SHELDON ABEND, dba AUTHORS RESEARCH COMPANY,
Plaintiff-Appellant, v. MCA, INC.; UNIVERSAL FILM EXCHANGE,
INC.; JAMES STEWART; PATRICIA HITCHCOCK O'CONNELL, as
Co-Executor of the Estate of Alfred Hitchcock and as
Co-Trustee of the Assets of the Estate of Alfred Hitchcock;
SAMUEL TAYLOR, as Co-Executor of the Estate of Alfred
Hitchcock and as Co-Trustee of the Assets of the Estate of
Alfred Hitchcock, Defendants-Appellees
Nos. 87-5780, 87-5833, 87-5922
UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT
863 F.2d 1465; 1988 U.S. App. LEXIS 17515; 9 U.S.P.Q.2D
(BNA) 1337; Copy. L. Rep. (CCH) P26,366
June 10, 1988, Argued and Submitted
December 27, 1988, Filed
PREGERSON, Circuit Judge:
Abend, owner of the renewal copyright on the original story on which the
motion picture "Rear Window" was based, brought suit against MCA and the
trustees and executors of Alfred Hitchcock's estate and assets. Abend's
complaint alleges copyright infringement based on defendants' re-release of the
"Rear Window" film in theatres, on TV, and on videocassette. The district court
granted defendants' motion for summary judgment based on the Second [**2]
Circuit's decision in Rohauer v. Killiam Shows, Inc., 551 F.2d 484 (2d Cir.),
cert. denied, 431 U.S. 949, 53 L. Ed. 2d 266, 97 S. Ct. 2666 (1977), and the
"fair use" defense. The district court denied defendants' motion for summary
judgment based on alleged defects in the story's copyright and also denied
plaintiff's motion for summary judgment as to defendants' liability for
copyright infringement. Plaintiff appeals the grant of summary judgment for
defendants and the denial of his motion for summary judgment. Defendants
cross-appeal the denial of their motion for summary judgment based on alleged
defects in the story copyright.
BACKGROUND
Plaintiff Abend, a literary agent, acquired from Chase Manhattan Bank the
renewal copyrights in several stories written by Cornell Woolrich. Chase
Manhattan Bank is the executor of Woolrich's estate. One of these stories, "It
Had to be Murder," was the basis for the 1954 film "Rear Window." The story was
first published in February 1942 in Dime Detective Magazine. The magazine had a
"blanket copyright" in the name of its publisher, Popular Publications, Inc. On
April 6, 1943, Popular Publications assigned any rights it had in the story,
except the right of magazine [**3] publication, to Woolrich, the author. The
assignment was recorded in the U.S. Copyright Office.
In 1945, Woolrich agreed to assign the rights to make motion picture versions
of six of his stories, including "It Had to be Murder," to B.G. De Sylva
Productions for $ 9,250. He also agreed to renew the copyrights in the stories
at the appropriate time and then assign the same movie rights to De Sylva
Productions for the 28-year renewal term. The defendants acquired the movie
rights in the story from De Sylva's successors in interest for $ 10,000.
In 1954, Paramount Pictures produced and distributed "Rear Window," the
classic movie version of Woolrich's story "It Had to be Murder." Alfred
Hitchcock directed; Grace Kelly and James Stewart starred.
Woolrich died in 1968 without a surviving spouse or child. He left his
property to a trust administered by his Executor, Chase Manhattan Bank, for the
benefit of Columbia University. On December 29, 1969, Chase Manhattan Bank
renewed the copyright in the "It Had to be Murder" story pursuant to 17 U.S.C. §
24. In 1972, Chase Manhattan assigned the renewal copyright to the plaintiff
Abend for $ 650 plus 10% of all proceeds from exploitation of the [**4] story.
Meanwhile, the film version had been broadcast on the ABC television network
in 1971. Plaintiff Abend at that time notified defendants Alfred Hitchcock,
James Stewart, and MCA that Abend owned the copyright renewal, but the
defendants nonetheless proceeded to enter into a second license with ABC to
rebroadcast the movie. In 1974, Abend filed suit against these same defendants,
and others, in the U.S. District Court for the Southern District of New York,
alleging copyright infringement. To settle the liability for this alleged
[*1468] infringement, Abend dismissed his complaint in return for $ 25,000. n1
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n1 The parties both proceed on the assumption that the settlement did not
address any of the issues raised in the current appeal.
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Three years later, the Second Circuit handed down its decision in Rohauer v.
Killiam Shows, Inc., 551 F.2d 484 (2d Cir.), cert. denied, 431 U.S. 949, 53 L.
Ed. 2d 266, 97 S. Ct. 2666 (1977). Relying on that decision, defendants
authorized Universal Pictures to re-release the film. The re-release involved
making new 35 and 16-millimeter prints of the film for theatrical exhibition in
the United States, creating videocassettes and videodiscs of the film, and
publicly exhibiting [**5] the film in theaters, over cable TV, and through
videodisc and videocassette rentals and sales. The re-release generated over $
12 million in revenue.
Abend brought suit against Alfred Hitchcock, James Stewart, and MCA -- the
owners of the "Rear Window" film and the renewal copyright in the film -- and
Universal Film Exchange, the distributor of the film. Abend's complaint alleges
that the re-release constitutes copyright infringement. The complaint further
alleges that defendants also interfered with the exercise of Abend's renewal
rights in other ways. Specifically, Abend contends that he sought to contract
with Home Box Office (HBO) to produce a play and TV version of the story, but
that defendants wrote him and HBO stating that neither he nor HBO could use
either of the titles -- "Rear Window" or "It Had To Be Murder." The complaint
alleges that defendants further interfered with Abend's renewal copyright by
attempting to sell the right to make a TV "sequel." The complaint also alleges
that the re-release of the original movie in itself interfered with Abend's
ability to produce other derivative works.
The parties filed cross-motions for summary judgment. Defendants initially
filed two [**6] motions for summary judgment, one based on Rohauer, the other
based on alleged defects in the story's copyright. Plaintiff moved for summary
judgment as to defendants' liability for copyright infringement. Defendants then
filed a third motion for summary judgment based on a "fair use" defense. At the
hearing on the motions, the district court granted defendants' motions for
summary judgment based on Rohauer and the fair use defense. The court denied
plaintiff's motion for summary judgment and defendants' motion for summary
judgment which alleged defects in the story's copyright. The plaintiff appeals
the district court's grant of summary judgment for defendants and the denial of
his motion for summary judgment. Defendants have cross-appealed from the
district court's denial of their motion for summary judgment based on alleged
defects in the story's copyright.
STANDARD OF REVIEW
We review a district court's grant of summary judgment de novo, viewing the
evidence in the light most favorable to the non-moving party, to determine if
any genuine issues of material fact exist. Baxter v. MCA, Inc., 812 F.2d 421,
423 (9th Cir.), cert. denied, 484 U.S. 954, 108 S. Ct. 346, 98 L. Ed. 2d 372
(1987). Whether [**7] a use of copyrighted material is a "fair use" is a mixed
question of law and fact. Harper & Row Publishers, Inc. v. Nation Enterprises,
471 U.S. 539, 105 S. Ct. 2218, 2230, 85 L. Ed. 2d 588 (1985). If the district
court found sufficient facts to evaluate each of the statutory factors, the
appellate court may decide whether defendants may claim the fair use defense as
a matter of law. Fisher v. Dees, 794 F.2d 432, 436 (9th Cir. 1986).
DISCUSSION
I. Did a Defective Copyright Notice or Defective Copyright Renewal Place the
Rear Window Story In the Public Domain Before 1970?
A. Was the Blanket Copyright Notice Defective?
The parties agree that in 1942 Woolrich conveyed to Popular Publications
[*1469] the magazine publication rights n2 in Woolrich's story, "It Had to Be
Murder." Woolrich, however, retained all other rights in the story. During the
same year, Popular Publications registered in its name a blanket copyright for
the issue of Dime Detective Magazine that contained, as part of its publication,
the story, "It Had to Be Murder." Woolrich did not separately register any
copyright for the story. Defendants contend that, under these circumstances, "It
Had to Be Murder" was ineffectively copyrighted [**8] and therefore entered the
public domain. We disagree.
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n2 There is no written record of this conveyance. The parties' agreement is
based on evidence presented to the district court. The evidence showed that the
custom and practice of the time was for authors to convey to publishers only the
right to publish the authors' stories in magazines in North America. All other
rights were generally retained by the author. Because this practice was
standard, there appears to be no disagreement concerning the character of
Woolrich's conveyance of rights to Popular.
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We adopt the Second Circuit's conclusion that where a magazine publisher has
purchased limited publication rights in a work "under circumstances which show
that the author has no intention to donate his work to the public, copyright
notice in the magazine's name is sufficient to obtain a valid copyright on
behalf of the beneficial owner, the author or proprietor [of the work]." Goodis
v. United Artists Television, Inc., 425 F.2d 397, 399 (2d Cir. 1970). n3
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n3 In Runge v. Lee, 441 F.2d 579, 581 (9th Cir.), cert. denied, 404 U.S. 887,
30 L. Ed. 2d 169, 92 S. Ct. 197 (1971), we cited Goodis with approval for the
proposition that a magazine's copyright of a work gives the author beneficial
ownership of a copyright in the work. It is not clear from the facts of Runge,
however, if the author in that case separately registered a copyright in the
work. See id. at 580. We therefore do not assume that Runge fully adopted the
holding of Goodis.
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In Goodis, the Second Circuit addressed a factual situation similar to the
one in this case. There, the author of a story granted limited rights to the
publisher of a periodical. The publisher registered a blanket copyright in the
issue of the periodical that contained the story. The author never separately
copyrighted his work. Id. at 399.
