A Theory of Copyright’s Derivative Right and Related Doctrines

By Michael Abramowicz. Full text here.

Although many copyrighted works are close substitutes for other copyrighted works, there would be many more close substitutes of certain works in the absence of the derivative right, the exclusive right to create adaptations of a copyrighted work. Yet even the derivative right’s defenders identify the suppression of new expression as a cost of the derivative right. In this Article, Professor Michael Abramowicz argues that the conventional defense of the derivative right, i.e., it encourages production of new works, is unsupported, and that the derivative right’s suppression of works that would be close substitutes for authorized derivatives and for one another, may well be welfare-improving. Rent dissipation theory, previously applied by commentators to patent law, suggests two implications for copyright’s derivative right: First, the derivative right prevents copyright races, which would rush authors into creating low-quality adaptations of their works. Second, the right prevents excessive competition among unauthorized derivative works. This theory allows the derivative right to be distinguished more clearly from the reproduction right, potentially helping to resolve thorny doctrinal problems. In addition, this understanding of the derivative right may provide a better justification than the defense previously offered for the long copyright term, because the derivative right increases in importance relative to the reproduction right late in the copyright term.