Case 1:19-cv-01091-LAK Document 38 Filed 05/03/19 Page 1 of 30

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
----------------------------------------------------------- X
:
JOHN WAITE, an individual; JOE ELY, an
:
individual, and on behalf of all others similarly : No. 1:19-cv-01091(LAK)
situated,
:
:
Plaintiffs,
:
:
v.
:
:
UMG RECORDINGS, INC., a Delaware
:
corporation, and DOES 1 through 10,
:
:
Defendants.
:
X
----------------------------------------------------------MEMORANDUM OF LAW IN SUPPORT OF DEFENDANT
UMG RECORDINGS, INC.’S MOTION TO DISMISS THE COMPLAINT

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TABLE OF CONTENTS
PRELIMINARY STATEMENT ................................................................................................. 1
BACKGROUND ........................................................................................................................ 2
I.

TERMINATION OF COPYRIGHT GRANTS UNDER 17 U.S.C. § 203 .................... 2

II.

PLAINTIFFS’ CLAIMS .............................................................................................. 3

ARGUMENT .............................................................................................................................. 4
I.

THE COMPLAINT FAILS TO STATE A CLAIM BECAUSE PLAINTIFFS
CANNOT TERMINATE GRANTS AS TO MOST OF THE WORKS AT ISSUE
BECAUSE THEY ARE NOT GRANTORS WITHIN THE MEANING OF 17 U.S.C.
§ 203 ........................................................................................................................... 5

II.

THE COMPLAINT FAILS TO STATE A CLAIM BECAUSE ELY’S PRE-1978
COPYRIGHT GRANT IS NOT ELIGIBLE FOR TERMINATION UNDER 17 U.S.C.
§ 203 ........................................................................................................................... 8

III.

THE COMPLAINT FAILS TO STATE A CLAIM BECAUSE PLAINTIFFS’
TERMINATION NOTICES ARE FATALLY DEFICIENT PURSUANT TO 37
C.F.R. § 201.10(b)(2)................................................................................................. 12

A.

Plaintiffs’ Notices Did Not Comply with the Applicable Regulation. ..................... 12

B.

The Defects in the Notices Are Not Harmless. ....................................................... 14

IV.

V.

PLAINTIFFS’ CLAIMS ARE BARRED BY THE COPYRIGHT ACT’S THREEYEAR STATUTE OF LIMITATIONS ...................................................................... 17

A.

Because Waite Was on Notice of His Ownership Claim in the 1980s, His Present
Claims are Time-Barred. ........................................................................................ 18

B.

Because Ely Was on Notice of His Ownership Claim in the 1970s, His Present
Claims are Time-Barred. ........................................................................................ 22
PLAINTIFFS’ COPYRIGHT INFRINGEMENT CLAIMS ALSO FAIL................... 24

CONCLUSION ......................................................................................................................... 25

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TABLE OF AUTHORITIES
Page(s)
Cases
Aday v. Sony Music Entm’t,
1997 WL 598410 (S.D.N.Y. Sept. 25, 1997)...................................................... 18, 20, 21, 24
Ashcroft v. Iqbal,
556 U.S. 662, 129 S. Ct. 1937 (2009) .................................................................................... 5
Barnhart v. Sigmon Coal Co., Inc.,
534 U.S. 438, 122 S. Ct. 941 (2002) ...................................................................................... 8
Brumley v. Albert E. Brumley & Sons, Inc.,
822 F.3d 926 (6th Cir. 2016) ............................................................................................... 12
Burroughs v. Metro-Goldwyn-Mayer, Inc.,
491 F. Supp. 1320 (S.D.N.Y. 1980) ............................................................................... 14, 16
Burroughs v. Metro-Goldwyn-Mayer, Inc.,
683 F.2d 610 (2d Cir. 1982) .......................................................................................... 12, 17
Chambers v. Time Warner, Inc.,
282 F.3d 147 (2d Cir. 2002) .................................................................................................. 3
Consumer Health Info. Corp. v. Amylin Pharm., Inc.,
819 F.3d 992 (7th Cir. 2016) ............................................................................. 17, 21, 22, 24
Cooper v. NCS Pearson, Inc.,
733 F.3d 1013 (10th Cir. 2013).......................................................................... 18, 22, 23, 24
DiFolco v. MSNBC Cable L.L.C.,
622 F.3d 104 (2d Cir. 2010) .............................................................................................. 3, 5
Fed. Deposit Ins. Corp. v. Meyer,
510 U.S. 471, 114 S. Ct. 996 (1994) ...................................................................................... 8
Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC,
139 S. Ct. 881 (2019) ...................................................................................................... 1, 12
Kwan v. Schlein,
634 F.3d 224 (2d Cir. 2011) ................................................................................................ 17
Latin Am. Music Co. v. Am. Soc’y of Composers, Authors, and Publishers,
593 F.3d 95 (1st Cir. 2010) .................................................................................................... 5

ii

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Lentell v. Merrill Lynch & Co., Inc.,
396 F.3d 161 (2d Cir. 2005) .................................................................................................. 5
Milne v. Stephen Slesinger, Inc.,
430 F.3d 1036 (9th Cir. 2005) ....................................................................................... 5, 7, 9
Music Sales Corp. v. Morris,
73 F. Supp. 2d 364 (S.D.N.Y. 1999) .................................................................................... 17
Penguin Group (USA) Inc. v. Steinbeck,
537 F.3d 193 (2d Cir. 2008) ...................................................................................... 2, 5, 7, 9
Star Athletica, L.L.C. v. Varsity Brands, Inc.,
137 S. Ct. 1002 (2017) ........................................................................................................ 11
Statutes
17 U.S.C. § 101......................................................................................................................... 19
17 U.S.C. § 106........................................................................................................................... 6
17 U.S.C. § 111........................................................................................................................... 8
17 U.S.C. § 201......................................................................................................................... 19
17 U.S.C. § 203.................................................................................................................. passim
17 U.S.C. § 204....................................................................................................................... 7, 8
17 U.S.C. § 304................................................................................................................... 2, 3, 9
17 U.S.C. § 507................................................................................................................... 17, 21
Other Authorities
37 C.F.R. § 201.10 ............................................................................................................. passim
ANALYSIS OF GAP GRANTS UNDER THE TERMINATION PROVISIONS OF TITLE 17,
U.S. COPYRIGHT OFFICE (Dec. 7, 2010), available at
https://www.copyright.gov/reports/gap-grant-analysis.pdf ............................................. 10, 11
BLACK’S LAW DICTIONARY (Bryan A. Garner ed., 10th ed. 2014) ............................................... 8
Federal Rule of Civil Procedure 11............................................................................................ 16
Federal Rule of Civil Procedure 12.............................................................................................. 1
H.R. REP. NO. 94-1476 (1976), available at
https://www.copyright.gov/history/law/clrev_94-1476.pdf .......................................... 3, 9, 10
iii

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Mary LaFrance, The Separate Tax Status of Loan-Out Corporations, 48 VAND. L.
REV. 879 (1995) .................................................................................................................... 4
MELVILLE B. NIMMER & DAVID NIMMER, NIMMER ON COPYRIGHT ........................................ 5, 17
HOUSE COMM. ON THE JUDICIARY, 89TH CONG., 1ST SESS., COPYRIGHT LAW
REVISION PART 6: SUPPLEMENTARY REPORT OF THE REGISTER OF COPYRIGHTS
ON THE GENERAL REVISION OF THE U.S. COPYRIGHT LAW: 1965 REVISION BILL
(1965) ................................................................................................................................. 10
GENERAL GUIDE TO THE COPYRIGHT ACT OF 1976, U.S. COPYRIGHT OFFICE
(1977), available at https://www.copyright.gov/reports/guide-to-copyright.pdf ................... 10

iv

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Defendant UMG Recordings, Inc. (“UMG”) respectfully submits this memorandum in
support of its motion to dismiss the Complaint brought by Plaintiffs John Waite (“Waite”) and
Joe Ely (“Ely”) (collectively, “Plaintiffs”), pursuant to Federal Rule of Civil Procedure 12(b)(6).

