[Federal Register Volume 67, Number 221 (Friday, November 15, 2002)]
[Rules and Regulations]
[Pages 69134-69137]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-28920]


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LIBRARY OF CONGRESS

Copyright Office

37 CFR Part 201

[Docket No. RM 2001-2A]


Notice of Termination

AGENCY: Copyright Office, Library of Congress.

ACTION: Final rule.

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SUMMARY: The Copyright Office is publishing a final rule amending its 
regulation governing notices of termination of transfers and licenses 
covering the extended renewal term. The current regulation is limited 
to notices of termination made under section 304(c) of the copyright 
law. The Sonny Bono Copyright Term Extension Act created a separate 
termination right under section 304(d). The final rule establishes 
procedures governing notices of termination of the extended renewal 
term under either section 304(c) or section 304(d).

EFFECTIVE DATE: January 1, 2003.

FOR FURTHER INFORMATION CONTACT: Kent Dunlap, Principal Legal Advisor 
for the General Counsel. Telephone: (202) 707-8380. Telefax: (202) 707-
8366.

SUPPLEMENTARY INFORMATION:

1. Background

    Under the 1909 copyright law, works copyrighted in the United 
States before January 1, 1978, were subject to a renewal system in 
which the term of copyright was divided into two consecutive terms. 
Under the system initially established by the 1909 legislation, the 
duration of copyright protection was for an original copyright term of 
28 years and a renewal term of an additional 28 years. The Copyright 
Act of 1976, Public Law 94-554, retained the renewal system for works 
that were copyrighted before 1978, and were still in their first term 
on January 1, 1978. However, under section 304 of the copyright law, 
the renewal term was extended to 47 years, creating a total potential 
duration period of 75 years.

[[Page 69135]]

    Besides generally extending the renewal term to 47 years, Congress 
also provided a termination procedure authorizing the termination of 
transfers or licenses during the extended portion of the renewal term. 
Established under section 304(c) of the copyright law, this provision 
created a means for authors and heirs of authors to secure the benefits 
of the additional 19 years added to the renewal term. In 1977, the 
Copyright Office adopted a regulation establishing the procedures for 
exercising the termination right. 37 CFR 201.10.
    On October 27, 1998, President Clinton signed into law the Sonny 
Bono Copyright Term Extension Act, (``CTEA''), Public Law 105-298, 112 
Stat. 2827 (1998). The CTEA amended the copyright law, title 17 of the 
United States Code, to extend for an additional 20 years the term of 
copyright protection in the United States. For works for which the 
duration of protection was determined under section 304 of title 17, 
the renewal term was extended from 47 years to 67 years. Like the 
Copyright Act of 1976, CTEA also contained a termination provision 
covering the newly extended portion (in this case, the last twenty 
years) of the extended renewal term. Established under section 304(d), 
this new right of termination was available only if the termination 
right under section 304(c) had expired by the effective date of CTEA, 
and if no termination had been previously exercised under section 
304(c).

2. Proposed Regulation

    On May 3, 2001, the Copyright Office published a proposed 
regulation modifying the termination regulation to include terminations 
made under section 304(d), in addition to terminations under section 
304(c). 66 FR 22139. This was to be accomplished by making several 
adjustments to existing Copyright Office regulations.
    Most of the changes involved 37 CFR 201.10, which governs notices 
of termination of transfers and licenses covering the extended renewal 
term. The proposed regulation added introductory text clarifying that 
the scope of the regulation covers terminations under either section 
304(c) or section 304(d). In provisions where the existing regulation 
referred to section 304(c), the proposed regulation added an 
alternative reference to section 304(d).
    The Office proposed substantive changes in only two areas. First, 
subsection (c)(i) of the proposed regulation provided that if the 
termination is made under section 304(d), the notice will provide a 
statement to that effect. Most of the notices of termination made under 
304(d) which have been received in this Office already contained such a 
statement. No corresponding requirement was imposed in notices of 
termination issued under section 304(c) because such a requirement 
would have upset established legal practices in issuing notices under 
that section.
    The second substantive change in the proposed regulation created 
new subsection (c)(vi), requiring that notices under section 304(d) 
contain a statement that termination of rights for the extended renewal 
term had not been previously exercised. This is a statutory requirement 
imposed in subsection 304(d), and including the requirement as part of 
the notice made it less likely that second notices of terminations 
would be filed.
    The proposal further included a provision modifying 37 CFR 
201.4(a)(v), regarding recordation of transfers and certain other 
documents, to include a reference to section 304(d).

