Sunday, March 28, 2010

Publishing Doomsday Clock & the Death of the Backlist

By Lloyd J. Jassin

Copyright Termination: A Guide for Authors

The Copyright Act gives authors an opportunity to recapture rights they licensed 35- to 40-years ago. Since an author's termination right cannot be waived, it allows authors to renegotiate the terms of publishing agreements they signed before the true value of their work was known. Some call it "contract bumping."  The termination right trumps written agreements -- even agreements which state they are in perpetuity.  Also known as “termination” or “recapture” rights, the deadline for sending termination notices for 1978 grants will begin to expire in 2011.

To protect authors and other creators of older works from having to live with a bad deal they entered into when they had little negotiating skill or leverage, the Copyright Act allows them (or their families) to recapture copyrights by sending notices of termination to their publisher partners. 

Post 1977 Contracts

Section 203 of the “new” Copyright Act applies to grants of copyrights signed on or after January 1, 1978 by the author -- not grants signed by an author's heirs.  One of the idiosyncrasies of the termination right, is that it does not apply to foreign grants.  However, under UK law, heirs can recapture rights twenty-five years after the death of an author.  Known as British Reversionary Rights, these rights are analogous to our recapture and termination rights.  

"Works made for hire" are immune from termination. Of special concern to heirs is an unsavory practice known as revoke and re-grant.  If you are an heir, be very careful of what you are asked to sign by agents, coauthors, publishers, producers and other copyright licensees and partners.   If it is a revoke and immediate regrant of the rights agreement, you may be signing away valuable rights for less than market rate.    

The Section 203 right of termination focuses on when the copyright grant or license was made.  “Termination may be exercised at any time during a period of five years beginning at the end of thirty-five years from the date of publication of the work under the grant or at the end of forty years from the date of execution of the grant, whichever is earlier.”

The rules that apply to termination are dense and unforgiving. If  you serve a Notice of Termination either too late, or too early, or incorrectly, you have squandered your termination rights.  It's essential the that the Notice of Termination be recorded with the Copyright Office, which must be prior to the date of termination.  You can serve a Notice of Termination as early as ten years before the effective date of recapture, or as late as two years before the effective date of recapture.  The author (or his heirs) selects the date termination will take effect, and must send a Notice of Termination within the termination window outlined in the Copyright Act.

ExampleIf a songwriter agreement was signed in 1978, the Notice of Termination could be served as late as two two years before the recapture date.   In this instance, 40-years from date of execution would be 2018, which means the notice of termination can be served as late as 2016.

Statutory v Contractual Termination Rights

The right of termination should not be confused with the contractual right many authors have to recapture  book rights when their book goes out-of-print.  When a book goes out-of-print, most book contracts allow the author to request a reversion of rights.  Regrettably, what constitutes "out of print" is not always clear, and responding to written requests for a reversion of rights is not a top priority with publishers.  Unlike out-of-print clauses, which requires the cooperation of the publisher, the statutory termination right automatically vests those rights in the author.      

It Involves Math!#$@!

Calculating the notice and recapture dates are the author's responsibility.  The Copyright Office does not provide Notice of Termination forms.  You must calculate the notice and recapture dates yourself.  It is strongly advised that you consult with a knowledgeable copyright attorney (not a trusts & estates attorney) if you have questions pertaining to termination.  

Death & Termination

The important message is that when an author dies, their spouse, children or grandchildren, even parents or siblings, may be entitled to exercise the recapture rights discussed in this article.   

Recapturing Ownership Rights to Pre-1978 Works

The Copyright Act gives families of deceased authors and composers an opportunity to recapture rights to pre-1978 works as well.  

For example, when the author of an older work dies during the initial 28-year term of copyright, that author’s family has the right to reclaim the renewal copyright, which is a further term of 67 years of copyright protection.  This subset of the Copyright Act also provides for termination at any time during the five year period beginning at the end of 56 and 75 years from the date the copyright was originally secured.  These added opportunities to get back ownership of copyrights exists even if the author assigned his or her renewal term (or devised it by will) to someone other than his family.  What is extraordinary about these rights, is that copyright law also trumps a writer or composer's will.

