Showing posts with label copyright. Show all posts
Showing posts with label copyright. Show all posts

Friday, July 14, 2023

The Lien: A Last Resort to Collect on a Debt - Guest Post by Attorney Kevin Casini, Esq.

Kevin Casini, Esq.

Top Connecticut attorney Kevin Casini, Esq. helps us understand the concept of a lien in the guest post below:

Judgment liens are the final step in collecting on a civil judgment. When a court issues a judgment, whether by a judge or verdict by a jury, it doesn't automatically force the debtor to pay. If the debtor doesn't pay, it is the responsibility of the creditor to enforce the judgment. Most enforcement happens when a creditor finds assets belonging to the debtor to be taken to satisfy the judgment. This begins with a judgment lien.

A judgment acts like a metaphorical cloud hovering over the debtor's personal property in the state. A judgment is unenforceable against personal property until it has been attached. The property can include bank accounts, stocks, bonds, vehicles, or other equipment.

Copyrights that are registered with the United States Copyright Office ("USCO") can be liened, through registration at the USCO of the lien. Unregistered copyrights cannot.
 
There are different types of liens: consensual, statutory, and judicial. Consensual liens include mortgages and car loans, while mechanic's liens and judgment liens are examples of statutory and judicial liens.  Once attached, they work similarly to consensual liens, allowing the creditor to seize the property to satisfy a judgment.

Some liens can be discharged too, depending on circumstances.  

  • Judgment liens: If there is no equity in the property to cover the lien, it may be discharged.  
A judgment lien typically extinguishes after 20 years.

To establish a lien on real estate, it must be recorded on the land records, but the process varies by state. If a judgment lien is attached to real estate, the judgment continues to accumulate interest at a higher statutory rate (e.g., 17.5% in the state of Connecticut in the United States) than market savings or mortgage rates, and the property's value usually increases over time. The lien is either satisfied through refinance, sale or the property to which it is attached, or by satisfaction. 

In some places, the order in which liens are recorded determines their priority. In other cases, certain creditors always have priority, and the government always has priority. The same principles apply to security interests in personal property. The creditor who perfects their security interest first usually has the highest priority. To perfect a judgment lien, it needs to be attached to property.

The way of attachment varies depending on the type of personal property. The way a judgment attaches to personal property is different from how a lien attaches to real estate. Real estate is immovable, and ownership is determined by land records. A judgment lien attaches as soon as it is recorded in the land records. Personal property, however, is movable, and there is usually no central registry for ownership except for automobiles.

Check with an attorney in your state to understand your rights and responsibilities when it comes to judgment liens. 

About The Author
Kevin Casini Kevin is an attorney and consultant in New Haven where he’s been recognized by New England SuperLawyers™ for his work in civil litigation, copyright, and trademarks, and a music business consultant with his company Ecco Artist Services.

Kevin is VP of Business and Legal Affairs for RME, (www.rme.com) the digital-first, modern rights organization that enables fair and accurate payments for creators and rightsholders.

In practice, Kevin has boasted a talented client roster of award-winning, Grammy nominated, gold and platinum certified artists, writers, producers, & DJs, and he teaches copyrights, music law, and entertainment law at Quinnipiac University School of Law. 

He has been speaker, moderator, and panelist at conferences from Austin to Boston, and has advised companies, firms, and governmental agencies on case law, new legislation and proposed legislation, and best practices.

Kevin is a member of the Recording Academy, Copyright Alliance, the Americana Music Association and serves on the advisory board of SONA and on the nominating committee of the Boston Music Awards.

He is a graduate of the Berklee College of Music. 

Follow Kevin on Twitter @KCEsq

Monday, April 4, 2022

Copyright Infringement Claims Step #1: Identify the Works Infringed

Copyright infringement is a serious offense that can result in significant damages. One common mistake in copyright cases is that a complaint has not properly identified all of the works infringed, or the complaint identifies a plaintiff who has no standing to bring a claim. Further, in order to estimate your or your client's potential liabilities or amount of money a client may be entitled to receive, counsel should first identify the copyrighted works that have been infringed. This can be tricky, but with the help of this post, you should be able to do it. 

