Nonprofit Use of Intellectual Property: Copyright Infringement or Fair Use?
Many nonprofit organizations are interested in having a welcoming website with images, logos, and education resources. When deciding whether to use a particular graphic, it is important for nonprofit organizations to be aware of the difference between copyright infringement and fair use when they are using material they do not own.
It is a common misconception that nonprofits are not subject to copyright infringement because the materials they use are not for commercial or for-profit purposes. Although the non-commercial use of materials may weigh in favor of a nonprofit to not be subject to copyright infringement, that is not always the case. It is vital that nonprofits keep track of the material they use because there are penalties for copyright infringement that could greatly impact an organization. Below are some common questions a nonprofit might have regarding copyright infringement and fair use.
If you have questions about trademarks and non-profit organizations or would like to begin the process, call a knowledgeable attorney at Abelaj Law, P.C. at 212-328-9568.
An Intention to Commit Copyright Infringement is Not Required for Liability
An organization can be liable for copyright infringement even if it did not know the material was copyrighted or that, in order to use the material, they needed to gain permission from the owner. A nonprofit can be exposed to vicarious copyright infringement even when the organization itself or its employees do not know they are using copyrighted material. This means a nonprofit is responsible for any harmful actions its employee commits, which includes using copyrighted material they do not own.
Fair Use Doctrine Does Not Automatically Protect Nonprofits from Copyright Infringement
Fair use allows a person to use a portion of copyrighted work that they do not own without permission from the owner to use the material. Nonprofit status, on its own, does not give the organization permission to use copyrighted material without permission under the fair use doctrine. However, if the nonprofit is using the copyrighted material for non-commercial use, such as using an image to promote a program or event that the organization is hosting, may weigh in its favor in determining whether fair use is applicable.
Factors Considered to Determine if the Use is Fair Use or Copyright Infringement
Determining whether something is fair use is not a “one size fits all” test. Courts will look at each individual case to evaluate whether an organization committed copyright infringement or if it is fair use. Because each nonprofit is unique and uses materials differently, the courts will review each organization’s circumstances when making its determination.
There are four factors that courts use to evaluate whether something is fair use or not[1]:
- Purpose and Commercial Nature. The purpose and character of the copyrighted material. This includes whether the material was used to commercial nature or is for nonprofit educational purposes.
- Unique or Factual Nature of the Original Work. The nature of the copyrighted work. Here, the court will shift its focus onto the original work (the initial material that the nonprofit used) to see if it has a lot of creative expression, whether it has been published, and if the original work incorporates primarily factually information like a news story.
- Portion of Original Work Used by Nonprofit. The amount of the copyrighted portion the nonprofit used in relation to the original work as a whole. Here, the court will look at how the nonprofit used the material and ask: Did the nonprofit only take a portion of the material? How much of the original material did the nonprofit use? Did the nonprofit take the original material and incorporate it into some of its own material?
- Economic Damages to Original Work. Finally, the Court will consider the effect of the market value of the copyrighted work. Many nonprofits might not think this last factor would apply to them, but that is just a myth. When evaluating this final factor, the court might look whether any economic harm has been done to the copyright owner and if the material the nonprofit is using is a substitute for the original owner of the material’s marketplace. This might be more common for nonprofits that operate in the healthcare, education, or arts sectors because they may be publishing or distributing more informational materials on their website.
Using Small Portion of Copyrighted Work May be Allowed
If a nonprofit takes a small amount of copyrighted work, a court might rule in favor of the nonprofit by stating they had a de minimis taking. This means that the nonprofit took an insignificant amount of the copyrighted material, and that no harm was done, even if it was taken without permission from the owner.
Although using a small portion of a copyrighted work without permission may mean no penalty, it is not a best practice to do so. A nonprofit should not get into the habit of taking small portions of other people’s copyrighted materials without their permission from the owner. Securing permission from the owner, rather than relying on de minimis taking, is the safest option as it will protect the organization from copyright infringement penalties.
Penalties for Copyright Infringement are Steep
Penalties for copyright infringement can be significant to a nonprofit. A court may order a nonprofit to pay actual damages, such as any profits the owner lost, statutory damages between $750 – $30,000, or in the case of a nonprofit’s willful copyright infringement, it can be fined up to $150,000. Additionally, a nonprofit that is found to commit copyright infringement may also be subject to paying the owner of the copyright’s legal fees. In extreme cases, a court may issue an injunction, where they will stop the nonprofit’s use of the copyrighted material.