Under these circumstances, the Second Circuit concluded that the publisher's
copyright effectively protected the story and gave the author beneficial
ownership of a copyright in the story. In so holding, the court decided that the
"doctrine of indivisibility" should not be strictly applied to decide who may
copyright a work.
The "doctrine of indivisibility" is a label used to describe the idea that a
copyright must be held in full by a single proprietor and may not be partially
assigned. See generally 3 Nimmer on Copyright § 10.01, at 10-4 to 10-19 (1988) (
"The Doctrine of Indivisibility Under the 1909 Act"). Under the doctrine, a
"licensee" of a copyright--i.e., someone who holds only partial copyright
privileges--may not copyright a work in the licensee's name. See Goodis, 425
F.2d at 400.
If the doctrine were strictly applied [**10] to the facts of this case and
to the facts of Goodis, the publisher's copyright could not protect the author's
interest in the story. This is because the publisher, who holds only partial
copyright privileges in the story, could not copyright the story in the
publisher's name.
The problem with strictly applying the doctrine of indivisibility in the
context of magazine publishing is that it "bring[s] about the unnecessarily
harsh result of thrusting the author's product into the public domain when, as
here, everyone interested . . . could see [the publisher's] copyright notice and
could not have believed there was any intention by [the author] to surrender the
fruits of his labor." Id. We agree with the Second Circuit that a strict
application of the doctrine in this context is not necessary.
As the Second Circuit noted, the doctrine of indivisibility is a judge-made
rule that relates primarily to standing. "The most frequently cited policy for
applying the indivisibility rule is to avoid multiple infringement actions, each
brought by the holder of a particular right in a literary work without joining
as co-plaintiff the author [*1470] or proprietor of the copyrighted work." Id.
[**11]
Despite the doctrine's continued usefulness in the area of standing, it is
not necessary to apply it to determine who may register a copyright to protect
the author of a contribution to a periodical. We agree with the Second Circuit's
observation that "the important considerations [for this question] are the
intention of the parties to obtain copyright and the adequacy of notice to the
public; the characterization of the publisher as assignee or licensee is
secondary." Id. at 403.
Defendants argue that the Supreme Court's holding in Mifflin v. R. H. White
Co., 190 U.S. 260, 47 L. Ed. 1040, 23 S. Ct. 769 (1903), bars our adoption of
the Second Circuit's holding. We are persuaded by the Second Circuit's treatment
of that opinion. See Goodis, 425 F.2d at 401-02.
In Mifflin, the Supreme Court held that a copyright in a publisher's name
could not protect the author's interest in a story printed by the publisher. 190
U.S. at 264. In Mifflin, the Court was interpreting the requirements of the
Copyright Act of 1831, 4 Stat. 436.
The Second Circuit notes that the 1909 Act changed the procedures for
copyrighting a work. Before 1909, under the 1831 Act, an author obtained
copyright before publication [**12] by depositing a copy of the title of his
work in the district court in the district of his domicile. Goodis, 425 F.2d at
401. After 1909, copyright could be obtained by publishing the work with notice
in conformity with the Act. Id. Thus, it was not until after Congress adopted
the Copyright Act of 1909 that authors would have reason to assume that "first
publication of the work, whether in magazine or book form, would be the means of
obtaining copyright." Id. at 402. Once the 1909 Act was adopted, it was common
for an "author [to] assume[] the publisher would attend to copyrighting the work
in his behalf." Id. To extend the Supreme Court's pre-1909 holding to
publication transactions conducted after 1909 would "provide a trap for the
unwary author." Id.
Thus, we find that the Second Circuit's position is not barred by earlier
precedent and makes sound practical sense.
B. Was the Renewal Defective?
In 1969, the executor of Woolrich's estate renewed the copyright in "It Had
to Be Murder" pursuant to section 24 of the 1909 Act. Defendants contend that
this renewal was invalid. They interpret section 24 to allow only Popular--the
proprietor of the copyright [**13] in Dime Detective Magazine--to renew the
copyright in "It Had to Be Murder," because it was Popular's blanket copyright
in the Magazine that originally gave copyright protection to the story. n4 Thus,
they argue that "It Had to Be Murder" passed into the public domain at the
expiration of the original 28-year copyright term when Popular failed to renew
the copyright. This contention lacks merit.
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n4 This argument assumes a rejection of defendants' previous argument that
Popular's blanket copyright of Dime Detective Magazine failed to protect "It Had
to Be Murder" and placed the story in the public domain.
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The right to renew the copyright in "It Had to Be Murder" is governed
exclusively by section 24 of the Copyright Act of 1909, 17 U.S.C. § 24. See
Epoch Producing Corp. v. Killiam Shows, Inc., 522 F.2d 737, 743 (2d Cir. 1975),
cert. denied, 424 U.S. 955, 47 L. Ed. 2d 360, 96 S. Ct. 1429 (1976). Originally,
section 24 provided in relevant part:
In the case of any other copyrighted work, including a contribution by
an individual author to a periodical or to a cyclopedic or other
composite work when such contribution has been separately registered,
the author of such work . . . shall be [**14] entitled to a renewal .
. . [or, if the author . . . be not living, then the author's
executors].
Act of March 4, 1909, c. 320, 35 Stat. 1075 (emphasis added). n5 As originally
enacted, section 24 gave authors the right to renew [*1471] their work, except
, inter alia, n6 when the work was published under the blanket copyright of a
composite work. See Shapiro, Bernstein & Co. v. Bryan, 123 F.2d 697, 699 (2d
Cir. 1941).
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n5 Congress reenacted section 24 as section 304(a) under the new Copyright
Act of 1976. See 17 U.S.C. § 304(a).
n6 Section 24 provides that the right of renewal belongs to the proprietor of
the copyright, i.e., the entity under whose copyright the work is published, in
three other circumstances: when the work is published posthumously, when it is
copyrighted by a corporate body, and when it is published by an employer for
whom such work is made for hire. See Shapiro, Bernstein & Co. v. Bryan, 123 F.2d
697, 699 (2d Cir. 1941).
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In 1940, Congress amended section 24 (then section 23) by deleting the
underlined phrase "when such contribution has been separately registered." Act
of March 15, 1940, 54 Stat. 51. The issue here is whether section 24 as amended
[**15] gives the author of a contribution to a periodical renewal rights with
respect to that contribution, even when the author did not separately copyright
the contribution. The legislative history of the 1940 amendment to section 24
leads us to conclude that it does.
The amendment came before Congress twice before it passed. n7 The
congressional reports that accompanied the bill on each occasion clearly evince
Congress' intent to provide the author of the contribution with a right of
renewal. The report that accompanied the bill the first time it went before
Congress stated that "the purpose of the bill [is to] . . . restore to the
author the right he enjoyed prior to July 1, 1937 [the effective date of section
24], to renew directly in his own name any of his contributions whether
separately registered or not." S. Rep. No. 1808, 75th Cong., 3d Sess. 2 (1938).
See also 83 Cong. Rec. 8297 (1938) (remarks of Senator Lodge describing the
amendment's goal of providing the author with a right of renewal in his own
work).
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n7 The first time the amendment came before Congress, it passed the Senate
but Congress adjourned before the amendment could reach the House floor. See 83
Cong. Rec. 8297 (1938) (amendment passes the Senate); 83 Cong. Rec. 8835 (1938)
(referred to House Committee); 83 Cong. Rec. 9613 (1938) (Congress adjourns six
days later).
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The second report was less expansive than the first but nonetheless noted:
The primary purpose of this proposed amendment is to make it possible
for authors . . . to save valuable copyrights from falling into the
public domain at the end of the first term of 28 years because the
contribution to the periodical was not separately registered, although
protected by the blanket copyright of the issue of the periodical in
which it appeared. Many of such copyrights are falling into the public
domain from day to day because the proprietor, i.e., the publishing
company of the periodical, has gone out of existence, leaving no
successor in interest or any legal representative entitled to renew
the copyright. This information comes to us through the authors
themselves or their agents, who seek to secure renewal, but upon
investigation of the original records it turns out that no separate
registration of the work in question had been made and consequently
the author or his widow, children, etc., are barred under the law as
it stands from exercising the renewal privilege.
H. R. Rep. No. 1612, 76th Cong., 3d Sess. 1 (1940). There was no debate or
hearing on the amendment. See Brylawski, [**17] Renewal of Copyright in a
Magazine Contribution: A Belated View, 42 Geo. Wash. L. Rev. 737, 749 (1974);
see also 84 Cong. Rec. 7079 (1939).
In light of this legislative history, we think Congress amended section 24 to
give authors the right to renew their contributions to composite works, even
when the author's contribution had not been separately registered.
No court has directly ruled on this issue, but two courts have noted that the
author has the right to renew the copyright in a contribution to a composite
work. Bartok v. Boosey & Hawkes, Inc., 523 F.2d 941, 948 (2d Cir. 1975) (
"contributors can renew individual contributions"); Cadence Industries Corp. v.
Ringer, 450 F. Supp. 59, 61 n.5 (S.D.N.Y. 1978) (individual author has right to
renew whether or not the copyright in his contribution has been separately
registered).
[*1472] The Copyright Office also views the author as having a right of
renewal in an individual contribution regardless of whether it has been
separately copyrighted. See United States Copyright Office, Compendium of
Copyright Practices § 11.8.3, at 11-23 (1973) ("While the proprietor of a
composite work may claim renewal in the work as a whole, the [**18] author of
an individual contribution, or his beneficiaries, may also claim renewal in his
contribution"); see also United States Copyright Office, Compendium of Copyright
Practices § 1317.05, at 1300-24 (1984) (similarly interpreting Copyright Act of
1976).
