Nigeria: Understanding The Scope Of Reversionary Interest In Copyright

UNDERSTANDING THE SCOPE OF REVERSIONARY INTEREST IN COPYRIGHT¹

1. Introduction

The concept of reversionary interest in the field of law generally operates at the expiration of the duration of a term, where an interest initially transferred to a temporary holder for a period of time subsequently reverts to the original interest holder. Reversionary interest is a popular term in real estate transactions that emerges from the ownership and possession of tangible or intangible property. For example, in a lease agreement, reversionary interest is originally deposited in the lessor who grants the lease of a property to the lessee for a certain period and upon expiration of that period, the ownership and possession of the leased property reverts from the control of the lessee to the ownership and possession of the lessor.

Flowing from this understanding, this article would be examining the scope of reversionary interest in the area of intellectual property particularly under copyright law, as it qualifies as an intangible property that accommodates the reservation of reversionary interest in a copyright author/owner. This article will further assess the jurisdictions that provide for, protect, and enforce the reversionary interests of copyright authors/owners. Notably, this article is borne out of the challenges most copyright authors/owners including their successor(s)-in-title face in reclaiming their licensed or assigned copyright after the grant/license/assignment is extinguished and the reversionary interest is required to return to the original author(s) or owner(s). Following this, suitable recommendations will be discussed in this article to cater for certain issues that arises during the operation of a copyright reversionary interest.

2. Definition of Terms

The Black's Law Dictionary² in relation to land law defines the word 'reversion' to mean the interest that is left after subtracting what the transferor has parted with from what the transferor originally had. In the same vein, 'reversion' can be further described as a future interest in land arising by operation of law whenever an estate owner grants to another a particular estate, such as a life estate or a term of years but does not dispose of the entire interest. A reversion occurs automatically upon termination of the prior estate, as when a life tenant dies.

The Black Law Dictionary³ describes "reversionary" as that which is to be enjoyed in reversion and the term "reversionary interest" to imply a future interest left in the transferor or successor in interest. A future interest⁴ is a property interest in which the privilege of possession or of other enjoyment is future and not present, as it can exist in either the grantor (as with reversion) or the grantee (as with a remainder or executory interest).

The Nigerian Court of Appeal in describing the nature of a reversionary interest in real property stated that:

It is important to understand that certain principles of law that are used in specific practice areas are interchangeably relevant in other areas or aspects of law. The operations and principles of reversionary interest in real estate transactions peculiar to tangible property can also be applied to intellectual property under copyright and consequently be described as reversionary copyright.

Reversionary copyright refers to the rights of an author's estate [successor(s)-in-title or assigns], and in some jurisdictions the right of an author to regain control over rights in a copyrighted work which have been assigned, licensed, or granted to a third party after a period of time or number of years.

The scope and application of reversionary right including the procedure for gaining reversionary rights vary in different jurisdictions depending on the copyright law in force.

3. Reversionary Copyright in the United Kingdom (U.K.)

Reversionary right in the UK was first laid out in the Copyright Act, 1911 (the 1911 Act)⁶ for the benefit of an author's estate years after the author's death. This provision in the UK was known as the Dickens' provision and by virtue of section 25 of the 1911 Act which provided for the application of the 1911 Act to British Dominions, it applied to member countries of the British Commonwealth countries including African nations like South Africa, Nigeria, Ghana etc., under the British Colony as of 1911.⁷

Section 5 of the 1911 Act encapsulated the provisions of reversionary interest by providing that the owner of a copyright in any work may assign the right, either wholly or partially, and either for the whole term of the copyright or for any part, and may grant any interest in the right by licence but no such assignment or grant shall be valid unless it is in writing signed by the owner of the right in respect of which the assignment or grant is made, or by his duly authorised agent. It goes further to provide in sub-section 2 that:

Although, the provision on reversionary interest was absent and completely excluded in the subsequent UK copyright enactment⁸ i.e., the 1956 Copyright Act,⁹ it was however restored under the Copyright: Transitional Provisions And Savings¹⁰ section of the current and applicable copyright law in UK, i.e. the 1988 Copyright, Designs and Patents Act (the 1988 Act).¹¹

The above-highlighted provision clearly stipulates that the reversionary interest in a copyright, in the absence of a direct assignment by the copyright owner to his estate,¹² automatically reverts to the copyright owner's legal personal representatives as part of his estate upon the expiration of 25 years after the death of the copyright owner. In this context, the legal personal representatives¹³ of the copyright owner are required by law, asides other legal requirements, to distribute the assets amongst the beneficiaries of the copyright owner.

