Being the start of a new year, January 1 (yesterday) saw a whole new set of works come into the public domain. And as that happens, some authors may want to use their characters for their own purposes. But if those characters are used in multiple works and not all of them are available, you might think you can't. Certainly the rightsholders for the later works will want you to think so. Are they right? A recent judgment on Sherlock Holmes gives some insight into this far-from-elementary question.
The characters of Sherlock Holmes and his assistant Dr. Watson are administered by Conan Doyle Estate, LLC (which I'll call "CDE"). However of the 4 novels and 56 short stories featuring Sherlock Holmes, all 4 novels and 46 of the 56 stories were published in the USA prior to January 1, 1923, which puts them into the public domain. Not surprisingly this drastically reduces their revenue potential, and so CDE's major source of income is licensing the rights to two things: the characters of Sherlock Holmes and Dr. Watson, and the copyright in the 10 short stories that are not yet in the public domain. As rights-managing organizations often do, CDE monitors uses of what it considers its intellectual property quite vigorously.
Klinger, the plaintiff in the lawsuit, is one of two co-editors of an anthology of newly-created Sherlock Holmes short stories. When she tried to publish the anthology through Random House CDE insisted that Klinger take a license to the characters. Klinger instead brought a lawsuit seeking a declaratory judgment to determine whether the characters are in the public domain. On December 23, Chief Judge Ruben Castillo of the Federal Court for the Northern District of Illinois released a judgment that has far-reaching consequences for both authors and IP owners.
A few words on the intellectual property status of characters. Under copyright law ideas themselves aren't protected, just the way they are expressed (i.e. the particular text, drawing, photograph, etc.). It's not infringement to have a story that's similar to someone else's story, but if you want to create something that is based on the prior story you either need to get a license to make what's called a derivative work or you need to be engaging in fair use. (I've written a few posts on fair use; see the link below if you need a refresher.) Characters are of course created in the course of creating a copyrighted work and they aren't the copyrighted work themselves, but creators need to be able to control the use of their characters or else they would have less incentive to create them. So the law addresses this by saying that when characters are sufficiently delineated in a particular work that using a character would require you to make use of the thing created in that work, the copyright status of that character is the same as the copyright status of the original work.
But for Holmes and Watson it's not quite so easy. These characters were created in a work that is now in the public domain, but expanded upon in works that aren't. For example, fans of the genre may know that Dr. Watson had a background as an athlete (first described in "The Sussex Vampire") or that Holmes eventually retired from his detective agency (in "The Lion's Mane"). Each of those comes from a story that is not in the public domain. CDE argued that because Holmes and Watson continued to be developed over time with the addition of traits like these they were still covered by the copyrights on the last stories and wouldn't yet be in the public domain. In opposition to that, Klinger argued that these character traits are just glosses on the pre-existing public domain characters and they should be in the public domain also.
The copyright status of partially-public characters has come up before in analyses of characters like Amos'n'Andy (Silverman v. CBS) and Superman (Siegel v. Warner Bros), and so Judge Castillo had some guidelines to help with his decision here. Relying on those prior decisions Judge Castillo held that Holmes and Watson are clearly set forth in the public domain stories to the point that they are fully-developed and so these characters are in the public domain, but each element of the character is an "incident of expression" and has to be analyzed separately. So Sherlock Holmes who works at his detective agency is in the public domain and can be used without a license from CDE, but post-retirement Sherlock is covered by copyright and needs a license.
This judgment clarifies three points for authors and creators.
1. Characters are protected elements under copyright law. This is more important than it may seem. Copyright law protects creators against "substantial" copying of their works. It is now becoming more clear that just taking a character from a fictional work, even where the new work places that character in a new environment, risks being copyright infringement. Put more simply: don't assume that just because you put Luke Skywalker on a dude ranch that you're okay because it's nothing like Star Wars.
2. It's okay for characters to fork, and different forks can have different lives. Judge Castillo specifically addresses this: CDE argued that Holmes and Watson needed to be covered under copyright otherwise there would be multiple versions of the same character and Judge Castillo said yes, that's possible, and that's how the law works here. So if you're using a famous character who has gone through various iterations, you need to make sure you get permission all the way up the chain of creators. Example: in some of the Star Wars licensed fiction created before Empire Strikes Back, Darth Vader isn't Luke's father and Luke and Leia aren't siblings; if you want to create something in that version of the universe you may need permission from that author as well as from Lucas.
3. Creators and their estates can't reboot their characters to extend their protection, but each rebooted character will be a new copyrighted work as a fork of the original. Superman was created in 1938. The movie "Man of Steel" was released in 2013 incorporating the character of Superman. But although "Man of Steel" didn't extend the copyright on Superman the character, the specific iteration of Superman in that movie is copyrighted as of that date. So the new elements introduced in that movie (e.g. working as a fisher in Alaska) would be protected for longer than the original character. And this rule will apply for a character in the public domain as well: Jane Austen's Elizabeth Bennet might be free and available for use, but if you want her to kill some zombies you'll have to talk to Seth Grahame.
In summary, and as Hollywood shows a bit too often every year, reusing and repurposing well-known characters is one of the most surefire ways for creators to extend the life of a creation and maximize its value. But there are limits. And through cases like this one, we're starting to see where they are.
Legal Minimum posts on fair use
Klinger v. Conan Doyle Estate
Silverman v. CBS
Siegel v. Warner Bros