ABKCO Music, Inc. v. LavereABKCO Music, Inc. v. Lavere
Thе ultimate question in this case is whether a phonorecord distributed in the late 1930s “published” the underlying work such that the clock started ticking under the Copyright Act of 1909.
ABKCO Music, Inc., whose library includes two Rolling Stones hits — Love in Vain, released in 1969, and Stop Breakin’ Down, released in 1972 — sought a ruling that the versions of these two songs recorded by Robert Johnson and distributed on a phonograph in the late 1930s were in the public domain under La Cienega. The district court determined on summary judgment that the Johnson versions of Love in Vain and Stop Breakin’ Down irrevocably entered the public domain when the copyrights were not renewed
I
Robert Johnson, a blues artist, recorded 29 songs before he was murdered in 1938. Sixteen were recorded in a November 1936 session, and, after the 1936 recordings were successfully distributed by Vocation Records, Johnson returned to the studio in June 1937 to record 13 more songs including Love in Vain and Stop Breakin’ Down. Vocation released Stop Breakin’ Down on March 20, 1938 and Love in Vain on February 9, 1939. No copyright registration for either song was filed. In the early 1960s, Columbia Records re-released Johnson’s recordings.
In 1969, The Rolling Stones released an album called Let It Bleed, which contained an adapted version of Love in Vain, and in 1972, the Rolling Stones adapted Stop Breakin’ Dovm for their album Exile on Main Street. ABKCO’s predecessor filed a copyright registration on Love in Vain in May 1970 and ABKCO filed a copyright registration claiming protection for The Rolling Stones’ adaptation and arrangement of Stop Breakin’ Down in 1972.
Meanwhile, LaVere became interested in Johnson’s music and by 1974 had located Carrie Thompson, Johnson’s sister, who was thought to be his only surviving heir. LaVere agreed to try to generate income from Johnson’s legacy and to pay Thompson (on behalf of Johnson heirs) fifty percent оf all royalties collected in exchange for her assignment to him of her copyright interests in Johnson’s works. LaVere formed King of Spades Music, a publishing company to administer the Johnson compositions and copyrights. Over time he assigned his copyright interests to Mimosa, which in turn assigned them to Delta Haze (whose dba is King of Spades Music).
In 1990, Columbia Records released a two-CD boxed set of Johnson’s recordings entitled Robert Johnson — The Complete Recordings. Love in Vain and Stop Brea-kin’ Down were included. It was quite successful. Columbia evidently recognized Jоhnson’s common law copyrights as, eventually, did other successful pop artists who adapted Johnson’s works. However, ABKCO did not. LaVere filed a copyright registration for the Columbia release in 1991. In February 1993 Delta Haze demanded that ABKCO cease and desist from unlicensed uses of the Johnson songs. Protracted negotiations followed. When it became clear they were going nowhere and Delta Haze threatened to sue in the summer of 1995, ABCKO filed this action for declaratory relief on November 9, 1995. It sought an order that the Johnson versions of Love in Vain and Stop Brea-kin’ Down are in the public domain under La Cienega. Delta Haze counterclaimed for a declaration that no protectable copyright interest exists in The Rolling Stones’ versions of Love in Vain and Stop Brea-kin’ Down and that it, rather than AB-KCO, is the sole owner of the legal copyright in these compositions.
Delta Haze moved to dismiss pursuant to Rule 12(b)(7) on the grounds that the Johnson Estate was an indispensable party and that ABKCO lacked standing. Both motions were denied. Each party moved for summary judgment, but bеfore the district court could rule,
Delta Haze timely appealed.
II
We first address two arguments advanced by Delta Haze that would require dismissal, if correct.
