Copyright Law: Fall 2008Professor Susanna Fischer

CLASS 17

October 15, 2008

WRAP-UP: TRANSFER

• Copyright is a bundle of rights under the 1976 statute, which recognizes the concept of divisibility (see s. 201(d)(2))

• Exclusive licensees but not nonexclusive licensees can bring suit for copyright infringement (BMI v. CBS)

Davis v. Blige (2d Cir. 2007) [Supp. p. 13

• Can a co-author retroactively assign his copyright interest to a third party?

• Songs were “Love” and “Keep it Moving”

• Did the Second Circuit fail to properly interpret s. 201(d)(2)

Sybersound Records, Inc. v. UAV Corp. (9th Cir. 2008) [Supp. p. 16]

• Can a co-owner (TVT) give Sybersound exclusive rights in the songs at issue?

• Does Sybersound have standing to sue a third party infringer for copyright infringement?

Comparing Davis and Sybersound

• Davis v. Blige, 505 F.3d 90 (2d Cir. 2007), and Sybersound Records, Inc. v. UAV Corp., 517 F.3d 1137 (9th Cir. 2008), address the rights of transferees from copyright co-tenants (joint owners), but from opposite perspectives. Blige: the transferee has reduced capacity to defend

• Sybersound: transferee has reduced capacity to sue.

Wrap Up: The Death of Divisibility? Gardner v. Nike, 279 F.3d 774 (9th

Cir. 2002)• Principle enunciated in s. 201(d)(2)

• E.g. Sybersound (9th Cir. 2008)

• Gardner v. Nike (9th Cir. 2002) : Transferee (Sony) of an exclusive copyright license (to a Nike cartoon character) could not transfer rights to Gardner w/o consent of Nike

Wrap-Up

• S. 204(a) requires that “transfers of copyright ownership” require a note or memorandum in writing signed by transferor

• “transfer of copyright ownership” does not include a nonexclusive license (s. 101, see Effects v. Cohen (9th Cir. 199) where a nonexclusive license was found implied from conduct of the parties)

Wrap Up: Recordation System

• Voluntary system permitting transfers of copyright ownership to be recorded with the Copyright Office.

• Recordation operates as constructive notice (so long 2 conditions are met: work is specifically identified and there is a registration of copyright for the work) - 205(c)

•

Wrap up: Priority Between Conflicting Transfers

• First transfer prevails if recorded within one month after execution in US or within 2 months after execution after US OR at any time before recordation of second transfer

• OTHERWISE LATER TRANSFER MAY PREVAIL IF RECORDED FIRST

Priority between conflicting transfer and nonexclusive license• Section 205(e) : Nonexclusive license,

whether recorded or not, prevails over conflicting transfer of copyright ownership IF license evidenced by written instrument signed by copyright owner or authorized agent AND license taken before transfer executed OR license taken in good faith before recordation of transfer and without notice of it.

Copyrights as collateral

• Eg songwriter uses the copyrights in her songs as collateral for a loan

• Copyrights can be used to afford the creditor protection in the event of a bankruptcy

• Creditor seeks to secure his claim by placing a lien on the copyrights

• How do you perfect this security interest so that the creditor is included in the group of secured creditors who are paid first from the bankruptcy estate?

Two possibilities for perfecting security interest in copyright

• 1. File in the state U.C.C. office (like for many types of real property)

• 2. Record the security interest in the Copyright Office

• Which is favored by the court in National Peregrine, Inc. v. Capital Fed. Sv. & Loan Ass’n, (C.D. Cal. 1990)?

National Peregrine case (C.D. Cal. 1990)

• National Peregrine’s predecessor had obtained a $6 million loan from Capitol Federal (defendant bank).

• Bank took the copyrights in film library and future income therefrom as security for the loan.

• Bank filed a UCC-1 financing statement in 3 states• Bank did not record transfer of security interest in

Copyright Office• Did the bank thus perfect the security interest in

the copyrights?

Peregrine case (C.D. Cal. 1990)• Section 205, provision for recordation of

transfers of copyright ownership in the Copyright Office, preempts state laws such as UCC providing for recording of security interests in various state offices

• Thus, if a bank takes a security interest in copyrights in many works (like the 145 films at issue in Peregrine), it will have to record these in the Copyright Office

Peregrine case (C.D. Cal. 1990)• There is much criticism of this case, but

subsequent bankruptcy courts have followed it

• Why has this case been criticized?

