Crosstown Music Company 1,LLC v Rive Droite Music Ltd & Ors

An assignment of copyright may be partial as to the period of subsistence even where the period ends on an uncertain future event. Section 90(2) of the Copyright, Designs and Patents Act 1988 contains no requirement that the period be fixed and certain at the outset. A clause providing that rights shall forthwith revert on an unremedied material breach can therefore operate as an automatic reverter, binding a successor in title. A title dispute arising under an English-law copyright contract with exclusive English jurisdiction is justiciable in England, including foreign copyrights. The rule against adjudicating foreign copyright infringement does not extend to such contractual title disputes. Because reverter is automatic, the remedy is not an election to terminate. No reasonable-time term or one-notice limit was implied, and later conduct did not restore title.

Crosstown, an American music publisher, acquired copyright interests in 119 songs from Rive Droite Music Ltd. The songwriters had assigned those rights to Rive Droite under agreements containing a clause providing for automatic reverter following notified, unremedied material breach.

Crosstown sought declarations that it owned the United Kingdom and foreign copyrights. Mann J, in [2009] EWHC 600 (Ch), dismissed the claims against the songwriters and declared that the copyrights had reverted to them. The appeal concerned the construction of section 90 of the Copyright, Designs and Patents Act 1988, the justiciability in England of title disputes concerning foreign copyright, and whether election, waiver, acquiescence or estoppel invalidated the cure notices or prevented reliance on them.

The Court of Appeal unanimously dismissed the appeal and upheld the declarations that the copyrights had reverted to the songwriters.

1. Automatic reverter. Mummery LJ held, with Morgan J agreeing and Sir Paul Kennedy agreeing with Mummery LJ’s reasons, that the agreements were worded as automatic reverter provisions. They did not merely impose future contractual obligations to reassign. Under section 90 of the Copyright, Designs and Patents Act 1988, a partial assignment may be limited to part of the copyright period. The statute does not require that period to be fixed, certain or known at the date of assignment. An assignment may therefore end on an uncertain future event, such as an unremedied notified breach. The court also rejected reliance on section 136 of the Law of Property Act 1925 as a guide to the construction of section 90. Authorities including Jonathan Cape v Consolidated Press [1954] 1 WLR 1313, Messager v BBC [1929] AC 151 and Mother Bertha Music Ltd v Bourne Music Ltd [1997] EMLR 457 supported the validity of such arrangements.
2. Foreign copyright. The court confined Lucasfilm Ltd v Ainsworth [2009] EWCA Civ 1328 to its decision that infringement claims concerning foreign, non-EU copyright were non-justiciable in England. It did not prevent an English court determining title arising under an English-law contract containing an exclusive English jurisdiction clause. Griggs v Evans [2004] EWHC 1088 (Ch) supported that conclusion.
3. Election and notice. Clause 18(a) was an agreed remedy for breach, not a repudiatory-breach election or a commercial option. No term requiring notice within a reasonable time, or limiting the writers to one notice for each breach, was necessary or implied. The authorities relied on concerning contractual options and election were distinguishable.
4. Post-notice conduct. Once the conditions for reverter were fulfilled, later exploitation of the songs, acceptance of royalties and receipt of accounts did not transfer title back to Crosstown. An estoppel or agreement restoring Crosstown’s title would have required an appropriate representation, reliance or agreement, none of which was established. The court did not need to decide the respondents’ notice because the disputed breach did not affect the operation of the other cure notices.

• Court of Appeal (Civil Division): The appeal was dismissed on all grounds. The court upheld the High Court’s declarations that the copyrights had automatically reverted to the songwriters.
• High Court (Chancery Division): Mann J, in [2009] EWHC 600 (Ch) , dismissed Crosstown’s claims against the songwriters and declared that the copyrights reverted following unremedied material breaches.