Counsel should consider the multiple categories copyrights that may or may not have been infringed. For example, in a music case, a complaint may focus on a singular claim, but reference multiple copyrights (e.g., "song" and "record" - which are separate works), including:

  1. The specific underlying musical or literary work (i.e., the composition, song, or words)
  2. Sound recordings of the underlying work
  3. Audiovisual recordings of the underlying music or literary work and/or sound recordings
  4. Album artwork
  5. Trademarks and/or rights of publicity (we won't get into this because it is beyond the scope of copyright infringement damages, but at times there are other damages of concern which are in addition to copyright infringement claims).

Given that separate rights are accorded to each of the above examples, the parties will need to investigate authorship and ownership of all of the potential rights infringed before concluding to which works the plaintiff has standing to bring damages and other legal claims. At minimum:

  • Procure or create a list of works potentially copied, including dates of creation, publication, renewal/extension, grant termination notification and grant termination, if applicable (to make sure the rights have not fallen into the public domain and in fact the chain of title supports the plaintiff's standing to make a claim)
  • Obtain a copy of the infinged work(s) that were potentially copied (besides understanding what category of work(s) were copied, it may be useful later, in investigating whether the nature of an infringement was willful, to note whether the original work bore any copyright notices)
  • Examine examples of the potentially infringing copies to identify which works were in fact copied (for example, in a musical case, were both the composition and the recording copied, or was it solely the composition which was re-recorded?)
  • Obtain copies of all available agreements covering and notices of intent to use the works potentially copied.  If the agreements were verbal, ask questions to understand the intention of the agreement and what consideration was exchanged and actions were taken to support the claims of such intentions.
  • If the agreement mentions that the work is a "work-for-hire," analyze whether the legal criteria were technically met for the work to be deemed a work for hire as defined in 17 U.S.C. § 101 (because it is not a work-for-hire merely because an agreement states so). 
  • Search the Internet to identify prior public copyright claims and uses
  • Search for and obtain records of copyright registration, copyright grant termination notices.  In the United States, the Copyright Office this year launched the Copyright Public Records System (CPRS) pilot, which will provide enhanced search capabilities as part of its modernization efforts. To participate in the pilot program and gain access to the latest search tools, users must attend a webinar, which can be found here.

While we do frequently assist legal counsel with such investigation, there are legal experts in chain-of-title research, so this may be something best outsourced to a specialist if you are unfamilliar with it.

If you are counsel to one or more plaintiffs, list the correct entities as the plaintiffs in your complaint, including any companies owned by your client(s), which may hold some of the relevant rights. Unfortunately for plaintiffs with loan-out companies, there may be certain drawbacks if the plaintiff is an entity as opposed to an individual.

Typically, either our engagement stops here because we learn that a plaintiff has no standing to make a copyright infringement claim, or the scope of the matter multiplies if we determine that the number of works infringed was greater than the plaintiff originally identified.

Tuesday, May 23, 2017

The Beverly Hills Bar Association has invited our founder, Cedar Boschan, to speak about copyright damages at its upcoming May 31, 2017 program.  Click the link below to sign up:

https://www.bhba.org/index.php/component/jevents/icalrepeat.detail/2017/May/Wed/625/-/comprehensive-copyright-infringement-remedies



Cedar plans to share her experience and insights about topics such as:

- How how she renders an opinion regarding actual damages suffered by a Plaintiff as a result of infringement
- Factors she considers when it comes to apportionment (i.e., allocating profits derived from the infringement)
- How she has been able to show that an infringer’s gross revenue is or is not reasonably related to infringement
- Document requests and interrogatory questions she suggests attorneys make in order to help prove damages

See you there!


Friday, December 23, 2016

2016 Year in Review - Tech & Game News

Professionally speaking, in 2016, I found articles about in-app purchasesthe value of interactive game deals, pricing of bundles and discounting to be most relevant news to my practice of auditing game publishers and distributors, while right of publicity cases like this and this were most relevant to my forensic accounting work.