Consequently, the British reversionary interest can only be beneficial to the copyright author's estate. Sub-paragraph 4 provides that the principle of reversionary interest enunciated in Paragraph 27 does not apply to the assignment of the copyright in a collective work or a licence to publish a work or part of a work as part of a collective work.

The 1988 Copyright, Designs and Patents Act is silent on any requirement for a timely notice or filing of a notice to the grantee or assignee. The reversionary right takes automatic effect upon the completion of the stipulated time.

4. Reversionary Copyright in the United States of America (U.S.A.)

The provision of reversionary copyright in the relevant USA Copyright Act 1976¹⁴ (the 1976 Act) is significantly different from what is contained in the U.K. Copyright, Designs and Patents Act 1988. The differences range from the fact that the term 'reversionary interest' is substituted with the phrase 'termination interest' in the 1976 Act and more importantly, unlike the 1988 U.K. Act, a reversionary or termination interest operates not only after the death of a copyright owner but during the lifetime of a copyright owner subject to certain conditions as will be discussed below.

Section 203 of the 1976 Act provides for the conditions and effects of terminating transfers and licenses of copyright granted by the author.

According to Paragraph (a) of Section 203 which contains the conditions for termination, it states that:

Paragraph (b) of Section 203 of the 1976 U.S.A. Act stipulates the effect of termination in which upon the effective date of termination, all rights under the title that were covered by the terminated grants or assignment revert to the author.

The above-italicized section of the 1976 U.S.A. Act when compared with the 1988 U.K. Act provides a clear distinction of the operability of termination interest by affording an opportunity to a copyright author to reclaim his copyright during his lifetime after the expiration of initial grant or assignment to an assignee or grantee or any other third party. The 1988 U.K. Act was definitive in its provision when it provided for such operation only after the death of a copyright owner.

While the 1988 U.K. Act provides for a timeline of 25 years after the death of a copyright owner, the 1976 U.S.A. Act stipulates a distinct timeframe for the reversion of the copyright in which termination of the grant or assignment may be effected at any time during a period of 5 years beginning at the end of 35 years from the date of execution of the grant or assignment; or, if the grant or assignment 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. Hence, after the grant or assignment of a copyright protected under the 1976 U.S.A. Act, the copyright reverts to the owner either alive or dead, within 5 years at the close of 35 years from the date the grant or assignment was executed.

The 1976 U.S.A. Act provided a detailed description of a person or persons who, under clause (2) of Paragraph A above, own and are entitled to exercise a total of more than one-half of that author's termination interest in the event that the author dies and cannot subsequently claim the termination interest. The 1988 U.K. Act did not aptly describe such beneficiaries but referred to them as the legal personal representatives of the copyright owner.

Notably, in a collective work where the grant is executed by two or more authors of a joint work, under the 1976 U.S.A. Act termination of the grant may be effected by a majority of the authors who executed it; if any of such authors is dead, the termination interest of any such author may be exercised as a unit by the person or persons who, under clause (2) of this subsection, own and are entitled to exercise a total of more than one-half of that author's interest. The 1988 U.K. Act expressly provided that its reversionary copyright does not apply to the assignment of the copyright in a collective work or a licence to publish a work or part of a work as part of a collective work.

While the requirement for a timely notice or filing of a notice to the grantee or assignee upon the termination of grant or assignment is absent in the 1988 U.K. Act, the 1976 U.S.A. Act, however, provides for this requirement.¹⁵ The 1976 U.S.A. Act further provides that termination of the grant or assignment may be effected notwithstanding any agreement to the contrary, including an agreement to make a will or to make any future grant.¹⁶

5. Reversionary Copyright in Nigeria

The Nigerian Copyright Act 1988,¹⁷ currently in force in Nigeria, does not have an express provision for reversionary rights including the preceding enactment i.e., the 1970 Copyright Act.

It is safe to say that Nigeria, by virtue of being a colonial territory of Britain and a British Commonwealth country prior to Nigeria's independence in 1960, had the privilege of applying the 1911 U.K. Copyright Act, that provided for the commencement of reversionary interest after 25 years from the date of death of a copyright owner, until the emergence of the 1956 U.K. Copyright Act which repealed the provisions on reversionary copyright.

However, sections 12(3) and 13(5) of the Nigerian Copyright Act 1988 makes an attempt to consider the position of 'heirs and successors in title' of a copyright author by stating that, in addition to a copyright author, they can claim authorship of an original work and also share in the proceeds of sale of such work. Both sections expressly state that; "For the purpose of this section, "author" includes his heirs and successors in title" but fails to contemplate a situation where the author dies, and the need arises for the heirs and successors in title to exercise these rights.

