An unknown author writes a script that gets purchased by a major production company. It sounds like a fairly straightforward story and licensing deal, right? Not for James Erwin who wrote "Rome, Sweet Rome" a story about a modern day U.S. Marine who goes back in time to fight in Ancient Rome. Erwin then sold the exclusive movie rights to Warner Brothers. However, this deal presents some interesting copyright issues because Erwin originally shared his ideas for "Rome, Sweet Rome" on Reddit, a social news website whose content is entirely user created. In addition to publishing his story here, user content was contributed by the community and arguably used by Erwin to finalize his story.
Reddit has a stake in Erwin's deal because of the User Agreement that all Reddit users agree to when they join the website community. The agreement specifies that users "agree that by posting messages, ... or engaging in any other form of communication with or through the Website, you [the user] grant us [Reddit] a royalty-free, perpetual, non-exclusive, unrestricted, worldwide license to use, reproduce, ... distribute, ... or sublicense any such communication in any medium ... and for any purpose, including commercial purposes, and to authorize others to do so." This presents the possibility that Reddit could now turn around and sell the portions of "Rome, Sweet Rome" divulged on the website. Section 205(e) of the Copyright Act states that a "nonexclusive license ... prevails over a conflicting transfer of copyright ownership" which seems to indicate that Reddit could legally license away the movie rights to "Rome, Sweet Rome," specifically the portions of the story and feedback trading on Reddit.
James Erwin, per Warner Bros. advice, has since removed "Rome, Sweet Rome" from Reddit and Reddit has not made any public efforts to sell its rights in the script. However, Reddit is operated by Advance Publications, a subsidiary of Conde Nast Publications. This means that they might be more likely than a small, independent website to license rights out to test the legal waters on the issue.
Regardless of whether Reddit acts on "Rome, Sweet Rome," it brings about an interesting issue of the rights of nonexclusive rights of licensees and licensors. For more on this story, see Does Warner Bros. Really Have Exclusive Movie Rights to a Story Posted on Reddit?