Consistent with the plain language of section 24, its legislative history,
the views of other courts, and the position of the Register of Copyrights, we
hold that section 24 gives the author of a contribution to a periodical a right
of renewal with respect to that contribution, even when the author has not
separately copyrighted the contribution.
II. Are Defendants Entitled to Summary Judgment as a Matter of Law Based on
the Second Circuit's Decision in Rohauer v. Killiam Shows, Inc.?
As owner of the renewal copyright in Woolrich's story, "It Had to Be Murder,"
Abend argues that defendants' re-release of the movie "Rear Window" in theaters,
on cable TV, and on videocassette constitutes infringement of the renewal
copyright. Defendants argue that they have the right to continue to exploit
"Rear Window" during the 28-year renewal period without regard to Abend's
ownership of the renewal copyright in the underlying story, [**19] "It Had to
Be Murder," because Woolrich agreed to assign to defendants' predecessors in
interest the motion picture rights in the underlying story for the renewal
period. The lawsuit arises because Woolrich died before he could obtain the
renewal copyright. To resolve this controversy, we must reconcile two competing
interests: the interest of the owner of the renewal copyright in an underlying
work, i.e., the story, to exclusive use of that work during the 28-year renewal
period, and the interest of the owner of the derivative work, i.e., the film, in
its continued exploitation. To do so, we must construe two provisions of the
Copyright Act of 1909. 17 U.S.C. §§ 7,24 (1909 Act).
Section 24 provides that an author or a designated statutory successor
(widow, child, or executor) may, within one year prior to the expiration of the
original 28-year copyright term, renew the copyright in a work for an additional
28 years. The plaintiff argues that the statutory successor, from whom he
acquired the renewal copyright, took the renewal right under section 24 free and
clear of any purported assignments of any interest in the renewal copyright, and
that defendants' publication and distribution [**20] of the "Rear Window" film
therefore infringes his renewal copyright.
Defendants argue that Woolrich's earlier consent to the creation of the movie
"Rear Window" and his agreement to assign motion picture rights in the story for
the renewal period to their predecessors in interest, once renewal had been
accomplished, gives them the right to continue to exhibit the film during the
renewal period, even though the author died before effecting renewal of the
copyright. To support their position, defendants rely on section 7 of the 1909
Act, 17 U.S.C. § 7 (1909 Act), which gives limited copyright protection to
derivative works such as a motion picture based on the underlying copyrighted
story. Section 7 states that:
Compilations or abridgments, adaptations, arrangements,
dramatizations, translations, or other versions of works in the public
domain or of copyrighted works when produced with the consent of the
proprietor of the copyright in such works . . . shall be regarded as
new works [i.e. a derivative work] subject to copyright under the
provisions of this title; but the publication of any such new works
shall not affect the force or validity of any subsisting copyright
upon [**21] the matter employed . . . or be construed to imply an
exclusive right to such use of the original works, or to secure or
extend copyright in such original works.
[*1473] 17 U.S.C. § 7 (1909 Act). (Emphasis added.)
Defendants and the district court both rely primarily on the Second Circuit's
decision in Rohauer v. Killiam Shows, Inc., 551 F.2d 484 (2d Cir.), cert. denied
, 431 U.S. 949, 53 L. Ed. 2d 266, 97 S. Ct. 2666 (1977), which held that
statutory successors to the renewal copyright in an underlying work under
section 24 could not "deprive[] the proprietor of the derivative copyright of a
right, stemming from the § 7 'consent' of the original proprietor of the
underlying work, to use so much of the underlying copyrighted work as already
has been embodied in the copyrighted derivative work, as a matter of copyright
law." Id. at 492. For the reasons set forth below, we reject this conclusion.
A. The Rohauer Decision
Rohauer involved the 1926 movie, "The Son of the Sheik," based on a novel
written by Edith Maude Hull. Hull obtained the copyright in the novel in 1925,
and subsequently assigned the motion picture rights to Moskowitz. Hull also
agreed to renew the copyright and assign the motion picture rights [**22]
during the renewal term to the purchaser Moskowitz. Id. at 486. In 1926, a
movie based on Hull's story was produced and copyrighted. The owners of the
movie renewed the derivative copyright on the movie in 1954, and in 1961 sold
this copyright to Gregstan Enterprises, Inc., a corporation headed by Paul
Killiam. Gregstan assigned the renewal copyright to defendant Killiam Shows,
Inc. in 1968. Mrs. Hull died in 1943. Her daughter renewed the underlying
copyright on the novel in 1952 under section 24, and, in 1965, assigned the
movie and television rights to Rohauer. On July 13, 1971, the original movie
aired on WNET, the New York public television station, using a tape made from a
print obtained from defendant Killiam Shows. Rohauer sued for copyright
infringement. Id. at 486-87.
1. Reconciling Sections 7 and 24
Judge Friendly, writing for the Second Circuit, saw his task as reconciling
the first clause of section 7, which grants copyright protection to derivative
works, with the section 24 provision for renewal of the underlying copyright. In
Rohauer, the Second Circuit found that no prior cases addressed this question,
and then relied on the "new property right" [**23] theory propounded in
Edmonds v. Stern, 248 F. 897 (2d Cir. 1918), and on the relative "equities" to
hold that defendants' broadcast of the "Son of the Sheik" movie did not infringe
the renewal copyright in the underlying novel. Rohauer, 551 F.2d at 490-93.
In Edmonds v. Stern, the Second Circuit held that the owners of a derivative
copyright in an orchestral arrangement of a song had a property right "wholly
separate and independent" from the property right in the underlying song. 248 F.
at 898. According to the court, when the author of the original work gave
consent to the creation of a derivative work, "a right of property sprang into
existence, not at all affected by the conveyance of any other right." Id. The
Second Circuit in Rohauer viewed its holding as "only a slight extension" of the
Edmonds decision. 551 F.2d at 492.
Abend argues that Rohauer's adoption of the new property right theory to
reconcile sections 7 and 24 violates the traditional rule that "a derivative
copyright protects only the new material contained in the derivative work, not
the matter derived from the underlying work." Russell v. Price, 612 F.2d 1123,
1128 (9th Cir. 1979), [**24] cert. denied, 446 U.S. 952, 100 S. Ct. 2919, 64
L. Ed. 2d 809 (1980). Shortly before Rohauer, the Second Circuit affirmed the
traditional rule in Gilliam v. American Broadcasting Co., 538 F.2d 14 (2d Cir.
1976). In Gilliam, plaintiffs, a group of writers and performers, sought to
enjoin ABC from broadcasting edited versions of programs that plaintiffs had
written and performed for broadcast by BBC. The scriptwriters' agreement between
plaintiffs and BBC gave the plaintiffs maximum control over the script and
precluded BBC from altering a program once it was recorded. Id. at 17. BBC
licensed the programs to Time Life Inc. for distribution, which in turn entered
into an agreement [*1474] with ABC for broadcast of the programs. Prior to
broadcast, the programs were severely edited. Plaintiffs described the editing
as "mutilation." Id. at 18. They successfully argued that the editing of the
program--the derivative work--infringed plaintiffs' copyright in their
script--the underlying work. The court held that section 7 provided protection
for the derivative work, so long as it did not affect the "force or validity" of
the underlying copyright. But, according to the Second Circuit in Gilliam,
ownership [**25] of the derivative copyright does not carry with it the right
to "affect the scope or ownership of the copyright in the underlying script."
Id. at 20 (emphasis added). The Second Circuit in Gilliam firmly declared that
"the ability of the copyright holder to control his work remains paramount in
our copyright law." n8 Id. at 21.
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n8 The parties dispute what effect, if any, section 7's provision that the
publication of a derivative work "shall not affect the force or validity" of the
copyright on the underlying work has on this case. Abend argues that the
defendants' exploitation of the "Rear Window" film impairs the "force or
validity" of the copyright in the underlying story in violation of section 7.
Defendants argue that section 7's "force or validity clause" was not intended to
apply to this situation at all. Rohauer supports the defendants' argument. In
Rohauer, the Second Circuit stated that the "force or validity clause" had no
bearing on the issue presented. Rohauer, 551 F.2d at 489-80. Because we hold
that this case is controlled by the Supreme Court's decision in Miller Music
Corp. v. Charles N. Daniels, Inc., 362 U.S. 373, 4 L. Ed. 2d 804, 80 S. Ct. 792
(1960), which held that statutory successors to renewal copyrights take free and
clear of all purported assignments of the renewal right when the author dies
before effecting renewal, we need not decide whether or how section 7's "force
or validity" clause bears on this issue.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [**26]
Abend also contends that Rohauer's adoption of the "new property right"
theory fails adequately to distinguish precedent, particularly G. Ricordi & Co.
v. Paramount Pictures Inc., 189 F.2d 469 (2d Cir.), cert. denied, 342 U.S. 849,
96 L. Ed. 641, 72 S. Ct. 77 (1951). n9 In Ricordi, Long, the author of the novel
Madame Butterfly, authorized Belasco to write a play based on the novel. Both
Long and Belasco subsequently assigned the right to make an opera based on the
play to the plaintiff Ricordi. In 1904, Ricordi copyrighted the opera. Later
Ricordi obtained the renewal rights to the opera. Long renewed the copyright in
his novel in 1925, and, before his death, assigned the movie rights to
Paramount, the defendant. At the same time, Paramount acquired from Belasco's
trustee the movie rights to the play. Belasco had never effected renewal of the
play's copyright. Ricordi sued for a declaration that he was entitled to produce
a movie of the opera. The court held that Ricordi's interest extended only to
"what was copyrightable as new matter in its operatic version." Ricordi, 189
F.2d at 471. According to the court, "a copyright renewal creates a new estate,
and . . . the new estate is clear [**27] of all rights, interests or licenses
granted under the original copyright." Id. Thus, Ricordi acquired no rights
under author Long's renewal, which was clear of all rights granted under the
original copyright, and therefore Ricordi could not "make general use of the
novel for a motion picture version of Long's copyrighted story. . . ." Id.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n9 Nimmer argues that the Second Circuit at least twice repudiated the new
property right theory--before Rohauer in Ricordi, after it in Gilliam. 1 Nimmer
§ 3.07[A] at 3-24. See also Russell v. Price, 612 F.2d at 1127 n. 13 ("the
so-called 'new property rights' theory which [Rohauer] . . . seems partially to
adopt, had been consistently rejected in earlier decisions. . . .").
