drama, but also motion pictures, television and other rights would make any such distinction useless from a practical point of view. It has been said that

In each paragraph there is listed, in the alternative, a more detailed subdivision of the various rights. Each of these rights is substantial and exists separately from the others, and has, of course, been considered a property right** *.7

A similar distinction which would have treated any grant of rights included in one of the subdivisions of section 5 of the law has been suggested.75 But section 5 is a classification of the kinds of works and not of rights, and this attempt only led to confusion between the right granted and the end result of the exercise of the right to which we will refer later.76

4.

"Manifested-intention-to-transfer-the-proprietorship" test

Analyzing the cases, Henn has discarded the other tests and proposed a more realistic one arrived at by "examining the intention of the parties in order to determine whether or not the proprietorship was intended to be transferred." 77 Under this test, the author might reserve some rights, but if the intention to transfer the proprietorship is clear, the transfer is an assignment.78 In the case of an unpublished work, the intent would be "unequivocally manifested" if the author transferred the common law copyright or the right to secure statutory copyright in the grantee's own name; for published works, the transfer of the statutory copyright would equally manifest such an intention." In stressing the intent of the parties and the comprehensiveness of the grant, the formulation has definite advantages over other tests. Insofar as it proposes that certain words or phrases shall unequivocally manifest intent, however, the test abandons the search for the intent of the parties and opens the door to mechanical application.80 We will apply the theory in the periodical situation in a later section.81

The danger of relying upon the use of words of art is illustrated in Fitch v. Young, 82 where the publisher, having secured statutory copyright by publishing a play, "assigned the copyright" to the author but reserved the publishing right. Judge Hand, finding that the publisher clearly intended to convey only the "playright" and reserve the copyright, dismissed an action by the author for infringement of the published play, because the author was only a licensee. This case may be cited as an example of the "partial reservation" test, the "intent to transfer proprietorship" test, and of the test requiring “a statutory division of the various rights before they can be separately assigned." Much depends upon the attitude of the court toward indivisibility in general and the desire to reach an equitable result, two aims which are not always reconcilable. Ingenious attempts to reconcile the decisions may be unrewarding; no better test is available

74 Frankfurter, J., dissenting in Commissioner of Internal Revenue v. Wodehouse, 337 U.S. 369, 421 (1949). 75 Photo-Drama Motion Picture Co., Inc. v. Social Uplift Film Corp., 220 Fed. 448 (2d Cir. 1915). It has even been argued that a grant of newspaper rights only, since it is less than the whole of section 5(b), Title 17, U.S.C., does not make the grantee a proprietor and he cannot secure separate copyright when he excrcises his rights; the court rejected the argument. National Comics Publications, Inc. v. Fawcett Publications, Inc., 93 F. Supp. 349 (S.D.N.Y. 1950), modified on other grounds 191 F. 2d 594 (2d Cir. 1951).

76 Bergstrom, The Businessman Deals with Copyright, in THIRD COPYRIGHT LAW SYMPOSIUM 248, 270 (1941); See Section III G(2), Derivative Works, infra.

77 Henn, supra note 56, at 433.

78 Id. at 434.

T9 Ibid.

80 See Section IV B(3), Retransfer with Reservations, infra.

$1 See Section IV B, Periodicals-A Case Study, infra.

$2 230 Fed. 743 (S.D.N.Y. 1916).

if we agree with Mr. Justice Frankfurter, dissenting in Commissioner of Internal Revenue v. Wodehouse,83 that

The notion that the attributes of literary property are by nature indivisible and therefore incapable of being sold separately, is derived from a misapplication by lower courts of two early cases in this Court. *** The inherent nature of the interests in intellectual property add their commercial negotiability were not involved. The Court determined the procedural problem before it so that the infringer would not "be harassed by a multiplicity of suits instead of one," and would not be subjected to "successive recoveries of damages by different persons holding different portions of the patent right in the same place.' Gayler v. Wilder, 10 How. 477, 494–95 (U.S. 1850); Waterman v. Mackenzie, 138 U.S. 252, 255.

