Opinion ID: 3035128
Heading Depth: 3
Heading Rank: 4

Heading: The District Court’s May 8, 2003 Order

Text: When considering the parties’ motions, the district court asked the question that lies at the very heart of the parties’ dispute: “Should the 1983 SSI Agreement be treated as a pre1978 agreement to be governed by the [CTEA’s] termination provisions of 17 U.S.C. § 304?” Answering the question in the negative, the district court held that the parties’ 1983 agreement itself revoked the grant of rights under the 1930 agreement that Clare’s notice sought to terminate, and that the grant made to SSI under the 1983 agreement was not subject to termination under the CTEA. In reaching its ruling, the district court rejected Clare’s argument that the 1983 agreement was merely an extension of the 1930 grant. The court further reasoned that the CTEA’s termination provisions apply only to grants made prior to 1978. The court also opined that the Copyright Acts did not alter the power of private parties to contract and that the 1983 agreement “was created in order to 6 Other issues were left pending in the district court. For example, the court had yet to rule on the validity of a copyright termination notice served by the granddaughter of the Pooh works’ illustrator. Also before the court was SSI’s declaratory-relief counterclaim, asserting that Disney was obligated to pay royalties to SSI. Those further proceedings are not at issue in this appeal. 16016 MILNE v. STEPHEN SLESINGER, INC. protect SSI and Disney from a termination of the rights granted to them.” In addition, the district court was not persuaded by Clare’s argument that “a grantee may not subvert the statutory rule against obtaining a new grant prior to termination of the original grant . . . unless there is at least a moment [of freedom] when the grantor is bound under neither the prior nor the new grant.” The court noted that although “§ 304(c)(5) [and] § 203(a)(5) . . . provide that termination of a grant may be effected ‘notwithstanding any agreement to the contrary,’ . . . [s]ection 304 does not apply[ ] because this is a post-1978 agreement, and § 203 does not apply[ ] because the grant in question was not made by the author” (quoting 17 U.S.C. §§ 203(a)(5), 304(c)(5)). Thus, the court concluded that the 1983 agreement was a new contract, effective after January 1, 1978, and that Clare’s termination notice was invalid.