Songwriter groups have hailed a ruling in the US Fifth Circuit Appeals Court that significantly expands the reach of the termination right under American copyright law to the advantage of music creators.
The landmark ruling, according to Music Creators North America, is both an “enormous victory for the American and global creator community” and “judicial recognition” that the US Copyright Act is meant to “protect the rights of creators first and foremost”.
Although the ruling relates to a dispute between one songwriter and one small independent music publisher over the rights in a single song, the judgement could impact on all American music publishers that control rights in songs that stem from decades old publishing deals.
The Fifth Circuit was reviewing a dispute between songwriter Cyril E Vetter and independent music publisher Resnik Music Group, which began when TV company ABC sought a sync licence to use Vetter’s song ‘Double Shot’ in a programme that is broadcast worldwide.
Vetter and his co-writer Don Smith assigned the copyright in ‘Double Shot’ to music publisher Windsong via a publishing deal all the way back in 1963. Resnik then acquired the copyright from Windsong in 2019, but by that point Vetter was exercising his termination right.
Under US law, a creator that transfers ownership of a copyright to a business partner, like a music publisher, can subsequently terminate that transfer and reclaim the copyright after a period of time - 35 years for works created after 1978, 56 years for works created before 1978, like ‘Double Shot’.
Which is why Vetter could exercise his termination right in 2019 and reclaim ownership of the ‘Double Shot’ copyright. But did he reclaim ownership of that copyright worldwide or just within the US?
It has been a long-held music industry convention that when a writer exercises the termination right, they can only reclaim their rights within the US. So the publisher continues to own and control the rights everywhere else in the world. Which means when ABC wanted a global sync licence for ‘Double Shot’, Resnik argued that only it could issue a licence to the broadcaster for use of the song outside the USA.
However, Vetter and his legal team argued that music industry convention regarding the termination right is wrong. In fact, under the relevant section of the US Copyright Act, once an old publishing deal has been terminated in the US, the worldwide rights in the songs covered by that deal should revert to the writer. Which means Vetter could in fact provide ABC with a global sync licence without involving Resnik.
Just under a year ago a court in Louisiana sided with Vetter. Judge Shelly Dick issued a summary judgement declaring that Vetter has owned the copyright in ‘Double Shot’ worldwide ever since he terminated his 1963 publishing agreement. Resnik then appealed the case to the Fifth Circuit.
The legal arguments in this case are complex and were explained in some detail in CMU’s report on the original judgement last year. However, a lot of it comes down to how copyright works on a global basis and the treaties that connect all the copyright systems around the world, especially the Berne Convention.
Under those treaties, a work that is directly protected by copyright under US law is also protected - and can therefore be monetised - under the copyright systems of every other country that has signed the treaty. But does that mean that US copyrights are simply respected by other copyright systems or that a separate distinct copyright exists in each country for each individual work?
Music industry convention - and Resnik’s case in court - relies on the latter interpretation of the treaties, ie that a separate copyright comes into existence in each country for each work. Because, crucially, the US Copyright Act states that the termination right does not affect “rights arising under foreign laws”. Which means the termination right doesn’t affect all the separate copyrights in other countries.
But the court in Louisiana rejected that argument, accepting Vetter’s position that there is instead a single copyright that originates in the US and which is then respected by copyright systems worldwide. And once a previous transfer of that single copyright has been terminated, the writer controls the work in all countries.
The Fifth Circuit judges have now endorsed Dick’s ruling, stating in their judgement that Resnik failed to provide “sufficient support in his analysis” of how copyrights work on a global basis - and how that impacts on the termination right in American law.
Also rejecting other arguments put forward by Resnik, the appeals court concluded that the original ruling in this case - ie Dick’s conclusion that Vetter now owns the copyright in ‘Double Shot’ worldwide - is “supported by statutory text, context and purpose”.
This judgement could as yet be further appealed, initially back at the Fifth Circuit and ultimately with the US Supreme Court. The wider music publishing sector is likely to want such an appeal given the precedent being set here.
If the Vetter judgement stands, publishers won’t be able to retain control of foreign rights - and therefore a cut of foreign revenues - on any songs where a writer exercises the termination right.
Welcoming the Fifth Circuit ruling, Vetter’s lawyers - Tim Kappel and Loren Wells - told CMU, “The Fifth Circuit ruling is an unequivocal win for creator rights, handed down by a unanimous panel of judges from across the ideological spectrum”.
“We’re incredibly grateful to Cyril Vetter”, they added, “for his willingness to take a principled stand, as well as the many artists’ rights organisations and advocates that stepped up to file amicus briefs in support of his case”.
Music Creators North America, meanwhile, said it was “ecstatic over the decision”, adding, “while the decision is still being reviewed” by its members, “it appears to represent an enormous victory for the American and global creator community, and a crucial, judicial recognition of Congressional intent that the US Copyright Act is primarily a statute meant to protect the rights of creators first and foremost”.