Further, followers of my tech feed on Twitter - especially game developer CFOs and attorneys - were most engaged by the following news in 2016, especially news reported by Gamasutra and VentureBeat:
There were many shares of information that did not engage readers, so I did not mention them.  What was the most interesting games earnings news story not mentioned here, especially those that pertain to royalties and/or damages?



Friday, January 1, 2016

2015 Year-In-Review: Damages

 What We Learned About Damages from Blurred Lines + Howard King Talk


What We Learned about Damages from 'Blurred Lines' in 2015
+ January 2016 Howard King Talk


Do you think Hollywood power litigator Howard King regrets his strategy to not present an alternate damage theory for jurors - and the judge - to consider when defending his clients Pharrell and Robin Thicke in the so-called "Blurred Lines" lawsuit brought by the family of Marvin Gaye?

With great deference to Mr. King, I think more defendants should consider including alternate damage theories in their defense strategy because of cases like this, where hiring the right damages expert could drastically change the outcome.

* * * * * * * *

You might find a chance to ask Mr. King a question about damages if you attend The Copyright Society of the USA's "Copyright Conversation with Howard King" in Los Angeles on January 21.  (Register and view who else registered here. Note that the AIMP members save $10 on registration - just log in to the AIMP site and then visit this page to see your discount code.)


* * * * * * * *

In any case, the below 2015 articles may interest those who wish to learn more about the damages aspects of the Blurred Lines matter:

Friday, May 8, 2015

Maximize Future Marital Settlement Agreement (MSA) Royalty Earnings with these Drafting Tips from Cheryl Hodgson, Esq.

Trademark, copyright, music law & digital media attorney Cheryl Hodgson of Hodgson Legal
The best family law attorneys know when to include outside experts on their team.  When it comes to intellectual property assets, family lawyers turn to attorney Cheryl Hodgson of Hodgson Legal for her expert advice.

As part of our collaboration geared towards helping family lawyers and their clients navigate the arcane world of intellectual property assets, we invited Ms. Hodgson to share three key drafting tips for family lawyers to consider in cases when the marital assets include royalties:

1.     Audit rights.  Audit rights are a vital component to any agreement that includes payment of royalties, whether or not a dissolution is involved. Without the direct audit rights as well as the right to participate in an audit of the source of the income stream, there is no means by which to verify the accuracy of accountings from an ex-spouse, or payments received by the ex-spouse. Moreover, without an audit to identify an ex-spouse’s non-compliance with the marital settlement agreement (“MSA”), it can be difficult or impossible to identify evidence to support legal action and hold the ex-spouse accountable for failing to properly pay. Therefore, one should always include a thoughtful audit clause in the MSA that grants access to the contracts that create the income stream. Moreover, rights to piggyback on direct audit rights are imperative.  (See this post for more audit clause drafting tips.)
2.     Earnings Periods.  The MSA should address dates governing receipts and payments prior to the date of dissolution since payments may be earned long before they are received. For example, in the case of foreign performance royalties from the broadcast of music on television and in film, earnings during the term of the marriage may not be received or paid in the United States for a year or even longer.
3.     Transfers of Title.   A court order detailing rights in the divided assets should be drafted in a manner that is both clear, detailed, and binding upon third party payees of royalties. Entertainment related companies are often loathe to make changes in existing payment instructions without clear agreements, letters of directions, and in many cases, a court order that clearly identifies the assets and the parties covered.

# # # 

Don’t wait for the next post in our ongoing collaboration – read more from Ms. Hodgson today on her own website.  Better yet, for a personalized consultation, call Ms. Hodgson today at 310-623-3515 and follow her on Twitter @CherylHodgson.

Sunday, February 22, 2015

Top Tweets YTD from the Auditrix 2015 Twitter Feed

Below are the popular tweets from the Auditrix twitter feed, which focuses on music economics and royalties, during 2015 YTD:

Best Unfinished Twitter Conversation with Glenn Peoples @ Billboard and John Strohm @ Loeb

Friday, January 9, 2015

Five Things to Consider Before Filing a Music Copyright Case

By Gerard P. Fox, Esq.

Gerard P. Fox, Esq. and his firm
handle general business, contract
and IP litigation across the
entertainment industry and
beyond.

