Panel 2: The Role of the Author and the Acquisition and Duration of Their Rights

29th Annual BTLJ-BCLT Spring Symposium: Origins, Evolution, and Possible Futures of the 1976 Copyright Act

Panel 2: The Role of the Author and the Acquisition and Duration of Their Rights

Molly Van Houweling, UC Berkeley Law (Moderator)

Tyler Ochoa, Santa Clara School of Law: why do we have formalities? Path dependence is one big explanation for registration, notice, deposit. If © is designed to incentivize exploitation, then formalities make sense—if you’re willing to create the work regardless, no point in ©; you should do something to claim that © was important to the creation (or distribution). Utilitarian view expressed in 1909 Act. Deposit and registration required for lawsuit in 1909, not pre-publication as in early republic. Domestic manufacturing clause.

1976 Act didn’t make huge changes in its initial form: notice was required for all copies published anywhere in the world, not just in the US, to avoid public domain: an expansion of the notice rule. UCC: notice substituted for other formalities. Failure to affix proper notice placed work in PD, subject to a cure provision. Manufacturing clause was kept, but sunsetted. Deposit/registration required to sue. Biggest single change in 1976 Act was duration. 85% of registered works went into public domain after 28 years, though musical works and motion pictures were heavily renewed (about 2/3). Books: 7%.

No works that received life+75 under the 76 Act have expired. The only works to enter the PD under the Act are pre-76 works that hadn’t yet been published or registered and were still unpublished as of 2002. And there’s still 45 years to go b/c of term extension.

Post-76 change gets most rid of the formalities that were preserved. BCIA: mandatory notice eliminated Mar. 1, 1989. Manufacturing clause expired; registration no longer required for foreign works to sue, though statutory damages/attorneys’ fees still require registration but there’s no technical violation of Berne b/c neither of those are required. VARA gives us something couched in the language of moral rights for the first time, but it requires single/limited edition (requires it to be signed/consecutively numbered, which is a formality). Automatic renewal; copyright restoration; CTEA term extension.

David Nimmer, UCLA School of Law: we have never known which works will still be popular several decades from now. Congress wanted to eliminate the Fred Fisher doctrine allowing assignment in advance of renewal rights. But it wanted to handle contributions to collective/joint works. That required more drafting.

How did that work? Winnie the Pooh termination: The current owner did a recission and regrant, all in one transaction. Nimmer argued that, before they got into that room, there was a termination right, and the agreement was an “agreement to the contrary” that was ineffective to override that termination right. He lost (but thinks he was right, and I definitely see his point). Congress could have allowed this, but the statute is categorical (w/the slight exception of renegotiating with the current owner once the termination notice has been sent). It’s not that he didn’t have authority to sign a contract. But the Supremacy Clause says that termination may be effected notwithstanding any agreement to the contrary. Fred Fisher has been resurrected.

What should we do? All we need are 2 changes: (1) voluntary nature of termination/all of the hoops to jump through make it practically impossible without counsel, and not easy even then. Termination should become automatic. (2) Congress should re-pass the provision about “any agreement” and say it really means it.

Robert Brauneis, GW Law: When does creative work get recognized as authorship? Most obvious exclusion doctrine is WFH; direction of 76 Act is really complicated there. It could be read as author-friendly only in relationship to the “instance and expense” test developed after the grand bargain was penned.

Other doctrines about recognizing creative work as central: fixation; derivative work authorship; joint/co-authorship. Under 1909 Act, phonorecord wasn’t fixation b/c not human perceptible, nor was choreographic work fixed in a visual record. The Office then adopted that requirement for deposit—registration had to be by visual notation and that forms the boundaries of the registered work. Many composers who don’t notate end up never being recognized as authors of the musical works they composed, especially in blues and folk genres.

That changes in terms of using recordings for fixation. But recordings are easier to pass back and forth b/t coauthors; it’s still possible for composers to lose out, but the average number of composers credited has grown a lot—Glynn Lunney says it’s more than doubled in a few decades; Emma Perot said it starts taking off in the 1990s and picks up speed. Possibly some is performers added as a condition of performance; others added because of fears of liability; sampling may also have added composers. Lunney suggests that each songwriter is becoming less productive.

More optimistic possibility: when he investigated “A Little Bird Told Me” from 1949, there was a composer of basic melody/lyrics, there was a lot of collaboration—singer Paula Watson and backup singers went over to his house and worked up new lyrics, a new bassline, a new arrangement & hummed introduction. But the “composer” was singly credited, leaving nothing but session payments for the other collaborators. Today, the others who contributed might have gotten a composition credit. A vanishingly small percentage of revenues today comes from sheet music; the authorship of the recorded version is much more collaborative; the rise in credits may not be less productive songwriters or overreaching of performers, but at least partly that more of the creative contributors are being recognized as authors, and the musical work recognized is “thicker” in that it contains more of the elements that make the work a hit.

1978 is when the legal change of the Act takes effect, and then there’s a change in form of deposit: by the 80s, 80% of applications are accompanied by phonorecord deposits. [What an interesting story!]

