This is the third of a 4-part series on issues in music copyright. Part 3 will provide an overview of the termination of transfer rights for musical compositions and sound recordings.
We mentioned termination of transfer briefly in part 2 of our series on duration to explain how the duration of a grant of a copyrighted work may be affected under current copyright law. Termination of transfer allows an author who has transferred their copyrights to a third party to reclaim those copyrights after a certain amount of time. It allows the author of the work a second chance to appreciate the worth of their work. For musicians, this is particularly important, because many artists transfer their rights in their musical compositions to publishers, and transfer their rights in sound recordings to their record label. Allowing the artist to terminate these grants, means the artist may still be able to capitalize on a successful song.
Termination of transfer is a right that exists for all copyrighted works (both musical compositions and sound recordings), and cannot be waived or contracted away by the author. There are, however, a few exceptions. One big exception is that the termination of transfer right does not exist for works-made-for-hire. Another big exception exists for derivative works; if you granted another the right to create a derivative work based on your original work, the grantee may continue to utilize the derivative work if it was prepared under the authority of the original grant before it was terminated. It is also important to keep in mind that these termination rights are only applicable to U.S. rights, not any grants made in foreign territories.
In addition, the scope of the right will be affected by the time in which the grant was made: one section of the Copyright Act covers works made on or after 1/1/1978, another section of the Act covers works made before 1/1/1978.
For any work in which the author has granted a transfer or license of copyright on or after 1/1/1978 (excluding grants made in the author’s will), § 203 allows the author (or the author’s heirs and assignees who are entitled to exercise a total of more than ½ of the author’s interest) to terminate the grant within a 5-year period beginning 35 years after the grant was executed. If the grant of rights included the right to publish the work, termination can begin at the end of 35 years from the date of publication or 40 years from the date of the grant, whichever term ends earlier.
- Example: Author A enters into a publishing agreement with Publishing Company B on January 1, 1980, granting his copyright in his musical composition.
- The earliest Author A (or eligible heirs/assignees) may terminate that grant is January 1, 2015.
- The latest Author A (or eligible heirs/assignees) could terminate the grant is January 1, 2020.
Termination requires filing an advance notice of intent to terminate. This notice must comply with all statutory requirements set out in § 203, including timely filing requirements. Notice cannot be served more than 10 years or less than 2 years to the effective termination date.
- Example: Continuing from our example above, Author A may serve notice:
- No earlier than January 1, 2005 (10 years prior to the earliest possible termination date), and
- No later than January 1, 2018 (2 years prior to the latest possible termination date).
A similar termination of transfer exists for grants of rights made by an author or persons other than the author before 1/1/1978. Section 304(c) lays out all requirements, and permits an effective termination during a 5 year period starting 56 years after the copyright was first secured, or beginning on 1/1/1978, whichever is later.
Like the requirement under § 203, notice of intent to termination is required. Notice must comply with all statutory requirements of § 304 and cannot be served more than 10 years or less than 2 years to the effective termination date.
- Example: Author A enters into a publishing agreement with Publishing Company B on January 1, 1957, granting his copyright in his musical composition.
- The earliest Author A (or eligible heirs/assignees) may terminate that grant is January 1, 2013.
- The latest Author A (or eligible heirs/assignees) could terminate the grant is January 1, 2018.
- Notice must be served no earlier than January 1, 2003, and no later that January 1, 2016.
The Sonny Bono Copyright Extension Act adds another element to this termination calculation. The Sonny Bono Act extended copyright protection for an additional 20 years. As a trade-off for this extension, authors have a second chance to exercise their termination rights for pre-1978 works if they missed their first opportunity. Under this Act if your pre-1978 work is still in it’s renewal term on October 27, 1998 (meaning that the work was copyrighted on or before 1/1/1923 and on or before October 26, 1939), the work can be recaptured in a 5-year period beginning 75 years after the copyright was secured.
- Example: Author A enters into a publishing agreement with Publishing Company B on January 1, 1935, granting his copyright in his musical composition. Author A could have terminated the grant as early as January 1, 1991 (56 years after the original copyright date), but failed to do so. Author A has another chance to terminate beginning January 1, 2010 and ending January 1, 2015 (5 year period beginning 75 years after the original date of copyright).
This blog has provided an overview of the termination rights for musical compositions and sound recordings. In the final part of our series we will discuss the different licensing schemes for music copyrights.
Maria Scheid is a graduate of The Ohio State University Moritz College of Law and former legal intern at the Copyright Resources Center at OSU Libraries