Source: http://www.wixenmusic.com/publishing-101/copyright-reversions/
Timestamp: 2017-05-01 02:16:03
Document Index: 781040399

Matched Legal Cases: ['§202', '§201', '§201', '§201', '§101', '§106', '§101', '§304', '§303', '§302', '§302', '§101', '§ 304', '§ 304', '§101', '§1000', '§101', '§101', '§101']

Copyright Reversions | Wixen Music Publishing, Inc.
You are here: Home » Publishing 101 » Copyright Reversions
by Lisa Alter
Copyright–An Overview
(8) architectural works.3
Section 106 of the United States Copyright Act9 lists six exclusive rights of the copyright owner, which include the rights:
(4) in the case of literary, musical, dramatic, and choreographic works, to perform the copyrighted work publicly;
(5) in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic or sculptural works, including the individual images of a motion picture or other audiovisual work, to display the copyrighted work publicly; and
(6) in the case of sound recordings, to perform the copyrighted work publicly by means of a digital audio transmission.10
(1) be a work prepared by an employee within the scope of his or her employment; OR
(2) be a work specially commissioned for use as a contribution to one of nine enumerated categories where the parties expressly agree in writing that the work shall be considered a work made for hire.
Non-dramatic or “small” performance rights include the rights to authorize nondramatic performances of compositions over television, radio, and other electronic devices; online transmissions; and non-dramatic live performances.
Bifurcated Duration Provisions Under US Copyright Act
The United States copyright law is unique in that the duration of the copyright differs depending on the date of creation of the work, as well as the date the work is initially registered or published.
Works created and copyrighted (that is, registered or published) prior to January 1, 1978, are protected for 95 years from the date the copyright was originally secured (95 years from the earlier of the registration or publication). The 95-year period is divided into an initial term of 28 years and a renewal term of 67 years.14
Works created prior to January 1, 1978, that were neither copyrighted nor fell into the public domain before that date are protected for the life of the author plus 70 years, provided (i) in no event shall the term of the copyright in such a work expire before December 31, 2002, and (ii) if such a work is published on or before December 31, 2002, the term of the copyright shall not expire before December 31, 2047.15
Works registered for copyright or published prior to January 1, 1923, are in the public domain in the United States.
Works created on or after January 1, 1978, are protected for the life of the author plus 70 years. In the case of a joint work, protection continues for 70 years after the death of the last surviving author.16
Anonymous Works; Pseudonymous Works; Works Made For Hire
The copyright term for an anonymous or pseudonymous work as well as a work made for hire endures for the shorter period of either 95 years from publication or 120 years from creation.17
Discrepancy in Duration Provisions
It is generally believed that the term of protection for works registered or published prior to January 1, 1978, is roughly equivalent to the term of protection for works created on or after that date. However, this is often not the case. Imagine, for example, a 20-year-old author who creates a composition and registers it for copyright in 1960. The author dies at the age of 85 in 2025. The song registered in 1960 will enter the public domain in the United States on January 1, 2056, just 30 years after the author’s death. Compare this to a 20-year-old author who creates a composition and registers it for copyright in 1980. The author also dies at the age of 85, in 2045. The song registered in 1980 will enjoy copyright protection until 2116â€”a full 40 years longer than the song from 1960. Clearly, the bifurcated duration provisions have not accorded the earlier author or his/her heirs protection equivalent to the life-plus-70 protection accorded authors of works created on or after January 1, 1978.
Original works may be registered with the Copyright Office at any time after their creation. Although copyright is now secured automatically upon the creation of a work even if no registration is made, it is advisable to officially register a copyright with the Copyright Office in order to establish priority as well as to document title. To register a musical work, request Application Form PA from the Copyright Office and return it with the requested material. You may also print out and fill in Form CO from the Copyright Office website and send it in with the requested material. The fee for both types of registration by mail is currently $65. In addition to these two methods, the Copyright Office allows you to register works online using the eCO Online System. This option provides the fastest processing times and currently costs $35. For a tutorial on how to use this system and more information about registering works visit the eCO Page of the Copyright Office’s website.
Renewing copyrights
The process of copyright renewal applies only to works registered or published before January 1, 1978.