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Abend argues that under Ricordi, a renewal copyright creates a new estate
that cuts off any rights acquired during the original term of the copyright.
Rohauer, however, found Ricordi distinguishable for a "fundamental reason:" in
Ricordi, the agreement between the authors and the plaintiff did not purport to
extend beyond the original term of Long's copyright; Ricordi had never bargained
for any rights in the renewal term. n10 [**28] Rohauer, 551 F.2d at 491. By
contrast, in both Rohauer and the case before us, the authors clearly agreed to
assign the motion picture rights to the [*1475] owners of the derivative work
during the renewal term. Id.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n10 Rohauer distinguished Fitch v. Shubert, 20 F. Supp. 314 (S.D.N.Y. 1937),
on the same ground.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
We find the distinction between Ricordi and Rohauer unconvincing because in
both situations there is no effective grant of motion picture rights to make a
derivative work during the renewal term. In Ricordi, no grant existed because
the parties never included renewal rights in the agreement. In Rohauer and our
case, the agreements evidenced the intention of each author to assign renewal
rights, but renewal rights never vested in either author because each died
before the time for renewal accrued, i.e. one year prior to the expiration of
the original term. In Miller Music Corp. v. Charles N. Daniels, Inc., 362 U.S.
373, 4 L. Ed. 2d 804, 80 S. Ct. 792 (1960), the Supreme Court held that an
assignment of full copyright renewal rights by the author prior to the time for
renewal--i.e. within one year prior to the expiration of the original 28-year
copyright term--cannot [**29] defeat the right of the author's statutory
successor to the renewal copyright when the author dies before the time that the
right for renewal has accrued. In Miller Music, Black and Daniels composed a
song and assigned all rights in it to Villa Moret, Inc., which obtained the
original copyright. Before the time when renewal rights accrued, Black assigned
his renewal rights to Miller Music. Black died before he could effect renewal.
His brother became executor and renewed the copyright under section 24, and
Daniels ultimately acquired the renewal copyright from Black's brother. Miller
Music sued Daniels for infringement. The Supreme Court held for Daniels, stating
that "the next of kin obtains the renewal copyright free of any claim founded
upon an assignment made by the author in his lifetime. These results follow not
because the author's assignment is invalid but because he had only an expectancy
to assign. . . ." n11 Id. at 375. The Court held that section 24 creates
contingency interests, and that "until [the renewal period] arrives, assignees
of renewal rights take the risk that the rights acquired may never vest in their
assignors. A purchaser of such an interest [**30] is deprived of nothing. Like
all purchasers of contingent interests, he takes subject to the possibility that
the contingency may not occur." Id. at 378. n12
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n11 Of course, in this case, had Woolrich lived until the time for renewal
arrived, Paramount could have enforced his agreement to assign to it the motion
picture rights in the renewal copyright. Fred Fisher Music Co. v. M. Witmark &
Sons, 318 U.S. 643, 657, 87 L. Ed. 1055, 63 S. Ct. 773 (1943).
n12 The Court concluded by noting that "whether it works at times an
injustice is a matter for the Congress, not for us." Miller Music, 362 U.S. at
378.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Miller Music provides ineluctable authority for Abend's position. Since
Woolrich died before the renewal period arrived, his purported assignment of
renewal rights is ineffective and irrelevant; the most defendants' predecessors
could have acquired was an expectancy in the right to use the story that
underlies the derivative work during the story's renewal period. The distinction
Rohauer draws between cases where the author never agreed to assign renewal
rights, like Ricordi and Fitch v. Shubert, 20 F. Supp. 314 (S.D.N.Y. 1937), and
cases like ours, where the author's agreement [**31] is plainly unenforceable
against his statutory successors, is meaningless. Accord 1 Nimmer on Copyright §
3.07[A], at 3-28, 3-29; see also Mills Music, Inc. v. Snyder, 469 U.S. 153, 183,
83 L. Ed. 2d 556, 105 S. Ct. 638 n.8 (1985) (White, J., dissenting) ("If an
author had assigned his rights in the renewal term at the time that he assigned
rights in the initial term, a grantee might safely release a derivative work
prepared under authority of the first-term grant. But if the author had died
before his renewal rights vested, his statutory successors acquired those
rights, and any previous assignment was rendered null." (Citations omitted.)).
Rohauer virtually ignores Miller Music. It dismisses Miller Music by stating
merely that Miller Music and other Supreme Court cases "were concerned with the
relative rights of persons claiming full assignment or ownership of the renewal
term of an underlying copyright," rather than with [*1476] the competing
rights of the owner of a renewal copyright in the underlying work and the owner
of the copyright in the derivative work. Rohauer, 551 F.2d at 490. The Rohauer
court fails to explain why this distinction rendered Miller Music irrelevant to
the case before [**32] it. n13 In our view, the fact that Miller Music involved
competing claims to the underlying copyright weakens defendants' argument. If
Miller Music makes assignment of the full renewal rights in the underlying
copyright unenforceable when the author dies before effecting renewal of the
copyright, then, a fortiori, an assignment of part of the rights in the
underlying work, the right to produce a movie version, must also be
unenforceable if the author dies before effecting renewal of the underlying
copyright.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n13 The defendants here do little better with respect to the case before us.
They add only that the Supreme Court "may want to reconsider Miller Music."
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
The legislative history behind section 24 lends further support to Abend's
position and the Supreme Court's decision in Miller Music. In Hearings before
the Committees on Patents on the Proposed Copyright Act, Mr. W. B. Hale,
representative of the American Law Book Company, discussed the problem of
obtaining renewal rights from joint authors of composite works. He testified
that:
it is only possible to cover the right of renewal of the actual
author. The right of renewal is contingent. It does not vest [**33]
until the end. If he is alive at the time of renewal, then the
original contract may pass it, but his widow or children or other
persons entitled would not be bound by that contract.
Legislative History of the 1909 Copyright Act K77 (E. Brylawski A. Goldman eds.
1976). Congress understood that the renewal right provided by section 24 was to
be contingent. Because the contingent nature of the renewal right would cause
hardship to owners of composite works, Congress exempted composite works from
this aspect of the renewal provision in the 1909 Act. See 17 U.S.C. § 24.
Significantly, Congress did not include a similar exemption for derivative
works. n14
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n14 The dissent seeks to distinguish the facts in the instant case and the
facts in Rohauer from cases such as Miller Music and Russell by arguing that the
instant case and Rohauer involve two copyrighted works -- the underlying work
and the derivative work -- whereas Miller Music and Russell involve only one
copyrighted work. Dissent at 4. This distinction is not relevant because the
critical inquiry is the extent of the defendants' copyright in the derivative
work. We recognize that the defendants are entitled to use the "new matter"
contained in the derivative work. We conclude, however, based on well-settled
principles of copyright law articulated in Miller Music, Russell, and the other
cases cited above, that the defendants do not have the unrestricted right to use
the "old matter" in the derivative work (i.e., the material taken from the
underlying work) during the underlying work's copyright renewal period.
The defendants only have two potential bases for their claimed right to use
the "old matter" during the copyright renewal period of the underlying work.
First, they might argue that the right was transferred to their predecessors by
the predecessors of the plaintiffs. As we demonstrate above, the rule
articulated by the Supreme Court in Miller leads to the conclusion that the
predecessors of the plaintiffs did not succeed in transferring the disputed
right to the predecessors of the defendants. See supra at 23. Second, they might
claim the disputed right on the basis of the original copyrighting of the
derivative work by their predecessors. We have shown, however, that the
traditional copyright rule provides that a derivative copyright protects only
the "new matter" contained in the derivative work, not the "old matter." See
supra at 19-22 (citing Russell, Gilliam, and Ricordi).
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
[**34]
2. The Equities and the 1976 Act
The Rohauer decision and defendants' position ultimately rest on policy
considerations. Rohauer found that "the equities lie preponderantly in favor of
the proprietor of the derivative copyright." Rohauer, 551 F.2d at 493. Rohauer
correctly observes that "in contrast to the situation where an assignee or
licensee has done nothing more than print, publicize and distribute a
copyrighted story or novel, a person who with the consent of the author has
created an opera or a motion picture film will often have made contributions
literary, musical and economic, as great as or greater than the original author.
" Id. The court's own words, however, reveal the flaw in its analysis: the
"greater contribution" [*1477] theory can cut both ways. While the creators of
the "Rear Window" movie clearly made substantial and costly contributions to the
underlying work, other derivative works protected by the Rohauer rule might
involve only minimal contributions to the underlying work. Consequently, this
rationale alone cannot justify Rohauer's holding.