3. Comments and Modifications

    The Copyright Office received one comment on the proposed 
modification of the regulations. Professor Tyler Ochoa of Whitter Law 
School suggested two modifications in the content of the termination 
notice to make it consistent with the statute. First, he noted that 
since terminations cannot be made for works made for hire, notices of 
termination for both section 304(c) and (d) should affirmatively state 
that the work is not a work made for hire. Second, he pointed out that 
in order to be eligible to terminate under section 304(d), the 
termination right under section 304(c) must have expired by the 
effective date of the Sonny Bono Copyright Term Extension Act. Since 
CTEA took effect on October 27, 1998, Professor Ochoa calculated that 
termination under section 304(d) would only be available for works 
first published between January 1, 1923, and October 27, 1939. 
Accordingly, he asserted that notices of termination under section 
304(d) should affirmatively assert that the work was originally 
published between these dates.
    The Copyright Office has considered Professor Ochoa's comments 
carefully. The requirement in section 304(d) that the termination right 
under section 304(c) must have expired at the time CTEA took effect was 
not a provision reflected in the proposed regulation. We agree in 
principle with Professor Ochoa's comments on this point. However, we 
disagree with some of the details of his analysis. First, he states 
that the relevant dates are January 1, 1923, and October 27, 1939. In 
fact, although Professor Ochoa is correct in calculating that January 
1, 1923, (the copyright date of the earliest works the terms of which 
were extended by CTEA) is the first of the two relevant dates, he 
appears to be a day late in his calculation of the second date. The 
better reading of section 304(d) is that copyright must have been 
secured no later than October 26, 1939. That is the last date on which 
copyright could have been secured for any work for which the section 
304(c) termination right had already expired by October 27, 1998, the 
effective date of CTEA.
    We calculate this date by noting that termination of a transfer or 
license under section 304(c) may be effected during a period of five 
years commencing ``fifty-six years from the date copyright was 
originally secured,'' 17 U.S.C. 304(c)(3), meaning that termination may 
be effected up to 61 years (56 + 5) after copyright was secured. 
However, in order to effect a termination, an author or an author's 
successor must serve a notice of termination ``not less than two years 
before'' the effective date, i.e., up to 59 years (61 - 2) after 
copyright was secured. 17 U.S.C. 304(c)(4)(a). Therefore, the 
termination right will have ``expired,'' see 17 U.S.C. 304(d), 59 years 
after copyright was secured. See S. Rep. No. 104-315, at 22 (1996) 
(purpose of section 304(d) was to ``provide a revived power of 
termination for individual authors whose right to terminate prior 
transfers and licenses of copyright under section 304(c) has expired, 
provided the author has not previously exercised that right''). On the 
effective date of CTEA, October 27, 1998, an author of a work for which 
copyright had first been secured on October 27, 1939, could still have 
served an effective notice of termination under section 304(c). 
Therefore, there would have been no need to give that author the 
additional right to serve a notice of termination under section 304(d). 
But an author of a work for which copyright had first been secured on 
October 26, 1939, could not have served an effective notice of 
termination on October 27, 1998, because the 59-year deadline for 
serving a notice of termination would have expired at the end of the 
previous day, i.e., on October 26, 1998. Hence, works for which 
copyright was secured between January 1, 1923, and October 26, 1939, 
(and for which the section 304(c) termination right was not exercised) 
are eligible for the section 304(d) termination right.

[[Page 69136]]