Seeking Permission to Use Copyrighted Material is Best Approach
A work may be copyrighted if a nonprofit uses an image that has already been registered with the United States Copyright Office or if someone has already made it known that they are the creator of a particular image. Although there are some circumstances where a nonprofit may not be liable for copyright infringement, it is best practice to get permission from the copyright owner. It is also important for a nonprofit to keep track of any material on their website, advertisements, pamphlets, cards or donation pages, etc., that they are currently using or have published.
A nonprofit should confirm that all the materials they are using are either something they own or have valid permission to use. Be sure to let anyone who has access to updating the nonprofit’s website, social media, or other digital communication double-check the image they are using before posting. If a nonprofit is not sure if something is copyrighted or if it is unsure about whether the organization has permission, do not post it and/or remove it from your website, donation page, social media or other public documents.
Call an Experienced Attorney About Protecting Your Nonprofit’s Copyrighted Today
For non-profit organizations, consistency in marketing and knowability are critical to maintain its favorable reputation and fundraising success. By knowing the laws of fair use, you can take action to protect your brand awareness if another organization attempts to use it. Federal registration of the business’s trademark is imperative for long-term goals and success. The law does not require that companies operating within the United States retain a lawyer for the trademark application process, however, the United States Patent Trademark Office encourages it. An attorney experienced with trademark law can help you through the complex process. They could ensure no avoidable delays or potentially losing rights to the trademark. To hear more about trademarks and non-profit organizations, call a seasoned lawyer at Abelaj Law, P.C. You can reach them at 212-328-9568.
How Your Estate Planning Can Help Charities You Care About
Making a gift to a charitable organization is a meaningful and impactful decision – one that can benefit both the causes you care about and your financial and estate planning goals. While the decision of how and when to give is personal, it can play a significant role in shaping your legacy. Below are some common ways your estate plan can help support the charitable organizations you care you.
Common Ways of Giving to Charities
There are numerous ways to give to charity, both during life and after your death. The approach that works best for you will be unique to your needs, including the value of the intended gift, the type of asset being donated and your tax situation. It’s important to work with an attorney experienced in charitable estate planning to determine the approach that works best for you. The attorneys at Abelaj Law, P.C. have helped many individuals incorporate charitable planning in their estate legacy and we can assist you in this process. Contact us today to get started.
Testamentary Gifts in a Will or Trust
A common way to support a charitable organization in estate planning is through a bequest in a will a trust. This is also known as planned giving. A person can specify a dollar amount, percent of estate, or specific asset (such as stock or real estate) to a charity. There is no federal limit on the number of charitable bequests an estate plan can have, which can allow for a donor to support multiple organizations.
The bequest can be outright or have restrictions on how the funds are used. A Trust or endowment can include instructions on how the funds are to be used by the charity over a long period of time.
Name a Charity as Beneficiary
Charities can be named as beneficiaries of your retirement assets, annuities or insurance policies. This can allow the donor to support specific organizations while also reducing estate taxes. A benefit of this approach is that it avoids probate and allows the charity to receive the bequest promptly.
Create a Donor Advised Fund
While a Donor Advised Fund, commonly known as a “DAF”, is not technically part of an estate plan, it allows a donor to contribute assets during their lifetime, take an immediate tax deduction, and recommend grants to charities over time. Donors can contribute to the funds as frequently as they like and then recommend grants to charities at a later date. This approach works well for donors who would benefit from a large charitable deduction in one year without immediately having to choose a specific charity to receive the funds.
Charitable Remainder Trust
A charitable remainder trust (“CRT”) is an irrevocable trust that allows a person to donate assets to charity and draw annual income for life or for a specific time. A CRT can offer financial benefits such as allowing a donor to plan major donations to charities, allow a donor to defer income taxes on the sale of assets transferred to the trust, and may allow a donor a partial charitable deduction based on the value of the charitable interest in the trust.
How to Get Started
As you consider including charitable donations in your estate planning, start by reflecting on the types of charities you have supported in the past, the types of assets you have contributed, whether you want to make an unrestricted gift or include certain parameters, and when you want the charity to receive the gift.