Rohauer's second equity consideration is the inability of the purchaser of
the derivative copyright [**35] "to protect himself against the eventuality of
the author's death before the renewal period" since the author's statutory
successors could not be definitely ascertained until that date. n15 Id. Again,
the Second Circuit raises a legitimate concern, but one the Supreme Court
apparently rejected in Miller Music. That case put assignees of copyright
renewal rights on notice that they were acquiring only a contingent interest,
with the risk that the interest might not vest. Miller Music, 362 U.S. at 375.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n15 Defendants and amici argue that this risk will lead producers to withdraw
films from distribution to avoid infringing the copyright in the underlying
work. The public will then be denied access to countless classic films.
Defendants' and amici's dire prediction, however, seems remote. More likely,
owners of the renewal copyright and producers will reach a mutually beneficial
financial arrangement which will ensure continued public access to the films.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Moreover, Rohauer's exclusive focus on potential unfairness to makers of
derivative works overlooks important policies behind section 24 that favor the
author. Congress enacted section 24 for two specific purposes. First, [**36]
Congress sought to provide authors with a "second chance" to reap the benefits
of their work, particularly since authors must often negotiate from an unequal
bargaining position. n16 Congress recognized that "not infrequently . . . the
author sells his copyright outright to a publisher for a comparatively small
sum. If the work proves to be a great success and lives beyond the term of
twenty-eight years . . . it should be the exclusive right of the author to take
the renewal term. . . ." Fred Fisher Music Co. v. M. Witmark & Sons, 318 U.S.
643, 654, 87 L. Ed. 1055, 63 S. Ct. 773 (1943) (quoting H. Rep. 2222, 60th
Cong., 2d Sess., pp. 14-15).
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n16 Congressional recognition of the need for this protection of authors
undercuts Rohauer's assertion that authors can protect their heirs by limiting
the terms of the assignment. Rohauer, 551 F.2d at 493-94.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
This concern is more compelling in the case before us. The infringement in
Rohauer consisted of making one videotaped copy of a print of the film and
broadcasting it over a public television station. This case, by contrast,
involves a nationwide re-release of the film in theatres, in the video-cassette
sales and rental markets, and on cable TV. Clearly, [**37] when Woolrich
agreed to assign his renewal rights, he could not have foreseen the
technological advances which have enabled the authors of the derivative work to
expand tremendously their exploitation of the film. This development highlights
the policy motivating section 24: Congress' desire to give authors a "second
chance" to make a better deal. To the extent Rohauer depends on equitable
considerations, its failure to consider the author's interests under section 24
makes the Rohauer result even more problematic.
Second, by enacting section 24, Congress intended to provide protection to
the author's family and so extended the renewal right to include the author's
surviving family or heirs, should the author die during the original term of the
copyright. Section 24 in essence acts as a "compulsory bequest of the copyright
to the designated persons." De Sylva v. Ballentine, 351 U.S. 570, 584, 100 L.
Ed. 1415, 76 S. Ct. 974 (1956). In balancing the equities in favor of the
derivative copyright owner, Rohauer never discusses either of these concerns
underlying section 24.
Instead, Rohauer looked to the 1976 Copyright Act to support its balancing of
the equities. The 1976 Act replaced the two-term [**38] scheme established
under the 1909 Act with a single term of copyright protection that would last
for the life of the author plus fifty years. 17 U.S.C. § 302. This single term,
however, applied only to [*1478] works copyrighted after its effective date,
January 1, 1978. For works in copyright prior to that date, the two-term renewal
system remained in effect. 17 U.S.C. § 304.
The 1976 Act also provided for an additional 19-year extension for existing
renewal copyrights, subject to the right of the author at the end of the 28th
year of the original renewal term to terminate any grants or licenses. However,
the 1976 Act included an exception for derivative works. The author's right to
terminate prior grants or licences for the 19-year extension period does not
apply to existing derivative works for which the author had granted 28-year
renewal rights. 17 U.S.C. § 304(c)(6)(A).
Rohauer viewed this exception as evidence of Congress' intent to give
"special protection" to derivative works. Rohauer, 551 F.2d at 494. While
Congress may, indeed, have intended section 304(c)(6)(A) to provide additional
protection in 1976, Congress' intent regarding the 1976 Act does not shed any
light on [**39] the meaning of the 1909 Act. By its terms, section 304 only
applies to the additional 19-year period. Abend persuasively argues that Rohauer
thus does what Congress declined to do -- apply the termination exception
retroactively to the 28-year renewal period. When Congress enacted the 1976 Act,
the prevailing view was that the owners of the renewal copyright in the
underlying story could "veto" the continued use of the derivative work. n17
Mills Music, 469 U.S. at 183 (White, J., dissenting). We can reasonably presume
that Congress knew of this prevailing view when it enacted the 1976 Act and
chose not to alter the balance. Cf. Mills Music, 469 U.S. at 172.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n17 Defendants argue that in Justice White's discussion of the 1909 Act, he
and the three Justices who concurred in his dissent "approved" of Rohauer. See
Mills Music, 469 U.S. at 183 n.7. Defendants overstate the case. In the footnote
to which defendants refer, Justice White provides support for his statements
regarding the renewal rights veto power over continued use of derivative works.
Describing this view as the "broad interpretation," Justice White cites Rohauer
in concluding that "a narrower interpretation eventually prevailed, but not
until after passage of the 1976 Act." Id. This comment indicates neither
approval nor disapproval by those four Justices. Nor does it carry much weight
as an observation. In the text of the dissent, Justice White accepts as the
"prevailing understanding" that the owner of renewal rights had "veto power"
over continued use of a derivative work. Id. at 183.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [**40]
Neither the equities, precedent, nor Congressional intent justify us in
changing the balance between owners of renewal copyrights in underlying works
and owners of the copyright in derivative works when Congress has refrained from
doing so. We therefore hold that defendants' continued exploitation of the "Rear
Window" film without Abend's consent violates Abend's renewal copyright in the
underlying story "It Had to Be Murder," unless the defendants can establish any
affirmative defenses. n18
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n18 For the reasons discussed in the next section, we hold that defendants
cannot characterize their use of the underlying story as a "fair use" to avoid
liability for infringement. Defendants raise other equitable defenses to Abend's
infringement action, in addition to fair use. Because defendants have not had
the opportunity to present these other defenses fully, see discussion at IV,
infra, the district court should consider these defenses on remand.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Our holding does not mean, however, that the equities of this case have no
bearing on its outcome. We are mindful that this case presents compelling
equitable considerations which should be taken into account by the district
court in fashioning [**41] an appropriate remedy in the event defendants fail
to establish any equitable defenses. Defendants invested substantial money,
effort, and talent in creating the "Rear Window" film. Clearly the tremendous
success of that venture initially and upon re-release is attributable in
significant measure to, inter alia, the outstanding performances of its
stars--Grace Kelly and James Stewart--and the brilliant directing of Alfred
Hitchcock. The district court must recognize this contribution in determining
Abend's remedy.
The district court may choose from several available remedies for the
infringement. [*1479] Abend seeks first an injunction against the continued
exploitation of the "Rear Window" film. 17 U.S.C. § 502(a) provides that the
court "may . . . grant temporary and final injunctions on such terms as it may
deem reasonable to prevent or restrain infringement of a copyright." n19
Defendants argue (in an attempt to persuade us to accept Rohauer) that a finding
of infringement presumptively entitles the plaintiff to an injunction, citing
Professor Nimmer. See 3 M. Nimmer, Nimmer on Copyright § 14.06[B] at 14-55 to
14-56.2 (1988). However, Professor Nimmer also states that "where [**42] great
public injury would be worked by an injunction, the courts might . . . award
damages or a continuing royalty instead of an injunction in such special
circumstances." Id. at 14-56.2.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n19 We apply the remedy provisions of the 1976 Copyright Act because the
infringement occurred after 1977. See Walt Disney Prods. v. Air Pirates, 581
F.2d 751, 754 (9th Cir. 1978), cert. denied, 439 U.S. 1132, 99 S. Ct. 1054, 59
L. Ed. 2d 94 (1979).
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
We believe such special circumstances exist here. The "Rear Window" film
resulted from the collaborative efforts of many talented individuals other than
Cornell Woolrich, the author of the underlying story. The success of the movie
resulted in large part from factors completely unrelated to the underlying
story, "It Had To Be Murder." It would cause a great injustice for the owners of
the film if the court enjoined them from further exhibition of the movie. An
injunction would also effectively foreclose defendants from enjoying legitimate
profits derived from exploitation of the "new matter" comprising the derivative
work, which is given express copyright protection by section 7 of the 1909 Act.
Since defendants could not possibly separate out the "new matter" from the
[**43] underlying work, their right to enjoy the renewal copyright in the
derivative work would be rendered meaningless by the grant of an injunction. We
also note that an injunction could cause public injury by denying the public the
opportunity to view a classic film for many years to come.
This is not the first time we have recognized that an injunction may be an
inappropriate remedy for copyright infringement. In Universal City Studios v.
Sony Corp. of Amer., 659 F.2d 963, 976 (9th Cir. 1981), rev'd on other grounds,
464 U.S. 417, 78 L. Ed. 2d 574, 104 S. Ct. 774 (1984), we stated that Professor
Nimmer's suggestion of damages or a continuing royalty would constitute an
acceptable resolution for infringement caused by in-home taping of television
programs by VCR--"time-shifting." See also Sony Corp. v. Universal City Studios,
464 U.S. 417, 499-500, 78 L. Ed. 2d 574, 104 S. Ct. 774 (1984) (Blackmun, J.,
dissenting).