PRELIMINARY STATEMENT
This matter relates to Section 203 of the Copyright Act of 1976, 17 U.S.C. § 203, which
permits an author to terminate certain grants of copyright rights executed on or after January 1,
1978, if specific conditions are met. Plaintiffs are recording artists who sent notices to UMG,
purporting to terminate transfers of copyrights pursuant to Section 203. In this action, Plaintiffs
seek a declaration that those termination notices are valid, and assert infringement claims against
UMG; Plaintiffs also purport to bring this action on behalf of a putative class of recording artists
who have served Section 203 termination notices on UMG. Plaintiffs’ claims, however, are
without merit, and the Complaint should be dismissed with prejudice.
Plaintiffs’ claims fail as a matter of law for at least four independent reasons.
First, under the plain language of the Copyright Act, only an author who executes a grant
(or if deceased, his or her statutorily designated heirs) may terminate the grant. Here, as to all of
the agreements involving Waite’s sound recordings, and one of the agreements involving Ely’s
sound recordings, Plaintiffs did not grant any transfer of copyright. Instead, any grants
respecting those works were made by third parties that provided Plaintiffs’ services and the fruits
of those services to predecessors of UMG or its affiliates. Because Plaintiffs were not grantors,
they are not entitled to terminate the grants.
Second, the other agreement involving Ely is not eligible for termination pursuant to
Section 203 because the parties executed that agreement prior to January 1, 1978, and Section
203 applies only to grants executed on or after that date.
Third, Plaintiffs’ termination notices do not comply with statutory and regulatory
requirements, making the putative terminations invalid and ineffective.
Fourth, the Copyright Act’s three-year statute of limitations bars Plaintiffs’ claims. The
Complaint fundamentally challenges ownership of the works at issue, and that challenge was ripe
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decades ago, at the moment the agreements governing the creation and ownership of those works
were signed.
Importantly, Plaintiffs’ copyright infringement claims are entirely premised on the
validity of their purported termination notices and corresponding ownership claims. Because
those latter claims fail as a matter of law, Plaintiffs’ infringement claims must also fail. For
these reasons, UMG respectfully requests that the Court dismiss the Complaint in its entirety.

BACKGROUND
I.

TERMINATION OF COPYRIGHT GRANTS UNDER 17 U.S.C. § 203
Under the Copyright Act of 1909, “authors were entitled to a copyright in their works for

an initial twenty-eight year period,” and “[a]fter this period expired, the author had the right to
renew the copyright for a second twenty-eight year term.” Penguin Group (USA) Inc. v.
Steinbeck, 537 F.3d 193, 197 (2d Cir. 2008). “The 1976 amendments to the Copyright Act,
which took effect in 1978, abandoned this framework,” and “replaced the two consecutive
twenty-eight year terms with a single copyright term of increased duration, and it created for
authors . . . [a] right to terminate the grant of a transfer or license.” Id. 197-98 (citation omitted).
More specifically, Congress established two separate termination regimes, one as to
grants executed by authors on or after January 1, 1978, and the other as to certain grants
executed before that date. See 17 U.S.C. §§ 203(a)(3), 304(c)(3). As to the former (which is the
termination provision at issue here), Section 203 provides:
In the case of any work other than a work made for hire, the exclusive or
nonexclusive grant of a transfer or license of copyright or of any right under a
copyright, executed by the author on or after January 1, 1978, otherwise than by
will, is subject to termination [under certain specified conditions].
Id. at § 203(a).1
1

The other termination provision, Section 304(c), provides in relevant part:
In the case of any copyright subsisting in either its first or renewal term on January 1,
1978, other than a copyright in a work made for hire, the exclusive or nonexclusive grant
of a transfer or license of the renewal copyright or any right under it, executed before
2

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Congress, however, did not make this right self-effectuating; indeed, “[i]nstead of being
automatic, . . . the termination of a transfer or license under section 203 would require the
serving of an advance notice within specified time limits and under specified conditions.” H.R.
REP. NO. 94-1476, at 124 (1976), available at https://www.copyright.gov/history/law/clrev_941476.pdf. Thus, in the Copyright Act, Congress directed the Register of Copyrights to prescribe
the “form, content, and manner of service” for termination notices pursuant to Section 203. 17
U.S.C. § 203(a)(4)(B).
The Copyright Office subsequently promulgated a regulation specifying requirements for
a termination notice. See 37 C.F.R. § 201.10. These requirements include, inter alia, “[a] brief
statement reasonably identifying the grant to which the notice of termination applies” and “a
clear identification of . . . [t]he date of execution of the grant being terminated.” Id. at §
201.10(b)(2)(iii), (v). Moreover, the regulation requires that this information be “[c]lear[ly]
identifi[ed]” by “a complete and unambiguous statement of facts in the notice itself, without
incorporation by reference of information in other documents or records.” Id. at § 201.10(b)(3).

II.

PLAINTIFFS’ CLAIMS
Plaintiffs are two recording artists who recorded albums that were released by

predecessors of UMG or its affiliate in the mid-to-late 1970s and early 1980s. See Compl. ¶¶ 25,
36; Declaration of Rollin A. Ransom (“Ransom Decl.”) Exs. A-G. 2 The contractual
relationships pursuant to which UMG or its affiliate obtained copyright ownership of these
albums were primarily made not with the artists themselves, but rather with loan-out or other
January 1, 1978, by any of the persons designated by subsection (a)(1)(C) of this section,
otherwise than by will, is subject to termination [under certain specified conditions].
17 U.S.C. § 304(c).
2

On a motion to dismiss, the Court may consider documents attached or explicitly referred to in
the Complaint, or on which the Complaint reasonably relies, without converting the motion to
one for summary judgment. See DiFolco v. MSNBC Cable L.L.C., 622 F.3d 104, 111 (2d Cir.
2010); see also Chambers v. Time Warner, Inc., 282 F.3d 147, 153 (2d Cir. 2002) (noting that
recording contracts are integral to a copyright claim and thus were properly incorporated by
reference on a motion to dismiss).
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companies who agreed to furnish the recording services of Plaintiffs, to record and deliver sound
recordings featuring Plaintiffs, and to vest copyright ownership of those sound recordings in
predecessors of UMG or its affiliate. 3 Ransom Decl. Exs. A-G.
By letter to UMG dated April 20, 2015, and sent by Plaintiffs’ counsel, Waite purported
to terminate copyright grants pursuant to Section 203, with respect to three albums: Ignition, No
Brakes, and Mask of Smiles. Compl. Ex. A. On December 15, 2015, Plaintiffs’ counsel sent a
similar letter to UMG on behalf of Ely, purporting to terminate copyright grants pursuant to
Section 203 with respect to four albums: Honky Tonk Masquerade, Down the Drag, Live Shots,
and Musta Notta Gotta Lotta. Id. Ex. C.4 Notably, the termination notices did not specifically
identify the grants that they were purporting to terminate, did not include the date of execution of
the grants, and did not identify all of the parties to the agreements governing the grants. Despite
these clear deficiencies, Plaintiffs seek a declaration that their termination notices are valid, and
damages for copyright infringement based upon UMG’s exploitation of the works following the
effective date of the putative terminations.