Identify the Causes You Care About
Think about the issues or organizations that have had a meaningful impact on your life. These could be nonprofits you’ve supported in the past or causes that reflect your values. There are many organizations out there doing meaningful work that would appreciate your donation.
Review accounts and documents
Review your estate documents every 3-4 years to ensure these documents reflect your intentions. If there is a charity you want to add as part of your estate documents or want to look at more robust options to support causes you care about, reviewing your documents is a great way to start.
Talk With an Experienced Estate Planning Attorney
For many families considering charitable giving as part of their estate plan, legal guidance may be beneficial. An experienced estate planning lawyer can make sure all documents are in order and help families determine the types of charitable giving that would best fit their needs. Consider visiting with the estate planning lawyers at Abelaj Law, P.C. at 212-328-9568 to learn more about how to integrate charitable giving into your estate plan.
Common Risks for Nonprofit Organizations and How to Prevent Them
Nonprofit organizations are essential to the well-being of our communities, delivering critical services to support those in need. While their charitable missions empower them to engage in unique, mission-driven activities, they are not immune to risk. In fact, as tax-exempt entities, nonprofits must navigate an added layer of regulations that for-profit businesses often don’t face. Proactively identifying and managing these risks is crucial for long-term sustainability and mission impact. In this post, we’ll examine some of the most common risks nonprofit organizations encounter and how to prepare for them effectively.
1. Conflicts of Interest Must be Disclosed and Addressed
Unlike for-profit entities, board members, officers, or other key persons involved at a nonprofit organization must disclose when they have conflict of interest or potential conflict of interests when making decisions that can impact the organization. When a conflict of interest or potential conflict of interest is identified, it is best practice for that person to remove themselves from the decision-making process.
If an organization engages in a related-party transaction where a conflict of interest exists, it can be at-risk of violating IRS rules that impose a significant tax and possibly jeopardize its tax-exempt status. This is particularly the case for private foundation, where self-dealing, when a key person benefits from a transaction to the organization’s detriment, can result in a hefty excise tax.
Although the IRS does not require a Conflict of Interest Policy, many States, such as New York, require that the organization have one in place to guide them through the decision-making process.
2. Governance and Compliance Risks from Internal and External Sources
Governance and Compliance risks cover a host of issues that nonprofit organizations may face. It is critical that board members, officers, and other key persons at an organization be familiar with the organization’s internal policies and aware of external laws. This includes complying with state, local, and federal tax rules to ensure the organization is only engaging in activities that carry out its charitable purpose in order to maintain its tax-exempt status.
A nonprofit organization must ensure that it is complying with its internal policies (Bylaws, Conflict of Interest Policy, Grant Policy, OFAC Policy, etc.) in order to maintain seamless and reliable operations. It is recommended to review internal policies every 3-5 years and ensure new board members get familiar with the organization’s governing documents before joining the organization.
Organizations must ensure compliance with external laws and requirements. This includes changes to nonprofit corporation laws, tax laws that impact the organization and applicable agency laws. By having ongoing communications with its general counsel, an organization can be nimble in responding to sudden changes in the law in order to avoid jeopardizing its legal standing.
3. Communication Risks to External Parties May Harm Organization’s Reputation
A nonprofit organization must be mindful of its communications. This includes social media posts, emails, and when members of the organization speak in public settings.
A nonprofit should have a procedure in place to review its communications prior to publication to confirm they accurately describe its charitable mission in a transparent manner. If a nonprofit organization does not, it may be at risk misrepresenting itself in contract negotiations, grant applications, or donor engagements. The result may be catastrophic if funding is lost or the resulting reputational harm is irreversible.
When advocating for or informing the public about its charitable goals, nonprofits must avoid engaging in partisan political activity and must not have a substantial part of their activities be lobbying. Organizations are allowed to advocate for supporting their charitable causes, but they cannot engage in prohibited political activity as there is a high risk of potentially losing 501(c)(3) tax-exempt status.
Adopting a policy and process for external communications will help create parameters on the type of language that can be used, the authorized platforms, and the individual responsible for reviewing the final products.
4. Financial Responsibility Cannot Be Abdicated
Nonprofit organizations rely on donations, grants, and fundraising events to support its operations and activities. It is the Board’s responsibility, both collectively and individually, to oversee the financial health of the organization.
