Untitled Texas Attorney General Opinion ( 1974 )

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BRNEY ENERAB.4
OF TEXAS
AUHTIN. TEXAS 78711
The Honorable James R. Arnold Opinion No. H- 440
Administrator
Governor’s Office of Traffic Safety Re: Whether film produced for
P. 0. Box 13449, Capitol Station state agency may be reproduced
Austin, Texas 78711 by private business enterprise
and sold for a profit where the
film is in the public. domain.
Dear Mr. Arnold:
You have asked whether the conditions attached to a federal grant,
used by the Texas Education Agency to develop and produce traffic safety
multimedia films and materials for driver education classes, permit.
reproduction and distribution of the film and materials by a private business
concern to the public at a profit.
The grant was approved by the National Highway Traffic Safety
Administration (NHTSA) subject to the conditions stated in its Consultant
Policy Memorandum No. Rb-B-101 of February 14, 1972, par,“. 6(g)
(l) Before publication or print$ng, the final draft
report shall be submitted to the Regional Office
for review and xoncurrence.
.. .,
. . . .
(2) After a report has been accepted for publication
or printing, it is to be regarded as information in the
public domain and its further use does not require
approval. Accordingly, the published version of the
final report shall not be copyrighted, nor contain any
restrictions which prohibit distribution and reproduc-
tion..
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.
The Honorable James R. Arnold page 2 (H-440)
As used herein, the term report generally refers to
an,y result of consultant contracts, such as surveys,
studies, manuals, guides, films, . . . etc.
Under these terms, the Texas Education Agency executed a contract
with a private production firm providing for the development of five .(5)
driver education lessons and other materials adapted for use on certain
multimedia equipment owned by the State. The final product due under
the contract included “one (I) master copy of each lesson and fifty (50)
sets of each lesson. Film stri,ps, films, and tapes must be provided
with reels and in color coded containers adaptable to state owned storage
equipment. ”
The contract also provided that:
Ai”‘;. II (A)
The Texas Education Agency and the National Highway
Safety Bureau would retain all copyrights. Title to
all materials developed including master prints,
internegatives and scripts will be transferred to the
TEA upon completion of Contractor’s tasks.
Art. IV (B)
All programs, systems, designs or other materials
developed by Contractor pursuant to this contract
shall be the property of TEA, but Contractor shall
have the right to use such programs for other purposes,
provtded no confidential kformation is disclosed. It
is dis``m,c~ly understood that TEA, and any other
agency of the State of Texas shall have the right to
use, reproduce, or publish any or all of such programs,
systtms, designs or other materials developed under
the contract for any purpose without permission of
Contractor, and without expense or charge.
In our judgment, the rights of parties under the State contract are
subject to the condi.tions of the funding grant as expressed in NHTSA’s
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L c
The Honorable James R. Arnold page ~3 (H-440)
Policy Memorandum N. R6 -B -101. The overriding condition, recognized
in the production contract, is that the product of the grant, once accepted
by NHTSA’s regional office for publication, is forever and unconditionally
in the public domain, and may be freely copied and used by any person or
agency desiring to do so without prior approval or charge for the right to
COPY.
The Regional Administrator of NHTSA explained the purpose and
effect of its policy of requiring all reports, including films, to be dedicated
to the public domain:
Our Consultant Policy Memorandum R6-B-101 relates
mainly to copyright aspects, in that no materials
developed shall be copyrighted nor contain any restric-
tions which prohibit distribution and reproduction. If
[the Contractor], for example, sold a copy of the multi-
media materials to an agency, whether in Texas or
outside the State, then any or all of it could be reproduced
or modified or used in anyway without prior approval.
Since the contract has been fulfilled and the materials due the State under its
provisions have been published and distributed, the film and materials
produced under the agreement~may be copied and marketed by anyone,
including the original contractor. The materials are now in the public
domain and may be reproduced and distributed by a private business concern
for a profit. G. Ricordi v. Haendler, 194 F. 2d 914 (2nd Cir. 1952).
Neither the State nor the original contractor has the right to exclude any
other person in possession of the materials from copying them, or using
them.
You have also asked whether the State must accept competitive bids
before deciding who will be “permitted” to make copies of the films and
material for public distribution. This would be the case if, under the
contract, the State could retain a “property” interest in the materials
after they were delivered. Under our interpretation of the grant conditions,
the only property interest left to the State is the right to control access and
use of the copies it owns. Expressly precluded is the right to “sell”
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The Honorable James R. Arnold page 4 (H440)
reproduction rights in the driver education materiala. Anyone who obtains
the materials, whether from the State or otherwise, may copy and distribute
them without prior approval. Consequently, competitive bidding is
unauthorized if used as a means to restrict the right to,reproduce the films
developed under the federal grant.
However, if the State itself intends to purchase copies in addition to
those produced under the original contract it must comply with laws relating
to competitive bidding. See e.g., Article 664-3, V. T. C. S., State Purchasing
Act of 1957.
SUMMARY
The conditions attached to a federal grant used
by the Texas Education Agency to develop and pro-
duce traffic safety films and materials for driver
education classes permit reproduction and distribu-
tion of the films and materials by a private business
concern at a profit.
Very truly yours,
N L. HILL
Attorney General of Texas
DAVID M. KENDALL, Chairman
Opinion Committee
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