ARGUMENT
To survive a motion to dismiss for failure to state a claim, “a complaint must contain
sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’”
Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937 (2009) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570, 127 S. Ct. 1955 (2007)). To meet this standard, a plaintiff must plead factual

3

A loan-out company employs the artist and then “loans out” his or her services to another
person or entity. Mary LaFrance, The Separate Tax Status of Loan-Out Corporations, 48 VAND.
L. REV. 879, 880–81 (1995). This structure offers two principal benefits to the artist: limited
personal liability and beneficial tax treatment. Id. at 881.
4

Ely’s termination notice also listed works entitled Fingernails/Because of the Wind, Honky
Tonk Masquerade/Johnny Blues, and She Never Spoke Spanish to Me/Cornbread Moon, versions
of which were included on the above-referenced albums. See Compl. Exs. C-D. In addition, the
notice listed the album Hi-Res. Id. Ex. C. However, because this work is not referenced in the
Complaint, see Compl. ¶ 38, UMG understands that Ely is not attempting to validate the
termination notice as to it.
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content “that allows the court to draw the reasonable inference that the defendant is liable for the
misconduct alleged.” Id. The Court may properly consider “the complaint, documents attached
to the complaint as exhibits, and documents incorporated by reference in the complaint.”
DiFolco v. MSNBC Cable LLC, 622 F.3d 104, 111 (2d Cir. 2010). Though all reasonable
inferences are drawn in a plaintiff’s favor on a motion to dismiss on the pleadings, the Court
need not accept as true “conclusions of law or unwarranted deductions of fact.” See, e.g., Lentell
v. Merrill Lynch & Co., Inc., 396 F.3d 161, 174-75 (2d Cir. 2005) (internal quotation omitted).
As demonstrated below, the Complaint fails to state a claim and should be dismissed, for
each of four independent reasons.

I.

THE COMPLAINT FAILS TO STATE A CLAIM BECAUSE PLAINTIFFS
CANNOT TERMINATE GRANTS AS TO MOST OF THE WORKS AT
ISSUE BECAUSE THEY ARE NOT GRANTORS WITHIN THE
MEANING OF 17 U.S.C. § 203
“In a copyright case, as in most cases, the language of the statute provides the starting

point for [the Court’s] analysis.” Milne v. Stephen Slesinger, Inc., 430 F.3d 1036, 1042 (9th Cir.
2005) (citations omitted). Section 203 of the Copyright Act explicitly limits termination of
copyright grants to those “executed by the author,” in which case only the author (or the
statutorily designated heirs of a deceased author/grantor) may terminate the grant. See 17 U.S.C.
§ 203(a); see also Penguin Group (USA) Inc., 537 F.3d at 198-99 (“17 U.S.C. § 203 . . . applies
only to grants made by the author rather than to grants made by either the author or other
parties.”); 3 MELVILLE B. NIMMER & DAVID NIMMER, NIMMER ON COPYRIGHT (“NIMMER”) §
11.03[B] (“Grants executed on or after January 1, 1978 are subject to termination only if
executed by the author.”). Thus, by the express terms of the Copyright Act, only a grant that is
executed by and as an author is potentially subject to termination pursuant to Section 203. See
Latin Am. Music Co. v. Am. Soc’y of Composers, Authors, and Publishers, 593 F.3d 95, 101 (1st
Cir. 2010) (rejecting application of Section 203 where terminating party was “neither the author
nor a statutory heir of the author,” but instead was a successor to the author/composer’s music
publisher).
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Here, Waite did not execute any of the grants he now seeks to terminate as a purported
author of the corresponding works. See Compl. Ex. B at 2; Ransom Decl. Exs. A-C. Instead,
any grants were made and executed by various loan-out companies that entered into agreements
with a predecessor of UMG’s affiliate – and Waite admits as much. Compl. ¶ 25. Specifically,
in 1981, Waite’s loan-out company, Heavy Waite, Inc., executed an agreement with Chrysalis
Records, Inc. (“Chrysalis”). Id.; see also Ransom Decl. Ex. A. In 1983, Waite’s loan-out
company, Moonwalk Music, Inc. (“Moonwalk”), executed an agreement with Capital Records,
Inc. (“Capitol”), a processor of UMG’s now-affiliate Capitol Records, LLC. Compl. ¶ 25; see
also Ransom Decl. Ex. B. And in 1985, Waite’s loan-out company, Diamond Stripe, Inc.,
executed an agreement with Capitol. Compl. ¶ 25; see also Ransom Decl. Ex. C. To the extent
these agreements contained a grant of rights, it was the loan-out company (not John Waite
individually or as author) that granted the transfer of copyrights pertaining to the Waite
recordings at issue. See Ransom Decl. Ex. A at ¶ 4 (loan-out company agreeing that “all
copyrights therein and thereto . . . shall be entirely [Chysalis’s] property, free of any claims
whatsoever by [the loan-out company]”); Ex. B at ¶ 5(b) (“Company grants and assigns to
[Capitol] all exclusive right, title and interest in and to such Work throughout the Territory,
including, but not limited to, all rights of the owner of copyright specified in 17 U.S.C. § 106.”)
(emphasis added); Ex. C at ¶ 5(b) (same). 5
Similarly, Ely was not the grantor in the agreement executed in 1979. Instead, a thirdparty company called South Coast Records, Inc. granted the rights to works to MCA Records,
5

Moreover, each of these agreements expressly stated that the loan-out company had a separate
and enforceable personal services contract with Waite, under which Waite agreed to furnish his
recording services exclusively to the loan-out company. See Ransom Decl. Ex. A at ¶ 10(a)
(“You hereby warrant and represent that you now have the exclusive right to Artist’s recording
services under a valid and binding recording contract . . . [and can] require the performance by
Artist of said contractual obligations.”); Ex. B at ¶ 2 (“Company represents, warrants and agrees
that: (a) Company has a contract with Artist. Company’s contract with Artist requires the
performance by Artist exclusively for Company.”); Ex. C at ¶ 2 (“Company represents, warrants
and agrees that: (a) Company has a contract with Artist . . . wherein Artist has agreed to perform
exclusively for Company upon such terms and conditions.”).
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Inc., UMG’s predecessor. See Compl. Ex. D at 4; Ransom Decl. Ex. E at ¶ 8A(a) (providing that
South Coast “assigns all right, title and interest in the copyright in and to the Masters and all
reproductions thereof and the sound performances contained therein”); see also id. at ¶ 1(c)
(“[South Coast Records] has or shall enter into a valid written Exclusive Artist’s Recording
Agreement with each artist.”).
Under the plain language of the statute, Plaintiffs simply do not have the authority to
effectuate termination of these grants; only a grantor can do so, and as to the agreements
referenced above, neither Plaintiff is the grantor.6 By seeking to terminate grants they did not
make, Plaintiffs are essentially asking the Court to disregard the operative agreements and ignore
the critical (indeed, determinative) role of the third-party grantors. Such a request is not within
the Court’s powers to grant. See Milne, 430 F.3d at 1044-45 (finding that no “authority
supplie[d] a basis for [the court] . . . to undo [a copyright] agreement, which was freely and
intelligently entered into by the parties”); see also Penguin Group (USA) Inc., 537 F.3d at 20001 (holding post-1978 agreement terminating and superseding pre-1978 agreement could not be
undone). For this reason, Waite’s claims should be dismissed in their entirety, and Ely’s claims
should be dismissed as to works that are subject to the 1979 agreement, including but not limited
to Live Shots and Musta Notta Gotta Lotta. Compl. Ex. D at 4.

6

In fact, the grantors are corporate entities who would only own the copyright as works made for
hire. Because works made for hire are expressly exempted from the termination scheme under
Section 203(a), these corporate grantors could also not terminate the grants at issue, although no
such attempted termination has been made. Moreover, even if the corporate grantors had
somehow acquired their rights by assignment from the artist – and there is no evidence of any
such assignment (which would have to have been in writing and signed by the artist under 17
U.S.C. § 204(a)), nor any attempt by the artist to terminate any such grant – the corporate
grantors would still have no right of termination here because their grant would not be one made
by the author.
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II.

