Besides, all the agent needs is a license to use the photos for his or her listing.
Lately, professional photographers have become increasingly concerned that MLS organizations may be overstepping their bounds and claiming ownership of their photographs.
Every MLS, the regional organizations that compile and distribute home listings to their local members, has adopted rules for its home listings, such as who can use them, and how they can be used.
I recently surveyed the rules and regulations adopted by MLS organizations around the country. When I did I was surprised to find that more than a few MLS organizations claimed ownership to copyright, not just in the MLS listings themselves, but also of the photos that agents and brokers submitted for listings.
MLS claiming copyright ownership in their work has many photographers crying foul. Already they have a tough time charging agents what their images are really worth. These days it is not unheard of for buyers to close based on the pictures alone without setting foot on the property. When that happens, who made the sale, the agent or the photographer?
The Copyright Act is clear that a transfer ownership of copyright in photographs requires a signed written document (paper or electronic). Section 204 of the Act says clearly that “[a] transfer of copyright ownership, other than by operation of law, is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner’s duly authorized agent.”
Courts interpreting section 204 have held that the owner of the copyright, or their “duly authorized agent,” cannot transfer copyrights orally. The transfer has to be in writing and it has to be signed in some way, such as with a physical or electronic signature. These requirements make it almost impossible to transfer ownership by accident. Except in the unusual case of a photographer who is also a real estate agent, chances are the local MLS has nothing that qualifies as a transfer of copyright ownership.
So far, no court has weighed in on the effect of MLS rules on photographers who never signed away their claim to the copyright in their photos. In a recent infringement case brought by an MLS against an internet start-up, the Fourth Circuit ruled in the MLS’ favor.
Because in that case the defendant had no claim to a copyright, it is hard to believe that the result would have been the same between MLS and photographer. Indeed, a dispute between a local MLS and an independent photographer may never materialize since the two are not naturally adverse to each other.
But the issue is very relevant to agents and brokers, especially ones with access to photographs used in expired MLS listings. New agents who pick up a listing after the prior agent could not make a sale, or when a home sells and then quickly returns to the market, have been known to post the photographs from the prior MLS listing. Of course, the new agent did not hire the photographer or pay for the photographs, and so we have an open-and-shut case of copyright infringement.
While the MLS may not own copyrights to photographs, it does own copyrights. All MLS systems own the copyright to the MLS compilation that they publish. A compilation is defined in section 101 of the Copyright Act as a “work formed by the collection and assembling of preexisting materials or of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship.”
Many courts have upheld the right of an MLS to claim copyright in its compilation of data on homes for sale. This compilation includes the arrangement of photographs of the homes being advertised, along with data about the homes.
But more than one MLS, not understanding the distinction between compilation copyright and copyright in the underlying work itself, has claimed rights that it simply does not have.
The rights the MLS has are the same as the rights the agent has which, without a written transfer, is a license to use the photographs for the purpose they were taken, namely the sale of the listing belonging to the agent who bought the photos. Once the agent loses the listing, or the property is sold, the license is no longer valid.
Agents often plead ignorance of the Copyright Act, but ignorance is no defense since copyright infringement has no intent requirement. You copy, you infringe; it’s that simple. The fact that the photo was downloaded from an MLS listing and the MLS says it owns all the photos in its listings does not make it so.
Joel Rothman is a Florida attorney board certified in intellectual property law who represents real estate photographers and other creative professionals in licensing matters and litigation. He is a partner in Schneider Rothman Intellectual Property Law Group in Boca Raton and can be reached at firstname.lastname@example.org.