A
Delta Haze contends that ABKCO lacks standing because it did not allege ownership and registration with respect to Stop Breakin’ Down as well as Love in Vain, and averred that it filed this action on account of a threatened suit for infringement arising only from Love in Vain. We disagree that the complaint’s failure specifically to mention Stop Brea-kin’ Down matters, for the record shows that ABKCO in fact filed a copyright registration (No. Eu 326810) on Stop Breaking Down April 27, 1972 as an “adaptation of words & music of a work in P.D.” The registration reflects Mick Jagger and Keith Richard as authors. Further, the record shows that from Delta Haze’s February 22, 1993 letter on, both parties understood the dispute to involve all Johnson works recorded by the Rolling Stones, including Stop Breakin’ Down as well as Love in Vain. Suit was сlearly threatened in June and August of 1995. Therefore, when ABKCO filed its action for declaratory relief on November 9, 1995, there was an actual controversy with respect to rights in the Johnson works sufficient to confer standing. See, e.g., Coral Constr. Co. v. King Co.,
B
Delta Haze also аrgues that AB-KCO’s action should have been dismissed for failure to join the Johnson Estate, the beneficial owner of the copyrights, as an indispensable party under
Ill
Turning to the central issue on appeal, Delta Haze argues that applying
A
This issue has a long history, stretching back to 1831, when Congress first extended copyright protection to original musical compositions. At that time, there was no technology for mechanically reproducing music, and Congress merely protected the copying of the sheet music. See Goldstein v. California,
only to establish the limits of the composer’s right; composers were to have control over the recordings themselves. Nowhere does the report indicate that Congress considered records as anything but a component part of a machine, capable of reproducing an original composition, or that Congress intended records, as renderings of original artistic performance, to be free from state control.
Id. at 566,
“Under the 1909 Act, an unpublished work was protected by state common law copyright from the moment of its creation until it was either published or until it received protection under the federal copyright scheme.” Id. at 952. When a work was published, it lost common law protection. See id. at 953. The owner could obtain federal protection for the published work by complying with the 1909 Act’s requirements; otherwise, the work entered the public domain. See Twin Books Corp. v. Walt Disney Co.,
The 1909 Act did not define the term “publication”; however, the Second Circuit held in Rosette v. Rainbo Record Mfg. Corp.,
However, in November 1997, the Copyright Act was amended to provide that “[t]he distribution before January 1, 1978, of a phonorecord shall not for any purpose constitute a publication of the musical work embodied therein.”
There is no dispute that if La Cienega applies to this case, the Johnson songs were published in 1938 and 1939 when they were released on phonorecord. The 28-year period of copyright protection under the 1909 Act would have begun to run at that time, expiring in 1966 and 1967. Since the copyrights were not renewed for a second 28-year term, the songs would have passed into the public domain. If, on the other hand,
Thus, the question that matters is whether
B
LaVere contends that we need not be concerned with retroactivity at all, because the purpose and effect of
If [the statute] were to be characterized in the lattér fashion [as a “substantial change in the law”], its retroactive application would pose a series of potential constitutional problems. If however [the statute] merely clarifies what [the prior statute] was originally intended to mean ... it has no retroactive еffect that might be called into constitutional question.
Beverly Community Hosp. Ass’n. v. Belshe,
There is a good argument that the 1997 amendment simply clarifies what the meaning of the 1909 Act was all along— namely, that the distribution of phonoree-ords did not constitute publication of the underlying works. As the House Report on the 1997 amendment indicates, the bill that resulted in
The La Cienega decision has, therefore, placed a cloud over the legal status of a large number of musical works recorded and sold before January 1, 1978. Moreover, it has called into question the long established interpretation of the Copyright Office. It is the intent of this section to remove the cloud and bring the law into conformity with the Second Circuit opinion and Copyright office practices.
Id. at 5.
Members of Congress expressed the same view. For example, Senator Leahy, a Senate co-sponsor, said the bill “was intended to clarify the Copyright Law of 1909 on an issue that has become a matter of increasing litigation in a number of Federal Circuits since the Ninth Circuit decision in the ZZ Top case.” 143 Cong. Rec. S11498 (1997). Senator Hatch, also a sponsor and Chair of the Senate Judiciary Committee, remarked that “Rosette comports with the nearly universal understanding of the music and sound recording industries and of the Copyright Office”; “overturning the La Cienega decision will restore national uniformity on this important issue by confirming the wisdom of the custom and usage of the affected industries and of the Copyright Office for nearly 100 years.” 143 Cong. Rec. S11301 (1997). Similarly on the House side, Representative Coble, who sponsored the legislation and chaired the House Judiciary Committee Subcommittee on Courts and Intellеctual Property, introduced the bill on the floor by explaining that it “clarifies that the distribution of a phonorecord before January 1, 1978, did not constitute a publication of the musical work embodied therein.” 143 Cong. Rec. H9882 (1997). Representative Bono stated that the bill was needed because La Cienega “has jeopardized the private property rights for thousands of creative individuals who live within the jurisdiction of the Federal Court of Appeals of the Ninth Circuit.” 143 Cong. Rec. H9882 (1997). And Representative Berman noted that composers had “rel[ied] on an industry standard of many decades duration,” a “long-time understanding of copyright law [which] has been ratified and reaffirmed by the Second Circuit.” “The La Cienega decision took that settled law and cast it on its head, threatening to thrust into the public domain hundreds of thousands of musical works
, From this record it is evident that Congress believed La Cienega was aberrational, that Rosette was the accepted and controlling interpretation, and that
However, ABKCO insists that
It is clear from the language employed that§ 303(b) should be applied to pеnding cases. First, the subsection obviously applies to pre-enactment conduct. In fact, it applies only to the distribution of records prior to January 1, 1978. Thus, applying the statute to pending cases has no impact on the conduct that is the subject of the subsection. Second, the subsection provides that the distribution of phonorecords “shall not for any purpose constitute a publication.” This court would be defying the express mandate of the statute if it were to dеcide on de novo review that phonorecord distribution constitutes publication. Finally, the presumption against retroactive application of statutes is based, in part, on a hesitancy to reverse settled expectations. In enacting§ 303(b) , however,Congress has resolved a problem of unsettled expectations that had arisen from the circuit split. We conclude that § 303(b) should be applied in resolving the present appeal.