On the other hand, and by necessary implication, the concept of reversionary interest may be extended to the interpretations of Regulation 7 of the Nigerian Copyright (Collective Management Organisations) Regulations 2007, a product of the statutory obligation of the Nigerian Copyright Commission, in respect of the collective administration of copyrighted works.¹⁸ Regulation 7 provides that "a member shall, upon reasonable notice of his or her intention to do so, have the right to withdraw his membership of a Collective Management Organisation or the rights assigned to the Organisation in respect of any of his works". Since the Nigerian Copyright Act 1988 already empowers the 'heirs and successors in title' of a copyright author to claim authorship of an original work and share in the proceeds of sale of such work, the heirs and successors-in-title impliedly have the right to withdraw membership from a Collective Management Organisation or the rights assigned to the Organisation in respect of any of the works of a demised original copyright owner.

6. Challenges in the enforcement of Reversionary Copyright

There are certain case scenarios where either the estate of a copyright owner(s) or the copyright owner(s) experiences difficulty in exercising their reversionary copyright and reclaiming a granted or assigned copyright after the expiration of the required number of years. For the purpose of this article, the following case-studies aptly puts these challenges in the enforcement of reversionary copyright into perspective.

These challenges were portrayed in a famous case in South Africa where the estate of a copyright owner named Solomon Linda had instituted an action in court to reclaim a share in the proceeds of their father's creation.

Solomon Linda was a Zulu migrant worker and entertainer who had made a sound recording in 1939 which he named 'Mbube' meaning 'Lion' in Zulu that later featured in the lyrics and makeup of a popular and best-seller song, 'The Lion Sleeps Tonight'. In spite of this remarkable success, Solomon Linda died a pauper, leaving his family too poor to afford a headstone for his grave.¹⁹

The song 'Mbube', already a major recording success in South Africa, had paved its way to the United States of America where it was modified at different times by Pete Seeger (a folksinger) and song writers George Weiss, Hugo Peretti and Luigi Creatore to project 'Wimoweh' (a modification of the Zulu lyrics, Uyimbube) and 'The Lion Sleeps Tonight' respectively. This happened until the song was synchronized into Walt Disney's musical, 'The Lion King'. The origin of the song, in Mbube, nor the role played by Solomon Linda was not acknowledged, and the song was presented as being of American origin.

Solomon Linda had assigned his worldwide copyright in Mbube to Gallo Record Company for a consideration of 10 shillings. He died in 1962, leaving a wife, Regina, and four children. In 1983 the American music publishing company, Folkways, which had gained control of 'Wimoweh', paid one dollar to Regina for the assignment of rights (as Linda's legal heir) to the renewal term of 'Wimoweh' under United States copyright law. In 1992, there were series of litigation ongoing in the United States regarding 'Wimoweh' and 'The Lion Sleeps Tonight', the rights to which had been newly acquired by Abilene Music. Folkways still settled for a further assignment of worldwide rights to Mbube from the Linda daughters for another dollar as their mother, Regina had died in 1990.

This sabotage by these American companies continued until the publication of Rolling Stone magazine in the late 1990s which exposed the fraudulent mechanisms devised by these American companies. In response, subsequent legal steps were thereafter taken to stake a claim on the part of the family to the proceeds of the song, especially 'The Lion Sleeps Tonight' version, and to gain due acknowledgment of Solomon Linda's role in creating the song, and of its South African origin.

In 2004, the estate of Solomon Linda was reopened, and an Executor was appointed. The peculiarity of the case only permitted the Executor to institute an action and claim against a Defendant that resides or has a place of business operation or other assets in South Africa. Since Abilene Music had no known assets in South Africa, the estate of Solomon Linda opted to sue the most prominent and high-profile licensee of the song against which it was possible to secure jurisdiction before a South African court, i.e., Walt Disney Enterprises Inc., South Africa including certain other licensees or sub-licensees of Abilene Music. The estate of Solomon Linda relied on the provisions of the 1911 U.K. Copyright Act, since South Africa was a British Commonwealth country at the time and claimed that the Defendants had infringed the Executor's copyright in Mbube by reproducing and publicly performing a substantial part of it in the guise of 'The Lion Sleeps Tonight' without any authorization, grant or assignment.