Attorney Gerard P. Fox has acted as lead trial counsel for corporate clients such as Vivendi and Clear Channel. Mr. Fox has also represented high profile entertainers including Madonna, Anita Baker and the Isley Brothers.  

From hiring experts to damage awards, in his post below, Mr. Fox shares some very useful tips from his years of copyright litigation experience.  For a personalized consultation, contact the Law Offices of Gerard Fox and also check out his Fox's Litigation Strategies Blog.

1.      In my opinion the Federal District Courts have been improperly applying a quantitative and not qualitative copyright analysis in music and film cases. This means that they take the totality of your copyrighted work which you claim has been infringed, and hold it up against the totality of the infringing work and actively look for dissimilarities.  This is incorrect under the law because in truth a song often includes many small, integrated and unique copyrightable works. Unfortunately, because the courts are taking this approach, it is much harder to win a copyright case in district court.  I tried one of the last published wins where I represented an artist claiming a part of their song was infringed. See Three Boys Music (Ronald Isley) v. Michael Bolton.  It’s not common.
2.     You will need to hire a musicologist up front.  If you want to have any chance of negotiating an early settlement or defeating an early motion for summary judgment (see below), you will need to retain an accomplished and respected musicologist. First, you should secure their independent opinion as a consultant, then if their opinion is one you respect and one that supports your contentions you should retain them as a formal expert.  Good musicologists, who are respected by defense counsel and the court, will usually ask for an up front retainer of no less than $5,000 or $10,000. Keep in mind that this retainer is not a cap of their total billings.  If the case proceeds through to depositions, summary judgment and trial, the musicologist would likely charge you upwards of $25,000. 
3.     Another consideration is that the defendants will most assuredly make an early motion for summary judgment wherein they will argue that the infringed elements of your song are common and not unique, and that the two musical works are not substantially similar.  They may make other arguments that are common to these type cases, but these are the two most likely arguments.  In making these arguments, they will put forth cases that move away from the proper application of Copyright law to a quantitative analysis of the works.  It is imperative that you retain attorneys who have a deep and up to date understanding of the case law, legislative history and this process to have any chance of defeating this type of motion.  This is no area for a general practitioner.  Defeating this summary judgment motion is essential, because if you do, which is rare in these cases, you will have all the leverage, as the defendants would be left to face a public jury trial.
4.     The prevailing party may be awarded their attorney’s fees under Copyright law.  Under 17 U.S.C. § 505 “the court may also award reasonable attorney’s fees to the prevailing party” in a copyright infringement case.  This is a huge issue to consider if you are the artist because if you lose, you could be ordered to pay hundreds of thousands of dollars of defense fees.  Now, awarding attorney’s fees and costs is discretionary with the district court judge, and many of these judges will NOT award the defendants their fees even if they win, on account of their very human concern about the financial devastation such an award would cause the artist, but this is a risk.
5.     Finally, when it comes to estimating your damages, you will not be awarded all of the infringing defendants’ net profits from the infringing distribution and use of the song, but an apportioned amount.  17 U.S.C. § 504(b) provides that the defendants are entitled to prove that certain elements of the profits are “attributable to factors other than the copyrighted work.” See Mackie v. Rieser, 296 F.3d 909, 915–16 (9th Cir.2002) (In the Ninth Circuit, on a claim to recover profits that are attributable to the copyright infringement, a plaintiff must show that the infringement itself, that is, the use of the plaintiff's work, was causally linked to the gross revenue claimed.).  This means that the defendants will argue that their notoriety, other songs on an album, the marketing behind them and their songs, the market that pre-exited for their music and other non-infringing parts of the song at issue were responsible for most of the profits earned, and that you should only be awarded a small apportioned amount of the net profits.  Of course, most defendants are not truthful about their actual net profits and will try to hide the true amount of their profits. To combat this it is important that you hire a forensic accountant who is knowledgeable about the music industry, such as Green Hasson Janks, to figure out the actual net profits, and then use your musicologist and maybe another music industry expert to argue that the piece of music stolen from you drove the sales and as a result defendants’ profits.
# # #

Gerard ("Gerry") Fox graduated from Georgetown Law School, magna cum laude, and earned an accounting degree from the University of Richmond. Mr. Fox acted as lead trial counsel for clients such as Vivendi, Clear Channel and Dow Chemical.

