You can read our new white paper, Making Sense of the Termination Right: How the System Fails Artists and How to Fix It, at publicknowledge.org/Termination.
Hidden inside Title 17 of the United States Code of Laws sits an unassuming but powerful right that Congress gave to artists and creators: the termination right. Unlike many statutory rights, this right is inalienable – it cannot be given away, not even through contract. Many artists enter into deals with companies that help fund, develop, resource, promote, and distribute their creative output. Typically, such deals involve artists granting or licensing the copyright in their work to these business partners for lengthy periods of time; sometimes these transfers are legally binding forever. The termination right allows authors of creative works to cut short, or terminate, existing grants or licenses of their work after at least 35 years have passed, regardless of their contract terms.
Congress justified the creation of the termination right on both economic and moral grounds. The right — codified at Sections 203 and 304 of the Copyright Act — was enacted to protect authors and their heirs against agreements that were unprofitable or inequitable by giving them an opportunity to share in the later economic success of their works. In crafting the right, Congress also recognized that unequal power dynamics left artists at a disadvantage when negotiating against more established licensees — particularly given that artists typically enter into their first business contracts early in their careers when they lack both bargaining power and negotiating expertise. Artists of color in particular were often subject to exploitative contracts. In short, the termination right offered artists and their heirs a fair shot at ending unfair contracts by reclaiming their rights.
Some artists may choose to exercise their termination right and reclaim ownership of their work. Other artists may use it as leverage to negotiate (or renegotiate) a better deal. This chart illustrates some of the various goals, pathways, and outcomes for artists and creators exercising the termination right:
Whichever path artists choose, they can control their financial and artistic futures by using the termination right. Ensuring that creators can effectively exercise this right — and thus fully participate in the social, cultural, and economic life of the country — is a core social justice issue.
Unfortunately, many artists and creators appear unable to exercise what is supposed to be an inalienable right. Court records, academic studies, and press reports all point to dysfunction within the termination right regime. The right is complex to execute, and that has allowed problems to take root as artists struggle to fulfill obscure eligibility, timing, and filing formalities which together create significant hurdles that are difficult (if not impossible) to overcome without expensive legal representation. Even when artists meet their statutory obligations, they can find themselves entangled in lengthy and expensive litigation to resolve ambiguities in the law and its application, ranging from judicial “work for hire” determinations to disputes over the statute of limitations. Artists shouldn’t have to become legal experts or hire pricey lawyers just to benefit from their work.
These imbalances are made worse by the power and information asymmetries between creators and their corporate business partners. Although the termination right is designed to level the playing field between artists and the companies that own the artists’ rights, termination right success stories are virtually non-existent. Even hugely successful legacy artists such as Billy Joel have reportedly tried and failed to reclaim ownership of their works. Creators who lack the financial resources or name recognition needed to engage in lengthy legal and public relations battles may be unable to even reach the doorstep of termination. For artists of color, who form the axis mundi of many creative industries yet go under- or un-represented in boardrooms and at the negotiating table, the path seems even narrower. And while it is certainly possible that these legal disputes and contract renegotiations may actually generate positive results for artists and creators, information on these processes is scarce due in large part to the proliferation of non-disclosure agreements throughout the creative industries. The lack of reliable, actionable information leaves policymakers and advocates with little more than anecdata, further exacerbating the information asymmetries that plague the system.
There is no “quick fix” for curing dysfunction in the termination right regime. Political disagreements among stakeholders, as well as a lack of empirical data that could inform good policymaking, combine to create a uniquely challenging environment for change. However, certain targeted policy actions can help restore fairness and functionality to the system for artists and licensees alike.
Public Knowledge recommends that the U.S. Copyright Office conduct a thorough study of the federal termination right regime. The system is highly complex, and too often important information related to the issue is kept hidden from public view. For these reasons, the study should be inclusive and transparent, with every reasonable effort made to shine a light on the parts of the termination right story that have gone unseen. Given that the Copyright Office cannot compel stakeholders to submit confidential documents, it would be necessary for the Office to implement a mechanism to facilitate voluntary submission, perhaps under seal or in redacted form. To the extent that it identifies dysfunction in the system, the study should explore meaningful reforms to best help artists take control of their creative futures, support themselves and their families, and spur on the creation of new and original works that benefit us all.
Tell Congress to call on the Copyright Office to conduct a formal study of the termination right at publicknowledge.org/ReviewTheTerminationRight.