[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,



[[Page 77953]]



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 termination was being served in a timely fashion, it was 

necessary to know the date the copyright in the pertinent work had been 

secured. In contrast, for section 203 terminations, the period is 

calculated based on the date the grant was executed or, in the case of 

grants covering the right of publication, the earlier of 40 years from 

the date of execution of the grant or 35 years from the date of 

publication. Accordingly, we propose that section 203 notices of 

termination state the date the grant was executed and, if a work was 

published under the grant, the date the work was published. Unlike 

section 304 terminations, terminations under section 203 present no 

need to state the date copyright was secured.

    Current Sec.  201.10(b)(ii) also requires that a section 304 notice 

of termination identify the title and at least one author of each work 

to which a notice applies, as well as the copyright registration 

number. However, the registration number must be provided only ``if 

possible and practicable.'' We propose to retain these requirements for 

section 203 notices of termination, but with one modification. In 

contrast to section 304, which permits each author (or the statutory 

successors of each author) of a work to terminate ``that particular 

author's share in the ownership of the renewal copyright'' (17 U.S.C. 

304(c)(1)), section 203 requires that in the case of a grant executed 

by two or more authors of a joint work, termination may be effected by 

a majority of the authors who executed the grant (or, if an author is 

dead, by the persons such as the widow, children, etc., identified in 

section 203(a)(2)). 17 U.S.C. 203(a)(1). As a result, we believe that 

when the grant being terminated was made by two or more authors of a 

joint work, a section 203 notice of termination should be required to 

identify all of the authors of that work who executed the grant.

    When Sec.  201.10 was originally adopted, we rejected a proposal 

that a section 304 notice of termination must identify all the authors 

of a work. That proposal was based on the assumption that it would be 

necessary ``to determine whether the proper parties have joined in the 

notice.'' 42 FR at 45917. We concluded that because section 304(c) does 

not require more than one coauthor to join in terminating a copyright 

transfer or license during the extended renewal term, such 

identification was unnecessary. ``[A] notice terminating a grant may be 

effected as to any particular author's share of the work. There is no 

requirement of unanimity, majority interest, or the like, among 

granting co-authors.'' Id. Therefore, identification of all co-authors 

``has nothing to do with the effectiveness of a termination notice 

served by those authors (or their successors) who do wish to terminate 

rights in a work to the extent of their share.'' Id. at 45917-45918. In 

contrast, as noted above, a section 203 termination of a grant covering 

a joint work does require participation by at least a majority of the 

authors who executed the grant.

    The final two current requirements relating to contents of section 

304 notices of termination (a brief statement reasonably identifying 

the grant to which the notice of termination applies and identification 

of the effective date of termination) appear to be equally applicable 

to section 203 notices of termination, and we propose to retain them 

for purposes of section 203.



Signature



    As noted above, termination under section 304 differs from 

termination under section 203 in that under section 304, each author of 

a joint work may terminate a grant "to the extent of [that] particular 

owner's share." 17 U.S.C. 304(c)(1). In contrast, section 203 requires 

participation in the termination by a majority of the authors of a 

joint work. Because of these differing approaches, the current 

signature requirements for section 304 notices of termination cannot be 

applied to section 203 without modification. Section 201.10(c)(2) 

currently provides that in the case of a termination of a grant 

executed by one or more of the authors of a work, a notice "as to any 

one author's share shall be signed by that author" or his agent or 

statutory successors. We propose to add a new Sec.  201.10(c)(3) to 

state the signature requirements for section 203 notices of 

termination. While these requirements are similar to the requirements 

stated in Sec.  201.10(c)(2), the inapplicable reference to "one 

author's share" is deleted.



Comments



    The Copyright Office solicits comments on the proposed regulation 

governing notices of termination under section 203. The Office also 

seeks comments on whether the Office should provide official forms for 

notices of termination of transfers and licenses under sections 203, 

304(c) and 304(d), and whether the use of such forms should be made 

mandatory. Requiring the use of official forms might make it less 

likely that notices of termination that do not comply with the 

statutory and regulatory requirements will be served. It would also 

facilitate the Office's processing of notices of termination submitted 

for recordation.



[[Page 77954]]



Information on Copyright Office Website



    The entire text of Sec.  201.10 as it would appear after adoption 

of the proposed amendments may be found on the Copyright Office website 

at http://www.copyright.gov/docs/203.html.



List of Subjects in 37 CFR Part 201



    Copyright.





Proposed Regulation





    In consideration of the foregoing, the Copyright Office proposes 

amending part 201 of 37 CFR, chapter II as follows:





PART 201--GENERAL PROVISIONS





    1. The authority citation for part 201 continues to read as 

follows:





    Authority: 17 U.S.C. 702.





    2. Section 201.10 is amended as follows:

    (a) By revising the section heading and the first sentence of the 

undesignated paragraph preceding paragraph (a).

    (b) By revising paragraph (b)(1) introductory text.

    (c) By revising paragraph (b)(1)(i).

    (d) By revising paragraph (b)(1)(v).

    (e) By revising paragraph (b)(1)(vii)(B).

    (f) By redesignating paragraph (b)(2) as paragraph (b)(3); and 

adding a new paragraph (b)(2).

    (g) By revising newly designated paragraph (b)(3).

    (h) By revising paragraphs (c)(1) and (c)(2).

    (i) By redesignating paragraphs (c)(3) and (c)(4) as paragraphs 

(c)(4) and (c)(5), respectively; and adding a new paragraph (c)(3).

    (j) By revising the introductory text of paragraph (d)(2).

    (k) By revising paragraph (d)(4).