THE COMPLAINT FAILS TO STATE A CLAIM BECAUSE ELY’S PRE1978 COPYRIGHT GRANT IS NOT ELIGIBLE FOR TERMINATION
UNDER 17 U.S.C. § 203
The fifth agreement at issue in this lawsuit is a contract with MCA Records, Inc. that Ely

executed on August 26, 1976. Ransom Decl. Ex. D. That agreement, however, is likewise not
eligible for termination under Section 203. By its clear terms, Section 203 permits termination
only of grants “executed . . . on or after January 1, 1978.” 17 U.S.C. § 203(a). As the Supreme
Court has “stated time and again,” “courts must presume that the legislature says in a statute
what it means and means in a statute what it says.” Barnhart v. Sigmon Coal Co., Inc., 534 U.S.
438, 461-62, 122 S. Ct. 941 (2002). “When the words of a statute are unambiguous, then, this
first canon is also the last: judicial inquiry is complete.” Id. at 462 (internal quotations and
citation omitted).
The term “executed” is unambiguous. Where a term is not expressly defined by a statute,
that term must be construed “in accordance with its ordinary or natural meaning.” Fed. Deposit
Ins. Corp. v. Meyer, 510 U.S. 471, 476, 114 S. Ct. 996 (1994). The traditional definition of
“executed” is “([o]f a document) that has been signed.” BLACK’S LAW DICTIONARY (Bryan A.
Garner ed., 10th ed. 2014). Indeed, in multiple sections of the Copyright Act, “executed” is used
synonymously with “signed.” See, e.g., 17 U.S.C. §§ 111(e)(1)(D) (requiring that “an owner or
officer of [a] cable system execute[] an affidavit”); 204(a) (stating under the heading
“[e]xecution of transfers of copyright ownership,” “[a] transfer of copyright ownership . . . is not
valid unless an instrument of conveyance . . . is in writing and signed by the owner”) (emphasis
added); 205(a) (authorizing recordation of a document pertaining to copyright “if the document
filed for recordation bears the actual signature of the person who executed it”); 406(a)(2)
(referring to recordation of “a document executed by the person named in [a copyright] notice”);
512(h) (authorizing issuance of a subpoena based upon a sworn declaration if “the proposed
subpoena is in proper form, and the accompanying declaration is properly executed”); 903(c)(1)
(authorizing recordation of a document pertaining to a mask work “if the document filed for
recordation bears the actual signature of the person who executed it”). “The normal rule of
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statutory construction [is] that identical words used in different parts of the same Act are
intended to have the same meaning.” Penguin Group (USA) Inc., 537 F.3d at 203 n.6 (quoting
Gustafson v. Alloyd Co., Inc., 513 U.S. 561, 562, 115 S. Ct. 1061 (1995)).
Court decisions are in accord. For example, in Milne, the Ninth Circuit used the terms
“executed” and “signed” interchangeably in a case concerning parallel terminology in Section
304. The court found that because a grantor “signed on April 1, 1983 a more lucrative deal,” that
“grant [wa]s not subject to termination under section 304(d) because it was not ‘executed before
January 1, 1978,’ as the statute expressly requires.” 430 F.3d at 1040, 1043 (emphasis added)
(citing 17 U.S.C. § 304(d)). Indeed, no court has held that pursuant to the Copyright Act’s
termination sections, the term “executed” means anything other than “signed.”
Likewise, the legislative history supports the traditional interpretation of “executed,”
namely, to mean the date on which the parties signed the contract. For example, in discussing
Section 203 terminations, the legislative history includes an example of how the time limitations
would work:
The effective date of termination . . . is required to fall within the 5 years
following the end of the applicable 35- or 40-year period. . . . As an example of
how these time-limit requirements would operate in practice:
Case 1: Contract for theatrical production signed on September 2, 1987.
Termination of grant can be made to take effect between September 2, 2022 (35
years from execution) and September 1, 2027 (end of 5 year termination period).
H.R. REP. NO. 94-1476 at 126 (emphasis added). By calculating the accrual date from the date
the contract was signed, Congress clearly intended for the signature date to be the date of
execution. Moreover, in further discussing the application of Section 203, Congress used the
terms “execution of the grant” and “signing of the contract” interchangeably:
As an exception to this basic 35-year rule, the bill also provides that “if the grant
covers the right of publication of the work, the period begins at the end of 35
years from the date of publication of the work under the grant or at the end of 40
years from the date of execution of the grant, whichever term ends earlier.” This
alternative method of computation is intended to cover cases where years elapse
between the signing of a publication contract and the eventual publication of the
work.
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Id. at 126 (emphasis added). Indeed, in this example, Congress actually makes clear that
“execution” of the grant means the date of the signing of the contract.
Further, in a report submitted to Congress in the years leading up to the Copyright Act of
1976, the Copyright Office also interpreted “executed” to mean the agreement’s signature date.
In the report, the Copyright Office provided the following example pertaining to terminations:
Take, for example, a case in which a book-publication contract is signed on July
1, 1970 while the book is in the process of being written, and in which publication
does not take place until May 1, 1976. Since the grant covers the right of first
publication, the 5-year period during which the contract could terminate would
begin on July 1, 2010 (40 years from the date of execution) rather than on July 1,
2005 (35 years from the date of execution). . . .
HOUSE COMM. ON THE JUDICIARY, 89TH CONG., 1ST SESS., COPYRIGHT LAW REVISION PART 6:
SUPPLEMENTARY REPORT OF THE REGISTER OF COPYRIGHTS ON THE GENERAL REVISION OF THE
U.S. COPYRIGHT LAW: 1965 REVISION BILL, at 73-74 (1965) (emphasis added) (attached as
Ransom Decl. Ex. H). Thus, at least in 1965, the Copyright Office believed that the date of
execution was the date the contract was signed, even as to works that were later created.
Moreover, in a guide dated just after Congress enacted the Copyright Act of 1976, the Copyright
Office explicitly considered an example concerning a grant where a “publishing company, on
July 1, 1977, makes a contract with [a] Novelist for a new book,” but “[t]he book is not written
until July 20, 1979.” GENERAL GUIDE TO THE COPYRIGHT ACT OF 1976, U.S. COPYRIGHT OFFICE,
at 6:6 (1977), available at https://www.copyright.gov/reports/guide-to-copyright.pdf. The
Copyright Office concluded that such a grant would not be eligible for Section 203 termination,
confirming that such grants are not included under the statute. Id.
Although the Copyright Office has more recently suggested that a different interpretation
is possible – namely, that the term “executed” in Section 203 might be interpreted to mean not
only the signing of a grant, but also the creation of a corresponding work (such that a grant is not
“executed” until the work that is the subject of the grant is created), see ANALYSIS OF GAP
GRANTS UNDER THE TERMINATION PROVISIONS OF TITLE 17 (“ANALYSIS OF GAP GRANTS”) at 12, U.S. COPYRIGHT OFFICE (Dec. 7, 2010), available at https://www.copyright.gov/reports/gap10