Works registered or published prior to January 1, 1964, must have been formally renewed (i.e., a renewal application must have been registered with the Copyright Office during the 28th year of copyright). Failure to renew caused the work to enter the public domain upon the expiration of the initial 28-year term of copyright.
Works originally registered or published between January 1, 1964, and December 31, 1977, benefit from automatic copyright renewal. Although the filing of a renewal application was not mandatory for these works, there were several advantages to filing renewals with the Copyright Office. A renewal registration in the 28th year records the interest of the renewal claimant in the work for the renewal term. Additionally, a renewal certificate can serve as prima facie evidence of copyright and allow the claimant to object to the creation of an unauthorized derivative work. Most significantly, with respect to posthumous renewal, the timely filing of a renewal application by the heirs of the author, where the heirs were not party to a prior renewal term grant, ensures that prior licensees shall not be entitled to continue to exploit either the original work or derivative works based thereon without the permission of the heirs.
Publication of Copyrighted Works
Publication is defined in the Copyright Act as the “distribution of copies or phonorecords of a work to the public by sale or other transfer of ownership, or by rental, lease, or lending.”18 Since January 1, 1978, the inclusion of a composition on a sound recording has constituted publication. The simple public performance of a composition does not constitute publication. The date of publication of a work may be significant in determining the duration, as well as statutory termination windows, of the work.
If an author dies before the end of the 28th year of copyright, the renewal term rights automatically vest in the author’s heirs (which may include the widow/widower or children of the author, the author’s executor(s), or the author’s next of kin) regardless of whether the author assigned the renewal term of copyright to a third-party prior to his or her death.19 A limited exception to this rule occurs if the author properly renewed the copyright during the 28th year of copyright, assigned the renewal term rights in the composition during that year, and subsequently died. In this limited circumstance, renewal term rights will remain with the assignee.
In general, when an author dies during the initial term of copyright, an assignee of the author such as a music publishing company may not rightfully claim the copyright during the renewal term unless (i) the author’s heirs were party to an initial grant of renewal term rights, or (ii) the author’s heirs subsequently assign the copyright for the renewal term to the music publisher.20 If an heir fails to advise the music publisher that the heirs have secured the renewal copyright and are reclaiming renewal term rights, the publisher may continue to collect on copyrights in the renewal term.
Statutory Termination of Transfers/ “Recapturing Copyrights”
Under Section 304(c) of the Copyright Act,21 grants or licenses of pre-1978 copyrights executed before January 1, 1978, by the author or his/her heirs may be terminated during a 5-year period beginning 56 years after the earlier of registration or publication. This 5- year period is commonly referred to as the “termination window.” Any exclusive or nonexclusive grant may be terminated, with the exception of a grant of rights in a work made for hire or grants made by will.
A grant may be terminated even if the original contract states that the grantee shall be entitled to retain its rights for the entire term of the copyright, including renewal and extended terms, because the statutory termination right overrides the contract. If the author dies before exercising the termination right, the termination interest vests in the author’s heirs, who are defined by statute to include the author’s widow or widower, children, or grandchildren, or, in the event the author’s widow or widower, children, or grandchildren are not living, the author’s executor, administrator, personal representative, or trustee. Termination may be exercised only by following the procedures for notice and recordation outlined by the Copyright Act and Copyright Office Regulations.
It is important to note that while renewal applications may be filed at any time during the calendar year in which the 28th anniversary of copyright occurs, the date of the start and close of the 5-year termination window corresponds with the original month and day of copyright. For example, if the original copyright date is April 29, 1955, then the earliest possible effective date of termination is April 29, 2011. In this case, the earliest possible date for serving notice of termination is April 29, 2001. The latest possible effective date for termination in this example is April 29, 2016, and the latest possible date for serving notice of termination is April 29, 20014. While it is recommended that the author or statutory heir(s) serve notice of termination on the earliest date possible, notice is timely if it is served at any time up until the date 2 years before the end of the 5-year termination window. Absent proper notice of termination, rights in the work will remain with the grantee.
Notice of termination may be served as of termination as
Termination will be effective as
If the copyright date is:
EARLY as TEN years before
LATE as TWO years before
EARLY as original date + 56 years
LATE as original date +61 years
Section 304(d) Termination–A Second Bite at the Apple?