Id. at 824 (citations omitted). We agree, and hold that
IV
Delta Haze also asks for reversal of the district court’s denial of its cross-motion for summary judgment and, failing that, argues that judgment should have been granted on its counterclaims. To the extent that its cross-motion is the mirror image of ABKCO’s, Delta Haze is entitled to a judgment declaring that the Johnson versions of Love in Vain and Stop Brea-kin’ Down did not enter the public domain when the phonorecords on which they were recorded were released in 1938 and 1939. Beyond this, however, we believe the district court is in а better position than we to sort out the issues that remain. For example, Delta Haze argues that AB-KCO can have no ownership interest in The Rolling Stones’ versions of the two works because The Rolling Stones added no original material. This may, or may not, raise triable issues — a point that we assume the district court has never considered, given its ruling that the Johnson works were in the public domain when The Rolling Stones made its adaptations.
ABKCO argues that dismissal of Delta Haze’s counterclаim was proper because it never threatened to sue for infringement, therefore there was no controversy between them to give the district court subject matter jurisdiction. But we cannot be certain of this, for the counterclaims appear to contest ABKCO’s claim to any protectable interest in the adaptation performed by the Rolling Stones. In addition, ABKCO contends that whatever claim Delta Haze might be able to state is time-barred. Again, these issues arе best left to the district court on remand.
Because we cannot tell from the district court’s order why it dismissed the counterclaims (it could simply have been that the counterclaims necessarily fell given the decision that the Johnson versions were in the public domain), we vacate the order dismissing the counterclaims. In doing so, we intimate no view one way or the other on the merits of the counterclaims or any motions that may be made with respect to them.
To summarize: we reverse the order and judgment granting ABKCO’s motion for summary judgment; we order judgment to be entered for Delta Haze that the Robert Johnson versions of Love in Vain and Stop Breakin’ Down did not enter the public domain when phonorecords embodying those works were released before 1978; and we vacate the judgment for ABKCO on Delta Haze’s counterclaims.
REVERSED and REMANDED.
Notes
. Under the 1909 Act, a properly registered artistic work receives copyright protection for 28 years from the date of first publication, renewable once fоr another 28 years. See Copyright Act of 1909, ch. 320, § 23, 35 Stat. 1075, 1080. The Copyright Act of 1976 amended the 1909 Act (effective January 1, 1978) in ways that are not material to this case. Prior to the 1997 amendment,
Copyright in a work created before January 1, 1978, but not theretofore in the public domain or copyrighted, subsists from January 1, 1978, and endures for the term provided by section 302. In no case, however, shall the term of copyright in such work expire before December 31, 2002; and, if the work is published on or before Decembеr 31, 2002, the term of copyright shall not expire before December 31, 2027.
Amended
(a) Copyright in a work created before January 1, 1978, but not theretofore in the public domain or copyrighted, subsists from January 1, 1978, and endures for the term provided by section 302. In no case, however, shall the term of copyright in such a work expire before December 31, 2002; and, if the work is published on or before December 31, 2002, the term of copyright shall not expire before December 31, 2047.
(b) The distribution before Januаry 1, 1978, of a phonorecord shall not for any purpose constitute a publication of the musical work embodied therein.
Pub.L. 105-80, § 11, Nov. 13, 1997, 111 Stat. 1534; Pub.L. 105-298, Tide I, § 102(c), Oct. 27, 1998, 112 Stat. 2827.
. See Mayhew v. Allsup,
. See McIntyre v. Double-A Music Corp.,
. Given our conclusion that