Copyright Transfer Terminations, Trademark, and Trade Dress: Forewarned Is Forearmed
| Publication year | 2014 |
| Pages | 51 |
| Citation | Vol. 43 No. 11 Pg. 51 |
Articles
Intellectual Property Law
Copyright Transfer Terminations, Trademark, and Trade Dress: Forewarned is Forearmed
By Matthew C. Holohan, Samantha K. Picans
Intellectual Property Law articles are sponsored by the CBA Intellectual Property Section. They provide information of interest to intellectual property attorneys who advise clients on protecting and exploiting various forms of intellectual property in the marketplace.
Coordinating Editors
K Kalan, Denver, Administrative Patent Judge—(720) 480-1500, kmkalan@yahoo.com; William F. Vobach, Denver, of HolzerlPLaw, PC—(720) 204-5673, vobach@holzeriplaw.com
Authors of copyrighted works who have assigned rights in those works may terminate those assignments after thirty-five years. These terminations, which are subject to limitations under federal statutes and state contract law, may create conflicting intellectual property rights.
A provision added to U.S. copyright law in 1976 has recently begun to impact the landscape of copyrights in the United States. Specifically, the Copyright Act of 1976 (Act) includes a provision that allows authors of copyrighted works who have assigned rights in those works to other parties to terminate those assignments after thirty-five years. Given the timing of the provision, the first thirty-five-year termination rights became effective in January 2013. In recent years, therefore, authors of original works have been able to reclaim their transferred rights through compliance with the termination provisions in the Act. This has the potential to impact the rights of copyright assignees and to affect the use of reclaimed copyrighted materials in other contexts, such as trademark. In addition, because the transfers themselves are governed by general contract law principles, state and federal contract law may affect these termination rights. Going forward, it will be important for both authors and assignees to understand their rights and obligations under the termination provisions.
Right to Transfer: Past and Present
The Act includes a provision that allows authors of copyrighted works who transferred rights in those works on or after January l, 1978 to terminate those transfers after thirty-five years.[1] The first of these terminations became effective on January l, 2013. Accordingly, it is important for holders of transferred copyright assets to understand what works are subject to termination and to be prepared to deal with authors seeking to reclaim their rights.
Historically, assignments of rights have been an important part of copyright law. It is common for an author (such as a writer, musician, or artist) to transfer or license his or her interest in an original work to a separate party (such as a publisher, record label, or other entity) that may be better positioned to exploit and monetize the creative work. Such transfers have traditionally operated as full, permanent assignments that eliminate the assignor's interest in the work and vest full ownership in the assignee. Transfers may also take the form of licenses.
The Act allows authors of copyrighted works (or their heirs) to unilaterally terminate a previous transfer of the work after a period of thirty-five years (for transfers after 1977) or fifty-six years (for copyrights existing before 1978) by engaging in certain procedures delineated in the Act.[2] The provision applies to transfers or licenses made on or after January 1, 1978.[3] Accordingly, the first terminations under this provision began to take effect in 2013. This means that any copyrighted work —a book, song, film, software, or even potentially a logo—that is subject to rights that have been transferred by the artist is subject to recapture by the artist without any compensation to the assignee.
This represents a dramatic shift in the balance of power between artists and publishers. Artists such as Bob Dylan, Tom Petty, Bryan Adams, Loretta Lynn, Kris Kristofferson, Tom Waits, Charlie Daniels, and Kool and the Gang have already filed termination notices to recapture the rights of some of their most well-known and valuable works.[4] A recent federal court decision from the U.S. District Court for the Southern District of California rejected an effort by a record label to invalidate thirty-three termination notices filed by Victor Willis, the lead singer of the Village People.[5] Thus, since January 2013, holders of copyrights of all sorts have stood to lose these valuable assets.
