The Unauthorized Use of Architect Drawings or Plans: Is it Theft?
OVERVIEW
Recently, the California Court of Appeals in Simmons v. Ehm Architecture, Inc., No. D080702, 2023 WL 8888228 (Cal. App. 4th Dist. Dec, 26, 2023) (unpublished), held that an owner giving his architect's plans to another architect without the first architect's consent for the new architect to complete the project constituted theft. This alert addresses architectural copyrights generally, and the potential impact the decision in Simmons may have on owner-architect agreements, especially for those who may use the American Institute of Architects (AIA) B101-2017, the standard form agreement between owners and design professionals for building design and construction administration services.
ARCHITECTURAL COPYRIGHTS
The Architectural Works Copyright Protection Act (AWCPA) grants copyright protection to "original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced or otherwise communicated, either directly or with the aid of a machine or device." The AWCPA specifically protects the "design of a building as embodied in any tangible medium of expression, including a building, architectural plans, or drawings" and includes the overall form as well as the arrangement and composition of spaces and elements in the design.
When ownership of plans, drawings, or designs of an architect that are the subject of an owner-architect agreement are not transferred to the owner, then the architect's copyrights in those works are protected under the AWCPA, and the unauthorized use of such plans or drawings may leave owners at risk of liability. Likewise, this situation may create a cause of action for design professionals. Either way, this situation could significantly impact both owners and designers alike.
SIMMONS V. EHM ARCHITECTURE, INC.
The Simmons decision grew out of a dispute over compensation for residential design services. The owner and architect entered into an AIA B101-2007 agreement, an earlier version of the AIA B101-2017, which is commonly used by owners and design professionals today. The owner, Simmons, hired Ehm Architecture, Inc. to design a connection from Simmons's house to his mother's house next door. Ehm charged a flat fee for "basic services," which included measurements and drawings of the existing structure and design plans for the addition. After the agreement was signed, Simmons requested changes that greatly increased the scope of the work and the architect's services. Simmons' requested changes affected "almost every drawing in the set." Simmons continued to work with Ehm after the design changes had been made, but by March 2018, Simmons surreptitiously planned to change architects without telling Ehm. When Simmons asked Ehm for a full set of the plans for the project, Ehm responded that they "do not typically release full sets of full prints when a project is so far over budget" and pointed out that because of all the changes for which Ehm had not yet been paid, Ehm "owned more of the plans than [Simmons did]." Nevertheless, Ehm agreed to release one set of plans to Simmons as an act of good faith.
Shortly after receiving the plans, Simmons' attorney sent Ehm a letter demanding a refund of all payments made to Ehm or the release of all "plans/intellectual property" that Ehm had prepared for the project. Ehm refused Simmons' demands and stopped work on the project. Before Ehm had stopped work on the project, however, Simmons had already signed a contract with another design firm, HyR Building, LLC, to finish the project using the plans prepared by Ehm. Simmons claimed to have given HyR a verbal instruction to not to use Ehm's plans.
Ehm sued Simmons for theft under California law, claiming that Simmons had taken possession of Ehm's proprietary design documents without Ehm's consent. After careful review, the court determined that HyR's design plans prepared for the project were copied from Ehm's design plans. Noting that Ehm needed to prove that Simmons acted with criminal intent, the court found that Simmons had committed theft because he took Ehm's design plans with the intent to use them to complete the project with HyR. The court also determined that Simmons knew he was violating the terms of the agreement with Ehm. Indeed, the court stressed that, "the contract with Ehm stated that the plans are Ehm's intellectual property and cannot be used for completion of this Project or others." Thus, the court found that Simmons' dissemination, and later use of Ehm's design plans for the completion of the project, was theft and that Ehm was entitled to damages.
RELEVANT AIA PROVISIONS
The AIA B101-2017, a newer version of the contract documents used in Simmons, contains several important provisions that merit careful consideration in light of the Simmons decision. Owners and designers should carefully review the following provisions:
Article 7 Copyrights and Licenses
§ 7.1: The Architect and the Owner warrant that in transmitting Instruments of Service, or any other information, the transmitting party is the copyright owner of such information or has permission from the copyright owner to transmit such information for its use on the Project.
§ 7.2: The Architect and the Architect's consultants shall be deemed the authors and owners of their respective Instruments of Service, including the Drawings and Specifications, and shall retain all common law, statutory, and other reserved rights, including copyrights.
§ 7.3: Upon execution of the Agreement, the Owner shall own the Architect's Instruments of Service, including Drawings and Specification, provided that the Owner substantially performs its obligations under this Agreement, including prompt payment of all sums due pursuant Article 9 and Article 11.
§ 7.4: The Owner shall not assign, delegate, sublicense, pledge or otherwise transfer any license granted under the Agreement without prior written consent of the Architect.
Article 9 Termination or Suspension
§ 9.7: In addition to the amounts that Owner shall compensate the Architect for services performed prior to termination, if the Owner terminates the Agreement for its convenience, or the Architect terminates the Agreement due to the Owner suspending the Project for more than 90 days, the Owner shall pay the Architect the Licensing Fee if the Owner intends to continue using the Architect's Instruments of Service.
TAKEAWAYS
The terms of the written contract between an owner and a designer dictate when and how the plans, specifications and other expressions of the design may be used. It is important to review these terms carefully and to make any changes to the form agreement to ensure that your interests are properly protected. If you are an owner, then you may wish to seek a full transfer of the architect's rights to the design. If you are a designer, you may wish to retain those rights. In any event, the intent of the parties should be clearly expressed in the agreement, including compensation for a transfer of those rights and the consequences for failing to pay that compensation. Simply put, you can avoid a situation like the one in Simmons if you carefully consider these potential issues at the outset of the project, before the execution of any agreement, and then abide by the terms of the agreement. Not doing so may leave owners and designers in a contentious situation.