Notice of termination may be served as
EARLY as copyright date + 75years
LATE as copyright date +80years
* Provided that the work was originally copyrighted on or before October 26, 1939.
Post-1978 Grants
The right of termination accorded under Section 203 of the Copyright Act is not limited to circumstances in which an author has failed to exercise the right to terminate a prior grant under Section 304(c). Imagine, for example, an author who registers a song for copyright on March 1, 1930, assigns the right to a music publisher in April of that year, and serves notice of termination on the music publisher pursuant to Section 304(c) effective March 1, 1986. After serving notice of termination, the author reassigns the copyright in the song to the original music publisher.22 Beginning in April 2011, the author or his heirs may serve notice of termination pursuant to Section 203 on the publisher effective April 1, 2021.
If the publication date is:
EARLY as the publication date + 35 years *
LATE as the publication date +40 years *
*In no event will the termination window begin later than 40 years after the date of the grant.
Each of the statutory termination provisions (both pre-1978 and post-1977) stipulates that in the event an author dies before serving notice of termination, the author’s right of termination is owned and may be exercised by his/her statutory heirs.
In the event that the author has a surviving spouse but no surviving children or grandchildren, then the termination right is owned entirely by the author’s spouse.
If the author dies leaving a spouse and children then the termination interest is owned 50% by the author’s spouse and 50% by the author’s children on a per stirpes basis.
The shares of a deceased child are owned by that child’s children on a per stirpes basis but can be exercised only by a majority of them.
In order to exercise the termination right of a deceased author, a majority of the statutory heirs must be signatory to the notice of termination. As a practical matter, this means that in the event that the author has more than one statutory heir, a certain degree of cooperation is necessary in order to recapture rights. For example, if an author dies leaving a spouse and 3 children, at least the spouse (50%) and 1 child (16.7%) must be signatory to the notice of termination. If an author dies leaving no spouse but 7 children, at least 4 of those children must be signatory to the notice of termination. It is not unheard of for rights to remain with a publisher because the author’s statutory heirs are not able or willing to cooperate to recapture rights.
An argument may be made that if a grant of worldwide rights is made in the United States under United States law and the grant is subsequently terminated by the author or his/her heirs pursuant to Section 304(c), 304(d), or 203 of the Copyright Act, then the termination would end the grantee’s rights throughout the world. However, the customary understanding is that because the termination right is unique to the United States copyright law, only the grant of rights in the territory of the United States is subject to termination.
In recognition of the Gap in the termination provisions, the United States Copyright Office has amended its regulations to clarify that it will record Section 203 notices of termination for works created after 1977 even when the agreement to make a grant was made before 1978. It should be noted that under these circumstances it may become important to precisely identify the date of creation of a work. According to the Copyright Act, “a work is â€˜created’ when it is fixed in a copy or a phonorecord for the first time.”23 If the exact date of creation is uncertain the parties may look to the initial date of registration or publication, or the date on which a work was delivered to a publisher, record label, or performing rights organization.
The termination provisions contain a safeguard for the original grantee (or that grantee’s successor in title) that prevents the author or his/her heirs from granting the terminated rights to a third-party until after the effective date of termination. An exception is made for a further grant to the original grantee or its successor in title. In effect, this allows the original grantee an exclusive negotiation period that begins on the date notice of termination is served and continues through the effective date of termination. A grant made to a third-party during this period is invalid.
Under such an analysis, a pre-1978 recording agreement will constitute work made for hire agreement only if it is found that the artist rendered services as an employee within the scope of his or her employment. Post-1977 recording agreements must be evaluated under the twoprong work made for hire test proscribed in the Copyright Act — (i) did the artist render services as an employee within the scope of his/her employment?; or (ii) were the artist’s services specially commissioned as a work for hire for inclusion in one of the nine categories of works enumerated in the Copyright Act?
Each performing artist — record label relationship must be examined through the lens of the agency criteria to determine whether in fact the artist was the employee of the label at the time the sound recording was made. In most cases, the artist — record label relationship will not be found to create an employee-employer relationship. Importantly, it is rare that a record label will withhold taxes from the monies paid to the artist, or provide the artist with health insurance or other benefits. Note, however, that in cases in which an artist renders services through his or her loan-out corporation, the relationship between the artist and the loan-out company may indeed be deemed to be an employeremployee relationship. In these cases, the loan-out agreement may be enough to prevent the artist from successfully terminating the grant of rights to the record label (as successor in interest to the loan-out company).