Gerry started his career at Covington & Burling, followed by Kaye, Scholer, before forming Fox & Spillane, where Mr. Fox honed his trial skills for twelve years. Four years ago, Gerry began the Law Offices of Gerard Fox.

Gerry handles General Business Litigation, Contract Litigation and Intellectual Property Litigation across the entertainment industry and beyond.

Gerry is admitted to practice in Maryland, Washington, D.C., California, has served as a media commentator, and wrote the book “Sue the Bastards.”

Saturday, November 22, 2014

Best of Last Week



@jimmybuffett does ask terrestrial stations to pay royalties; he is part if the @musicFIRST coalition.

9 Spotify tools for hardcore music fans


Why Apple has a good shot at killing the freemium streaming music model @jillkrasny via @Inc



Cedar Boschan at the Beverly Hills Bar Association - DVD



Need MCLE credit? Check my panel: "Royalty Income Meets Marital Dissolution Dividing, Managing and Accounting"

Molly Neuman: From Riot Grrrl Founder to Indie Label Advocate - Digital Music News


Lady Gaga's Parsippany #producer loses $7.3M suit to #songwriter




Taylor Swift's Extreme Measures to Keep "1989" From Leaking via @YouTube


Study from Pandora Touts the 'Pandora Effect' on Music Sales | Billboard #promotionaleffect


Don Henley: Record Companies 'Not Going to Roll Over' on Copyright Issue | Rolling Stone



 Duke Ellington's grandson failed to show EMI broke a 50-year-old contract by diluting his share of the legendary composer's royalties, New York's highest court ruled.

RT @musicregistry: The Million Dollar Record Label Theft, & How It Came Crashing Down


Fortune: Pandora's plans for growth


An #iTunes #contract


 YouTube Stars More Popular than Mainstream Celebs per Variety

SiriusXM Slammed Yet Again As New York Judge Rules in Turtles Lawsuit - Hollywood Reporter



# # #

For more music news, follow me @Auditrix.  For interactive games and other IP royalty, business and litigation news, you should follow me @RoyaltyExpert.

Sunday, November 16, 2014

Last Week's Top Links

Several popular items I posted last week on Linkedin and Twitter shared a theme named Irving Azoff:
The big news in the music business last week was YouTube's announced launch of its Music Key service. In addition to the above-linked Hollywood Reporter/Irving Azoff piece, most of the inquiries spurred by my "What is Content ID?" blog post last week were regarding YouTube Music Key subscriber revenue.

However, another popular YouTube tidbit that I shared with my LinkedIn connections had to do with good ol' advertising revenue: Per Jason Calacanis, "YOUTUBE has grabbed about 10% of television revenue"

More music items that engaged my connections on LinkedIn include:
My Twitter followers @Auditrix were most engaged in the following items:
On the copyright front, there was movement last week in one of the most interesting cases that I am following, between Smokey Robinson and his ex-wife, Claudette. Everyone I know who knows them both think it is too bad that they are litigating, so even though the issue of whether state community property laws or Federal copyright laws apply to royalties for terminated copyright grants is very interesting, I was nevertheless happy to read that the parties dropped their suit (see http://t.co/8pt5xyFxnQ) ...but, upon sharing this news in my @Auditrix Twitter feed, the reporter who has had the best coverage of this case - Eriq Gardner at the Hollywood Reporter - suggested that we have not seen the end of this dispute (see the link Mr. Gardner shared here and follow him on Twitter here).  In any event, if you are an attorney or business manager, keep an eye on this case - the outcome could impact your clients!

Tencent was another company in the news last week due to its partnership with Warner Music Group in China (see this, this, this and this), but the most popular bit that I shared about Tencent last week was via my @RoyaltyExpert Twitter feed, which focuses more on games than music: Tencent said that titles on its games portal QQ are better at making money than games on WeChat

Other top games items I shared last week:
# # #

For more music news, follow me @Auditrix.  For interactive games and other IP royalty, business and litigation news, you should follow me @RoyaltyExpert.