    Second, Professor Ochoa states that the requirement is that the 
work was first published between the relevant dates in 1923 and 1939. 
In fact the requirement is somewhat broader: copyright must have been 
secured on or between those dates. See 17 U.S.C. 304(d)(2). Although 
publication with notice was the most common means of securing copyright 
under the Copyright Act of 1909, copyright could also be secured for 
certain unpublished works by registering those works with the Copyright 
Office. See section 11 of the 1909 Act, 17 U.S.C. 12 (repealed 
effective Jan. 1, 1978).
    Although we agree in principle with Professor Ochoa's observation, 
we note that the regulation already requires that the notice of 
termination designate the date on which copyright was originally 
secured. To add to this requirement an additional statement that the 
copyright was secured between January 1, 1923, and October 26, 1939, 
would be redundant. Nevertheless, it would be useful for parties 
involved in a termination under section 304(d) to be aware of this 
requirement. For this reason, we are adding the following sentence to 
the introductory paragraph of Sec.  201.10: ``a termination under 
section 304(d) is possible only if no termination was made under 
section 304(c), and federal copyright was originally secured on or 
between January 1, 1923, and October 26, 1939.''
    With regard to the proposal to add a statement in the notice of 
termination that the work was not a work made for hire, the Copyright 
Office has decided not to adopt this suggestion. The regulation on 
notice of termination has never required that a notice of termination 
recite all of the statutory requirements underlying termination. The 
current regulation has been in effect since 1977, and no practitioner 
has reported a problem because the notice does not affirmatively state 
that the work being terminated is not a work made for hire. For this 
reason, the Copyright Office has decided not to disrupt settled 
practice in this area.
    In reviewing generally the proposed regulation, the Copyright 
Office has also decided to adopt a number of technical corrections. In 
the proposed regulation, a new subsection (b)(vi) required that notices 
under section 304(d) contain a statement ``that termination of rights 
for the extended renewal term has not been previously exercised.'' This 
provision was intended to apply to the 19-year extended renewal term 
under section 304(c), rather than the 20-year extended renewal term 
under section 304(d). In order to clarify this matter, the language has 
been revised to read: ``If termination is made under section 304(d), a 
statement that termination of renewal term rights under section 304(c) 
has not been previously exercised.''
    In order to give authors and practitioners sufficient time to learn 
of these new requirements, the effective date of these amendments to 
the regulation is January 1, 2003. Notices of termination served on or 
after January 1, 2003, must comply with the amended regulation. Of 
course, authors and their representatives who serve notices of 
termination prior to that date are encouraged, although not required, 
to include the information that will be required in the amended 
regulation.

List of Subjects in 37 CFR Part 201

    Copyright.

Final Regulation

    In consideration of the foregoing, the Copyright Office is amending 
part 201 of 37 CFR, chapter II in the manner set forth below:

PART 201--GENERAL PROVISIONS

    1. The authority citation for part 201 is revised to read as 
follows:

    Authority: 17 U.S.C. 702.
    Section 201.10 also issued under 17 U.S.C. 304.


Sec.  201.4  [Amended]

    2. In Sec.  201.4(a)(1)(v), add ``and (d)'' after ``304(c).''


Sec.  201.10  [Amended]

    3. Section 201.10 is amended as follows:
    a. by adding introductory text before paragraph (a);
    b. by redesignating paragraphs (b)(1)(i) through (v) as (b)(1)(ii) 
through (v) and (vii), respectively;
    c. by adding new paragraphs (b)(1)(i) and (vi);
    d. by removing ``paragraph (v)'' in newly redesignated paragraph 
(b)(1)(vii) and adding ``paragraph (vii)'' in its place; and
    e. by revising paragraphs (c)(2), (d)(2), (d)(4) and (e).
    The revisions and additions to Sec.  201.10 read as follows:


Sec.  201.10  Notices of terminations of transfers and licenses 
covering extended renewal term.

    This section covers notices of termination of transfers and 
licenses covering the extended renewal term under sections 304(c) and 
304(d) of title 17, of the United States Code. A termination under 
section 304(d) is possible only if no termination was made under 
section 304(c), and federal copyright was originally secured on or 
between January 1, 1923, and October 26, 1939.''
* * * * *
    (b) * * *
    (1) * * *
    (i) If the termination is made under section 304(d), a statement to 
that effect;
* * * * *
    (vi) If termination is made under section 304(d), a statement that 
termination of renewal term rights under section 304(c) has not been 
previously exercised; and
* * * * *
    (c) * * *
    (2) In the case of a termination of a grant 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.
* * * * *
    (d) * * *
    (2) The service provision of either 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 terminated, and based on such 
investigation:
    (i) If there is no reason to believe that such rights have been 
transferred by the grantee to a successor in title, the notice is 
served on the grantee; or
    (ii) If there is reason to believe that such rights have been 
transferred by the grantee to a particular successor in title, the 
notice is served on such successor in title.
* * * * *
    (4) Compliance with the provisions of paragraphs (d)(2) and (3) of 
this section will satisfy the service requirements of either section 
304(c) or section 304(d) of title 17, U.S.C., whichever applies. 
However, as long as the statutory requirements have been met, the 
failure to comply with the regulatory provisions of paragraph (d)(2) or 
(d)(3) of this section will not affect the validity of the service.
    (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 either section 304(c) or section 304(d) of title

[[Page 69137]]

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) of this section, or in 
complying with the provisions of paragraph (b)(1)(vii) of this section, 
or in describing the precise relationships under paragraph (c)(2) 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: October 28, 2002.
Marybeth Peters,
Register of Copyrights.

James H. Billington,
The Librarian of Congress.
[FR Doc. 02-28920 Filed 11-14-02; 8:45 am]
BILLING CODE 1410-30-P