[Federal Register: December 20, 2002 (Volume 67, Number 245)]
[Proposed Rules]
[Page 77951-77955]
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LIBRARY OF CONGRESS
Copyright Office
37 CFR Part 201
[Docket No. 2002-5]
Notice of Termination
AGENCY: Copyright Office, Library of Congress.
ACTION: Notice of proposed rulemaking.
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SUMMARY: Commencing January 1, 2003, copyright owners or their
statutory successors will be entitled, under certain circumstances
prescribed by section 203 of the Copyright Act, to terminate transfers
or licenses of copyright that were granted on or after January 1, 1978.
The Copyright Office is proposing to adopt a regulation governing the
form, content, and manner of service of notices of termination. The
proposed regulation is based on the existing Copyright Office
regulation governing termination of transfers and licenses covering the
extended renewal term, and is adapted to meet the requirements for
termination of post-1977 transfers and licenses.
DATES: Comments should be in writing and received on or before February
3, 2003. Reply comments should be received on or before March 5, 2003.
ADDRESSES: If sent by mail, 10 copies of written comments should be
addressed to: David O. Carson, General Counsel, Copyright GC/I&R, P.O.
Box 70400, Southwest Station, Washington, DC 20540. If hand delivered,
10 copies should be brought to: Office of the General Counsel,
Copyright Office, James Madison Memorial Building, Room LM-403, First
and Independence Avenue, SE., Washington, DC.
FOR FURTHER INFORMATION CONTACT: David O. Carson, General Counsel.
Telephone: (202) 707-8380. Telefax: (202) 707-8366.
SUPPLEMENTARY INFORMATION: Prior to the effective date of the Copyright
Act of 1976, the term of copyright was 28 years, subject to renewal by
the author or certain other persons described in the statute for an
additional 28 years. The second term was considered a new estate,
meaning that with certain exceptions such as works made for hire, all
rights reverted to the author at the commencement of the second term,
and transfers or licenses of copyrights made during the initial 28-year
term automatically terminated.\1\ The 1976 Copyright Act abandoned the
two-term system of copyright duration in favor of a unitary term, but
it provided for two circumstances under which authors or their
statutory successors could terminate transfers or licenses of rights.
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\1\ In Fred Fisher Music Co. v. M. Witmark & Sons, 318 U.S. 643
(1943), the Supreme Court significantly limited this rule by holding
that authors could, during the initial term of copyright, assign
renewal term rights and that such assignments would be valid during
the renewal term if the author was alive at the commencement of the
renewal term.
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First, because the 1976 Act added 19 years to the terms of existing
copyrights, extending the renewal term from 28 years to 47 years,
section 304(c) provides that authors or certain statutory successors
(such as the surviving spouse, children and
[[Page 77952]]
grandchildren or, if there are no such surviving relatives, the
author's executor, administrator, personal representative, or trustee)
may terminate pre 1978 \2\ exculsive or non-exclusive grants of
transfers or licenses during the extended renewal term and secure for
themselves the benefits of the additional 19 years added to the renewal
term. Termination may be effectuated by serving the grantee or the
grantee's successor in title with a notice of termination (which may be
served only during a period prescribed by the statute) and recording
the notice of termination with the Copyright Office prior to the
effective date of termination. 17 U.S.C. 304(c). Section 304(c)(4)(B)
provides, "The notice shall comply, in form, content, and manner of
service, with requirements that the Register of Copyrights shall
prescribe by regulation." In 1977, the Copyright Office adopted a
regulation establishing the procedures for exercising the termination
right. 37 CFR 201.10. Pursuant to section 304(c) and 37 CFR 201.10,
authors and their statutory successors have been serving notices of
termination of transfers and licences, and filing those notices for
recordation with the Copyright Office, for almost 25 years.\3\
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\2\ The effective date of the Copyright Act of 1976 was January
1, 1978.
\3\ The Sonny Bono Copyright Term Extension Act, ("the Act"),
Pub. L. 105-298, 112 Stat. 2827 (1998), extended the renewal term by
an additional twenty years and gave authors or their statutory
successors a second opportunity to terminate transfers or licenses
during the extended renewal term. 17 U.S.C. 304(d). Earlier this
year, the Copyright Office amended 37 CFR 201.10 to adopt
requirements for notices of termination pursuant to section 304(d).
67 FR 69134 (Nov. 15, 2002).
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Second, the 1976 Act provides that authors may terminate grants of
transfers or licenses entered into after January 1, 1978. 17 U.S.C.
203. Unlike termination pursuant to section 304(c) and (d), termination
pursuant to section 203 is available only when the grant was made by
the author, but as with termination pursuant to section 304, certain
statutory successors may terminate if the author is no longer alive at
the time termination may be made. 17 U.S.C. 203(a)(2). Termination may
be made during a five-year period commencing 35 years after the
execution of the grant or, if the grant included the right of
publication, the earlier of 35 years after publication pursuant to the
grant or 40 years after the execution of the grant. 17 U.S.C.
203(a)(3). As with section 304 terminations, termination under section
203 is accomplished by serving a notice of termination on the grantee
or the grantee's successor in title and recording the notice with the
Copyright Office prior to the effective date of termination. The notice
must be served no more than 10 years and no later than two years before
the effective date of termination. 17 U.S.C. 203(a)(4)(A). As with
section 304 terminations, "The notice shall comply, in form, content,
and manner of service, with requirements that the Register of
Copyrights shall prescribe by regulation." 17 U.S.C. 203(a)(4)(B).