Sunday, March 30, 2014

Q&A With
Copyright Grant Termination Expert
Lisa A. Alter, Esq.


Lisa A. Alter, Esq.

Many music clients require sophisticated copyright grant termination strategies.  A most distinguished expert on this complex topic is New York attorney Lisa A. Alter. In the full length interview below, Ms. Alter graciously shares her intricate knowledge.

For more information about termination of grants of copyright or other copyright related matters, please visit www.alterandkendrick.com or contact Lisa Alter at lisa.alter@alterandkendrick.com or (212) 707-8377.


Cedar Boschan: What is a copyright grant?

Lisa Alter: A copyright grant is a conveyance of any or all rights in an original work of authorship (such as books, compositions, motion pictures and sound recordings) that arise under copyright.  Those rights may include the right to reproduce the work in copies or phonorecords and to distribute those copies, the right to create derivative works based on the original work and the right to publicly perform and/or display the work.

Boschan: Many entertainers earn a living from copyright grants to publishers, film studios and record companies.  Why would one want to terminate a copyright grant?

Alter: Termination rights can be very valuable. Typically, the author (or heirs) may be receiving only a fraction of the income derived from the exploitation of the copyrights under the grant.  Moreover, the author (or heirs) may have limited or no control or approval over how the copyrights are exploited.  Once rights have been terminated and recaptured in the U.S., the author or his/her heirs may self-administer the works, enter into an administration deal on terms more favorable than the original grant, renegotiate terms with the original grantee (perhaps for the world), or sell all or a portion of the copyrights to either the original grantee or a third party.  

Boschan: Under which conditions can one recapture a copyright after granting it to another party?

Alter: Some contracts provide for automatic termination of the grant after a term of years. For example, with respect to works that were copyrighted prior to January 1, 1978 the term of copyright protection is divided into an initial 28 year term and a 67 year extended renewal term. Unless the initial grant of copyright in these works expressly included a conveyance of “renewals and extensions” of copyright, the grant automatically terminates upon the expiration of the initial 28 year term. Other contracts may allow the grantor to terminate the grant in the event that certain conditions are or are not met.  With respect to “life of copyright” grants, the grantor may be able to exercise a statutory right of termination.  For pre-1978 grants made by the author or his/her statutory heirs, statutory termination may be effected during the five year period commencing 56 years after the date the work was first published or registered for copyright.  For post-1977 grants made by the author, the statutory termination may be effected during the five year period commencing 35 years after the date of the grant (or, where the grant includes the right of publication, the five year period commencing on the earlier of 35 years after publication under the grant or 40 years after the date of the grant).  In order to effect statutory termination for either pre-1978 or post-1977 copyrights, the statutory notice requirements must be fulfilled.

Boschan: Who may terminate a copyright grant?

Alter: The author, or if the author is deceased, the author’s statutory heirs may terminate a grant of copyright.  Statutory heirs include the author’s surviving spouse and children (and in the case of a deceased child, the children of such deceased child).  If the author leaves no surviving spouse, child or grandchild, the author’s executor, administrator, personal representative or trustee may terminate a grant in the author’s place.

Boschan: Works for hire cannot be recaptured.  How can one tell if one’s copyright is a work for hire?

Alter: Just because a contract says that a copyright is being created as a work made for hire does not mean that it is, in fact, a work made for hire.  The rules are different depending on whether the work was created before January 1, 1978 or on or after that date.  For pre-1978 works, the courts will typically apply an “instance and expense” test in determining if a copyrighted work is work made for hire, which examines whether the work in question was created at the instance and expense of the employer. From 1978 on, a work will be deemed to be a work made for hire if either (a) the work was created by an employee during the course of his/her employment (as determined by general agency standards), OR (b) the work was expressly commissioned as a work made for hire for inclusion in one of nine  enumerated categories (the categories include audio-visual works but, notably, do not including sound recordings).

Boschan: What steps do you take to terminate a copyright grant?

