A federal court in Los Angeles, California dismissed an attempt by the family of artist Joe Shuster, the first illustrator to depict the comic book character Superman, to reclaim Shuster’s copyright interest in the character from DC Comics, the company that published Shuster’s work. DC Comics v. Pacific Pictures Corp., 10-cv-3633 (C.D. Cal. Oct. 17, 2012).
In 1938, together with co-creator Jerry Siegel, Shuster assigned to DC Comics the “exclusive right to the use of the [Superman] characters and story.” After the artist died in 1992, Shuster’s brother and sister entered into an agreement with DC Comics, pursuant to which the company would make payments to the sister over a period of several years. Among other things, the agreement provided as follows:
[T]his agreement fully settles all claims to any payments or other rights or remedies which you may have under any other agreement or otherwise, whether now or hereafter existing regarding any copyrights, trademarks, or other property right in any and all work created in whole or in part by your brother, Joseph Shuster, or any works based thereon. In any event, you now grant to us any such rights and release us, our licensees and all others acting with our permission, and covenant not to assert any claim of right, by suit or otherwise, with respect to the above, now and forever.
Over a period of years following the execution of the 1992 agreement, Shuster’s sister asked for and received from DC Comics several “bonus” payments over and above what the company had agreed to pay. In connection with these requests, Shuster’s sister assured DC Comics in writing that she and her brother were “not planning to reclaim the Superman copyright,” and that she would “honor” the parties’ 1992 agreement. Despite these assurances by Shuster’s sister, in 2003, Joe Shuster’s nephew, acting as substitute executor of Shuster’s estate, served DC Comics with a notice of termination of the prior grants of the Superman copyrights. DC Comics filed a suit for a declaration that the notice of termination was ineffective. In an October 17, 2012 decision, the court granted summary judgment to DC Comics, ruling that the attempted termination was barred by the 1992 agreement.
The court explained that Shuster’s heirs based their attempt to terminate Shuster’s copyright transfers on 17 U.S.C. § 304(d), a provision added to the Copyright Act in 1999. Section 304(d) permits the author or his heirs to terminate pre-1978 copyright transfers where: (i) the work was originally registered or published on or before October 26, 1939; and (ii) the author or heirs did not exercise termination rights under Section 304(c) of the Copyright Act.
The court determined that “the 1992 Agreement, which represented the Shuster heirs’ opportunity to renegotiate the prior grants of Joe Shuster’s copyrights, superseded and replaced all prior grants of the Superman copyrights. The 1992 Agreement thus represents the parties’ operative agreement and, as a post-1978 grant, it is not subject to termination under 17 U.S.C. § 304(d).” The court further held that when Shuster’s sister signed the 1992 agreement, “she exhausted the single opportunity provided by statute to the Shuster heirs to revisit the terms of Shuster’s original grants of his copyrights.” In support of this position, the court quoted Penguin Group (USA) Inc. v. Steinbeck, 537 F.3d 193 (2nd Cir. 2008), which held that, “Once the termination right is extinguished, it is extinguished with respect to all parties holding a termination interest, whether or not they agreed to its exercise.” The court acknowledged that Section 304(c)(5) of the Copyright Act provides that, “Termination of the grant may be effected notwithstanding any agreement to the contrary, including an agreement to make a will or to make any future grant.” However, the court agreed with the U.S. Court of Appeals for the Second Circuit in Steinbeck, which held that an agreement entered into before the right to terminate existed could not constitute an “agreement to the contrary” under Section 304(c)(5).
by Shawn N. Sullivan, Oct. 21, 2012.