Sir Paul McCartney has filed suit against Sony/ATV Music Publishing in New York Federal Court, seeking a declaration that he can exercise his termination rights under the Copyright Act of 1976 in order to reclaim the rights to many of his musical compositions for The Beatles. The songs, which McCartney either wrote, or co-wrote with John Lennon, and which were once owned by pop music star Michael Jackson, are immensely valuable. It is anticipated that Sony/ATV may challenge the former Beatle’s termination notices in order to preserve its rights.
According to McCartney’s complaint, he assigned rights to the songs in question to various music publishers between 1963 and 1971, and such rights were eventually acquired by Sony/ATV. When Congress adopted the Copyright Act of 1976, it created a mechanism for authors like McCartney who had assigned their interests under the old U.S. copyright statue to terminate the assignment and effectively reclaim the U.S. rights (but only the U.S. rights) during a window period of 56-61 years after the original copyright date. A similar right exists after 35 years for contracts entered into starting in 1978.
This termination right exists regardless of any contract that the author may have signed; in other words, the Copyright Act allows writers to “undo” their prior contracts, and any contract that attempts to prevent a writer from exercising this right is not enforceable in the U.S. Section 304(c) of the Copyright Act requires authors to serve advance notice with the U.S. Copyright Office between 2 and 10 years prior to the termination date, which McCartney began doing in 2008 in anticipation of recovering his share of the copyrights in The Beatles songs beginning in 2018.
This matter is complicated by a recent decision by an English court involving Sony (in a similar action brought by Duran Duran), in which it was held that the band’s termination notices constituted a breach of the original contracts that assigned the rights to its music publisher. However, these contracts were governed by U.K. law, not U.S. law. Ultimately, the English court ruled that contracts governed by U.K. law trumped the band’s rights under U.S. copyright law, even though the U.S. copyright law says the exact opposite, and despite the fact that many ex-U.S. writers have exercised these termination rights in the past, regardless of the law governing their contracts. Duran Duran has indicated that it may appeal the ruling. In light of this ruling, Sony/ATV may feel that McCartney faces an uphill battle in reclaiming his song rights since his original contracts are governed by U.K. law.
McCartney’s complaint asserts that Sony has refused to provide confirmation of termination and has “thus attempted to reserve Defendants’ right to assert that once Paul McCartney’s terminations go into effect, Paul McCartney will have breached his contractual obligations to Defendants. Rather than provide clear assurances to Paul McCartney that Defendants will not challenge his exercise of his termination rights, Defendants are clearly reserving their rights pending the final outcome of the Duran Duran litigation in the U.K.”
McCartney’s suit is clearly an attempt to expedite a U.S. court ruling counter to the ruling in the Duran Duran matter, with the goal of avoiding a protracted saga or a potential breach of contract suit by Sony/ATV. However, we may also be seeing the start of a trend of writers (whose contracts are governed by non-U.S. law) seeking assurances from U.S. courts that they can still exercise their termination rights regardless of their original non-U.S. contracts. Lawyers practicing in this area will likely receive questions about whether clients (publishers or writers) should race to the courthouse either in the U.S. or abroad to preserve their rights. The ruling in the McCartney case, as well as any appellate ruling in the Duran Duran case, will be closely watched to determine how to address these concerns.
This blog post is not offered as, and should not be relied on as, legal advice. You should consult an attorney for advice in specific situations.