Getting your copyrights back...
THIS POST IS INTENDED FOR GENERAL ILLUSTRATION PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL ADVICE. THE AVAILABILITY AND EXERCISE OF ANY RIGHTS WILL DEPEND ON THE SPECIFIC FACTS AND CIRCUMSTANCES OF EACH CASE.
U.S. Copyright Law gives authors (such as songwriters and artists) the right to terminate their prior assignments and licenses of copyrights, and regain ownership of the U.S. rights in and to their works. This right may be exercised “notwithstanding any agreement to the contrary” – in other words, the law gives authors an opportunity to get out of contracts and get their rights back.
However, un-doing a grant is not always simple. Successful termination depends on many factors that are often determined on a case-by-case or even work-by-work basis. At the very least, it will involve a review of the grant(s) and the nature of the rights assigned or licensed to a record label or a music publisher, the nature of the works and when they were created, registered and/or first published, whether the grant(s) and the works were made jointly with co-authors, and the chain of title if the original grantee subsequently assigned the author’s rights to a successor.
In some cases, the likelihood of success may not always be certain due to the still-evolving and “un-tested” nature of the U.S. law in this area. For the purposes here, this post is limited to the key statutory requirements for terminations under § 203 of the Copyright Act of 1976, as amended.
Why Is There a Termination Right? To protect against the unequal bargaining position of less-established authors at the beginning of their careers when it is difficult to determine the value of their work. Termination rights give authors the opportunity to re-negotiate for more lucrative deals in line with the marketplace value of their works after a period of time.
What Is Terminable? Under § 203, the U.S. rights assigned or licensed under grants of copyright made by the author on or after January 1, 1978. Works made by hire, transfers made by will, non-U.S. rights and derivative works prepared under a grant are not subject to termination.
Who May Terminate? The author, or a majority of the authors for a grant jointly made by more than one author, or if an author is deceased, his/her beneficiaries holding a majority of his/her termination interest. An author’s beneficiaries and the allocation of his/her termination interest are specifically set forth under the statute.
When Are Rights Terminable? Any time during the 5-year period or “window” beginning 35 years after the grant date, but if the work is first published under the grant, then the 5-year window beginning at the earlier of 35 years after first publication or 40 years after the grant date. Note that a grant will not be deemed made until the work is created.
How to Terminate? Termination rights must be affirmatively exercised by serving a written notice on the original grantee or its successor no less than 2 and no more than 10 years before termination. The notice must comply with all the requirements stated under the law, in form, content and manner of service. Termination will not be effective unless a copy of the notice is recorded with the U.S. Copyright Office before the termination date.
And Then… Termination rights vest in all person(s)-in-interest once notice is duly served, and will revert to them on the termination date if the rights have been effectively terminated.
Further Grants. After notice is served and until the termination date, no further grants involving the termination interests are deemed valid unless the grants are made with the original grantee or its successor (who, in effect, has a right of first refusal for at least 2 years since notice must be made at least 2 years in advance). If a majority is needed to terminate, the same number and proportion of the majority (but not necessarily the same individuals) are required for any future grants involving the termination interests. Termination rights and further grants apply to all persons-in-interest, including any non-signers (majority rules!). Note that an author and an original grantee or its successor may always voluntarily terminate an existing grant and re-negotiate a new one at any time, which would effectively “re-start the termination clock” for another 35- or 40-year period.
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