POBA offers the following perspective on the impact of the Copyright Act of 1976. This is not a legal opinion, but is provided by our copyright experts for your consideration. We encourage you to seek the advice of counsel, if needed.
While Copyright Act of 1976 affects all fields of artistic expression, it will have its most profound impact on music – the industry, the creators of songs and sound recordings, and their heirs. You should consult your own counsel if you believe this may apply to a music estate you manage or to musical works you own, even if you did not create those works.
This is an especially important time for the Estates of songwriters and recording artists. The provisions outlined in the Copyright Act of 1976 (which took effect in 1978) that relate to the effective period of copyright grants ending after 35 years have just begun to “ripen” – that is, to become applicable. This is referred to as “reversion” or “termination” of copyrights, since it allows artists or their heirs to take back control of their copyrights by formally terminating their grant of copyrights after 35 years. As detailed below, accurate cataloging of all holdings is essential in order for heirs to regain control of their copyrights.
The Copyright Act 1976 allows creators and their heirs to reclaim a “grant” or license of copyrighted creations (more simply, to take back control of their copyright(s)) as long as they were not created as works for hire. Congress’ policy decision was based in part on recognition of two primary factors:
- First, that unknown or lesser known artists had unequal bargaining power when reaching for commercial distribution, use or display of their work(s); and
- Second, that new distribution, use and display mechanisms continue to develop (e.g., streaming). Since these could not be foreseen at the time an artist created the work and made a grant of copyrights, these new means of sale, use and distribution may not have been considered and/or incorporated into any agreements made.
The Copyright Act 1976 (17 US Code) includes two sets of rules for how this works:
- Sec. 203 concerns the artist or author who sold (“granted”) the copyright after January 1, 1978. They or their heirs can terminate or revert that grant after 35 years, that is, in 2013 or later. However, they only have 5 years during which they can file for termination of the original grant of copyright. Assuming all the proper paperwork gets done in time, record labels and publishers could lose copyrights to sound recordings and songs they bought or licensed in 1978 starting in 2013, in 1979 starting in 2014, and so on.
- Sec. 304 concerns the artist or author who sold (“granted”) their copyright on or before December 31, 1977. The rules for reclaiming these copyrights are too specific for us to describe in general, but between this section of the copyright law and its extension, called “The Sonny Bono Extension Act of 1998,” it may be possible to cancel the grants of these copyrights as well. The facts concerning your situation should be checked soon, as the clock is ticking to reclaim early- and mid-twentieth century copyrights.
Please be aware that these provisions for copyright reversion apply only to agreements made in and covering the territory of the United States. Grants made to foreign publishers or record companies remain in place for the original contract term.
If an artist transferred copyrights to a song or sound recording to a music publisher or record company at the beginning of a career when leverage or value was lowest, s/he may now reclaim that copyright and regain an economic interest and re-grant copyright on better business terms, including for specific, newly developed uses. One obvious example is internet streaming.
There are many other variables, in part dependent on how many original co-creators may have been involved, but an estate’s first step is to marshal the dates, identities, and details relating to the original copyright grants to confirm whether any reversion can be claimed. Clearly, proper cataloging and accurate dating of all creations is especially important. Paperwork for reclaiming copyright(s) must also be carefully handled.
If you are a rights holder who may be affected by these changes, feel free to contact POBA’s Concierge Services for assistance to ensure that the necessary steps are taken.
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