Possible Gap in Termination Provisions

Proposed Rulemaking

The Copyright Office is proposing to amend its regulations governing notices of termination of certain grants of transfers and licenses of copyright under section 203 of the Copyright Act of 1976. The amendments are intended to clarify the recordation practices of the Copyright Office regarding the content of section 203 notices of termination and the timeliness of their service and recordation, including a clarification that the Office will accept for recordation under section 203 a notice of termination of a grant agreed to before January 1, 1978, as long as the work that is the subject of the grant was not created before 1978. Whether such notices of termination fall within the scope of section 203 will ultimately be a matter to be resolved by the courts.

Legal Analysis of Gap Grants under Termination Provisions

Following consultations with songwriters and other stakeholders who reached out to the Copyright Office and some Congressional offices, the Copyright Office published a Notice of Inquiry in the Federal Register requesting comments on the applicability of the termination provisions in Title 17 to certain grants of transfers and licenses of copyrights made prospectively by authors, specifically those entered into before January 1, 1978 for works that were not created until January 1, 1978 or later (so-called “Gap Grants”). The Office arrived at the conclusion that Gap Grants are terminable under section 203 as currently codified, because as a matter of law the date of execution of the grant will be on or after January 1, 1978. Until there is a work of authorship, there is no copyright interest, no transfer of that interest, and no author for whom exclusive rights (not to mention termination rights) can vest. 17 U.S.C. §§ 101, 102(a), 106 and 203. Nonetheless, the Copyright Office agrees with many stakeholders that it would be beneficial for Congress to clarify the statute, to ensure greater certainty in the marketplace with respect to the accuracy of copyright ownership.