The rationale for the section 203 termination right is similar to
the rationale for the section 304 termination right. As the legislative
history of section 203 states:
The provisions of section 203 are based on the premise that the
reversionary provisions of the present section on copyright renewal
(17 U.S.C. 24) should be eliminated, and that the proposed law
should substitute for them a provision safeguarding authors against
unremunerative transfers. A provision of this sort is needed because
of the unequal bargaining position of authors, resulting in part
from the impossibility of determining a work's value until it has
been exploited. Section 203 reflects a practical compromise that
will further the objectives of the copyright law while recognizing
the problems and legitimate needs of all interests involved.
House Report on Copyright Act of 1976, H.R. Rep. No. 94-1476, at 124
(1976).
Because section 203 terminations may be made only with respect to
grants made on or after January 1, 1978, and because notice of
termination may be served no earlier than 25 years from the date of
execution of the grant (which, in the earliest case, would be 10 years
before the effective date of termination, which may be no earlier than
35 years from the date of execution of the grant),\4\ no termination
notices under section 203 have been possible between January 1, 1978,
and the present. However, commencing January 1, 2003, certain authors
and their statutory successors will be able to serve section 203
notices of termination, because on that date, 25 years will have passed
since January 1, 1978.
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\4\ Or, if the grant covered publication of the work, notice may
be served no earlier than 30 years from the date of execution of the
grant or 25 years from the date of publication under the grant. See
the discussion above.
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Because notices of termination must comply with requirements
prescribed in a regulation by the Register of Copyrights, it is now
necessary to adopt a regulation that will set forth the requirements as
to form, content and manner of service of section 203 notices of
termination. Fortunately, the regulation governing section 304 notices
of termination provides a model for a regulation governing section 203
notices. Because the statutory requirements for termination under
section 304 are very similar to the statutory requirements for
termination under section 203, we propose to adopt a regulation modeled
closely on the existing section 304 regulation. See 37 CFR 201.10. In
this notice of proposed rulemaking, we seek comments on the rules that
we propose to adopt, which would amend Sec. 201.10 to add requirements
for section 203 notices of termination.\5\
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\5\ Because of the time required to receive and consider
comments from the public, it will not be possible to announce final
regulations prior to January 1, 2003. However, because some authors
or statutory successors may be able to and desire to serve notices
of termination as early as January 1, 2003, we intend to publish an
interim regulation shortly after publication of this notice of
proposed rulemaking, and before January 1, 2003. The interim
regulation will be virtually identical to the regulation proposed
herein and will be in force pending the adoption of a final
regulation.
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Existing Sec. 201.10 sets forth requirements governing the form
and content of section 304 notices of termination, the signature on a
notice of termination, the manner of service, the effect of harmless
errors in the notice, and recordation of the notice. We propose to
modify Sec. 201.10(b), which governs the contents of a section 304
notice of termination, by adding a new subparagraph to govern the
contents of a section 203 notice of termination. The new subparagraph
adapts the content requirements of the existing regulation to meet the
needs of section 203. Somewhat different treatment is also required for
signatures of section 203 notices of termination. Beyond those changes,
only minor revisions in the wording of various provisions are necessary
in order to reflect the fact that notices of termination may be served
under section 203.
Contents of the Notice
The first modification that we propose is an amendment to Sec.
201.10(b)(1)(i). Currently, that subparagraph requires that if
termination is being made under section 304(d)--the termination
provision added by the Sonny Bono Copyright Term Extension Act--the
notice must include a statement to that effect. The requirement that
notices of termination under section 304(d) refer specifically to
section 304(d) was added in the recent amendment of Sec. 201.10, in
order to distinguish such notices from notices served under section
304(c). No corresponding requirement was imposed for notices of
termination issued under section 304(c) because such a requirement
would have added a new requirement for such notices,
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which have been served since 1978, and might upset established legal
practices in issuing notices under that section.
Because a third category of notice of termination--pursuant to
section 203--is now available, we believe that it would be prudent to
require all notices of termination--whether under section 203, 304(c)
or 304(d)--to state which statutory provision is being invoked.
Requiring such specification should assist in eliminating confusion
over the nature of any notice of termination. Accordingly, we propose
to amend Sec. 201.10(b)(1)(i) to require that a notice of termination
pursuant to section 304 must identify whether the termination is made
under section 304(c) or section 304(d).\6\
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\6\ The interim regulation to be announced shortly will not
include this amendment because we do not believe it would be prudent
to change the requirements for section 304 notices of termination on
such short notice. The interim regulation will be effective January
1, 2003.
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We propose to add a new Sec. 201.10(b)(2) to state the required
contents of a section 203 notice of termination. The proposed
requirements are very similar to the requirements for section 304
notices, departing from that model only in instances where the
requirements of section 203 are different from the requirements of
section 304. Section 201.10(b)(2)(i) would require that a notice of
termination made under section 203 identify itself as such. Section
201.10(b)(2)(ii) would be identical to current Sec. 201.10(b)(1)(ii),
requiring identification of the name of each grantee (or successor in
title) whose rights are being terminated, as well as the address at
which service of the notice is being made.
Section 201.10(b)(2)(iii) would impose a requirement not found in
the regulation governing section 304 notices of termination:
identification of the date of execution of the grant being terminated
and, if the grant covered the right of publication of a work,
identification of the date of publication of the work under the grant.
In contrast, current Sec. 210.10(b)(ii) requires that a notice of
termination under section 304 identify the date copyright was
originally secured. When the original regulation was adopted, we
explained that the latter requirement was being imposed because ``the
period during which termination may be effected is measured from the
date copyright was originally secured.'' Final Regulation, Termination
of Transfers and Licenses Covering Extended Renewal Term, 42 FR 45916,
45917 (Sept. 13, 1977). Therefore, in order to determine whether a
notice of