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grant-analysis.pdf – that does not aid Ely here. First, Ely does not allege when the sound
recordings that are the subject of the 1976 Agreement were created, and therefore fails to satisfy
even this potential interpretation of the statute. Cf. Compl. ¶ 36 (referring to date on which
Honky Tonk Masquerade was “released,” not date on which it was created). 7
Second, and in any event, the Copyright Office was clear that its recent consideration of
the issue was “not a substitute for statutory clarification” respecting whether works that were
created in or after 1978, but which are the subject of a grant dated before 1978, are eligible for
termination under Section 203. ANALYSIS OF GAP GRANTS at iii. Nor is it the role or
responsibility of this Court to rewrite the statute, or to otherwise substitute its judgment in place
of the plain language adopted by Congress. As the Supreme Court has stated, copyright cases do
not involve “a free-ranging search for the best copyright policy, but rather ‘depend[] solely on
statutory interpretation.’” Star Athletica, L.L.C. v. Varsity Brands, Inc., 137 S. Ct. 1002, 1010
(2017) (quoting Mazer v. Stein, 347 U.S. 201, 214, 74 S. Ct. 460 (1954)). Such an inquiry “must
give effect to the clear meaning of statutes as written,” id. (quoting Estate of Cowart v. Nicklos
Drilling Co., 505 U.S. 469, 476 , 112 S. Ct. 2589 (1992)), and “begin[s] and end[s] . . . with the
text, giving each word its ‘ordinary, contemporary, common meaning.’” Id. (quoting Walters v.
Metropolitan Ed. Enterprises, Inc., 519 U.S. 202, 207, 117 S. Ct. 660 (1997)). Here, both the
plain language of the statute and the relevant legislative history confirm that Section 203 clearly
excludes such so-called “gap grants”, and only Congress – not the courts or the Copyright Office
– has the power to amend the statute to include them.
Indeed, just this year, the Supreme Court unanimously reiterated the principle that courts
must hew to the Copyright Act as written by Congress, regardless of whether the Act is working
precisely as Congress intended or as courts or the Copyright Office believe it should. See Fourth
Estate Public Benefit Corp. v. Wall-Street.com, LLC, 139 S. Ct. 881, 892 (2019) (noting that

7

Nor could Ely truthfully allege that such works were created prior to January 1, 1978. On the
contrary, UMG’s documents reflect that these sound recordings were recorded in 1977.
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although “the statutory scheme [requiring issuance of a copyright registration as a condition to
filing suit] has not worked as Congress likely envisioned,” the Court could not substitute its
judgment for that of Congress: “Unfortunate as the current [issue] may be, that factor does not
allow us to revise [the Copyright Act’s] congressionally composed text”). Unless and until
Congress amends Section 203, courts must follow its plain meaning. As such, any grant in Ely’s
pre-1978 cannot be terminated pursuant to Section 203 and his claims pertaining to works
subject to that agreement must be dismissed.

III.

THE COMPLAINT FAILS TO STATE A CLAIM BECAUSE PLAINTIFFS’
TERMINATION NOTICES ARE FATALLY DEFICIENT PURSUANT TO
37 C.F.R. § 201.10(B)(2)
The Court should also dismiss the Complaint because Plaintiffs’ termination notices did

not contain the information required by the applicable regulation, and are therefore invalid. As
noted above, pursuant to 37 C.F.R. § 201.10(b)(2)(iii), (v), a notice of termination under Section
203 must include a “brief statement reasonably identifying the grant to which the notice of
termination applies” and a “clear identification” of the “date of execution of the grant being
terminated.”
Plaintiffs’ termination notices are fatally deficient in both respects: their putative
identification of the purported affected grants is woefully inadequate, and they do not include
any date of execution whatsoever. See Brumley v. Albert E. Brumley & Sons, Inc., 822 F.3d 926,
931 (6th Cir. 2016) (holding that a purported termination notice did not effectuate termination
because “[t]he Act and its implementing regulations describe several requirements of a
termination notice” and the notice did not comply with the stated requirements) (citing in part 37
C.F.R. § 201.10). As a result, Plaintiffs’ termination notices failed to effectively terminate any
copyright grants. See Burroughs v. Metro-Goldwyn-Mayer, Inc., 683 F.2d 610, 622 (2d Cir.
1982) (leaving intact rights to books not listed in termination notice).
A.

Plaintiffs’ Notices Did Not Comply with the Applicable Regulation.

First, the termination notices are fatally deficient because they do not “reasonably
identify[] the grant to which the notice of termination applies.” 37 C.F.R. § 201.10(b)(2)(v).
12

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Plaintiffs provided the following brief statements:
Grant Hereby Terminated: All grants or transfers of copyright and all rights of
copyright proprietor, including publication and recording rights, in and to the
above sound recordings including, without limitation to the granted dated in or
about 1981 between the members of the recording group called The Babys and
Chrysalis Records.
Compl. Ex. A (Waite Termination Notice).
Grant Hereby Terminated: All grants and transfers of copyright and all rights of
copyright proprietor, including publication and recording rights, in and to the
above sound recordings including, without limitation to the grant dated in or
about 1978 between the recording artist Joe Ely and MCA Records.
Id. Ex. C (Ely Termination Notice). As explained in UMG’s response letters, see id. Ex. B, D,
these descriptions do not accurately or reasonably identify the grants governing the works listed
in the notices.
For example, Waite purports to terminate a “grant dated in or about 1981 between the
members of the recording group called The Babys and Chrysalis Records,” id. Ex. A, but
“[t]here is no such agreement covering the sound recordings identified in . . . [Waite’s] notice,”
id. Ex. B at 1. Based on UMG’s records, the recordings identified in Waite’s notice “appear to
be governed by a series of agreements from 1981, 1983 and 1985 entered into by various
furnishing companies providing [Waite’s services, not The Babys] to either Chrysalis or
Capitol.” Id. Ex. B at 1; see also Ransom Decl. Exs. A-C. Indeed, the Complaint itself confirms
the inaccuracy (and inadequacy) of Waite’s putative termination notice – nothing in Plaintiffs’
allegations respecting Waite reference the termination of any grant respecting a “recording group
called The Babys.” Cf. Compl. ¶ 25 (referencing Waite-related contracts with no reference to
The Babys).
Ely’s notice is similarly inadequate in its failure to reasonably identify the grants
purportedly at issue. Ely purports to terminate a “grant dated in or about 1978,” Compl. Ex. C,
but agreements from 1976, 1979, and 1980 appear to govern the recordings listed in the notice,
id. Ex. D at 1, 4-5; see also Ransom Decl. Exs. D-G.

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Second, Plaintiffs also failed to identify the date of execution of the grants at issue.
Attached to Plaintiffs’ notices are charts that provide various other dates, including publication
dates, termination notice dates, and purported effective dates of termination, but noticeably
absent from the charts are any dates of execution of the grants. See Compl. Exs. A, C.
Moreover, as explained above, supra Part C.1., while both notices reference a single “grant dated
in or about” a certain year, those dates are either incorrect or do not encompass any of the works
listed in the notice. See Compl. Exs. B, D. Thus, Plaintiffs’ notices do not comply with the
requirements set by the Copyright Office. See 37 C.F.R. § 201.10(b)(2)(iii).
B.

The Defects in the Notices Are Not Harmless.

