PUBLISHED SEPTEMBER 2016
by Jonathan Lyons & Jesseca Salky, Founding Partners, Lyons & Salky Law LLP
The US Copyright Act of 1976 presents authors and their statutory successors the opportunity to terminate previous grants copyrighted work rights. For evergreen titles, this can be a very lucrative opportunity; for publishers of such copyrighted titles, where these works may represent the cornerstone of their backlist, such terminations can be financially and legally burdensome. Because of the potential burden, it is essential for both authors and publishers to understand their termination rights and plan accordingly.
By drafting these termination provisions, Congress intends to address the often-unequal bargaining position between publishers and authors at the beginning of their careers. Termination rights allow the author or their successors to either renegotiate the terms of their existing publishing agreements or enter into new agreements with another publisher that more accurately reflect the current value of the works.
There are three specific provisions in the Copyright Act that apply to terminations.
- 1. Section 304(c) applies to works published prior to 1978 and states that terminations may be effected between 56 to 61 years from the date the copyright was secured.
- 2. Section 304(d) also covers works prior to 1978 if the initial window of termination described above has expired. In this instance, terminations can be effected during a five-year window beginning 75 years from the date the copyright was secured.
- 3. Section 203(a) provides a termination right to authors who granted publication rights in 1978 and thereafter in a five-year window that runs 35 years from publication of the work or 40 years from the date of the execution of the grant—whichever occurs first.
These terminations require notice be sent by the author or, if the author is deceased, by persons owning a majority interest in the termination rights to grantees two to 10 years prior to the effective date of termination. The notice must be sent to the Copyright Office two to 10 years prior to such termination taking effect.
The copyright for BOOK 1 was secured on Sept. 1, 1962. Under Section 304(c), termination may be effected between Sept. 1, 2018, and Sept. 1, 2023. The earliest notice could have been sent is Sept. 1, 2008 (10 years prior to the earliest date available for termination), and the latest that notice may be sent is Sept.1, 2021 (two years prior to the last date available for termination).
BOOK 2 was published on Dec. 9, 1985. Under Section 203(a), termination may be effected between Dec. 9, 2020, and Dec. 9, 2025. The earliest notice could have been sent is Dec. 9, 2010 (10 years prior to the earliest date available for termination), and the latest notice may be sent is Dec. 9, 2023 (two years prior to the last date available for termination).
Limitations on Termination Rights
There are exceptions to termination rights that authors and publishers should be aware of: First, these rights do not apply to works made for hire; second, derivative works already created under the original rights grant may still be utilized after termination, though no new derivative work may be prepared (e.g., a film produced based on a book could continue to be exploited, but any remake rights would be cut off). Termination rights do not apply to grants made on or after Jan. 1, 1978, by persons other than the author, and they do not apply to a license of rights outside of the US (e.g., if an author grants world rights to a publisher, the author may terminate rights in the US, but the grant would remain in force as it relates to other territories).
As may be expected, these clauses have generated significant confusion and litigation between authors and their successors. Authors and publishers are well-advised to consult with a copyright attorney about these rights and their potential implications. In particular, the procedure for sending notice requires much attention to detail and, if improperly constructed, termination may be ineffective. However, if properly constructed, termination rights provide authors and their successors with a powerful tool to control the exploitation of their works.
Jonathan Lyons and Jesseca Salky are the founding partners of Lyons & Salky Law LLP. Their firm provides counsel in all areas of the entertainment industry, with an emphasis on publishing and copyright matters. Lyons & Salky Law also advises clients across a variety of other media industries including film, television, stage, new media, and design.