As the district court pointed out in the Sony case, an injunction is a "harsh
and drastic" discretionary remedy, never an absolute right. Universal City
Studios v. Sony Corp. of Amer., 480 F. Supp. 429, 463, 464 (C.D. Cal. 1979), rev
'd on other grounds, 659 F.2d 963 (9th Cir. 1981), reversed, 464 U.S. 417, 78 L.
Ed. 2d 574, 104 S. Ct. 774 (1984). [**44] Abend argues nonetheless that
defendants' attempts to interfere with his production of new derivative works
can only be remedied by an injunction. We disagree. Abend has not shown
irreparable injury which would justify imposing the severe remedy of an
injunction on defendants. Abend can be compensated adequately for the
infringement by monetary compensation. 17 U.S.C. § 504(b) provides that the
copyright owner can recover actual damages and "any profits of the infringement
that are attributable to the infringement and are not taken into account in
computing the actual damages." (Emphasis added.)
The district court is capable of calculating damages caused to the fair
market value of plaintiff's story by the re-release of the film. Any impairment
of Abend's ability to produce new derivative works based on the story would be
reflected in the calculation of the damage to the fair market value of the
story. In Cream Records, Inc. v. Jos. Schlitz Brewing Co., 754 F.2d 826, 827
(9th Cir. 1985), for example, the plaintiff presented evidence that defendants'
unauthorized use of part of [*1480] plaintiff's song in a commercial had
"destroyed the value of the copyrighted work" to other advertisers. [**45] We
held that the plaintiff could recover this lost value as damages. Id. at
827-28.
In addition to actual damages suffered, Abend would be entitled to profits
attributable to the infringement. 17 U.S.C. § 504(b). Defendants' fear that
Abend could receive 100% of their profits is unfounded. Abend can receive only
the profits attributable to the infringement. Id.; Frank Music Corp. v.
Metro-Goldwyn-Mayer, Inc., 772 F.2d 505, 518 (9th Cir. 1985) ("When an infringer
's profits are attributable to factors in addition to use of [its] work, an
apportionment of profits is proper."). Should the court find infringement
because defendants have failed to establish any affirmative defenses, on remand
it must apportion damages.
While apportioning profits is not always an easy task in these cases, neither
is it a new or unusual one. In the landmark case of Sheldon v.
Metro-Goldwyn-Mayer Pictures Corp., 106 F.2d 45 (2d Cir. 1939), aff'd, 309 U.S.
390, 60 S. Ct. 681, 84 L. Ed. 825 (1940), Judge Learned Hand held that profits
should be apportioned between the plaintiff and defendants, after finding that
defendants' movie "Letty Lynton" infringed plaintiff's play "Dishonored Lady."
Sheldon, 309 U.S. at 396. Judge Hand recognized that "no [**46] real standard"
can govern this apportionment, but he "resolved to avoid the one certainly
unjust course of giving the plaintiffs everything, because the defendants cannot
with certainty compute their own share." Sheldon, 106 F.2d at 51. The court then
set plaintiffs' share of the profits at 20%, to "favor the plaintiffs in every
reasonable chance of error." Id.
We likewise recognize that courts cannot be expected to determine with
"mathematical exactness" an apportionment of profits. We require only a
"reasonable and just apportionment." Frank Music Corp., 772 F.2d at 518. In
Frank, the defendants infringed plaintiff's copyright in the play "Kismet" by
including parts of songs and six minutes of music from the play, and by using
similar characters and setting in Act IV of a musical revue entitled "Hallelujah
Hollywood." Id. at 510. We remanded to the district court for apportionment of
profits using a reasonable formula.
We also required apportionment in Cream Records, 754 F.2d at 828. In Cream,
the plaintiff, owner of the copyright in "The Theme From Shaft," sought to
recover all profits earned from a commercial produced by the defendants which
infringed plaintiff's [**47] copyright by using a ten note ostinato from the
song. Id. We held that "in cases such as this where an infringer's profits are
not entirely due to the infringement, and the evidence suggests some division
which may rationally be used as a springboard, it is the duty of the court to
make some apportionment." Id. at 828-29 (quoting Orgel v. Clark Boardman Co.,
301 F.2d 119, 121 (2d Cir.), cert. denied, 371 U.S. 817, 9 L. Ed. 2d 58, 83 S.
Ct. 31 (1962).
Because factors other than Woolrich's story clearly contributed to "Rear
Window's" success, should the district court find that the defendants have
failed to establish any affirmative defense to the infringement, the district
court should award Abend actual damages and apportion profits between Abend and
the defendants. We turn now to the defenses raised by defendants.
III. Is the Defendants' Use of the Underlying Work a "Fair Use"?
Defendants argue that if we do not affirm the district court's grant of
summary judgment based on Rohauer, we should do so on the alternative ground
relied on by the district court -- that use of the copyrighted story was a "fair
use." We conclude, however, that the district court erred in holding that the
defendants' [**48] use was fair.
Under 17 U.S.C. § 107, certain unauthorized uses of a copyrighted work are
not infringing. These uses are termed "fair uses." Section 107 does not set
forth a clear test for determining when a use is a "fair use." Rather, it
identifies four non-exclusive [*1481] factors that the court must consider:
(1) the purpose and character of the use, including whether such
use is of a commercial nature or is for nonprofit educational
purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation
to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of
the copyrighted work.
17 U.S.C. § 107.
In applying the first factor, the Supreme Court has held that "every
[unauthorized] commercial use of copyrighted material is presumptively an unfair
exploitation of the monopoly privilege that belongs to the owner of the
copyright." Sony Corp. v. Universal Studios, Inc., 464 U.S. 417, 451, 78 L. Ed.
2d 574, 104 S. Ct. 774 (1984). The defendants argue that their distribution of
the "Rear Window" film serves an educational purpose, rather than a commercial
one. They offer no authority, however, for the bold proposition that a [**49]
work's popularity may make its value educational rather than commercial.
Clearly, the defendants' "use is of a commercial nature." 17 U.S.C. § 107(1).
The second factor that we must consider is the nature of the copyrighted
work. A use is less likely to be deemed fair when the copyrighted work is a
creative product. See, e.g., Brewer v. Hustler Magazine, Inc., 749 F.2d 527, 529
(9th Cir. 1984) (citing Sony Corp., 464 U.S. at 455 n. 40); see also 3 Nimmer on
Copyright § 13.05[A] at 13-77 ("Copyright protection is narrower, and the
corresponding application of the fair use defense greater, in the case of
factual works than in the case of works of fiction or fantasy."). Here, the
copyrighted work is a fictional short story: a quintessentially creative
product. This factor, therefore, militates against a finding of fair use.
The third factor is the amount of the portion used in proportion to the
entire copyrighted work. It is undisputed that the "Rear Window" film was based
on the underlying story, "It Had To Be Murder." Although it is not entirely
clear how much of the story was used in the film, Alfred Hitchcock testified in
his deposition that the film was at least "20 [**50] percent Cornell Woolrich."
We have held that "one cannot copy the substance of another's work without
infringing his copyright." Benny v. Loew's Inc., 239 F.2d 532, 537 (9th Cir.
1956) (television burlesque of copyrighted motion picture is not a fair use),
aff'd by an equally divided court sub nom. Columbia Broadcasting System v. Loew
's, 356 U.S. 43, 2 L. Ed. 2d 583, 78 S. Ct. 667 (1958). Recently, we noted that
the Supreme Court's decision in Sony "casts doubt on [this court's] previous
pronouncements concerning wholesale copying as an absolute preclusion to fair
use." Hustler Magazine, Inc. v. Moral Majority, Inc., 796 F.2d 1148, 1155 (9th
Cir. 1986) (Pregerson, J.). In Sony, however, the Supreme Court merely held that
"time-shifting" -- making a video-tape copy of a television broadcast for
viewing at a later time -- was a fair use. Sony does not stand for the
proposition that wholesale copying for a purely commercial purpose may ever be a
fair use. Indeed, in Harper & Row the Supreme Court held that the unauthorized
quotation of an insubstantial portion of an unpublished manuscript was not a
fair use when the quotation "took what was essentially the heart of the book."
105 S. Ct. at 2233 (citation [**51] omitted).
Here, a substantial portion of the underlying story, "It Had To Be Murder,"
was used in the "Rear Window" film. Even if the film did not take "what was
essentially the heart of the [story]," we conclude, based on our application of
the other four statutory factors, that the defendants' use was not a fair use.
The fourth factor that we must consider is the effect of the use on the
potential market for the copyrighted work. Nimmer terms this factor "the most
important, and indeed, central fair use factor." 3 Nimmer on Copyright § 13.05
[A] at 13-80. To illustrate the application of this factor, Nimmer posits a
hypothetical in which an unauthorized motion picture is made based on a [*1482]
copyrighted novel. Although the motion picture will have no adverse effect on
bookstore sales of the novel -- and may in fact have a beneficial effect -- it
is "clear that [the film's producer] may not invoke the defense of fair use." 3
Nimmer on Copyright § 13.05[B] at 13-84. Nimmer explains that although the film
will not prejudice the novel's sale in the book medium, it will prejudice its
sale in the motion picture medium. Id. "If the defendant's work adversely
affects the value of any [**52] of the rights in the copyrighted work (in this
case the adaptation right) the use is not fair even if the rights thus affected
have not as yet been exercised by the plaintiff." Id at 13-84 - 13-85 (footnotes
omitted).
Here, there is no question that the adaptation rights were adversely affected
by the defendants' re-release and distribution of the "Rear Window" film. Abend
stated in his declaration that he was interested in obtaining the rights to the
underlying story, "It Had To Be Murder," because he thought that it should be
republished, and because he thought that it could be remade for United States
television. Counsel for the defendants conceded at oral argument that Abend's
plans for a remake were frustrated by the existence of the "Rear Window" film.