Although the regulation provides that “[h]armless errors in a notice…shall not render the
notice invalid,” 37 C.F.R. § 201.10(e)(1), the defects in the putative termination notices are not
harmless. Both Plaintiffs’ failure to reasonably identify the grants at issue and their failure to
identify the date of execution of the grants at issue “materially affect[ed] the adequacy of the
information required to serve the purposes of 17 U.S.C. 203.” Id.; see also Burroughs v. MetroGoldwyn-Mayer, Inc., 491 F. Supp. 1320, 1326 (S.D.N.Y. 1980) (failing to provide a “complete
and unambiguous” “statement . . . identifying the grant to which the notice of termination
applies,” “is not ‘harmless error’; it undoubtedly ‘materially affect[ed]’ the adequacy of the
Notice”) (citing 37 C.F.R. § 201.10(e)(1)), aff’d 636 F.2d 1200 (2d Cir. 1980).
While UMG has undertaken a reasonable effort to ascertain which grants Plaintiffs seek
to terminate, for the reasons set forth above, none of the agreements that UMG has identified is
actually terminable under Section 203. Moreover, as to Ely, even though UMG’s response to
Ely’s termination notice identified two agreements covering the works that Ely’s notice listed,
the Complaint references only the first of those agreements (though it also claims termination as
to works covered by the second of those agreements). See Compl. ¶¶ 37-38, Exs. C & D. In
short, UMG is still uncertain of the grants ostensibly covered by Plaintiffs’ termination claims
(and to the extent Plaintiffs claim some other, as yet unidentified, grants govern the works at
issue, that would only underscore the inadequacy of the termination notices and confirm that the
14

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error is not harmless). As a result, UMG was and is left to speculate as to which grants the
notices purported to terminate, and to fully and fairly evaluate the timeliness, scope, and validity
of the notices.
Likewise, the exclusion of execution dates is a material, non-harmless omission, as the
date of execution is essential to establish whether a grant is subject to termination under Section
203, when the termination may be effected and for what period, and whether the notice is timely.
See 17 U.S.C. § 203(a). As to Ely’s claim, for example, the notice references a “grant dated in or
about 1978,” Compl. Ex. C at 1, which may or may not be terminable – if the grant is executed
before 1978, it is not terminable under Section 203. Indeed, in this critical respect, the notice
conflicts with his claims in the Complaint – the Complaint references only a single Ely
agreement, and alleges that it was entered into in 1976. See Compl. ¶ 36. 8 It is therefore
apparent that this and Plaintiffs’ other errors and omissions “materially affect[ed] the adequacy
of the information required to serve the purposes of 17 U.S.C. 203.” 37 C.F.R. § 201.10(e)(1).
Nor were the defects in the notice the product of some good faith error. Plaintiffs’
counsel purports to be a “copyright termination expert” with “over thirty years” of experience as
“a music lawyer” and “working with terminations since the late 1980s.” Message From Our
Founder, COPYRIGHT TERMINATION EXPERTS, http://copyrightterminationexperts.com/about-us/
(last visited Apr. 18, 2019). Indeed, his website and domain name is “Copyright Termination
Experts.” See id. By including a flatly incorrect description of one agreement; providing an
ambiguous and incomplete reference to others; and omitting the required “execution date”
column from the charts attached to his termination letters, but including columns for numerous
other dates (some of which are not required), Plaintiffs’ counsel and self-described “Copyright
Termination Expert” presumably knew what he was doing – namely, deliberately failing to
8

To the extent Ely intends to claim that the date of creation of the works recorded pursuant to
the 1976 Agreement is relevant, see supra § II, his notice is doubly deficient, as it does not
include either a specific date of execution or any date of creation. See Compl. Ex. C at 1-2; see
also supra n.7.
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comply with the Copyright Office’s regulations. That is not good faith, and it is not harmless
error.
It is also no answer for Plaintiffs to claim that they have lost or otherwise no longer have
copies of the contracts that they seek to terminate (notably, Plaintiffs do not allege that they ever
asked UMG, much less their own lawyers, for copies of the contracts, or that any such request
was refused). Through their termination notices, Plaintiffs seek to interfere with UMG and its
affiliate’s ownership rights in the affected sound recordings. And through their complaint,
Plaintiffs endeavor not only to validate that interference, but also to accuse UMG of engaging in
copyright infringement. If Plaintiffs seek to excuse the deficiencies in their notices by claiming
ignorance of the terms of the agreements, then they have necessarily conceded that they lacked a
good faith basis to bring their Complaint. See Fed. R. Civ. P. 11(b). Without reviewing and
assessing the numerous facts necessary to properly terminate a grant of copyright rights under
Section 203 – including the author, the grantor, the grantee, the nature of the grant, and the date
of execution of the grant, among numerous other terms – Plaintiffs cannot possibly have
conducted “an inquiry reasonable under the circumstances” to support the notice or advance the
present claims. Id.9
In sum, the Second Circuit has made plain that failing to comply with the regulation’s
notice requirements, including failing to provide a “complete and unambiguous” “statement . . .
identifying the grant to which the notice of termination applies,” renders the notice ineffective.
Burroughs, 491 F. Supp. at 1326; see also Burroughs, 683 F.2d at 622 (omitting five works from
notice rendered the notice ineffective as to those five works). 10 Because Plaintiffs failed to
9

The fact that Plaintiffs have recorded the putative termination notices with the Copyright Office
(see Compl. ¶¶ 26, 37) is also irrelevant. As the operative regulation states, “[t]he fact that the
Office has recorded a notice is not a determination by the Office of the notice’s validity or legal
effect.” 37 C.F.R. § 201.10(f)(4). See also id. (noting that recordation “is without prejudice to
any party claiming that the legal or formal requirements for effectuating termination . . . have not
been met”).
10

Although the court in Music Sales Corp. v. Morris, 73 F. Supp. 2d 364 (S.D.N.Y. 1999),
adopted a less rigorous standard, that decision has been rebuked for its lax approach to
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reasonably identify the grants they sought to terminate, their notices are fatally deficient and
their claims should be dismissed.

IV.

PLAINTIFFS’ CLAIMS ARE BARRED BY THE COPYRIGHT ACT’S
THREE-YEAR STATUTE OF LIMITATIONS
The Court should also dismiss the Complaint as untimely. By this action, Plaintiffs claim

ownership of the works at issue in the Complaint, and correspondingly dispute UMG’s
ownership. This challenge, however, was ripe when the agreements at issue were executed. At
that time, Plaintiffs affirmed that they were not legal authors and owners of copyrights in the
works at issue; instead, they affirmed that another party was and is the legal author of those
works, and was and is the owner from the outset and in perpetuity of the corresponding
copyrights. Plaintiffs’ claims are therefore time-barred under the Copyright Act’s three-year
statute of limitations for “civil action[s] . . . maintained under the provision of [the Copyright
Act].” 17 U.S.C. § 507(b). 11
The statute of limitations begins to run “when ‘a reasonably diligent plaintiff would have
been put on inquiry notice as to the existence of a right.’” Kwan v. Schlein, 634 F.3d 224, 228
(2d Cir. 2011) (quoting Stone v. Williams, 970 F.3d 1043, 1048 (2d Cir. 1992)). This principle
applies to disputes respecting copyright ownership. Id. at 229. Under the reasonably-diligent
plaintiff standard, “any number of events can trigger the accrual of an ownership claim,
including ‘[a]n express assertion of sole authorship or ownership.’” Id. at 228 (quoting Netzer v.
Continuity Graphic Assocs., Inc., 963 F. Supp. 1308, 1315 (S.D.N.Y. 1997)); see also Consumer
Health Info. Corp. v. Amylin Pharm., Inc., 819 F.3d 992, 995 (7th Cir. 2016) (affirming district
court dismissal of suit as untimely on finding that ownership claim accrued upon Plaintiffs’
signing of an agreement transferring “all right, title, and interest in and to” a copyright); Cooper

termination notices and its apparent misapprehension of the regulatory scheme. See NIMMER at §
11.06[B] (calling the decision in Music Sales Corp. “suspect”).
11

As the time bar of these claims by many decades is evident based on the allegations of the
Complaint themselves, there is no issue of fact requiring discovery.
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v. NCS Pearson, Inc., 733 F.3d 1013, 1016 (10th Cir. 2013) (finding an ownership claim
triggered where a contract transferred “all Intellectual Property Rights”); Aday v. Sony Music
Entm’t, No. 96-CV-0991-MGC, 1997 WL 598410 (S.D.N.Y. Sept. 25, 1997) (holding that sole
ownership claim accrued when defendants first asserted ownership by entering into contract with
plaintiff in which a work-for-hire clause afforded sole ownership of the copyrights to
defendants).
Here, Plaintiffs’ claims were ripe decades ago when they expressly acknowledged and
agreed that they were not authors and copyright owners, but instead that their contributions were
owned in the first instance and in perpetuity by others. Plaintiffs’ claims are therefore timebarred.
A.