At the outset, it is important to note that sound recordings are not specifically included in the nine categories of commissioned works enumerated in the Copyright Act. In 1999, Congress amended the Copyright Act to add sound recordings as a category of commissioned works as part of an unrelated bill and after virtually no debate.24 The amendment was repealed the following year “without prejudice” to the debate of whether sound recordings may or may not be deemed works made for hire.25 Courts have rejected the argument that a sound recording falls within the category of motion picture or other audiovisual work, thus ruling out one of the nine categories.26 Services rendered by a performing artist are clearly not commissioned for use in six other categories — translation, supplementary work, instructional text, test, answer material for a test, or an atlas. That leaves two possible applicable categories: contributions to collective works and compilations.
The Copyright Act defines a collective work as “a work, such as a periodical issue, anthology, or encyclopedia, in which a number of contributions, constituting separate and independent works in themselves, are assembled into a collective whole.”27 A compilation is defined as “a work formed by the collection and assembling of preexisting materials or of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship … [including] collective works.”28
This position is arguably going outside the plain meaning of the statute. While multiple people may work on the creation of a sound recording, the work that they provide does not necessarily rise to the level of an original work of authorship. The fact that the record label may rearrange the order of compositions on a recording, or even choose to eliminate compositions, no more renders the sound recording a compilation than does the fact that a book publisher edits an author’s novel or rearrange’s chapters in a book. Finally, with the growing trend toward the digital release of single-song sound recordings, it will be increasingly more difficult to find that a compilation exists.
The statutory termination provisions enable an author or the heirs of a deceased author to terminate perpetual or “life of copyright” grants under copyright. However, in certain cases it may not be necessary to invoke the statutory termination provisions if a contract itself provides for the expiration or termination of the grant. Some contracts provide for early termination in the event that certain events occur (such as breach by, or bankruptcy of, the grantee) or that certain events fail to occur (such as the failure to meet a minimum guaranteed royalty). Other grants are in the form of option agreements under which rights terminate in the event that an option is not exercised. It was not uncommon prior to 1978 for a grant to be limited on its face to the initial 28-year term of copyright, or for a grant to specify that it was to persist for a limited term of years. It is established case law in the United States that a pre-1978 grant will persist in the United States for the initial term of copyright only unless the grant specifically includes a grant of the renewal term of copyright.29 Note, however, that the general understanding is that the grant will continue to control outside the United States in these instances unless specific provisions are included in the contract that provide for a limited term outside the United States.
During the mid-twentieth century, a series of original and renewal songwriter form agreements were published by the Songwriter’s Protection Agency, successor in interest to AGAC and predecessor in interest to the Songwriter’s Guild of America. It is worth noting several of the most commonly used of these forms, which contained specific provisions relating to the term of the contract. While the contract must be reviewed in each instance to determine if the parties amended or modified the standard terms, a basic familiarity with these provisions will alert you to a possibility that a grant will terminate at least in some portion of the territory by virtue of the standard language of the agreement.30
The 1939 Uniform Popular Songwriters Contract
The 1939 Uniform Popular Songwriter Contract (the “1939 UPSC”) provides for the grant of rights in a musical composition and the right to secure copyright in the composition throughout the world, including “the right to have and to hold the said copyright and all rights of whatsoever nature thereunder existing.” Since the 1939 UPSC does not specifically grant rights for the renewal and/or extended term of copyright, the form is generally understood to convey rights in the United States for the initial 28-year term of copyright only. With respect to the rest of the territory (the world excluding the United States) the grant is understood to persist for the life of copyright in the song in each country of the territory.