The organization’s financials must be handled in a transparent manner and ensure the majority of funds are used to carry out the organization’s charitable mission.
The organization should reiterate to its Board that financial compliance and responsibility remains with the Board at all times and is not a responsibility that can be transferred to someone else, whether a committee, CPA, attorney, or outside consultant. There should be checks and balances in place to ensure that filings are submitted to the IRS on a timely basis and that the finances are properly invested to meet the organization’s overall goals. Failure to do so may result in loss of tax-exempt status, which requires significant cost and time to regain from the IRS.
5. Reputational Risks May Result from Internal or External Events
Reputational risks usually refer to the potential loss of public trust and credibility due to actions, behaviors, or external perceptions of an organization. A “bad reputation” can cause a ripple effect through the organization and impact its internal structure and external partners. This is because nonprofits rely on their reputation in order to receive donations, grants, and enter into contracts. Reputational risks can cause internal disruption and cause a stagnant Board not be able to make important decisions for the organization. It can also cause community backlash, loss of funding and opportunities, and may even prompt an investigation from the Attorney General.
Contact Our Experienced Nonprofit Lawyer Today
Risk is an inevitable part of running an organization, but it doesn’t have to hinder a nonprofit organization’s activities. Recognizing risk is the first step to resolving it. By taking proactive approach to risk management, board members, officers, and other key persons can help set up the organization for long-term success to make a lasting difference in their communities.
At Abelaj Law, P.C., we understand the various risks nonprofit organizations face and work with them to mitigate and resolve current or potential issues. Our work is about giving the tools and resources an organization needs in order to succeed. To hear more about our services, call a seasoned lawyer at Abelaj Law, P.C. You can reach them at 212-328-9568.
Also, check out or Board Member Training: How to prevent Disruptions Before They Occur https://www.abelajlaw.com/elevate-your-nonprofit-governance/
Naming Rights for Charitable Endowments: Legacy, Leverage, and Legal Precision
In the world of philanthropy, recognition is often as enduring as the gifts themselves. For many donors, attaching their name—or that of a loved one—to a charitable cause is not merely about prestige; it’s about expressing values, shaping legacy, and ensuring the memory of one’s contribution endures through time. Naming rights, particularly those attached to charitable endowments, offer a compelling intersection between generosity and identity. Yet as simple as it may seem to see one’s name on a building or scholarship, the legal and tax frameworks underlying these rights are far from straightforward.
At Abelaj Law PC, we have worked closely with both donors and nonprofit institutions to structure charitable gift agreements that reflect intention, promote trust, and withstand the passage of time. This article explores the deeper dynamics at play when naming rights accompany charitable endowments, and the considerations—practical, legal, and emotional—that must be navigated with care. If you have questions about planned giving, naming rights and gift agreement or would like to begin the process, call a knowledgeable attorney at Abelaj Law, P.C. at 212-328-9568.
The Endowment as a Vehicle of Permanence
A charitable endowment is, by design, a long-term commitment. The principal gift is preserved, invested, and only a portion of the returns are used annually to support a cause or organization. For the donor, this structure represents a form of permanence: a commitment that outlives them and continues to express their values for generations.
Establishing such an endowment can be achieved through various giving vehicles. Some donors prefer outright cash donations during life; others may contribute appreciated securities for favorable tax treatment. More complex instruments like charitable remainder trusts or pooled income funds offer the donor an income stream during life, with the remainder ultimately benefiting the nonprofit. Endowments can also be created at death through bequests, often tied to an estate plan designed to achieve both philanthropic and tax-saving goals.
Regardless of the vehicle, what binds all successful endowments is a well-drafted agreement—one that does more than document the gift amount. It must articulate purpose, address contingencies, and—when naming rights are involved—reconcile recognition with accountability.
Recognition in Exchange for Generosity
Naming rights are a form of recognition that straddle a legal and emotional line. For charities, they are a valuable tool to inspire generosity. For donors, they symbolize trust in the institution and a desire to be visibly linked to a cause. The challenge is ensuring that the recognition is appropriate, enduring, and governed by clear expectations.
From a legal perspective, naming rights are typically conferred via a charitable gift agreement. This agreement must detail not only the timing and scope of recognition—such as when signage goes up, or which portion of a building will bear the donor’s name—but also the conditions under which those rights might change or even be revoked.
