By William Harnish
Creative people often ask attorneys, “How do I protect my work?” or “How do I get a copyright?” or “What will a copyright get me?” These are great questions, but a related question is often unasked: “What happens to my copyrighted work when I die?”
The short answer: It depends.
This article discusses certain issues that should be considered when planning how a copyright will be transferred to a beneficiary. An attorney should always be consulted for this type of planning, as many transfers depend on the facts and circumstances concerning a copyright.
To start, pretend there is a man named Jasper Nuggins. Jasper’s lifelong dream has been to write the next great American novel. He spends countless hours drafting chapter after chapter of the story of the struggle of one man to find himself in the concrete jungle of New York City. Jasper’s wife, Prue Nuggins, humors her husband’s creative ambitions.
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Now pretend that Jasper’s agent lands Jasper a publishing deal. Jasper signs the deal, finishes his book, and, once the book has gone to press, relishes in the fact that he is a published author.
Shortly after publishing, Jasper gives his entire manuscript to his brother, Sly Nuggins, with the sober counsel: “Keep this book, Sly, and make what you can out of it. I don’t want Prue to have it because, bless her heart, she has never understood why I wrote it. But you understand, so it is yours.”
Now pretend that Jasper dies five years later. Jasper’s will bequeaths his entire estate to his wife, Prue. The manuscript stays with Sly since it was a gift and is excluded from Jasper’s estate. A year after Jasper’s death, a movie producer contacts Jasper’s agent with the intent of making a movie based on Jasper’s book. One of the first questions the agent might ask is: “Who has the copyright to Jasper’s book?” Or, in other words: “Who is authorized to sign this movie deal and collect potential royalties?”
Based on the gift and the communique to Sly, one could think that Sly now has the copyright; after all, Jasper literally handed him the manuscript. This may have been Jasper’s intent, but copyright law under Title 17 of the United States Code may fashion an answer contrary to Jasper’s intent.
For starters, transfer of the material form of an artistic work is usually not enough to transfer the underlying copyright to the work. A copyright is typically transferred by a signed agreement. An agreement can be as broad as granting all rights with the copyright or as refined as granting a non-exclusive license for one right under the copyright.
The opposite is also true: a valid transfer of a copyright does not automatically transfer physical possession of the artistic work. Physical transfer would have to be contemplated in the agreement.
In the example of Jasper’s gift to Sly, simply handing over the manuscript should not transfer the copyright to the work. Jasper still owned the copyright and likely did not know it (even though he was still entitled to any royalties from book sales). Sly has a memento, but he can neither sign nor benefit from the movie deal since he was not properly assigned the copyright during Jasper’s life.
So, who has it? Jasper’s will gave all of his property to his wife, so she should own the copyright.
What should Jasper have done if he truly wanted Sly to have the copyright? Had Jasper spoken with an attorney, he would have learned that copyright ownership goes beyond simply possessing the material object. He would have also learned that lifetime transfers are not always permanent. An attorney could have shown Jasper his options and they could have planned how to transfer the copyright to Sly in a way that made the most sense.
To illustrate these options, pretend that Jasper, during his life, had not only given Sly the manuscript, but had also signed an agreement that transferred all his rights under the copyright to Sly. This should make it so that the copyright would not pass to Prue during the administration of Jasper’s estate. One thing to consider with this type of lifetime transfer is that current copyright law allows Jasper to terminate this transfer 35 years after the transfer — if he is still alive. Despite Jasper dying five years later in this example, Sly is not off the hook. The right of termination is reserved for Prue, any of Jasper’s children and potentially his grandchildren. This right of termination applies to any lifetime transfer and is called “forced heirship.”
It should be noted that a lifetime transfer of a copyright does not have to be limited to individuals. A creator can transfer a copyright — or limited rights of a copyright, or grant a license — to a trust, LLC, partnership or corporation. If a creator has a trust in place then he or she can transfer the copyright to the trustee and the copyright will be administered with the rest of the trust property. A company can receive a copyright and use it in its normal course of business. The right of termination after a creator’s death would also apply to any of these entities.
Why would the law allow the complete transfer of Jasper’s copyright to Sly to be terminated? It is clear that Jasper wanted Sly to have the book. Congress recognizes, however, that this is not always the case. Many young or up-and-coming creators are prone to sell their copyrighted material for a quick buck or recognition and may not be savvy enough to get the best deal for their work. A right of termination allows a creator or its heirs to reclaim the copyright and enjoy a more equitable return on the creator’s work.
An exception to this right of termination is to have a copyright pass by will.
Pretend now that Jasper’s attorney had related all this to his client. How should Jasper plan during his life if he truly wants Sly to have the copyright? As noted above, he could execute a written agreement that outlines exactly what rights he wants to transfer to Sly. Jasper could elect to only grant Sly the movie rights, or rights of duplication or all rights. Any rights retained by Jasper, however, would likely pass with his estate — in this case, to Prue. Further, Prue and any of Jasper’s children and grandchildren should have a right to terminate any rights that were transferred to Sly during Jasper’s life.
On the other hand, Jasper could retain the copyright for himself during his life but then expressly name Sly as the recipient of the book’s copyright in his will, likely eliminating the threat of termination.
Creators are amazing people doing amazing work that can make a difference for generations, which is why creators should take care when planning what to do with any copyright after death. The wrong manner of transferring the copyright could result in consequences the creator would have liked to avoid.
William D. Harnish is an attorney in the Salt Lake City office of Snell & Wilmer. His practice is concentrated in estate planning, with a focus on wills, trusts and nonprofit entities.{/mprestriction}