The case was later settled out of court. The settlement, which operates worldwide and in settlement of all claims, includes the following:

1. That the heirs of Linda will receive payment for past uses of 'The Lion Sleeps Tonight' and an entitlement to future royalties from its worldwide use.
2. That 'The Lion Sleeps Tonight' is acknowledged as derived from Mbube.
3. That Solomon Linda is acknowledged as a co-composer of 'The Lion Sleeps Tonight' and will be designated as such in the future.
4. That a trust will be formed to administer the heirs' copyright in Mbube and to receive on their behalf the payments due from the use of 'The Lion Sleeps Tonight'.²⁰

This case set a precedent for the estate of copyright owners or authors who are not benefiting from the copyrighted works of these deceased owners, to obtain the requisite remuneration arising from the exploitation of such works and enforce their reversionary copyright.

Another popular case that addresses the issue of reversionary copyright is the Duran Duran Case.²¹ In 1980 and 1981, Duran Duran entered into agreements with Gloucester Place Music Limited (then Tritec Music Limited), owned by Sony/ATV Publishing, which assigned certain copyrights in songs written or composed by Duran Duran during a particular period in return for the payment of royalties. The 1976 U.S.A. Copyright Act permits copyright authors/assignors to terminate an assignment of U.S.A. copyrights 35 years after the assignment by serving notice on the assignee. In 2014, Duran Duran served notices under the 1976 U.S.A. Copyright Act to terminate the assignments of the U.S.A. copyright for their songs. Gloucester Place Music Limited²² had argued that serving such notice was in breach of the agreements entered into, as the agreements did not expressly reserve Duran Duran's right to terminate the assignments of the U.S.A. copyrights in accordance with the 1976 U.S.A. Copyright Act.²³

The Court considered the following issues before it: (a) whether or not the agreements did not expressly reserve Duran Duran's right to terminate the assignments of the U.S.A. copyrights in accordance with the 1976 U.S.A. Copyright Act, (b) whether or not Duran Duran was entitled to serve such notices and recover the copyrights or did the notices amount to breach of the agreements, (c) how a reasonable person having the relevant background knowledge would interpret the wording of the agreements.²⁴

The Court held that a reasonable person would believe that Duran Duran and Gloucester Place Music Limited intended for the U.S.A. copyrights to be assigned for their full term and that Duran Duran were prohibited from exercising their rights to terminate under the 1976 U.S.A. Copyright Act.²⁵

Following this, the U.K. court had held that Duran Duran had breached the agreements by serving the notices and were unable to terminate an assignment of the U.S.A. copyrights in accordance with section 203 of the U.S.A. Copyright Act 1976, since the assignment agreements, entered into over 30 years ago, did not specify that they were subject to the right to terminate under the 1976 U.S.A. Copyright Act.²⁶

7. Recommendations and Conclusion

This author recognizes the deliberate efforts adopted by developed countries in the advancement of their laws particularly to address certain entitlement concerns that may arise from a legal liability perspective within the justiciable ambit of the law.

In most jurisdictions, the phrase 'reversionary interest' only becomes operative in a property transaction such as the lease of a property but little or no attention is paid to the operability of this term in respect of an intangible property. The provisions of any copyright law, like the Nigerian Copyright Act 1988, in addressing the 'ownership of copyright', 'duration of copyright' and 'termination of copyright' may consider inserting sections providing for the extent and recovery of ownership of copyright in the case of a deceased copyright owner including the period for recovery after the end of an earlier grant or assignment of a copyright. The current Nigerian Copyright (Repeal) Bill 2015 presently before the National Assembly is expected to repeal the Nigerian Copyright Act 1988. However, fails to acknowledge nor provide for reversionary interest in copyright works.

Another relevant consideration in this discourse will be the interpretation of the word 'assignment' usually employed in real property transactions to signify a total, complete and perpetual transfer of rights and interests in a landed property from an assignor to an assignee. In this case, such transfer is permanent, and any form of reversion is not contemplated. However, in the copyright domain, assignments or complete transfers of copyright may still be made subject to a reversionary interest. A cue may be taken from the assignment of copyright by a copyright owner to a collective management organisation (CMO) authorizing the CMO to administer or license certain copyright to ensure collective management of copyrights and remittance of royalties. Although, copyright has been assigned, where the copyright owner/assignor dies, the copyright devolves to his heirs or successors-in-title who may consequently withdraw the rights assigned to the CMO in respect of any of the works of the demised original copyright owner.²⁷

It is advisable that copyright assignment agreements, in compliance with the laws of a jurisdiction either local or foreign, should not be drafted in perpetuity but contemplate the provisions of a reversionary interest in the agreement to safeguard against the future interests of the beneficiaries of a copyright assignor or owner as practiced. The conspicuous effect of an existing provision for reversionary interest in copyright will be to secure or guarantee the position of the estate of a demised copyright owner to benefit from the creativity of their predecessor(s).

