The U.S. Court of Appeals for the Second Circuit reversed a lower court’s decision that dismissed a lawsuit brought by comic book artist Gary Friedrich, creator of the popular Ghost Rider character, concluding that Fredrich had no basis to bring a lawsuit contesting Marvel Enterprises ownership of the Ghost Rider copyright.  The court concluded that the district court erred in ruling that Marvel owned the copyright without conducting a trial.  Gary Friedrich Enterprises LLC, et al. v. Marvel Characters, Inc., et al., Case No. 12-0893 (2d Cir., June 11, 2013) (Chin, J.).

The comic Ghost Rider features a motorcycle-riding character with a flaming skull named Johnny Blaze, who gave his soul to the devil in return for his adoptive father being cured of cancer.  The plaintiff asserted that he conceived and wrote Ghost Rider and later agreed to publish the character through Magazine Management, which later became Marvel Entertainment.  According to the cover of the 1972 debut issue, the comic was conceived and written by the plaintiff.

An agreement covering the relationship between the plaintiff and the defendant was signed by both parties in 1978 and stated that the defendant was the owner of the copyright to the character’s original story.  The agreement also stated that plaintiff expressly granted to the defendant forever all rights of any kind and nature in and to the work.

The plaintiff filed a lawsuit in 2007, claiming he owned the renewal copyright to the Ghost Rider character.  The initial copyright term for Ghost Rider expired at the end of 2000, 28 years after the original publication in 1972.  By operation of law, the renewal copyright would have vested in the plaintiff, as the original author.  The plaintiff held the belief that the 1978 agreement only covered his future work and not the renewal copyright in his original work.  However, the defendant exploited the Ghost Rider character after 2000 by publishing reprints and new issues of the Ghost Rider comic series.  Marvel argued it could do so since it held the renewal copyright.

A district court ruled that the plaintiff had given up his rights to the Ghost Rider character, including the renewal of the copyright, by signing the 1978 agreement that stated that Marvel received the rights to the plaintiff’s work “forever,” which the district court found included the renewal term rights.  Friedrich appealed.

After considering the issue, the 2d Circuit reversed and remanded the case for further proceedings.  According to the court, “when interpreting a contract, the intention of the parties should control, and the best evidence of intent is the contract itself.“   The court further stated that “if the terms suggest more than one meaning when viewed objectively by a reasonably intelligent person who has examined the context of the entire integrated agreement, then the agreement is ambiguous and extrinsic evidence may be considered to determine the parties’ intent.”  Here, there were genuine disputes of material fact regarding the parties’ intent to assign renewal rights.  Therefore, the court concluded that the agreement is ambiguous and ordered the lower court to conduct a trial.