National Peregrine case (C.D. Cal. 1990)

• There is much criticism of this case, but subsequent bankruptcy courts have followed it

• Why has this case been criticized? Because it complicates relatively simple business transactions and also creates uncertainty for past lenders who only made UCC filings

• Some legislative proposals to overturn this decision, but none enacted so far. Limited to registered copyrights in World Auxiliary (9th Cir. 2002)

“Arising Under” Copyright or Contract Law – see p. 373

• Licenses are contracts so one might think that disputes over license agreements would be governed by state law, not federal copyright law. Yet clearly some issues involving licenses, such as whether the writing requirement of the Copyright Act are met, arise under federal law.

• Courts have had difficulty in determining when such claims “arise under” federal law.

Foxwoods Casino in Connecticut

Bassett v. Mashantucket Pequot Tribe (2d Cir. 2000) [C p. 373]

• Describe the dispute between Bassett and the Pequot Tribe

• Why did the district court dismiss the action?

• In the view of the Second Circuit was the dismissal justified?

• Did it endorse the T.B. Harms test or the Schoenberg test?

Bassett

• Test for “arising under” the Copyright Act (and hence subject matter jurisdiction in federal court) is:

• 1. the complaint seeks a remedy expressly granted by the statute or

• 2. the complaint asserts a claim requiring construction of the statute

New York Times v. Tasini

• New York Times v. Tasini and the material on transfer by operation of law will not be covered on the exam

DURATION OF COPYRIGHT OWNERSHIP

• How long is it constitutional for a copyright to last? Remember: Constitution says Congress can gives Authors protection “for limited Times”

• How long should a copyright last? Should it be for life of author plus term of years or for a specific term of years, or a specific term of years plus a renewal term?

DURATION UNDER 1909 ACT

• 1909 Act: initial and renewal term (like Statute of Anne). How long were these under the 1909 Act?

• Under the Statute of Anne?

• What is the purpose of a renewal term? NOTE idea of statutory beneficiaries

RENEWALS UNDER 1909 ACT

• How did you renew copyright under the 1909 Act?

RENEWALS UNDER 1909 ACT

• How did you renew copyright under the 1909 Act? You had to file a renewal registration within the last year of the copyright term.

• To renew, you had to register the work.

• What happened if you did not file a renewal registration?

WHAT IF AUTHOR WAS DEAD BY THE 28th YEAR?

• Who, if anyone, had right to renew the copyright?

WHAT IF AUTHOR WAS DEAD BY THE 28th YEAR?

• Who, if anyone, had right to renew the copyright? Statutory beneficiaries: Widow or widower, children, executor or next of kin (1909 Act § 24)

SHARE OF STATUTORY BENEFICIARIES (p. 421)

• See Broadcast Music, Inc. v. Roger Miller Music, Inc., 396 F.3d 762 (6th Cir. 2005) (CB p. 422) per stirpes

• Accord Venegas-Hernandez, 424 F.3d 50 (1st Cir. 2005)

WHO OWNS THE RENEWAL TERM OF A WORK MADE FOR

HIRE OR POSTHUMOUS WORK?• See p. 422

PROBLEMS WITH RENEWALS UNDER 1909

ACT

PROBLEMS WITH RENEWALS UNDER 1909

ACT• For many works, renewal was not sought,

or there were problems with renewal registration.

• That is why House Report characterized it as “one of the worst features of the present copyright law” – life of author more clear (see CB p. 391 para. 5)

RENEWALS UNDER 1909 ACT

• Could the author assign his renewal expectancy before renewal vests? See Fred Fisher Music (1943) ; - Yes

• Isn’t this contrary to the purposes of renewal?

RENEWALS UNDER 1909 ACT

• Can the author assign the statutory beneficiaries’ renewal rights? See Saroyan v. William Saroyan Foundation, 675 F. Supp. 843 (S.D.N.Y. 1987), aff’d, 862 F.2d 304 (2d Cir. 1988) (CB p. 420)

• Saroyan: “Everyone’s got to die, but I always thought an exception would be made in my case”

VESTING OF RENEWAL TERM

• How long into the 28th year of the initial term must the author live to vest the renewal interest of the author’s assignee?

• Conflict between cases: Marascalco v. Fantasy, Inc. (9th Cir. 1991) and Frederick Music Co. v. Sickler (S.D.N.Y. 1989) (see CB p. 424)