The 1947 Revised Uniform Popular Songwriters Contract
The 1947 Revised Uniform Popular Songwriters Contract (the “1947 UPSC”) provides for the worldwide grant of copyright in the subject compositions. The agreement provides that rights will revert to the author in the United States and Canada at the end of the initial term of copyright, or 28 years from the date of publication in the United States, whichever is shorter. The 1947 UPSC does not provide for automatic termination and reversion of rights outside the United States and Canada but does provide in Paragraph 8 that if the author intends to offer for sale the rights in the composition outside the United States and Canada, he/she must give the publisher 6 months’ prior written notice of such intention. This notice is known in the industry as the “Paragraph 8 Notice.” The 1947 UPSC does not specify when the Paragraph 8 Notice may be served. While the position of some music publishers is that the notice must be served 6 months prior to the expiration of the initial term of copyright, this argument is not supported by the language of the contract. The better interpretation is that the Paragraph 8 Notice may be given at any time (after the initial term of copyright) that the author or his/her heirs decide to offer the rights in the song for sale outside the United States and Canada.
The 1950 Uniform Popular Songwriters Renewal Contract
The 1950 Uniform Popular Songwriters Renewal Contract (the “1950 UPSRC”) provides for the grant of rights for a period equal to the shorter of (i) the second or renewal period of the United States copyright, or (ii) 28 years after the expiration of the first original term of the United States copyright. The 1950 UPSRC provides, further, that on the expiration of the 28- year term the rights to the composition will revert to the author throughout the world, unless foreign rights were granted to a foreign publisher before 1947. The effect of a grant of renewal rights utilizing the 1950 UPSRC is that even if the original songwriter agreement was construed to convey rights outside the United States for the life of copyright in the composition, the grant may only persist until the date 28 years after the original term of United States copyright.
In September 2011, the European Parliament and Council of the European Union adopted a Directive requiring the EU Member States to adhere to a uniform term of protection for musical compositions with words that will expire 70 years after the death of the last to survive of the author of the lyrics or the composer of the musical composition.31 Each EU Member State is required to pass legislation implementing the Directive, which is to apply to “all such works in protection at the date by which the Member States are required to transpose this Directive.”32 It is not clear whether the Directive requires Member States to retroactively grant copyright protection to the portion of a composition (e.g., the lyrics or the music) which has fallen into the public domain prior to the passage of the implementation legislation. Each country’s implementation legislation will need to be analyzed in order to determine the impact on individual compositions.
The service of a notice of termination under the Copyright Act is generally believed to effect a termination of rights in the United States only. While there may be a legal or contractual basis for also reclaiming rights outside the United States, this must be evaluated on a case-by-case basis. In addition, an analysis of the relevant foreign copyright laws is recommended. Particularly with respect to older works, the possible application of foreign copyright laws relating to the posthumous reversion of copyrights should be considered. Many foreign jurisdictions recognize some form of reversionary interests. Foremost among the foreign reversionary laws are the provisions relating to the “British Reversionary Right.”
The United Kingdom Copyright Act of 1911 provided that copyrighted works granted to a thirdparty automatically revert to the author’s heirs, successors, or legal representatives 25 years after the death of the author under the following circumstances: (i) the author is the first copyright owner of the work, and (ii) the grant being terminated (e.g., the publishing agreement) was made by the author (grants made by the author’s heirs are not terminable under Copyright Act of 1911). The Copyright Act of 1911 applied to all of the so-called “British Reversionary Territories” or “BRTs”– that is, all countries that were part of the British Commonwealth as of 1911.33
Upon the effective date of termination of a grant, the songwriter or his/her heirs will identify a publisher for purposes of administering the music publishing rights in the song. At the outset, it is customary for this entity to be the songwriter’s or heirs’ wholly-owned publishing entity (be it a corporation, partnership, or d/b/a for the writer or heirs). The long-term administration of the compositions is generally handled in one of three ways — the catalogue may continue to be handled by the songwriter or heirs (self-published), the catalogue may be administered by a third-party music publisher, or the catalogue may be sold to a third-party music publisher.
Lisa A. Alter is a partner in the firm of Alter & Kendrick, LLP (www.alterandkendrick.com) in New York City. Her practice focuses primarily on copyright law. She advises composers, musical estates, and music publishers and consults frequently on music publishing matters, including issues involving copyright due diligence, termination of grants, and recapture of copyrights. Ms. Alter has lectured frequently at law schools and professional meetings on these topics.
For information regarding the reprinting of all or a portion of this publication, please contact Lisa Alter, Alter & Kendrick, LLP, at 212-707-8377;lisa@alterandkendrick.com.
