Santa Claus Is Comin’ To EMI

In 1934, John Frederick Coots and Haven Gillespie wrote the song “Santa Claus Is Comin’ to Town.”  They conveyed the copyright to Leo Feist, Inc., a prominent music publisher at the time.  The copyright in the song was covered by the 1909 Act, which provided for a 28 year initial term followed by a second 28 year renewal term.  In 1951, Coots and Gillespie entered into a new agreement granting Feist the renewal term, such that when the original term ended in 1962, Feist remained the copyright owner for the renewal term (until 1990).  Coots’ heirs claim the song still generates $1mm per year in royalties, in which they share 25% (half of the half of the writers’ share).

The 1909 Act has been extensively amended over the years, beginning in 1976.  Two significant changes involve (1) the duration of copyright and (2) the rights of authors to terminate transfers.

With respect to copyright duration, the 1976 Act provided for a term of 75 years for all works created before January 1, 1978, which would include Santa Claus Is Comin’ to Town.  In 1998, the Sonny Bono Act the term was extended another 20 years, meaning Santa Claus Is Comin’ to Town enjoys a 95 year term–from 1934 to 2029.

The 1976 Act completely changed the way in which authors could regain control of their works.  Rather than 2 separate terms, the 1976 Act has a single term, but a right to terminate any transfer after a certain period of time.  For works created before January 1, 1978, Sec. 304(c)(3) of the Act provides for termination of any transfer of copyright ownership “can be effected at any time during the period of five years beginning at the end of the fifty-six years from the date the copyright was originally secured, or beginning January 1, 1978, whichever is later.” In this case, 56 years after 1934 is 1990.  Because the Bono Act extended the term of copyright by another 20 years, there is a second termination provision in Sec. 304, which allows for termination to be effected “during a period of 5 years beginning at the end of 75 years from the date the copyright was originally secured.”  But only where the author had not previously exercised a termination right.

Importantly, Sec. 304(c) has a recordation formality: a copy of any notice of termination must be recorded with the Copyright Office “before the effective date of termination, as a condition to its taking effect.”

On September 24, 1981, pursuant to Section 304(c), Coots sent Feist a notice to terminate the 1951 Agreement, selecting October 23, 1990 as the effective date of termination.  On November 25, 1981, Coots’ attorney, M. William Krasilovsky sent the 1981 Notice to the Copyright Office for recordation.  For you collectors of copyright trading cards, William Krasilovsky is the author of This Business of Music (now in its 10th edition), one of the most respected books on the music industry.  However, on May 7, 1982, the Copyright Office sent Krasilovsky a letter, stating, “[p]ursuant to our telephone conversation of March 1, 1982, we are returning [the 1981 Notice] to you unrecorded.” Only Krasilovskywas copied on the letter. The 1981 Notice was never later recorded with the Copyright Office.

On April 6, 2004, Gloria Coots Baldwin, Patricia Bergdahl, and Christine Palmitessa (Coots’ heirs) sent EMI, which had purchased Feist, a termination notice (the “2004 Notice”), pursuant to Section 304(d) seeking to terminate Coots’ transfer effective in 2009 (1934 plus 75 years),  EMI filed a motion for summary judgment on the grounds that (a) the 1981 termination was ineffective because the notice was never recorded in the Copyright Office and (b) the 2004 notice was ineffective because it was a second attempt to terminate a transfer, which Sec. 304(d) does not allow.  Judge Scheindlin of the Southern District of New York agreed with EMI and granted its motion.  Her decision is here.