Winter 2006-10 Transfer of copyrights upon death of composer

Number 62
Winter 2006

Transfer of copyrights upon death of composer

In Venegas v. ACEMLA et al., 424 F.3d 50 (1st Cir., 2005), the U.S. Court of Appeals for the First Circuit considered the rights of a music composer’s widow and children with respect to the decedent’s copyrighted work.

Prior to his death in 1993, Puerto Rican composer Guillermo Venegas Lloveras granted the rights to his compositions to a number of musical publishing companies. Specifically, in 1952, Venegas entered into an agreement with PEER, a musical publishing company that acquired rights and licensed them to third parties. He also signed other contracts in 1969 with PHAM, and in 1970 with Southern Music, both of which were, at the time, affiliated with PEER.

In 1996, Lucy Chavez Butler, Venegas’s widow, assigned her copyright interests to LAMCO and, through LAMCO, to its affiliate in Puerto Rico, ACEMLA. Both of these music publishers were also engaged in the business of obtaining rights to musical compositions, licensing them, and obtaining royalties from sub-licensees.

Two lawsuits

A year later, Chavez brought suit in local court against Venegas’s four heirs concerning ownership of the copyright of the composer’s works. In 2000 the Puerto Rico Court of Appeals ruled that copyright interests in Venegas’s works belonged to his four children, in light of both his will and an agreement that Chavez and the four siblings had reached.

In 2001, the siblings countered with their own suit, this time filed in federal court. They argued that LAMCO, ACEMLA and others, including Chavez, incurred in copyright infringement of Venegas’s work, which they claimed to own 100%.

In terms of the ownership rights, the U.S. District Court for the District of Puerto Rico first ruled that the four plaintiffs and Chavez each owned 20% of the renewal-term copyrights that arose after the composer’s death. Later, in 2004, the court awarded them compensation for damages suffered for one act of infringement (which were to be paid by PEER), but rejected the rest of the plaintiffs’ infringement claims. The court also set aside their effort to rescind the rights that PEER obtained in 1952 from Venegas himself.

The district court also held LAMCO liable in damages for infringement, but rejected other infringement claims because the four siblings failed to provide evidence that the compositions that LAMCO had unrightfully licensed were either copied or performed. Both LAMCO and the heirs appealed to the First Circuit.

Renewal upon death

The Court of Appeals for the First Circuit ruled that upon securing a copyright for his or her work, any composer or author also obtains a right to renew the same for an additional term. If the owner dies before he or she has exerted this right to renew, the same passes to his or her heirs “not by will but as specified by the Copyright Act itself,” 17 USC § 304(a)(1)(C).

In 1976 Congress passed a law that allows copyright owners to renew their ownership rights for an additional 47 years (extended to 67 years by the Sonny Bono Copyright Term Extension Act of 1998) if their original 28-year terms had not elapsed as of January 1, 1978. If the author dies, the renewal rights pass to the widow, widower, or the author’s children. That being so, the author cannot assign his family renewal rights to a third party if there is a widow or successor offspring.

Venegas’s right to renew the copyrights had not matured at the time of his death. Because of this, it was necessary to distinguish between ownership rights of the original copyright and the right to renew the same.

Puerto Rico decision

The Puerto Rico Court of Appeals had allowed the siblings 100% ownership of the original copyright, but did not address the issue of the unmatured renewal rights. The federal Court of Appeals, on the other hand, interpreted Congress’ expressions in 17 USC § 304(c)(2)(A) and other policy considerations to conclude that, when renewal rights are not mature at the time of the owner’s death, such rights belong to both the spouse and offspring in a 50%-50% proportion. Only in the absence of a widow or widower and heirs will the owner’s rights pass to his or her executor for execution in accordance to an existing will, or to the next of kin if there is none.

Performance necessary

Many of the plaintiffs’ infringement claims were dismissed because of lack of supporting evidence. The federal Court of Appeals sustained the District Court’s ruling that claimants must provide the necessary evidence to support their claim and obtain a remedy.

The Court of Appeals also concluded that “a music publisher’s unauthorized grant of a license to a third party to perform or copy a copyrighted work is [not] an act of infringement [if] there is no adequate proof that the third party ever undertook an infringing act (for example, by performing or recording a copyrighted song).” The court stated that “most (perhaps all) courts that have considered the question have taken the view that a listed infringing act (beyond authorization) is required for a claim.” In other words, that Congress did not intend to recognize independent liability if none of the infringing acts listed in the law ever occurred. In such a case a plaintiff may file an unjust enrichment case, or a claim for interference with contractual relations, both with the state courts.

© 2006 Goldman Antonetti & Cordóva, LLC