[Federal Register Volume 67, Number 245 (Friday, December 20, 2002)]
[Proposed Rules]
[Pages 77951-77955]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-32136]


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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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