Copyright in unauthorized derivative works: the creators are doing something that authors do, but may not be recognized as authors. Protection doesn’t extend to unlawfully used material, and arrangements made for cover version can’t be ©d without permission of original © owner. Melville Nimmer argued that the first provision was inherited from 1909 Act; current edition of treatise says that the statute was ambiguous and the decisions contradictory, and Silbey/Samuelson argue that the text didn’t provide for forfeiture of © in newly added content, making the 76 Act an innovation.

Joint work: Intent to combine is required; designed to overrule precedents allowing music publishers to create joint works by combining music and lyrics written independently, but read much more broadly. Comment in legislative materials: Desirable to reduce as far as possible the situations in which a work is a joint work. Courts seem to have taken that to heart, including both in the 9^th and 2^nd circuits. Resulting problem: dominant creator gets sole ownership when other creators were consciously and intentionally creatively involved—denying authorship status to the creative work that authors do. Litman: courts erase the contributions of “inconvenient” co-creators.

Is the 76 Act to blame, or the courts resisting something outlined in the statute? More of the blame is on judges than on the language in his view.

Peter DiCola, Northwestern Pritzker School of Law: Reforms of the Act did not, and could not, meaningfully help authors given what else was about to happen, that is, consolidation, here in the music industry. Most conversations he has, people think he’s talking about Taylor Swift. But he thinks of the bell curve: a distribution of musicians—Swift is not representative. The industry has literally made sure that some things she’s done will never be possible for any other musician again.

Market demand determines copyright payout. But market demand is also shaped by concentration among companies that deliver content; in the US 4 have 97% of market share in streaming music. 3 major publishers and 3 labels, down from 7 even in past decades. Independent sector claims are often misleading (Spotify claims to send a lot of revenue to them) b/c an artist’s vanity label can be claimed as an indie but distributed by a major. And they’re parts of larger conglomerates. Composers and songwriters/recording artists face very large entities with lots of bargaining power. Recording contracts have become more structurally exploitative—shift to 360 deals where labels “participate” in revenue of artist in other endeavors like tours & t-shirts. Labels have moved to contractual agreement against re-recording, so Swift will be the last unless we restrict those contracts.

Biggest story now: consolidation of entities that retail or deliver music. Wal-Mart used its power to control both pricing and content. Now big companies are negotiating with big companies: oligopolies selling through oligopolies. That’s why Spotify, YouTube, Apple and Amazon are subject to increasing scrutiny and discontent by musicians. © can only deliver economic benefits based on structure of markets into which authors sell. Demand isn’t enough: the market structure is categorically different now from the market structure in 1976: twin oligarchies; tech companies may be willing to sell music at a loss to keep people on the platforms, which hasn’t happened before; Act wasn’t designed w/that kind of music in mind.

Along with antitrust, you could have more default rules prohibiting contracting around. Draft legislation: allowing sectoral bargaining for musicians against streaming companies. Could create authors’ rights to access data about how their works are exploited; transparency in accounting practices.

Biggest new hole in authors’ rights: Spotify’s policy starting 2023 is that they don’t pay royalties on tracks that get less than 1000 streams in the last 12 months. Perlmutter referred to streaming as a huge success compared to the litigation against filesharing, but now we see what happens: having music on Spotify means agreeing that your less successful tracks won’t get any royalties. How do we know what’s happened to the © system? It’s opaque! Don’t take Spotify’s word for it.

Q: are these mostly music-specific?

Brauneis: On coauthorship, there are field-specific practices and many are affected by the law/not in line with the caselaw.

Nimmer: ProCD v. Zeidenberg was bad—circumvented © law; contracts prohibiting soundalikes are systematically trying to defeat the right to make soundalikes, and we should also be hostile to them.

DiCola: we could elevate the negative space of 114(b) into the right of the public.

Ginsburg: who deserves the blame for the exclusion of inconvenient co-authors? It’s the judges! The statute only says intent to merge contributions, not intent to be co-authors. Master mind reasoning is nonsensical! Doctrinally, this is wrong, but it does have the merit of getting rid of the inconvenient co-contributors. If you apply the statute as written, how do you decide who is enough of a contributor to be an author? Should ideas be enough? [I think editing is the classic difficult case unless you bring in reasoning about the social meaning of various roles, and that just helps you with the editor, not with the dramaturg in the next case.]

Brauneis: the courts don’t feel competent to modify the rule that co-authors get equal shares to allocate ownership, so they need to find a rule to prevent people like Jefri Aalmuhammed from being authors. We would have to confront unequal shares—or say that if you didn’t plan for the situation you have to live with the default rule. Both Aalmuhammed & the Second Circuit case are about motion picture companies refusing to do things that they should have done (getting WFH agreements in place).

Ochoa: could have said that everyone in the credits is a co-author, but everyone else signed a WFH agreement, so Aalmuhammed only gets a 1/1000 share, but it made no sense for the Second Circuit to say that the director isn’t a coauthor.