Milne and Disney Enterprises, Inc. v. Stephen Slesinger, Inc.

Holding:

In this action for declaratory relief, the U.S. District Court for the Central District of California ruled against plaintiff heir of an author of children’s books and co-plaintiff Disney Enterprises. Specifically, the district court held that the plaintiffs’ copyright termination notices seeking to cancel license rights first granted under a 1930 agreement were invalid. According to the court, a subsequent agreement entered into by the parties in 1983 re-granted such rights and served to bar the intended cancellation sought in 2002. Termination rights over grants given by an author on or after the effective date of the Copyright Act of 1976 are governed by Section 203 (a) of the Copyright Act, but the same provision states that such a grant may not be terminated for thirty five years.

Detailed Summary:

This action was brought before the US District Court for the Central District of California involving the issue of validity of termination notices made by the heir of the author of popular children’s books made up of “Winnie the Pooh” characters. Defendant was the licensee of the copyrighted works.  Plaintiffs’ suit merely sought a declaratory judgment from the court to say the copyright termination notices served on defendant in 2002 involving the rights provided under the 1930 grant and1961 agreements were valid, and that the rights to the works would revert to the plaintiff-grantor in 2004.

Both parties filed motions for summary judgment.  In resolving the issue, the district court took into account the evolution of federal copyright law, starting with the passage of copyright laws in 1909, then in 1976, and finally the Sonny Bono Copyright Termination Extension Act (“CTEA”) effective October 27, 1998.  The CTEA granted additional residual rights to authors and heirs of protected works whose termination rights under the Copyright Act of 1976 had expired without being exercised, as stated in 17 U.S.C. Section 304.

Termination rights over grants given by the author on or after the effective date of the Copyright Act of 1976 are governed by Section 203 (a) of the Copyright Act, but the same provision states that such a grant may not be terminated for thirty five years.  The court also discussed various agreements made by the parties, including between the deceased author (made during his lifetime), his son, granddaughter, the defendants, and co-plaintiff Disney Enterprises.

Plaintiffs asserted that the 1983 agreement was merely an extension of the 1930 grant, as they pointed to provisions of Sections 304(c) and 203 (a) which stated, “Termination of the grant may be effected notwithstanding any agreement to the contrary, including an agreement to make a will or make any future grant.”

The court disagreed, believing what was involved was a post-1978 agreement, and considering that the grant in question was not made by the author himself. In addition, the court observed that termination rights under the 1976 Act were not exercised where the parties to the 1983 agreement “did not attempt to change or modify the nature of their association with one another, or alter the character of their long-standing author/grantee relationship.”

Therefore, on the basis of finding that the 1983 agreement was a separate contract made effective after January 1, 1978, the court ruled that the copyright termination notice served in 2002 was invalid.

No monetary award was issued since no amount was sought in this action that was only for declaratory relief.

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