Cross faces at Crosstown as composers get their copyrights back

Here's a tricky case.  A couple of songwriters assign their copyrights to a company that is obliged to exploit those copyrights commercially.  The deal contains a clause that enables the songwriters to get their copyright back if the company is in material breach of its obligations.  The company then assigns the copyrights to another company, following which the songwriters want their copyright back. Do they get it? Yes, according to Crosstown Music Company v Rive Droite Music Ltd and others [2009] EWHC 600 (Ch), a decision of Mr Justice Mann (Chancery Division, England and Wales) on Wednesday,

Crosstown took an assignment of 119 copyrights owned by Rive Droite. Some of those copyrights related to songs written by Taylor and Barry, who assigned the copyright in their compositions to Rive Droite so that the latter could exploit the copyright and pay them royalties under an agreement which provided (in clause 18(a)) that, if Rive Droite were to be in material breach of its terms and failed to take all reasonable action to remedy that breach within 45 (in Taylor's case) or 60 (in Barry's case) days of written notification of a 'cure notice', the assigned copyright would revert to the writers.

Taylor and Barry later considered that a reversion-triggering breach had occurred, with the consequence they again owned the copyright in their various compositions. In April 2007 they served cure notices on Rive Droite, giving notice to Crosstown, relying on various alleged breaches -- including failure to cough up all the royalties on Cher's song Believe -- and asserting that they now owned thir copyrights again. Faced with those notices, Crosstown sued Rive Droite for specific performance of the sale agreement. Taylor and Barry counterclaimed for copyright infringement. The action involves determining (among other things) (i) whether the copyrights re-vested in Taylor and Barry; (ii) whether clause 18(a) bound the claimant as assignee of the copyrights and (iii) whether Taylor and Barry had lost any right to reversion of the copyrights through waiver, acquiescence or estoppel.

The main question before Mann J in these proceedings whether Taylor and Barry were correct in saying that there had been breach of clause 18(a). On a close analysis of the facts, he concluded that clause 18 provided for an automatic revesting of the copyrights, the cure notices were unassailable and that, therefore Crosstown's attack on their validity must fail. The judge discussed one legal issue of substantial interest: did clause 18 take effect differently in respect of different national copyrights? On that matter he had this to say:

"89.... I refuse to allow Crosstown to contend that the effect of clause 18 might be different in relation to different national copyrights. Although it might not be strictly relevant, I would add that this conclusion produces a much more satisfactory (if not conveniens) litigation picture, because if the position were otherwise the point might have to be determined in as many jurisdictions as there are copyrights in this case. I have not totted up the number of jurisdictions involved, but I think there are at least half a dozen if not twice that. That prospect is unsatisfactory. In the present case it is not appropriate to inflict that on the Writers. I reach the conclusion that I do without having to consider the strength of the submission that it would be wrong to assume that foreign copyright law is the same as English law. That submission would only become relevant if there were an issue as to different jurisdictions, and I have held that there is no such issue in this case because of the manner in which the case has proceeded hitherto. I also do not have to consider the extent to which foreign copyright issues can be litigated in this country (see, for example, Lucasfilms Inv v Ainsworth [noted here by the IPKat]), because again that only arises where there is a properly formulated issue as to the point, which again in this case there is not".

The IPKat wonders how many businesses taking assignments of copyright take the trouble to root around for clauses that may have the effect of undermining their commercial expectations, or whether they are merely happy to rely on warranties that their title will be secure.  Merpel moans, I still don't get it: if Crosstown has taken an assignment of the copyright from Rive Droite, surely Rive Droite doesn't have any copyright title to the works that can revert to the songwriters? Or have I missed something?