Because Waite Was on Notice of His Ownership Claim in the 1980s, His
Present Claims are Time-Barred.

In the Complaint, Waite alleges that he is “currently the owner of the United States
copyright in and to the sound recordings comprising the Ignition album.” Compl. ¶ 34. Waite’s
claim of ownership is necessarily based on his contention that the agreement governing that
album – the 1981 agreement between Waite’s loan-out company, Heavy Waite, Inc., and
Chrysalis (“1981 Agreement”), see supra § I – contained a grant by Waite as an author that is
subject to termination under Section 203. See Compl. ¶¶ 25, 27, 32, 34. That contention, in turn,
necessarily assumes that the recordings made pursuant to the 1981 Agreement are not “works
made for hire,” as Section 203 expressly states that the termination right does not apply to works
made for hire. 17 U.S.C. § 203(a) (providing for termination right in “the case of any work other
than a work made for hire”). 12

12

The Copyright Act defines “work made for hire” as:
(1) a work prepared by an employee within the scope of his or her employment;
or (2) a work specially ordered or commissioned for use as a contribution to a
collective work, as a part of a motion picture or other audiovisual work, as a
translation, as a supplementary work, as a compilation, as an instructional text, as
a test, as answer material for a test, or as an atlas, if the parties expressly agree in
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The parties dispute whether and under what circumstances a sound recording may be a
“work made for hire” within the meaning of the Copyright Act. See Compl. ¶¶ 51(A) & (B),
52(A) & (B). Resolution of that dispute, however, is irrelevant to the present argument. What is
relevant is that the repudiation of Waite’s claim of copyright ownership, and the status of the
sound recordings made under the 1981 Agreement as works made for hire, are set forth in the
1981 Agreement itself. Specifically, Section 4 of the 1981 Agreement states:
For the purposes hereof, you, Artist, and all other persons rendering services in
connection with such master recordings shall be our employees for hire and all
such master recordings shall be works made for hire under the United States
Copyright Law. [Chrysalis] shall, accordingly, have the sole and exclusive right
to copyright such master recordings . . . and to secure any and all renewals and
extensions of such copyrights in our name.
Ransom Decl. Ex. A at § 4 (emphasis added). Further, Waite joined in the representations and
warranties made by Heavy Waite. Id. at Ex. A, §1(b) (“All of the warranties, representations,
covenants and agreements on the part of Producer contained in the Agreement, which concern
me, are true and correct.”).
The other agreements referenced in the Complaint, which govern the remaining identified
works featuring Waite, contain similar provisions. 13 In the 1983 Agreement between Moonwalk
and Capitol (“1983 Agreement”), Waite’s loan-out company agreed as follows:
With respect to any person whose services are furnished by [Moonwalk] in
connection with masters recorded hereunder, including, but not limited to, Artist
and/or any person engaged to act as a Producer, [Moonwalk] has or shall have a
contract in which the person acknowledges that each master embodying the
a written instrument signed by them that the work shall be considered a work
made for hire.
17 U.S.C. § 101. Under Sections 201(a) and (b) of the Copyright Act, copyright vests initially in
the author of a work, and “[i]n the case of a work made for hire, the employer or other person for
whom the work was prepared is considered the author.” 17 U.S.C. §§ 201(a) & (b).
13

Waite claims ownership only of Ignition, presumably because the effective date of his putative
notice of termination has not yet passed with respect to his other works. For the reasons set forth
herein, however, the statute of limitations necessarily bars his claims as to those other works as
well, in light of the plain language of the agreements governing those works.
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results and proceeds of his services is prepared within the scope of [Moonwalk’s]
engagement of his personal services and is a work made for hire, or as part of an
lp-master constitutes a work specifically ordered by [Moonwalk] for use as a
contribution to a collection work and shall be considered a work made for hire.
[Moonwalk] further agrees that [Moonwalk] shall cause each such person to
execute and deliver to EMIA a “Declaration re Collective Work” and “Power of
Attorney” in the form attached hereto.
Ransom Decl. Ex. B at § 5(a). In an Inducement Letter attached as Exhibit B to the 1983
Agreement, Waite agreed to “[a]ll of the warranties, representations and covenants on the part of
[Moonwalk] contained in this Agreement concerning [him]” and agreed to be “bound by same as
though [he] were a party to the Agreement.” Id. at Ex. B at ¶ 3. Accordingly, the 1983
Agreement confirmed that Capitol was and is “the sole, exclusive, and perpetual owner of all
masters from inception.” Ransom Decl. Ex. B at § 18. The 1985 Agreement between Diamond
Stripe, Inc. and Capitol (the “1985 Agreement”) contains similar provisions. See id. Ex. C at §§
5(a), 18, p. 46 of 75.
The 1981, 1983, and 1985 Agreements thus expressly reflect a repudiation of any
authorship or ownership claim by Waite. Under well-established authority, this contractual
repudiation triggered the statute of limitations for Waite’s current claims, which are necessarily
premised on the notion that the sound recordings are not works made for hire, and are therefore
subject to termination under Section 203. For example, in Aday, a loan-out company for the
recording artist professionally known as Meat Loaf entered into a recording agreement with
Cleveland Entertainment, Inc. (“Cleveland”) in August 1977 (“Cleveland Agreement”), for Meat
Loaf’s recording services; that agreement provided that Meat Loaf’s services were provided as
an employee for hire. 1997 WL 598410 at *2. Cleveland, in turn, had a distribution agreement
(“CBS Agreement”) with CBS Records (“CBS”) with respect to artists under contract with
Cleveland, including Meat Loaf; indeed, Meat Loaf signed an inducement letter in which he
agreed to be bound by the terms of the CBS Agreement as it applied to Meat Loaf’s recordings.
Id. The CBS Agreement provided CBS with the “exclusive right to copyright such master
recordings in its name as owner and author of them and to all renewals and extensions of such