Explaining why HBO abandoned a project to remake the story into a film, counsel
for the defendants stated: "It's not hard to figure out when you compare the
underlying work with our movie." Under Nimmer's hypothetical, this adverse
effect on the owner's adaptation rights makes the defendants' use of the
underlying work unfair. It is irrelevant that the re-release of the "Rear Window
" film may have promoted sales of the underlying [**53] story in the book
medium.
This case presents a classic example of an unfair use: a commercial use of a
fictional story that adversely affects the story owner's adaptation rights. The
district court erred as a matter of law in concluding that the defendants' use
was a fair use.
IV. Did the District Court Err in Denying Plaintiff's Motion For Summary
Judgment?
When the district court granted defendants' motions for summary judgment
based on Rohauer and "fair use," it denied plaintiff's motion for summary
judgment as to defendants' liability for copyright infringement. Abend appeals
the denial of his motion for summary judgment. n20 He argues that there are no
genuine issues of material fact regarding various affirmative defenses raised by
the defendants and that he is therefore entitled to judgment as a matter of law.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n20 Ordinarily a denial of a motion for summary judgment is not a final order
and thus not appealable. 28 U.S.C. § 1291. However, the district court's grant
of summary judgment was a final decision giving us jurisdiction to review its
denial of plaintiff's motion for summary judgment.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Although we hold that the district court erred in granting summary judgment
for [**54] defendants based on Rohauer and fair use, we cannot grant plaintiff
's motion for summary judgment and decide whether defendants have infringed
plaintiff's renewal copyright. Our review of the record indicates that the
district court denied Abend's motion because it granted the defendants' motions
based on Rohauer and fair use, and did not fully consider the merits of Abend's
motion regarding the various affirmative defenses raised by the defendants. n21
Consequently, we remand to the district court for reconsideration of plaintiff's
motion for summary judgment and the affirmative defenses raised by defendants.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n21 These affirmative defenses include estoppel, unclean hands, waiver,
abandonment, laches, and copyright misuse.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
CONCLUSION
We affirm the district court's denial of defendants' motion for summary
judgment based on alleged defects in the story's copyright and renewal.
We reject the Second Circuit's reasoning in Rohauer and reverse the district
court's grant of summary judgment on this issue. [*1483] Likewise, the panel
should hold that defendants' re-release of the film was not a "fair use" of the
underlying story.
Because the district court may not have considered the merits [**55] of
Abend's motion for summary judgment, we remand the case to the district court
for reconsideration.
DISSENTBY:
THOMPSON
DISSENT:
THOMPSON, Circuit Judge, dissenting:
I concur in Part I of the majority opinion.
I respectfully dissent from Part II, and write more about that later.
I concur in the majority's conclusion in Part III that the district court
erred in granting the defendants' motion for summary judgment based upon the
defense of "fair use," but I do not agree with, and accordingly express my
dissent from, that portion of Part III in which the majority suggests that the
defendants' copyright in the movie, "Rear Window", is in some way limited
because the "fair use" defense is inapplicable to Abend's claim of infringement.
The majority's view of "fair use" is premised on a hypothetical example by
Professor Nimmer in which he assumes that "an unauthorized motion picture is
made based on a copyrighted novel." See majority opinion at page 1481-1482. The
obvious flaw in this reasoning is that the premise does not apply in this case.
Here, the movie "Rear Window" was not an "unauthorized" creation. Moreover, the
defendants copyrighted it. It enjoys its own copyright protection as a
derivative work, as [**56] I discuss later in this dissent. Pursuant to this
copyright, the defendants have the right to exploit their movie without
infringement by others, including Abend. The unavailability of the "fair use"
doctrine as a defense to Abend's claim of infringement of his copyright has
nothing to do with the defendants' right to use their movie which is protected
by its own copyright.
I dissent from Part IV of the majority opinion, because I believe the
district court did not err in denying Abend's motion for summary judgment.
My dissent from Part II is predicated on my conviction that the district
court was correct in granting summary judgment in favor of the defendants on the
basis of the Second Circuit's decision in Rohauer v. Killiam Shows, Inc., 551
F.2d 484 (2d Cir.), cert. denied, 431 U.S. 949, 53 L. Ed. 2d 266, 97 S. Ct. 2666
(1977). I would hold, therefore, that the defendants' 1983 re-release and
exhibition of their movie, "Rear Window," did not infringe Abend's renewal
copyright in the story "It Had To Be Murder."
The majority opinion accurately recites the facts. I state the following only
to focus on those circumstances which I believe apply to an appropriate analysis
of Rohauer.
In 1942, Cornell Woolrich's [**57] short story "It Had To Be Murder" was
first published. Three years later, Woolrich agreed to assign exclusive
worldwide motion picture rights in the story for its initial and renewal
copyright terms to the defendants' predecessor-in-interest. Pursuant to this
grant, and during the initial term of Woolrich's copyright, the defendants
produced and released the motion picture "Rear Window," based in part on
Woolrich's story. The film, directed by Alfred Hitchcock and starring James
Stewart and Grace Kelly, was released in 1954. It was copyrighted by the
defendants at that time.
In 1968, just before the onset of the story's renewal period, Woolrich died.
Thus he never assigned the renewal rights in the story to the defendants as he
had promised. A year later Woolrich's executor did renew the story's copyright,
effective in 1970. In 1971, Abend acquired the story's renewal rights from
Woolrich's executor. In 1982, the defendants renewed their copyright in the film
"Rear Window." In 1983, the defendants re-released the film. Thereafter, Abend
brought this suit claiming infringement of the story's renewal copyright and
seeking compensatory damages, an accounting of the defendants' profits [**58]
and a permanent injunction which, among other things, would enjoin the
defendants from exhibiting, distributing, selling [*1484] or marketing "Rear
Window" in the United States.
The majority believes that Miller Music Corp. v. Charles N. Daniels, Inc.,
362 U.S. 373, 4 L. Ed. 2d 804, 80 S. Ct. 792 (1960) controls this case. See
majority opinion, pages 1474 n.8 and page 15497. As Judge Friendly explained in
Rohauer, however, n1 Miller Music involved a set of facts significantly
different from those presented in Rohauer and in the present case. Rohauer, 551
F.2d at 490.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n1 The majority asserts that Judge Friendly "virtually ignore[d]" Miller
Music in Rohauer, and Miller Music "provides ineluctable authority for Abend's
position." Majority opinion at page 1475. The majority thus suggests that Judge
Friendly either did not understand or purposely ignored the obvious. As I
explain above, I believe Judge Friendly correctly determined that Miller Music
failed to address the situation presented by Rohauer. Indeed, the Justices of
the Supreme Court who have expressed an opinion about the Rohauer decision have
noted that it states the view of the 1909 Act that has "prevailed." Mills Music,
Inc. v. Snyder, 469 U.S. 153, 183, 83 L. Ed. 2d 556, 105 S. Ct. 638 n.7 (1985)
(White, J., dissenting).
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - - [**59]
Miller Music involved only one copyrighted work. In that case, two music
publishers claimed the right to publish the song "Wine and Roses" through
purported assignments of the renewal copyright in the song. Miller Music Company
had been assigned the renewal rights by the song's co-author, Ben Black, during
the song's initial copyright term. Before that initial term expired, Black died.
His will contained no specific bequest concerning the renewal copyright. Black's
executor renewed the copyright, which was then distributed by decree of the
probate court to Black's residuary legatees. These legatees then assigned the
renewal copyright to Charles N. Daniels, Inc. The Supreme Court held that this
latter publisher, and not Miller Music Co., owned the publishing rights to the
song. In so doing the Court merely addressed "the relative rights of persons
claiming full assignment . . . of the renewal term of" a single copyrighted
work. Rohauer, 551 F.2d at 490. See also Miller Music, 362 U.S. at 374.
By contrast here, as in Rohauer, two separately copyrighted works, each
capable of being renewed under section 24 of the 1909 Act, are involved. The
distinction, as Judge Friendly [**60] recognized, is an important one. The
defendants do not challenge Abend's right to publish the story, nor do they
claim a right to publish it themselves; they do challenge Abend's ability to
block their right to show their film or to participate in its profits. Instead
of being called upon to decide which of two parties has rights under the 1909
Act (the question decided by the Court in Miller Music), we are called upon to
reconcile the interests of two parties who both have rights under the 1909 Act.
See Rohauer, 551 F.2d at 490.
The question thus remains here, as it did in Rohauer, whether continued
exhibition of the copyrighted derivative work (the film "Rear Window") should be
deemed to infringe Abend's renewal copyright on the underlying work (the story
"It Had To Be Murder."). See Rohauer, 551 F.2d at 485-86. In my view, it should
not. Nothing in the 1909 Act limits the use a copyright holder can make of his
properly created derivative work. Rather, in section 7 of the 1909 Act, Congress
gave derivative works dignity equal to underlying works, by providing that
derivative works "shall be regarded as new works subject to copyright under the
provisions [**61] of this title," so long as "produced with the consent" of
the proprietor of the underlying copyright. 17 U.S.C. § 7 (emphasis added).
Thus, like an underlying work, a properly created n2 derivative work is entitled
to the full range of protection provided to all works copyrighted under the 1909
Act.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n2 There is no dispute that the derivative film "Rear Window" was originally
made with valid section 7 consent.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Mindful of this, Judge Friendly concluded that it would not make sense to
"deprive[] the proprietor of the derivative copyright of a right, stemming from
the section 7 'consent' of the original proprietor of the underlying work, to
use so much of the underlying copyrighted work as already has been embodied in
the copyrighted derivative work" simply because the renewal [*1485] copyright
in the underlying work had vested in the statutory successor to the original
proprietor instead of the original proprietor. Rohauer, 551 F.2d at 492. The
identical situation is presented here, and the same result should obtain.
