Intellectual Property Attorney

Termination Rights Under The Copyright Act: Part Two

In Part One of this series of blogs, we introduced termination rights and discussed the right provided under Section 304(c) of the Copyright Act. This blog deals with a second opportunity to terminate grants of copyright. This second termination right arises pursuant to subsection (d) of Section 304 of the Copyright Act.

The right under Section 304(d) may only be exercised if the owner of a termination right did not exercise the first right under subsection (c) and that right had expired before October 27, 1998 (the significance of this date will be discussed in Part Three of this blog series). As with the first right, this second right only relates to grants executed by the author or his/her statutory heirs before January 1, 1978, and the right may only be exercised by a majority interest of the author’s statutory beneficiaries and only to the extent of the author’s share.

So, how does the termination right under subsection (d) differ from the one under subsection (c)? It has to do with which works are covered. Subsection (d) covers older works. Specifically, works copyrighted up to 80 years (as opposed to 61 years) prior to the effective termination date.

Pursuant to Section 304(d), termination can be effected any time during the five-year period beginning at the end of seventy-five (75) years from the date of copyright; provided (a) advance written notice is served on the grantee at least 2 years and no more than 10 years prior to the date of termination, and (b) a copy of the notice is recorded in the Copyright Office before the effective date of termination.

Therefore, notices could be served on October 8, 2012, for example, for works published between October 8, 1934 and October 27, 1937 (works published after this date are ineligible for this termination right). If one serves notice for a work published on October 8, 1934, the effective date of the termination would be October 8, 2014. If one serves notice for a work published on October 27, 1937, the effective date of the termination could be any time between October 27, 2014 and October 27, 2017. By October 27, 2015, the opportunity to serve notices for any remaining eligible works will have closed.

Termination under Section 304(d) has the same effect as it does under Section 304(c). Following termination, rights revert to the persons owning the termination interest, including those owners who did not sign the notice of termination. Termination affects all rights held by the grantee and any sublicensees, except rights based on foreign copyright law. The prior grantee, and any sublicensees of the grantee, may continue to utilize any derivative work already created (and the grantee may still receive royalties from its sublicensee’s utilization of its derivative work), but they may not create new derivative works. Owners of a majority interest in the reverted rights may grant the reverted rights, including the right to create new derivative works, after the date of termination. If the new grant is to the prior grantee, the grant may be made any time after the notice is served.

Part Three in this series of blogs will discuss the reasoning that gave rise to these termination rights, including the origins of the October 27, 1998 cut-off date.

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