For instance, a donor might provide a gift to fund a medical research center, with the understanding that a particular laboratory will carry their name. But what happens if, decades later, that lab is closed or repurposed? Does the donor’s name transfer to another facility? Is it removed altogether? Should naming rights expire after a set number of years, or continue in perpetuity? These are not merely procedural questions; they strike at the heart of donor intent and institutional integrity.
Balancing Donor Control with Institutional Autonomy
Donors, particularly those contributing significant sums, often wish to maintain some form of control over how their gift is used. They want assurances that their intentions will be honored—not just at the time of the gift, but long into the future. However, the law generally treats completed gifts as irrevocable, with ownership and control passing fully to the nonprofit.
That said, thoughtful drafting can give donors a measure of ongoing influence. For example, gift agreements may include reporting obligations, requiring the nonprofit to provide annual updates on how funds are invested or disbursed. Some donors choose to appoint a family member or representative to receive these reports and serve as a watchdog over the gift’s implementation.
Legal standing is another important concern. Traditionally, donors did not have the right to sue a charity for failing to uphold the terms of a gift. That authority rested solely with the state attorney general, acting in the public interest. But the law is evolving. More recent cases have acknowledged the legitimacy of donor standing—particularly when the gift agreement explicitly confers that right. Donors seeking such enforcement authority should ensure that the agreement grants them, their heirs, or their designated agents the ability to pursue legal remedies if the gift terms are breached.
The Charity’s Perspective: Naming Rights with Guardrails
While recognition can incentivize philanthropy, it also exposes nonprofits to reputational and operational risks. Charities must consider what happens if a donor’s reputation is later tarnished. We’ve seen an example of this backlash against institutions bearing the Sackler family name after the Oxycodone crisis. In such cases, the ability to remove or alter naming rights becomes crucial. A carefully crafted agreement can include “morals clauses” or reputation-based revocation provisions, preserving the charity’s discretion to dissociate when necessary.
Similarly, institutions should be wary of gifts that come with overly restrictive conditions or impractical requirements. While it is reasonable for a donor to earmark funds for scholarships in a specific field or for research into a particular disease, attempts to influence operational decisions—such as admissions, faculty hiring, or curriculum—can encroach on academic or organizational autonomy and may even threaten a nonprofit’s tax-exempt status.
To avoid these issues, charities should ensure that gift agreements clearly state that the nonprofit retains ultimate control over the use of funds. The IRS has long held that for a gift to be deductible, the recipient organization must have full discretion over its application. Language such as “this contribution is made with the understanding that the donee has complete control and administration over the use of the donated funds” helps ensure the gift qualifies as a charitable contribution.
Naming Rights and Tax Deductibility
Recognition through naming is considered an incidental benefit by the Internal Revenue Service, meaning it generally does not reduce or eliminate a donor’s tax deduction. However, if naming rights are tied to performance conditions or reversion clauses—such as the donor regaining ownership if certain criteria aren’t met—the gift may be deemed incomplete or non-deductible.
For instance, a gift that reverts back to the donor’s estate if a building isn’t completed, or if matching funds aren’t raised, may not qualify for a deduction unless the conditions are considered “so remote as to be negligible.” Tax compliance is especially critical when dealing with large or complex gifts, and both parties should work with experienced counsel to structure agreements accordingly.
Vehicles for Setting Up Endowments
Donors can establish endowments through various giving vehicles, including:
- Direct cash gifts to a public charity, donor-advised fund (DAF), or community foundation.
- Gifts of appreciated securities, which may offer favorable tax treatment.
- Charitable remainder trusts (CRATs/CRUTs) or pooled income funds, which provide income to the donor or others during life with the remainder going to charity.
- Bequests and other planned giving arrangements at death, which can yield estate tax benefits.
Each structure has unique tax implications under IRC §170. For example, cash gifts to public charities are deductible up to 60% of adjusted gross income (AGI), while gifts of appreciated securities may be limited to 30%.
A Thoughtful Partnership
At its best, a naming rights arrangement is not a transaction—it is a relationship. One built on mutual respect, shared vision, and a commitment to honoring both donor legacy and institutional mission. But like any enduring relationship, it requires clarity, communication, and sometimes, the humility to plan for the unexpected.