Extrapolated Effects: Intersection of Copyright, Trademark, and Trade Dress
Much of the focus of the recent wave of copyright transfer terminations has been on the entertainment industry, as musicians seek to reclaim their copyrighted works from their respective record labels. However, these terminations will have effects elsewhere, as well. A wide variety of works are subject to copyright protection (and thus termination), and many of these works implicate other areas of intellectual property law. For example, holders of trademarks that consist of or are based on assigned artwork may encounter attempts to terminate prior assignments. This is because a source-identifying logo may be sufficiently original and creative to qualify for copyright protection in addition to trademark protection.[6]
One can envision a situation in which an artist assigns the copyright in a work of art to a company that then uses that image as a trademark or as part of a trademark. The company may have spent years building brand recognition around the image only to face an attempt to terminate the original copyright assignment by the artist who created the work. The artist would argue that the assignee would then be unable to use its own trademark without permission from the copyright holder.
It is important to note that, in such a situation, trademark rights, which are separate from copyright, would likely remain with the assignee. Although the artist would seek to regain control of the copyright in the work itself, the assignee would likely have good arguments that, even if such an attempt by the artist is successful, the assignee would continue to have the right to use the image as a trademark. Thus, the artist would seek to regain control of the original copyright, but he or she may be unable to use the image as a trademark in the same manner that the assignee used the image, even if he or she successfully regains control of the copyright. For example, if the assignee used the image as a trademark for shoes, the artist likely would not be permitted to attach the recaptured image to his or her own brand of shoes, because such use may infringe the assignee's trademark rights.
Further, Congress recently strengthened protections against trademark dilution via the Trademark Dilution Revision Act (TDRA).[7] The TDRA makes it easier for holders of strong trademarks to prevent use of similar marks that might not create consumer confusion but that nonetheless are "likely" to cause dilution of the famous mark.[8] In the example discussed above, the owner of a copyrighted work that has become a trademark for shoes could not turn around and use the same copyrighted work on his or her own brand of shoes. If the trademark had become strong under the TDRA, the copyright owner may also be unable to use the copyrighted work on unrelated products, or even sell the image on T-shirts or other media. It is important to note that these issues would arise under the TDRA only if the trademark resulting from the assigned copyright is sufficiently strong. Nonetheless, an author reclaiming a copyrighted trademark faces substantial risk if he or she seeks to exploit the work for his or her own benefit.
The conflict between trademark and copyright is not a new phenomenon. For example, in Nova Wines, Inc. v. Adler Fels Winery LLC, the plaintiff and the defendant both used images of Marilyn Monroe on wine bottles.[9] The defendant had obtained the necessary copyright authorization to use the specific image of Marilyn Monroe in question, but the court held that the plaintiff had established a trade dress interest in associating Marilyn Monroe with wine—that is, the use of Marilyn Monroe's image on wine bottles had become a source-identifier for the plaintiff.[10] Accordingly, at the preliminary injunction stage, the court held that the plaintiff's authorized use of a copyrighted image nonetheless may infringe another party's trade dress.[11] Thus, ownership of a copyright may not be sufficient to authorize the use of a copyrighted work in all settings. The valid exploitation of a work under copyright law may nonetheless tread on other intellectual property rights.
The Federal Circuit weighed in on this issue in Boyle v. United States, stating that "the government's issuance of a service mark registration to [one party] cannot be construed as either authorization or consent for it to infringe [another party]'s copyright," and "possession of a service mark is not a defense to infringement of a valid copyright."[12] Although these statements were made in the context of rejecting a copyright holder's taking claim against the government for issuing a trademark, the case has been cited by decisions addressing the tension between copyright and trademark law where parties have conflicting ownership.
For example, in Sadhu Singh Hamdad Trust v. Ajit Newspaper Advertising, Marketing and Communications, Inc., the court denied summary judgment on a claim of copyright infringement regarding a work on which the same court had previously granted summary judgment on a claim of trademark infringement.[13] The court acknowledged that "it may appear contradictory for the Court to deny plaintiff's trademark claim, yet consider its claim of copyright infringement on the...
To continue reading
Request your trial