    (l) By revising paragraph (e)(1).

    (m) By revising paragraph (e)(2).

    The additions and revisions to Sec.  201.10 read as follows:





Sec.  201.10  Notices of termination of transfers and licenses.





    This section covers notices of termination of transfers and 

licenses under sections 203, 304(c) and 304(d) of title 17, of the 

United States Code. * * *

* * * * *

    (b) * * *

    (1) A notice of termination covering the extended renewal term 

under sections 304(c) and 304(d) of title 17, U.S.C., must include a 

clear identification of each of the following:

    (i) Whether the termination is made under section 304(c) or under 

section 304(d);

* * * * *

    (v) The effective date of termination;

* * * * *

    (vii) * * *

    (B) A statement that, to the best knowledge and belief of the 

person or persons signing the notice, the notice has been signed by all 

persons whose signature is necessary to terminate the grant under 

section 304 of title 17, U.S.C., or by their duly authorized agents.

    (2) A notice of termination of an exclusive or nonexclusive grant 

of a transfer or license of copyright or of any right under a 

copyright, executed by the author on or after January 1, 1978, under 

section 203 of title 17, U.S.C., must include a clear identification of 

each of the following:

    (i) A statement that the termination is made under section 203;

    (ii) The name of each grantee whose rights are being terminated, or 

the grantee's successor in title, and each address at which service of 

the notice is being made;

    (iii) The date of execution of the grant being terminated and, if 

the grant covered the right of publication of a work, the date of 

publication of the work under the grant;

    (iv) For each work to which the notice of termination applies, the 

title of the work and the name of the author or, in the case of a joint 

work, the authors who executed the grant being terminated; and, if 

possible and practicable, the original copyright registration number;

    (v) A brief statement reasonably identifying the grant to which the 

notice of termination applies;

    (vi) The effective date of termination; and

    (vii) In the case of a termination of a grant executed by one or 

more of the authors of the work where the termination is exercised by 

the successors of a deceased author, a listing of the names and 

relationships to that deceased author of all of the following, together 

with specific indication of the person or persons executing the notice 

who constitute more than one-half of that author's termination 

interest: That author's surviving widow or widower; and all of that 

author's surviving children; and, where any of that author's children 

are dead, all of the surviving children of any such deceased child of 

that author; however, instead of the information required by this 

paragraph (vii), the notice may contain both of the following:

    (A) A statement of as much of such information as is currently 

available to the person or persons signing the notice, with a brief 

explanation of the reasons why full information is or may be lacking; 

together with

    (B) A statement that, to the best knowledge and belief of the 

person or persons signing the notice, the notice has been signed by all 

persons whose signature is necessary to terminate the grant under 

section 203 of title 17, U.S.C., or by their duly authorized agents.

    (3) Clear identification of the information specified by paragraphs 

(b)(1) and (b)(2) of this section requires a complete and unambiguous 

statement of facts in the notice itself, without incorporation by 

reference of information in other documents or records.

    (c) Signature. (1) In the case of a termination of a grant under 

section 304(c) or section 304(d) executed by a person or persons other 

than the author, the notice shall be signed by all of the surviving 

person or persons who executed the grant, or by their duly authorized 

agents.

    (2) In the case of a termination of a grant under section 304(c) or 

section 304(d) executed by one or more of the authors of the work, the 

notice as to any one author's share shall be signed by that author or 

by his or her duly authorized agent. If that author is dead, the notice 

shall be signed by the number and proportion of the owners of that 

author's termination interest required under section 304(c) or section 

304(d), whichever applies, of title 17, U.S.C., or by their duly 

authorized agents, and shall contain a brief statement of their 

relationship or relationships to that author.

    (3) In the case of a termination of a grant under section 203 

executed by one or more of the authors of the work, the notice shall be 

signed by each author who is terminating the grant or by his or her 

duly authorized agent. If that authoris dead, the notice shall be 

signed by the number and proportion of the owners of that author's 

termination interest required under section 203 of title 17, U.S.C., or 

by their duly authorized agents, and shall contain a brief statement of 

their relationship or relationships to that author.

* * * * *

    (d) * * *

    (2) The service provision of section 203, section 304(c) or section 

304(d) of title 17, U.S.C., whichever applies, will be satisfied if, 

before the notice of termination is served, a reasonable investigation 

is made by the person or persons executing the notice as to the current 

ownership of the rights being





[[Page 77955]]





terminated, and based on such investigation:

* * * * *

    (4) Compliance with the provisions of paragraphs (d)(2) and (3) of 

this section will satisfy the service requirements of section 203, 

section 304(c), or section 304(d) of title 17, U.S.C., whichever 

applies. * * *

    (e) Harmless errors. (1) Harmless errors in a notice that do not 

materially affect the adequacy of the information required to serve the 

purposes of section 203, section 304(c), or section 304(d) of title 17, 

U.S.C., whichever applies, shall not render the notice invalid.

    (2) Without prejudice to the general rule provided by paragraph 

(e)(1) of this section, errors made in giving the date or registration 

number referred to in paragraph (b)(1)(iii), (b)(2)(iii), or (b)(2)(iv) 

of this section, or in complying with the provisions of paragraph 

(b)(1)(vii) or (b)(2)(vii) of this section, or in describing the 

precise relationships under paragraph (c)(2) or (c)(3) of this section, 

shall not affect the validity of the notice if the errors were made in 

good faith and without any intention to deceive, mislead, or conceal 

relevant information.

* * * * *



    Dated: December 17, 2002.

David O. Carson,

General Counsel.

[FR Doc. 02-32136 Filed 12-19-02; 8:45 am]



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