Abend argues, and the majority appears to agree, that Judge Friendly's
Rohauer analysis "violates" the "traditional rule" of this circuit as expressed
in Russell [**62] v. Price, 612 F.2d 1123 (9th Cir. 1979), cert. denied, 446
U.S. 952, 100 S. Ct. 2919, 64 L. Ed. 2d 809 (1980), that "a derivative copyright
protects only the new material contained in the derivative work, not the matter
derived from the underlying work." Russell at 1128. This is not so.
Russell involved the George Bernard Shaw play "Pygmalion." The play was
copyrighted by Shaw. A motion picture of the same name based on the play had
been produced under a license from Shaw. The film itself was copyrighted when
initially made. However, the film's copyright was never renewed. The copyright
in the underlying play, meanwhile, had been renewed. The case arose when holders
of the underlying play's renewal copyright sued defendants who had distributed
the film after the film's copyright had expired.
The defendants in Russell, citing Rohauer, argued that when the film's
derivative copyright expired, the whole product entered the public domain free
of the monopoly protection of any subsisting copyright in the underlying work.
Russell, 612 F.2d at 1127. For this reason, defendants argued, the underlying
work, like the derivative work, was no longer protected by the copyright laws.
We rejected that [**63] notion, and explained that the defendants' attempt to
rely on Rohauer was misplaced, because the facts of Rohauer involved
"significant differences" from the facts of Russell. Id. at 1126. The Russell
court then held that "although the derivative work may enter the public domain,
the matter contained therein which derives from a work still covered by
statutory copyright is not dedicated to the public." Id. (emphasis added). The
import of the "traditional rule" in Russell is simply that a derivative work's
loss of its copyright protection does not cause the loss of the underlying work
's copyright protection.
In the present case, the defendants do not argue that Woolrich's story is no
longer protected from public appropriation. Rather, they assert the right to
exhibit their own protected work. Thus, once again the present case is
distinguishable because it presents the conflict of two protected works. Russell
, like Miller, involved only one copyrighted work; the film in Russell was no
longer protected by copyright law. The court in Russell was not faced as we are
here with two works of equal dignity in the eyes of copyright law. Indeed, the
Russell [**64] court itself pointed out that in Russell, unlike Rohauer, there
was "no longer a conflict between two copyrights, each apparently granting
'their proprietors overlapping "exclusive" rights to whatever underlying
material . . . had been incorporated into the derivative film.'" Russell, 612
F.2d at 1128 (citation omitted).
Both Abend and the majority assert that Rohauer runs counter to cases in its
own Second Circuit, in particular one case antedating Rohauer, G. Ricordi & Co.
v. Paramount Pictures, Inc., 189 F.2d 469 (2d Cir.), cert. denied, 342 U.S. 849,
96 L. Ed. 641, 72 S. Ct. 77 (1951), and one case announced after Rohauer,
Gilliam v. American Broadcasting Co., 538 F.2d 14 (2d Cir. 1976). These cases,
however, are distinguishable.
Like Russell, Ricordi did not concern the question whether the holder of a
derivative copyright could exhibit that copyrighted work. Rather, it concerned
the question whether the derivative copyright holder could produce a new and
different derivative work without the consent of the underlying copyright
holder.
Ricordi obtained the rights to make a libretto for an opera from the novel
"Madame Butterfly." n3 The agreement granted [*1486] such rights for the
[**65] initial copyright period only. Ricordi made the opera and copyrighted
it. Later, during the novel's renewal period, Ricordi sued for a declaration
that he was entitled to produce a movie based on the opera. The Second Circuit
held that to the extent Ricordi had added new matter, he could produce a movie
based thereon, but he no longer had the right to exploit the underlying material
for a movie. Ricordi, 189 F.2d at 471.
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n3 He also obtained permission to make the opera from the holder of a
copyright in a play based on the book; the play had been created pursuant to
proper consent of the novel's author as well.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Unlike Ricordi, the defendants here do not seek to create a new work from
their movie. If they sought to make a play, or even a new movie, Ricordi would
be applicable. Moreover, there was no challenge in Ricordi analogous to the one
here--no one there challenged Ricordi's ability to exhibit his opera. For these
reasons Judge Friendly in Rohauer properly distinguished Ricordi. Rohauer, 551
F.2d at 493.
Neither is Gilliam on point. In that case, a group of British actors and
performers known as "Monty Python" held the copyrights in scripts written [**66]
for a television series. The copyrights in the recorded programs based on the
scripts, meanwhile, were held by the British Broadcasting Corporation (BBC).
Under a detailed agreement between Monty Python and the BBC, the latter was not
permitted to edit the programs without first consulting the Monty Python
writers. The BBC later granted the American Broadcasting Company (ABC) the right
to broadcast several of the programs. ABC severely edited the programs. Monty
Python sued for infringement of their scripts.
In finding for Monty Python, the Second Circuit concluded that since the BBC
itself had never obtained permission to edit the scripts, it could not possibly
transfer such a right to a third party like ABC. Gilliam, 538 F.2d at 21.
Gilliam has nothing to do with our case.
In sum, when presented with the facts of Rohauer, Judge Friendly wrote on a
precedent-free slate. He did not, however, look only to the statute. He
carefully examined the 1909 Act's legislative history as well as its language in
determining that the "force or validity" clause of section 7 "ha[d] no bearing"
on the problem there presented. Rohauer, 551 F.2d at 488, 490. That is, he
concluded that [**67] the statutory language had not been designed to address
the competing copyrights situation presented by Rohauer. n4
- - - - - - - - - - - - - - Footnotes - - - - - - - - - - - - - - -
n4 Abend nevertheless contends that the defendants' re-release of "Rear
Window" does impair the "force or validity" of Abend's renewal copyright in the
underlying story in violation of section 7. The majority, in finding Miller
Music dispositive, chose not to decide "whether or how section 7's 'force or
validity' clause" is implicated by the present case. See majority opinion at
page 1474 n.8. I agree with Judge Friendly's analysis, which applies equally
here, that section 7 was not written to address the situation presented by
Rohauer. See Rohauer, 551 F.2d at 488-490.
- - - - - - - - - - - - End Footnotes- - - - - - - - - - - - - -
Having found nothing in precedent or legislative history dictating a finding
of infringement, Judge Friendly next looked to policy considerations in
determining what Congress would have wanted when faced with the problem of
competing copyrights. Rohauer, 551 F.2d at 493. See also id. at 486 ("A court
must grope to ascertain what would have been the thought of the 1909 Congress on
an issue about which it almost certainly never thought at all."). He decided
that it would [**68] be "more in keeping with the letter and purposes of the
[1909 Act]" not to limit exhibition of the derivative work. Rohauer, 551 F.2d
at 486. Judge Friendly reasoned that makers of derivative works, unlike
licensees who merely print or distribute an unchanged underlying work, make
their own creative contributions, of the type Congress sought to protect under
copyright law. Id. at 493. This factor augurs in favor of allowing the
derivative copyright holder to continue exhibiting his work.
Creative contributions by the defendants to the movie "Rear Window" abound.
The movie added a love interest not present in the story. And of course the
lighting, acting, staging, as well as substantial script adaptations from the
basic story, all originated with the film. In short, the film is a new work of
art. Faced with substantially [*1487] the same question which was presented in
Rohauer, there is no reason to depart from its holding. Its reasoning is sound,
its precedent is firm, and I see no logic in creating a split of authority in
the circuits on this matter of national concern.
The majority states the defendants lost their right to exploit "Rear Window"
without Abend's consent, or at [**69] least without letting him share in the
proceeds from the exploitation, because Woolrich died prior to assigning his
renewal rights. I do not agree. In my view, what the defendants lost when
Woolrich died before commencement of the renewal term and assignment of his
renewal rights was not the right to continue to display their separately
copyrighted movie. Rather, they lost the right to create a new movie--indeed to
create any new work using Woolrich's story. It seems to me this view reads the
1909 Act plainly and gives due weight to Rohauer, Miller, Russell, Ricordi, and
Gilliam.
Contrary to the majority's suggestion, the holding of Rohauer does not deny
authors of underlying works or their successors a "second chance" to reap
benefits from their own works. See majority opinion at page 1477. Abend is free
to republish "It Had To Be Murder," authorize a new movie, television or
theatrical productions, create book cassettes and otherwise capitalize on the
success of "Rear Window" in any manner so long as he does not infringe upon the
new matter contained in that movie. See G. Ricordi & Co. v. Paramount Pictures,
Inc., 189 F.2d 469, 472 (2d Cir.), cert. denied, [**70] 342 U.S. 849, 96 L. Ed.
641, 72 S. Ct. 77 (1951).
Because I believe the defendants should prevail on their Rohauer defense, I
would not get to the issue of remedies. The majority suggests the parties should
share the profits from "Rear Window." It reaches this conclusion apparently
because it recognizes the unjust result of its holding that Abend, who invested
not one dime in creating the movie, should now have some rights to it. This
"share-the-wealth" concept offends my sense of justice. I don't see why Abend
should be permitted to squeeze the defendants for money generated by a movie
which they created, in which they risked their capital, and to which they
committed their substantial talents. Granted, the defendants used Woolrich's
story. But they paid him for it, and he agreed to assign his renewal rights in
the story to them. Now, because of the quirk of fate that Woolrich died before
the renewal term of the copyright in the underlying story, Abend, according to
the majority, is entitled to a portion of "Rear Window's" profits. It just doesn
't make sense.