TERMINATIONS OF TRANSFERS  IVAN HOFFMAN B.A., J.D.

        An overall note:  all of these rights to terminate do not exist if the creator was an independent contractor and executed a valid work made for hire agreement or if the creator was a bona fide employee of the assignee for whom the work was created during the course and scope of that employment and thus acted as an employee for hire.  However, not all contracts executed by independent contractors in which there is language referring to the agreement as a work made for hire will be legitimately determined to be a work made for hire agreement. Read the several articles on my site under the link “Articles for Writers and Publishers” dealing with work made for hire agreements.  Additionally, relationships that look like employment relationships may turn out to not be such relationships.  Or it may be that the work that was created may not have been part of the course and scope of employment.  This issue has been discussed at length by the United States Supreme Court in Community for Creative Non-Violence vs. Reid and you should read that case carefully.  Therefore, the work thus created may not fall into the work made for hire relationship of employer-employee and should be looked at carefully.  Thus, both the creator and the assignee should thus consult with an experienced attorney to review the actual status of the initial relationship to see if termination is available.

        Let’s posit this situation:  A creator entered into a contract with an assignee in 1930, transferring to the assignee all rights to a certain work (book, song etc.) including all rights to the copyright including the renewal thereof.

        The law provides that the grant of rights may be terminated by the creator if living or the creator’s spouse, children, grandchildren or estate in a particular order (it is much more complicated if there was more than one creator and even more complicated still if one of the creators has died and much more complicated still again if the one who died did so without leaving a will) even though the contract language is clear.  A creator may not contract away the creator’s rights to renew a copyright or to terminate the grant.

        What can happen now in this year 2001?

        Initially, you must determine if the copyright is still in existence.  This requires research into whether or not it was initially registered, whether a renewal application was filed as was required for copyrights of that age, if so, by whom and was the “whom” the proper party.  Then a determination must be made as to how this copyright was affected by subsequent copyright laws and amendments thereto.  But let’s assume that the copyright is still valid.

        The law provides that a creator can terminate a transfer at any time during a window of 5 years commencing 56 years after the original copyright date or within that same 5 year window commencing January 1, 1978, whichever is the later.  Let’s now do the math: copyright in 1930, 56 years from that date is 1986, the 5 year window runs from 1986 through 1991.  It looks like the right was lost because once the window passes, the right to terminate is lost.  Ah! Congress to the further rescue.

        In 1998, Congress passed the Sonny Bono Copyright Term Extension Act that extended the terms of copyright protection for an additional 20 years and further provided for the contingencies in this situation.  The said Act provides that if a copyright is in its initial or renewal term at the time the Act was effective (which is October 27, 1988 and thus a separate determination has to be made here to see if the copyright was still valid) and if the window to terminate has already passed, then the right to terminate is extended to a period of 5 years from 75 years from the date of the original copyright.  In this example, the right to terminate exists starting in 2005.  Therefore, in this example, the creator must know when the original copyright was granted, whether it was legally and properly renewed and whether it is still in existence because the term of the renewal period has been changed a few times.

        In the event of original copyrights that were taken out later than the one in this example, where 56 years from that date is still later than 2001, the Sonny Bono Act does not come into play.

        The law provides that the creator may terminate grants of copyright or any rights under copyright based on contracts entered into during or after 1978 during a five year window commencing with the earlier of either the end of 35 years from the date of publication of the work that was the subject of the agreement or the end of 40 years after the signing of the said agreement.

        As to both kinds of termination, in the event that the window is still open, the law requires that the creator or the creator’s estate send a notice to the assignee not less than 2 nor more than 10 years prior to the effective date of termination, which effective date must be within the 5 year window.  That notice is, in itself, quite complex and there are a series of regulations in the Code of Federal Regulations detailing the nature of the contents of that notice and how, as a condition of termination, the notice must be recorded at the copyright office.

        In addition to the exclusions based on work made for hire, discussed above, the right to terminate does not exist as to works that were created as “derivative works,” which are works that were based on the original copyrighted work.  For instance, if the work that was transferred was a book or a piece of artwork and before the notice of termination, a work such as a television show or a computer game was created using the original copyrighted work, the termination of the original transfer does not operate to terminate the rights as to such derivative work nor may such termination prevent the owner of the rights in the derivative work from exploiting those rights even after the termination. However, once there is a termination of transfer the owner of the rights in the derivative work may not make any subsequent versions of the original work.

        Additionally, any transfers of rights of copyrights made by will cannot be terminated by the estate of the grantor.

        This area of the copyright law is enormously complex and it is made more so because of the amendments to the copyright law over the last couple of decades.  Precise timing calculations must be made as well as research into the original copyrights, the need for renewal applications for certain copyrights and when those were required, whether they were done properly, whether, in the event of death of the creator or creators, who has rights to the work now and many, many other issues.

        This is definitely something that should be done by an experienced, publishing attorney and not by a publisher trying to “save” money by doing it itself.  This is the wrong time to be frugal for if the publisher guesses wrong, the monies expended in future exploitation of a work can be put at risk.

Read “The Do It Yourself Publishing Lawyer.”

© 2001 Ivan Hoffman