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copyrights.” The CBS Agreement also provided that “[s]olely for the purposes of any applicable
copyright law, all persons rendering services in connection with the recording of master
recordings shall be deemed ‘employees for hire’ of CBS.” Id.
Some twenty years later, in 1997, Meat Loaf and his loan-out company sued Cleveland
and CBS, among others, seeking a declaration that Meat Loaf “is not, and never was, an
‘employee for hire’ of either Cleveland and/or CBS pursuant to the copyright laws of the United
States . . . and/or that there has been no valid and enforceable assignment to Sony and/or
Cleveland of the copyrights in and to [Meat Loaf’s] master recordings.” Id. at *4 (citation
omitted). This Court dismissed the claims against Cleveland and CBS as untimely under Section
507 of the Copyright Act. It reasoned that the CBS Agreement and the Cleveland Agreement
“clearly set forth that the rights to the sound recordings belong to Cleveland and CBS, not [the
loan-out company] or Meat Loaf. Therefore, plaintiffs had reason to know in 1977 about any of
the problems with the ‘work for hire’ provision that they now contend violates the Copyright
Act.” Id. at *5.
The same outcome obtains here. The agreements clearly set forth that the works recorded
pursuant to them were “work[s] made for hire,” and Waite expressly acknowledged and agreed
to these provisions. If he wished to challenge the work for hire status of the works, or assert
“any problems with the ‘work for hire’ provision[s]” of the agreements, his time to do so was
within three years of the date of those agreements. His effort to do so in this lawsuit, decades
after the agreements were signed and the claim accrued, comes years too late.
Aday is not alone in holding that contractual provisions affecting ownership claims start
the statute of limitations clock as to such claims. In Consumer Health Information Corp., the
Seventh Circuit affirmed the district court’s dismissal of a copyright infringement suit as
untimely. 819 F.3d at 997. There, the plaintiff contractually assigned “all right, title, and
interest in and to said copyrights in the United States and elsewhere, including registration and
publication rights, rights to create derivative works and all other rights which are incident to
copyright ownership.” Id. at 994. Although the plaintiff framed its lawsuit as an infringement
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claim, the court held that “the central dispute [was] copyright ownership,” and that “copyright
claims premised on disputes about ownership accrue ‘when plain and express repudiation of coownership is communicated to the claimant.’” Id. at 996 (emphasis in original) (citation
omitted). Because the underlying contract “unambiguously” assigned the copyright to the
defendant, the “cause of action accrued in March 2006, when the contract was executed.” Id. at
993. Accordingly, the lawsuit – brought some seven years later – was untimely. Id. at 997.
The Tenth Circuit reached a similar result in Cooper, in which it affirmed dismissal of
plaintiff’s claim of co-ownership of a psychological test. 733 F.3d at 1018. There, plaintiff had
entered into an agreement providing that plaintiff’s co-authors (but not plaintiff) “exclusively
own[ed] all intellectual property rights in the Work and that no other person ha[d] an option,
claim, or right to the Work.” Id. at 1014. The co-authors and the corporation then granted
defendant’s predecessor corporation “all right, title, and interest” in the psychological test. Id. at
1014-15. In affirming the district court’s grant of summary judgment in favor of the defendant,
the court found that the agreement “placed [Plaintiff] on notice that her ostensible copyright coownership claim was in jeopardy and thereby started the statute of limitations running.” Id. at
1016. Because plaintiff did not sue until seventeen years later, her claim was time barred. Id. at
1018.
The rationale of the foregoing cases applies with equal force to Waite. Because he did
not bring his claim until decades after the agreements put him on notice of his putative challenge
to the work for hire status of his recordings and his corresponding ownership claim, that claim is
untimely.
B.

Because Ely Was on Notice of His Ownership Claim in the 1970s, His Present
Claims are Time-Barred.

In the Complaint, Ely alleges that he is “currently the owner of the United States
copyright in and to the sound recordings comprising the Ely albums.” Compl. ¶ 43. Ely’s claim
of ownership is based on his contention that the agreements covering the albums – which provide
that MCA owns the copyrights in the sound recordings created thereunder as works for hire –
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were terminable under Section 203 and were terminated. As with the Waite agreements,
however, because the Ely agreements identified the works created thereunder as works made for
hire and expressly repudiated Ely’s claims of ownership, the claims advanced in the Complaint –
which directly challenge the work for hire status of those recordings – are untimely.
As discussed above, the earlier of the agreements was an August 26, 1976, agreement
between Ely and UMG’s predecessor, MCA Records, Inc. (“MCA”) (“1976 Agreement”).
Under Section 8 of the 1976 Agreement, Ely acknowledged MCA as the
sole, exclusive and perpetual owner of all of the Masters from inception, which
ownership entitles MCA among other things to . . . (c) All right, title and interest
in the copyright in and to the Masters and all reproductions thereof and the sound
performances contained therein, including the exclusive right to copyright same
as ‘sound recordings’ in MCA’s name, and to renew and extend such copyrights
(it being agreed that for this purpose Artist is deemed MCA’s employee for hire),
and to exercise all rights of the copyright proprietor therein.
Ransom Decl. Ex. D at § 8 (emphasis added). To the extent Ely intended to challenge the status
of the sound recordings created under the 1976 Agreement as works for hire (as he purports to do
here), the above language clearly put him on notice of such a claim. Accordingly, the statute of
limitations began to run upon execution in 1976, and has long since passed.
Ely’s challenge to the work for hire status of the recordings prepared under the 1979
agreement between South Coast Records, Inc. and MCA (see supra I) (“1979 Agreement”), and
his corresponding ownership claim in this action, is also untimely. Section 1(j) of the 1979
Agreement provides:
[A]ll such persons, including Artist and the Individual Producers, have
acknowledged or will acknowledge that MCA is the sole, exclusive, and perpetual
owner of all rights of copyright . . . including the exclusive right to copyright
records embodying such results and proceeds as ‘sound recordings’ in the name of
MCA, to renew and extend such copyrights (it being agreed that for this purpose
each such person is deemed MCA’s employee for hire and the sound recordings
‘works-for-hire,’ as that term is presently defined in the United States Copyright
Act).
Ransom Decl. Ex. E at § 1(j) (emphasis added). And when the 1979 Agreement was amended in
1980, it again affirmed MCA’s sole, exclusive, and perpetual ownership of the copyright in
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 Case 1:19-cv-01091-LAK Document 38 Filed 05/03/19 Page 29 of 30

recordings produced thereunder: “MCA shall own free and clear from any and all claims by any
third party for manufacture and sale throughout the world in perpetuity, the masters recorded by
you hereunder embodying the performances of Ely.” Ransom Decl. Ex. G at § 4(e); see also id.
at Inducement Letter, § 5 (stating that “MCA is the exclusive owner of all rights of copyright . . .
including the exclusive right to copyright same as ‘sound recordings’ in the name of MCA . . . it
being agreed that for this purpose I am deemed MCA’s employee for hire and the sound
recordings ‘works-for-hire”).
Now, decades after entering into agreements expressly acknowledging the work for hire
status of the works at issue, and thereby repudiating any claims of authorship or copyright
ownership, Ely purports to dispute the work for hire issue and claim that he actually was an
author and copyright owner of the works from the outset. His time to do so has long since
passed. See, e.g., Aday, 1997 WL 598410 at *5; Consumer Health, 819 F.3d at 997; Cooper, 733
F.3d at 1016. The Complaint should therefore be dismissed as barred by the statute of
limitations.

V.

PLAINTIFFS’ COPYRIGHT INFRINGEMENT CLAIMS ALSO FAIL
Plaintiffs’ copyright infringement claims are based entirely on the proposition that their

termination notices are proper and valid, and that they therefore own the copyrights in the
referenced works. See, e.g., Compl. ¶¶ 35, 45 (alleging that infringement is based on
exploitation after “effective date” of termination notices). Because Plaintiffs’ purported
terminations pursuant to Section 203 are invalid for the reasons set forth above, and because their
ownership claims are time-barred in any event, their infringement claims necessarily fail as a
matter of law.

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 Case 1:19-cv-01091-LAK Document 38 Filed 05/03/19 Page 30 of 30

CONCLUSION
For the forgoing reasons, UMG respectfully requests that the Court grant its Motion to
Dismiss in its entirety and grant such other and further relief as the Court may deem just and
proper.
Dated: New York, New York
May 3, 2019
SIDLEY AUSTIN LLP
By: /s/ Steven M. Bierman
Steven M. Bierman
sbierman@sidley.com
Melanie Berdecia
mberdecia@sidley.com
SIDLEY AUSTIN LLP
787 Seventh Avenue
New York, NY 10019
Telephone: (212) 839-5300
Facsimile: (212) 839-5599
Rollin A. Ransom (admitted pro hac vice)
rransom@sidley.com
Lisa M. Gilford (admitted pro hac vice)
lgilford@sidley.com
Adriane Peralta (admitted pro hac vice)
adriane.peralta@sidley.com
SIDLEY AUSTIN LLP
555 West 5th Street, Suite 4000
Los Angeles, CA 90013
Telephone: (213) 896-6000
Facsimile: (213) 896-6600
Richard S. Mandel
rsm@cll.com
Thomas Kjellberg
txk@cll.com
COWAN, LIEBOWITZ & LATMAN, P.C.
114 West 47th Street
New York, NY 10036-1525
Telephone: (212) 790-9200
Facsimile: (212) 575-0671
Attorneys for Defendant UMG Recordings,
Inc.
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