Example.  Miles Davis, the jazz icon, died in 1991, before the end of the 28th year of copyright of his revolutionary 1970-album Bitches Brew.  Because he died before the 28th year of copyright, his renewal term rights in the song Bitches Brew vested automatically in his heirs -- cutting off a sister and brother mentioned in his will, and severing his ties to his music publisher.  Today, his sons (two of whom were not included in their father's will) and his daughter, jointly control the remaining 67-years of copyright in Bitches Brew and other songs.   Here, Section 203 trumped both Miles Davis' will and his songwriter agreements.   

Similarly, in 1938 Jerry Siegel and Joe Schuster, two young men from Cleveland, Ohio, signed over all of their rights to the Superman character to DC Comics for $130.00 and vague promises of future work. To address this, and similar economic injustices, Congress gave authors (and their heirs) a second chance to strike better financial deals. As a result, starting in 1999, using Section 302 of the Copyright Act, Siegel’s heirs recaptured his rights to the Superman character. Fortunately, you don’t have to be related to a man of steel to reclaim copyrights. The heirs of Jack Kirby, Hank Williams, William Saroyan, Truman Capote, Joe Young, Lorenz Hart, and many others have availed themselves of these valuable rights.

Copyright Estate Planning

The clock is ticking.  Don't miss this opportunity to get your book or song rights back.  Termination notices, which must adhere to complex formalities, must be sent within a narrow window. On January 1, 2013, provided timely Termination Notices are sent (and recorded with the Copyright Office) grants made on January 1, 1978 will terminate.  As a copyright owner, or copyright owner's heir, you must be vigilant. Failure to exercise these rights, or exercise them in a timely manner, can be fatal.  And, if you delay filing your claim, you can be time-barred by the statute of limitations.

If you are thinking about exercising your renewal or termination rights, or need help renegotiating your soon-to-terminate publishing agreement, call us.  We can help you: (i) identify which copyrights are eligible for termination; (ii) determine who is the proper party to exercise those termination rights; (iii) prepare, file and record your Notices of Termination; (iv) assist you recover rights to copyrighted works you thought were irrevocably assigned or bequeathed to others; (v) work cooperatively with your trusts and estates attorney on reopening an estate, or seek monetary damages that flow from a determination of ownership or co-ownership of a legacy copyright.      

The Best of 1978

Select Books

1.  The Stand - Stephen King
2.  Eye of the Needle - Ken Follett
3.  The House of God - Samuel Shem
4.  The Far Pavilions - M.M. Kaye
5.  Holcroft Covenant - Robert Ludlum
6.  Chesapeake - James Michener

Select Songs (artist , not composer shown)

1. Is This Love - Bob Marley & the Wailers
2. Le Freak - Chic
My Life - Billy Joel
4. Life's Been Good -- Joe Walsh
5. Night Fever - The Bee Gees
6. Miss You - The Rolling Stones
7. YMCA - Village People

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NOTICE: This article discusses general legal issues of interest and is not designed to give any specific legal advice pertaining to any specific circumstances. It is important that professional legal advice be obtained before acting upon any of the information contained in this article.  This article represents copyrighted material and may only be reproduced in whole for personal or classroom use. It may not be edited, altered, or otherwise modified, except with the express permission of the author. 

LLOYD J. JASSIN is a New York-based publishing and entertainment attorney with a special interest in copyright and trademark matters.  He is co-author of The Copyright Permission and Libel Handbook: A Step-by-Step Guide for Writers, Editors and Publishers (John Wiley & Sons, Inc.).  A former publishing executive, Mr. Jassin has written extensively on negotiating contracts in the publishing and entertainment industries, and lectures frequently on contract and copyright issues affecting creators. He may reached at Jassin@copylaw.com or at (212) 354-4442. His offices are located at 1560 Broadway, Suite 400, New York, NY 10036. Visit www.copylaw.org.

(c) 2010. Lloyd J. Jassin. All Rights Reserved.





4 comments:

  1. Hi! This is an awesome page. Keep up the good work!


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  2. hhiiiiii !!!!!!!!!!!!!!1 awesome job!!!!!!

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  3. This is very interesting information. Thank you. I'll be back regularly from here on out. - Robert S. Nahas

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  4. "Of special concern to heirs is an unsavory practice known as revoke and re-grant."

    It's amazing that courts permit this device. It twists the words "any agreement" into "any agreememt except those agreements designed to evade the termination right." Classic.

    ReplyDelete