Alter: The first step is to evaluate all relevant information about the grant, the subject copyright(s), the author(s) and the parties to the grant.  Next, one determines the time frame for serving notice and, at the proper time, prepares the notice taking care that it complies in form and content with the criteria set forth in the Copyright Act and attendant regulations.  Then, one serves the notice on the original grantee and/or the grantee’s successor(s) in interest and records the notice in the Copyright Office.  It bears noting that the mechanism for proper service of notice of termination is complicated by design.  Since the effect of improper service may be forfeiture of one’s termination right, it is worth getting professional guidance in the process.  Recipients of notices of termination should also scrutinize the notice to ascertain whether the notice conforms to statutory requirements.

Boschan: After a copyright grant is terminated, what, if any, rights does the original assignee retain?

Alter: After a grant of copyright is terminated, the original assignee will retain the rights to derivative works created during the term of the grant.  For example, a music publisher who loses rights in a composition will retain the right to exploit sound recordings embodying the composition that were created prior to termination and will continue to collect mechanical license fees from the sale of those sound recordings. However, the publisher cannot release that sound recording in a different format or authorize new recordings of the composition after the effective date of termination.

Boschan: Does this apply in the USA only, or throughout the world?

Alter: Statutory termination is limited to the United States.  If a grant was a worldwide grant (whether made in the U.S. or abroad) the grant will terminate in the U.S. but continue outside the U.S.

Boschan: Do you help clients recapture foreign copyrights?

Alter: We frequently are asked to assist clients in asserting rights in the so-called “British Reversionary Territories” or “BRTs”.  There is a limited reversionary right that may be available in one or more of the countries that were part of the United Kingdom in 1911.  Depending on the date of the relevant grant made by an author, rights may automatically revert to the author’s heirs 25 years after the death of the author.  Keep in mind that for most of the BRTs the date of the grant is critical.  For example, in England the reversionary right only applies to grants made by an author on or before June 1, 1957.

Boschan: Are some copyrights easier to recapture than others?

The copyright termination provisions apply to all grants of rights under copyright.  There is no category of copyright that is “easier” to terminate.  Rather, the ease of termination will depend on the complexity of the relevant factors in the specific circumstances surrounding the copyrights and grants.

Boschan: What happens when there is a mistake on the termination notice?

Alter: Some mistakes may be deemed “harmless error” and will not invalidate the termination notice.  Other mistakes – including misidentifying the applicable termination provision, serving notice on the wrong party or failing to record a notice in the Copyright Office prior to the effective date of termination – may render the notice ineffective.  If a notice is ineffective and the time frame for serving notice closes before a new notice is served, then the author (or heirs) may lose the right to terminate the grant.

Boschan: Is terminating a copyright grant expensive?

Alter: The basic costs of serving a notice of termination by certified mail (not necessary, but recommended because it affords proof of service) and recording the notice in the Copyright Office are fairly minimal.  The related legal costs involved in reviewing a matter to determine the applicability of the statutory termination provisions, preparing the notice(s) of termination and implementing termination will vary, depending on the complexity of the situation.  Clearly, the more copyrights and/or contracts involved, the more complicated the process may be, which could impact the cost.  

Boschan: What happens after you notify a company of your client’s intention to terminate a copyright grant?

Alter: That depends.  Sometimes, the company will contact us right away to discuss reacquiring the terminated rights.  The original grantee (or its successor) has an exclusive negotiation period between the time that notice of termination is served and the effective date of termination (at least two years) during which it is the only party allowed to enter into a further grant of copyright with respect to the terminated rights.  In other circumstances, the company may remain silent in which case we may reach out to the company to discuss a new grant (if our client is interested in continuing its relationship with the company).  Otherwise, we wait until the rights actually revert on the effective date of termination, reclaim the works and help the client decide how the recaptured rights will be administered in the future.

Boschan: Do most people who are eligible to reclaim copyrights do so?

Alter: An increasing number of authors are exercising their termination rights.  Those who do not may simply be unaware of the opportunity.  An exception may be in a situation in which an author is deceased, leaving children and a spouse who is not the parent of those children.  In this case, a majority of the heirs may not be willing to act together to effect termination.  Since it is necessary for the spouse and at least one child to sign a termination notice, the opportunity to terminate may be lost. 