At Abelaj Law PC, we understand the legal and human dimensions of charitable giving. Our work is not just about drafting agreements—it’s about helping donors express their values and helping organizations steward those values with integrity. Whether you are considering a major philanthropic gift or managing one, we are here to ensure that the generosity behind it is protected, honored, and made lasting.
Call an Experienced Attorney About Naming Rights in Charitable Agreements Today
For individuals or non-profit organizations who are considering naming rights as part of a charitable gift agreement, complying with tax laws while providing protection and reasonable control to both the givers and getters is necessary. By considering the rights and restrictions in naming a charitable asset in recognition of a generous donor, the parties can focus on the details that are most relevant in achieving the gift’s goals. An attorney experienced with planned giving and relevant laws applicable to endowment agreements can help you through the detailed and rewarding process. They could ensure that you do not include a provision in the gift agreement that might jeopardize your taxable deductions. To hear more about naming rights in endowment agreements, call a seasoned lawyer at Abelaj Law, P.C. You can reach them at 212-328-9568.
Estate Planning When Your Spouse Isn’t On Board: What to Do
If you are ready to begin estate planning, but are getting resistance from your spouse, you may be wondering if you should go it alone. Although addressing your combined estate and goals is helpful, you can take control of your estate planning on your own.
Open and Honest Discussion
Spouses often complete their estate planning together. However, it is not unusual for one spouse to avoid the topic. Estate planning comes with difficult emotions and important decisions. It’s not surprising that someone may not want to deal with this head-on.
Discuss with each other the reason that one is resisting this project. If the topic is emotionally heavy for your spouse, ask why and what might help to reduce the emotions. Did your spouse experience the aftermath of a difficult estate administration? Are they worried about not being alive at key moments of their loved ones’ lives?
Getting to the heart of their reluctance is important information for you to understand if you will be able to convince them to engage in estate planning with you, or if you need to take on this matter for yourself.
Your Individual Estate Plan is a Gift to Your Loved Ones
Estate planning for a couple may include joint decisions on desired bequests to loved ones, guardianship appointments of minor children, tax benefits and combined legacy goals. If your partner does not want to engage in the process, you can still make many of these key decisions on your own.
We often work with one partner in a couple, usually a woman, whose partner does not want to engage in estate planning. We provide you with an outline of what estate planning powers you have alone and how it might be different if your spouse joined in the planning. You will be aware that you have much ability to direct the disposition of your estate.
Your individual documents will express your wishes to ensure that your loved ones have a seamless plan to administer your estate. By planning ahead, it will allow your loved ones to focus on your shared memories and not on the complexity of administering an intestate estate.
Intestacy is Your Default Estate Plan Where Distribution is Governed by the Law
Without an estate plan in place, you will be considered intestate at your death. The result is that the law will govern who receives your estate, who is your estate’s administrator, and who is your children’s guardian.
In New York, the estate of a person who dies with a spouse and no children passes entirely to the spouse. If the person dies with a spouse and children, the first $50,000 passes to the spouse, plus 50% of the residuary, with the other 50% to the children.
In New Jersey, the distribution is more nuanced. As a comparison, if a person dies with children and no spouse, the children receive the entire estate equally. If a person dies with a spouse and children all born of the marriage, the spouse receives the entire estate.
Intestacy requires additional Court oversight and does not allow for deviation from the law of descent and distribution. Your estate administrator may have to file a costly bond if there are minor children. If most of your relatives are estranged, your estate administrator may have to hire a genealogist to identify which of them are automatically entitled to your estate assets. If you have a taxable estate, your heirs will receive a lower bequest because you did not proactively take steps during your lifetime to create lifetime trusts.
By creating an estate plan, you will be able to override most of the default laws and avoid the extra costs and delays in an extended court proceeding.
Moving Forward Confidently on Your Own
The law does not require that spouses engage in estate planning together. If you have attempted to convince your spouse that estate planning is important to you, and they have not agreed, it may be time to forge ahead on your own.
The process is empowering as you will have the opportunity to discuss your goals with an attorney, understand the options available to you, and improve the outcome for your loved ones. You will feel relieved to know that you have taken control over your estate plan and that your legacy goals will be realized.
At Abelaj Law, PC, we are committed to assisting individuals and families with all of their estate planning legal needs so they can feel confident that their final wishes are honored. Contact our experienced legal team today at 212-328-9568 for a free introductory call to learn more.