Gloucester Place Music Ltd v Le Bon & Ors

An assignment of copyright expressed to vest the entire copyright in the assignee for its full term may implicitly preclude the assignor from exercising a later statutory termination right which would bring the assignment to an end prematurely. The question is one of objective contractual interpretation, assessed in light of the relevant legal background and the commercial purpose of the transaction. The doctrine of non-derogation from grant may support that construction, although it need not provide an independent route to the result.

The claimant, a music publisher, sought declarations that current and former members of Duran Duran and their service companies had breached, or would breach, music publishing agreements by serving notices under section 203 of the United States Copyright Act 1976 to terminate assignments of United States copyright in 37 songs.

The agreements were governed by English law. The central issue was whether their proper construction permitted the defendants to exercise the statutory termination right, or whether the agreements implicitly required the copyrights to remain vested in the claimant for their full term.

1. Applicable law. The agreements were governed by English law under the parties’ express choice of law. The court therefore applied English principles of contractual interpretation. United States copyright law formed part of the factual and legal background, but evidence about its effect on contractual remedies was inadmissible and irrelevant in the absence of properly adduced expert evidence.
2. Construction of the agreements. Contractual interpretation is an objective exercise directed to the meaning conveyed by the documents to a reasonable person with the relevant background knowledge. That background may include relevant law. The words assigning the “entire copyrights”, read with the provisions concerning renewals, extensions and modifications, conveyed an intention that the copyrights should vest, and remain vested, in the claimant for their full term.
3. That construction implicitly precluded the defendants from exercising rights under United States law which would terminate the claimant’s ownership before expiry of the copyrights. The provision preventing transfers of copyright interests to another person reinforced the conclusion. Exercising the termination rights effectively transferred the reversionary interest from the claimant back to the defendants.
4. Non-derogation from grant. The doctrine could apply to copyright, but it did not furnish an independent basis for the result. It nevertheless supported the claimant’s interpretation of the agreements. The requirement of commercial certainty was a neutral factor.
5. The defendants had breached the agreements by serving the notices, or would breach them if notices whose effective dates had not arrived were not withdrawn. The court would hear counsel on the precise terms of the declarations.