Boschan: Can you recover a partial interest in a copyright – for example, on behalf of one of two co-authors of a work?

Alter: Each author of a joint work may terminate a grant and recapture rights with respect to his/her share of the work.  There are frequently situations in which one author terminates a grant and recaptures his/her rights, while the rights of his/her co-author remain with the original grantee. The only caveat is that with respect to grants made by the author on or after January 1, 1978 where two or more authors were signatory to the same grant, a majority of those authors must sign off on the notice of termination.

Boschan: What about on behalf of only some of an author’s heirs?

Alter: Where an author is deceased, a majority of the author’s statutory heirs must execute the notice of termination.  For example, if an author dies leaving a widow (who by law has a 50% interest in the author’s termination rights) and two children (who share the remaining 50% interest), the widow plus at least one of the children must be party to the termination notice.  Once termination is effected, the rights will revert to all of the author’s statutory heirs in their pro-rata share (even those heirs who did not sign off on the notice of termination).

Boschan: How does the possibility of reversion impact the value of a copyright?

Alter:   Termination rights can be very valuable for authors or heirs.  However, the possibility of termination or reversion will undoubtedly have a negative impact on the value of a copyright for a grantee seeking to sell its assets.  For example, if a music publisher has a large catalog of compositions that includes songs which may, in the future, be subject to termination, a potential purchaser of the catalog may want to discount the value of the catalog to compensate for the potential loss of U.S. rights. Alternatively, a portion of the purchase price may be held back until the period for serving notice of termination closes without notice being served.

Boschan: How do you collaborate with accountants on copyright termination matters?

Alter: We collaborate with accountants on a variety of termination matters including analyzing potential termination issues affecting financial due diligence in connection with the sale or purchase of copyright catalogs, assessing the potential impact of copyright termination with respect to the appraisal of musical catalogs for estate, divorce, or other valuation purposes, and evaluating the potential risks or opportunities presented by the termination provisions for copyright owners or authors in conjunction with the accountants that represent them.

Boschan: Why do so few attorneys understand the intricacies of copyright grant terminations? 

Alter: The termination process is highly technical and involves a very particular knowledge base that many attorneys do not need to draw upon in their typical transaction or litigation practices.  Because of the potential complexities of termination – and the inherent dangers of lost opportunity if a termination notice is improperly served – termination matters are often referred to attorneys whose practice focuses in that area.

Boschan: What are the current “hot topics” in the world of copyright grant termination?

Alter: Perhaps the “hottest” topic involves the right to terminate grants of rights in sound recordings.  While in some instances record labels have taken the position that sound recordings are works made for hire and thus not subject to termination, this is certainly not uniformly the case.  A growing number of performing artists and producers are, in fact, serving notice of termination on record labels and either recapturing the rights to their sound recordings or renegotiating their agreements with the labels.

Another “hot topic” concerns so-called “gap issue” grants. That is, contracts that provided for the author to deliver works created over a term of years. Where that term begins prior to 1978 but continues thereafter, works created and delivered post-January 1, 1978 may fall into a “gap” in the termination provisions. The better approach is to treat these works as having been granted by the author when the work was created on or after January 1, 1978 despite the fact that the contract was signed before 1978.

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Lisa A. Alter is a partner in the firm of Alter & Kendrick, LLP in New York City. Her practice is focused primarily in the area of copyright law, with a particular emphasis on domestic and international music copyright issues. She advises composers, authors, musical estates, and music publishers on a wide variety of transactional and licensing matters, conducts in-depth copyright due diligence in connection with the acquisition, sale and/or administration of copyright catalogues, and consults on issues involving termination of grants, recapture of copyrights, and foreign reversionary rights. Her clients include songwriters, composers and performing artists, prominent musical estates, and music publishing companies.  Ms. Alter has testified as an expert witness in matters involving music publishing interests and copyright termination rights.  Ms. Alter is a graduate of Wesleyan University and New York University School of Law and she is the author of “Protecting Your Musical Copyrights” which has recently been released in its third edition.