Rules Concerning Copyrights and Estate Planners
It is critical that an estate planning practitioner have a working knowledge of the 1976 Copyright Act, because without such knowledge, the consequences to his or her client may be damaging and could wreak havoc with the intended disposition of the copyrights associated with the client’s creative works.
The 1976 Act creates three impending pitfalls that an estate planner must consider when disposing of a client’s creative works and the related copyrights:
1. A Gift or Bequest of a Creative Work Does Not Transfer the Copyright. In order to transfer the creative work and the copyright during the client’s lifetime or upon death, the client must specifically state that the copyright is being transferred with the creative work. A gift or bequest of a creative work without a corresponding gift or bequest of the copyright will only pass the creative work to the donee or beneficiary.
2. Copyright Termination Rights Transfer Under Forced Heirship. There is much uncertainty associated with transferring the client’s copyrights during the client’s lifetime or upon the client’s death, other than by will. The ability to separate rights from the bundle and transfer them independently enables the creator to control the work’s exposure and profit as he or she may desire.
3. Transfers of Copyrights Other Than Those Made by Will May be Revoked. Section 203 presents the opportunity for a creator’s surviving spouse and/or children and grandchildren to undo lifetime estate planning transfers if they do not endure to their benefit. This interferes not only with the creator’s wishes regarding to whom the copyright devolves, but also with desire to avoid probate. This highlights the need for revisions to Section 203 of the 1976 Act to bar transfers to testamentary substitutes from the right to termination by a creator’s surviving spouse, children, and grandchildren.
See Michelle Bergeron Spell and Jodi C. Lipka, The Pitfalls Concerning Copyrights that Every Estate Planning Professional Needs to Know When Representing Authors and Artists, Herrick, Sept. 24, 2014.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.