[2] Address your inquiries to the Library of Congress, Copyright Office, 101 Independence Ave. S.E., Washington D.C. 20559-6000; telephone (202) 707-3000; website www.copyright.gov
[4] 17 U.S.C. §202.
[5] 17U.S.C. §201(b).
[6] 17 U.S.C. §201(a).
[7] 17 U.S.C. §201(b).
[8] 17 U.S.C. §101.
[9] 17 U.S.C. §106.
[12] Community for Creative Non-Violence v. Reid, 490 U.S. 730, 751 (1989).
[13] 17 U.S.C. §101.
[14] 17 U.S.C.§304(a).
[15] 17 U.S.C.§303.
[16] 17 U.S.C.§302.
[17] 17 U.S.C.§302.
[18] 18 U.S.C. §101.
[19] Section 304(a)(1)(C) of the U.S. Copyright Act designates the persons entitled to renew a copyright registration in the event that the author has died prior to the commencement of the renewal term: (ii) the widow, widower, or children of the author, if the author is not living, (iii) the author’s executors, if such author, widow, widower, or children are not living, or (iv) the author’s next of kin, in the absence of a will of the author. 17 U.S.C. § 304(a)(1)(C).
[20] See Stewart v. Abend, 495 U.S. 207, 219-20 (1990).
[21] 17 U.S.C. § 304(c).
[22] In this example, the author may assign the rights to a third-party music publisher but must wait until the effective date of termination has occurred. The grant to the third-party music publisher will be subject to termination under Section 203.
[23] 17 U.S.C. §101.
[24] Intellectual Property and Communication Omnibus Reform Act of 1999, Pub. L. 106-113 §1000(a)(9), 113 Stat. 1501 (repealed 2000).
[25] 146 Cong. Rec. 7,771 (2000); Work Made for Hire and Copyright Corrections Act of 2000, Pub. L. No. 106-379, 114 Stat. 1444 (codified as amended at 17 U.S.C. §101 (2000)).
[26] See, e.g. Lulirama Ltd. v. Axcess Broadcast Services, Inc., 128 F.3d 872 (5th Cir. 1997).
[27] 17 U.S.C. §101.
[28] 17 U.S.C. §101.
[29] See e.g., Miller Music Corp. v. Charles N. Daniels, Inc., 362 U.S. 373, 375 (1960); Epoch Producing Corporation v. Killiam Shows, Inc., 522 F.2d 737, 747 (2d Cir. 1975), cert. denied, 424 U.S. 955 (1976); G. Ricordi & Co. v. Paramount Pictures, Inc., 189 F.2d 469, 471 (2d Cir. 1951), cert. denied, 342 U.S. 849 (1951); White-Smith Music Pub. Co. v. Goff, 187 F. 247, 253 (1st Cir. 1911).
[30] It is important to review each individual agreement in the context of the series of transactions that may occur during the life of a work. For example, a work that reverts to the author in the United States by reason of a contract that terminates at the end of the initial term of copyright may be the subject of a renewal agreement.
[31] Directive 2011/77, 2011 O.J. (L. 265) (EU).
[33] The British Reversionary Territories are generally believed to include the following: Anguilla, Antigua, Ascension Islands, Australia, Bahamas, Bangladesh, Barbados, Barbuda, Belize, Bermuda, Botswana, British Antarctic Territory, British Virgin Islands, Brunei, Canada, Cayman Islands, Central and Southern Line Islands, Channel Islands, Cyprus, Dominica, Falkland Islands, Federated Malay States, Gambia, Ghana, Gibraltar, Grenada, Guyana, Haiti, Hong Kong, India, Republic of Ireland, Isle of Man, Israel, Jamaica, Kenya, Kiribati, Lesotho, Malawi, Malaysia, Malta, Mauritius, Montserrat, New Zealand, Nigeria, North Borneo, Pakistan, Pitcairn Islands, Rendonda, Republic of South Africa, Sarawak, Seychelles, Sierra Leone, Singapore, Solomon Islands, Somalia, South Georgia, South Sandwich Islands, Sri Lanka, St. Helena, St. Kitts-Nevis, St. Lucia, St. Vincent, Swaziland, Tanzania, Tonga, Trinidad and Tobago, Tristan de Cunha, Turks and Caicos Islands, Tuvalu, Uganda, United Kingdom, Zambia, Zimbabwe.