Clippings – Gaiman v. McFarlane

It also spawned a legal battle royal over a deal gone sour that pitted two comic book giants and one-time collaborators: Spawn creator Todd McFarlane and Sandman creator and best-selling novelist Neil Gaiman.

The drama recently climaxed in a Chicago federal appeals court. A three-judge panel delivered a resounding victory for Gaiman, who had accused McFarlane of costing him millions of dollars in royalties by breaking promises and refusing to acknowledge his co-ownership of characters that became part of the popular Spawn franchise.
The ruling is more than a win for Gaiman. Intellectual property experts predict the appellate decision will have broader influence on joint authorship issues, giving everyone who participates in a creative work a potential copyright claim.

“There are all kinds of people who contribute ideas to creative works in movies, plays, comic books,” said Ronald Staudt, a law professor at Chicago-Kent College of Law, who teaches copyright and Internet law. “Courts normally reject the notion of just contributing ideas on the theory that ideas are not copyrightable.

“Up until now, you had to create something that was independently copyrightable,” he said. “The judge says you don’t need that.”

What started as science fiction fantasy morphed into the reality of a legal tussle between two of the more celebrated figures in the world of comic books.

An Englishman who lives in western Wisconsin, Gaiman wrote a guest issue of Spawn, a fantasy comic featuring armies of the damned that McFarlane had written himself up to that point.

The pair had a handshake deal made in 1992 and McFarlane’s promise that he would treat Gaiman “better than the big guys” did, a reference to larger comic book publishers, such as Marvel and DC Comics. Gaiman was paid $100,000 for the issue, according to court documents.

Three new characters emerged from Gaiman’s story: the scantily-clad diva warrior Angela, villainous Medieval Spawn and bearded wizard Cogliostro. Sales responded: Gaiman’s issue sold about 1 million copies, 400,000 more than a previous issue.

Angela became such a big hit with Spawn readers that Gaiman was asked to write a mini-series about her that was later published in paperback form. Angela and Medieval Spawn also were made into toys by McFarlane’s toy company.

The secondary uses of the characters and paperback reprints became the source of much of the dispute. In January 2002, Gaiman sued McFarlane and a number of his companies in federal court in Wisconsin, alleging fraud, copyright violations and non-payment of royalties.

Court documents revealed that the pair struck a deal in 1997 in which Gaiman and McFarlane traded rights to Medieval Spawn and Cogliostro for Miracleman, a character to which Gaiman had contributed in the past. But two years later, McFarlane backed out of the contract.

A seven-member Wisconsin jury in October 2002 awarded Gaiman half ownership in the three characters and half the profits to date from each of those characters and publications since their inception.

While the court is still tallying the amount, Gaiman estimates that he will receive between $2 million and $5 million. After paying his lawyers, he plans to donate the rest to the Comic Book Legal Defense Fund, a 1st Amendment fund for comics.

McFarlane says he will appeal
After the verdict McFarlane promised an appeal and was quoted as saying, “I can’t seem to get around that it is a very complicated case that jurors didn’t get the full grasp of.”

The appellate court said otherwise. In his opinion released at the end of February, Judge Richard Posner of the 7th U.S. Circuit Court of Appeals ranges far in his examination of copyright law.

He spends much of 33-page judgment rejecting McFarlane’s first defense that Gaiman didn’t sue before the 3-year statute of limitations expired on copyright claims.

Copyright decision noteworthy
But his analysis of what kind of fictional characters can be copyrighted is significant, Staudt said. McFarlane argued that Gaiman only contributed the idea for the characters, and ideas are not copyrightable, only expression is. The expression, McFarlane said, was due to his drawing of the characters.

Posner disagreed, saying, “Gaiman’s contribution may not have been copyrightable by itself, but his contribution had expressive content without which Cogliostro wouldn’t have been a character at all, but merely a drawing.”

The judge also rejects the defense’s claim that Cogliostro and Medieval Spawn are too commonplace to be copyrighted.
In doing so, Posner disagrees with the 9th Circuit, which in 1954 denied copyright to Dashiell Hammett’s famously distinctive detective character Sam Spade.
Posner distinguishes between literary and graphic expression as
in comic book
s.

“A reader of unillustrated fiction completes the work in his mind; the reader of a comic book or the viewer of a movie is passive,” Posner wrote.

“That is why kids lose a lot when they don’t read fiction, even when the movies and television that they watch are aesthetically superior.”

Gaiman said in an interview he found the opinion mildly amusing because it even includes the Lone Ranger’s secret identity (John Reid).

“It’s an important judgment for protecting creators,” said Gaiman, who also is the author of the best-selling novel “American Gods.”

McFarlane, of Phoenix, declined to comment on the appellate decision. His attorney, Michael Kahn, said his client was disappointed with the ruling and was exploring further legal options.