Intellectual property continues to gain global recognition by progressively maintaining contact with most aspects of human creativity. In this modern age, intellectual property has been able, in collaboration with emerging technologies, to create a landmark of staple assets and further grounds to safeguard digital assets. Just like the case of a title owner of a landed property who wishes to transfer ownership to his or her descendants after death, an original intellectual property rights holder is likely to intend a transfer of his or her intangible property, either through a will or intestate, to his successor(s)-in-title, assigns or heirs to continue to protect and reap from the fruits and legacy of their creativity.

Creating an avenue for authors and their estates to recapture assigned copyrighted works by limiting the duration of such transfers in certain instances (as discussed in this paper) would enable the assignor to correct the negative impact of poorly negotiated transactions entered into at the inception of their careers, in addition to empowering the deceased author's estate to benefit from the subsequent success of these works.

Footnotes

1. Franklin Okoro, Associate, Intellectual Property and Technology Department, S.P.A. Ajibade & Co., Lagos, Nigeria.

2. Bryan A. Garner (2009), Thomson Reuters, 9th ed., p.1434.

3. Ibid.

4. Ibid. p.885.

5. Nwankwo & Ors. v. Okafor & Ors. (2019) LPELR-48188(CA).

6. 1911, UK Public General Acts, Chapter 46.

7. Ashley Rovner, (2016), "Reversionary Rights: Unusual Ways to Have a Second Bite at the Copyright Apple". Chicago Kent Journal of Intellectual Property available at https://studentorgs.kentlaw.iit.edu/ckjip/reversionary-rights-unusual-ways-second-bite-copyright-apple/#_edn13 accessed 27^th June 2022.

8. Edwards & Love, (2018), "Regaining ownership of copyright: Traps for the unwary in UK and US Copyright Law". Reed Smith Client Alerts available at https://www.reedsmith.com/en/perspectives/2018/03/regaining-ownership-of-copyright-traps-for-the-unwary accessed 27^th June 2022.

9. 1956, UK Public General Acts, Chapter 74.

10. Pursuant to Section 170, Schedule 1, Paragraph 27 of Copyright, Designs and Patents Act, 1988.

11. 1988, UK Public General Acts, Chapter 48.

12. Successor(s)-in-Title, Heirs or Assigns.

13. The duties of a legal personal representative summarily include:

(a) collect assets to be distributed under a will or intestacy; (b) pay any debts; (c) divide the remaining assets among the named beneficiaries. See https://www.revenue.ie/en/life-events-and-personal-circumstances/death-and-bereavement/information-on-tax-after-a-bereavement/duties-of-a-personal-representative.aspx accessed 27th June 2022.

14. The Copyright Act of 1976 provides the grounds for the extant and current copyright law in the United States of America presently. It took effect on January 1, 1978, implementing fundamental and pivotal changes in many areas of copyright law.

See Copyright Law of the United States and Related Laws Contained in Title 17 of the United States Code, 2011, available at chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://www.wipo.int/edocs/lexdocs/laws/en/us/us352en.pdf accessed 27th June 2022.

15. Paragraph 4(a), (b), Section 203, USA Copyright Act 1976.

16. Paragraph 5, Section 203, USA Copyright Act 1976.

17. Nigerian Copyright Act, 1988, Cap. C28, Laws of the Federation of Nigeria, 2004.

18. Section 39(7), Nigerian Copyright Act 1988 provides that the Nigerian Copyright Commission shall have power to make regulations on Collecting Societies specifying the conditions necessary to give effect to the purposes of this section of the Act.

19. Dr. Owen Dean (2006), "Copyright in the Courts: The Return of the Lion", World Intellectual Property Organization (WIPO) Magazine.

See https://www.wipo.int/wipo_magazine/en/2006/02/article_0006.html accessed 27th June 2022.

See https://spoor.com/awakening-the-lion-in-the-jungle-the-story-of-the-lion-sleeps-tonight-case/ accessed 27th June 2022.

20. Ibid.

21. Gloucester Place Music Ltd. v. Le Bon and others, [2016] EWHC 3091 (Ch).

22. Ibid.

23. Charlotte Lister (2016), "Ruling against Duran Duran highlights the importance of foreign law advice", Squire Patton Boggs, Global Business IP and Technology Blog.

See https://www.lexology.com/library/detail.aspx?g=69c3eb75-38c1-4af1-966e-beba9ba59f8a accessed 27th June 2022.

24. Ibid.

25. Ibid.

26. Ibid.

27. Regulation 7, Nigerian Copyright (Collective Management Organisations) Regulations 2007.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.