D. RIGHT TO SUE

Weil felt that the chief distinction between an assignment and license under the present statute was "the right to sue on infringement, or rather as to the extent of the relief obtainable in such actions, and with respect to the right to reassign." While assignees may, of course, reassign the copyright and licensees cannot, a partial assignment or license may be made assignable by express grant. 85 A licensee may not ordinarily grant sublicenses but he may do so if expressly authorized to do so by the licensor.86

87

There is extreme confusion in the cases and today many courts permit the licensee to sue, provided that he meets procedural requirements. The decisions are strewn with distinctions between assignments, partial assignments, assignments with conditions, grants, conveyances, "exclusive" and "mere" licenses. The distinctions are not applied uniformly, and the tests become circuitous: if the grant is interpreted to permit suit, it is therefore an assignment; if the transferee is not permitted to sue, the grant is a license. To a great extent, the distinction has become a verbal one.88

E. RECORDATION IN COPYRIGHT OFFICE

Whether a transfer is an assignment or license may also make a difference with respect to the effect of recordation in the Copyright Office. The statute provides for the recordation of assignments of copyright in the Copyright Office; if not recorded, the assignment is void against a subsequent purchaser or mortgagee for valuable consideration, without notice, who does record his assignment.89 The statute is silent on the recordation of licenses, but the practice of the Copyright Office has been to record partial assignments and licenses.90 Some writers have felt that recordation of licenses does not give constructive notice.91 The decisions have not finally settled this

83 337 U.S. 369, 419 (1949), The application of an essentially different statutory privilege to the copyright situation has been criticized. See e.g., Laskin, All Rights Unreserved, in COPYRIGHT LAW SYMPOSIUM, No. 7, at pp. 91, 105 (1956).

AMERICAN COPYRIGHT LAW 549 (1917).

85 Id. at 550.

se Ibid.

87 Cf. Photo-Drama Motion Picture Co., Inc. v. Social Uplift Film Corp., 213 Fed. 374 (S.D.N.Y. 1914), aff'd, 220 Fed. 448 (2d Cir. 1915); Buck v. Elm Lodge Inc., 83 F. 2d 201 (2d Cir. 1936); Stephens v. Howells Sales Co., Inc., 16 F. 2d 805 (S.D.N.Y. 1926); Machaty v. Astra Pictures, Inc., 197 F. 2d 138 (2d Cir. 1952); Widenski v. Shapiro, Bernstein & Co., Inc., 147 F. Supp. 909 (1st Cir. 1945).

8 Cohn, Old Licenses and New Uses, 19 LAW & CONTEMP. PROB. 184, 186 (1954). #17 U.S.C. § 30 (1952).

Code of Federal Regulations, Title 37, Ch. II, § 201.4, 21 FED. REG. 6021 (1956); DE WOLF, AN OUTLINE OF COPYRIGHT LAW 78 (1925).

WEIL, AMERICAN COPYRIGHT LAW 563-564 (1917); BALL, LAW OF COPYRIGHT AND LITERARY PROPERTY 550 (1944); Cf. Witwer v. Harold Lloyd Corp., 46 F. 2d 792, 795 (S.D. Cal. 1930), rev'd on other grounds, 65 F. 2d 1 (9th Cir. 1933), petition for cert. dismissed per stipulation of counsel, 296 U.S. 669 (1933), in which the court stated, "While the circumstance is not controlling, it may be noted that the instrument apparently is deemed sufficient as an assignment by the Copyright Office, as it was regularly registered therein as an assignment."

point. In his dissent in Commissioner of Internal Revenue v. Wodehouse,92 Justice Frankfurter said

Moreover, the Copyright Office will record these partial assignments, thus protecting the transferee and thereby increasing the marketability of the separate rights.93

There being no way of predicting with any degree of accuracy whether a court will regard a particular transaction as an assignment or license, it is safer to record exclusive licenses as well as assignments. In Photo-Drama Motion Picture Co., Inc. v. Social Uplift Film Corp.,94 Judge Hand felt it was not necessary to consider whether the grant of the right to dramatize was a license or assignment and came within the recording provisions because

a license falls before an assignment taken in good faith anyway. It would be absurd to protect a subsequent purchaser against a prior unrecorded assignee and leave him open to prior unrecorded licenses which should defeat him.95 The appellate court commented that—

As to the recording section 44 (now 30), we find it difficult to appreciate complainant's point. If a book can be copyrighted, if a drama giving the story of the book can be copyrighted, if a moving picture showing such picture fictionally also can be copyrighted, then each of these copyrights can be separately assigned and must be recorded to avail of the constructive notice which the section contemplates.98

The court apparently confused the rights comprising the copyright with the derivative copyrights resulting from the exercise of these rights. The decision has been read as indicating that an unrecorded license may be void against a subsequent licensee for value and without notice.97

F. TAXATION

Historically, the rule of indivisibility has played a major role in shaping the tax effect of assignments or licenses of copyright material. This subject is treated in a separate memorandum.98

G. WHAT INDIVISABILITY IS NOT

There are two areas presenting similar problems which are sometimes confused with indivisibility.99

1. Coownership

Suits by one coowner against an infringer occasionally present much the same problems, especially with respect to possible joinder of parties and multiple recovery as do cases involving divisibility.100

97 Kaplan, Literary and Artistic Property (Including Copyright) As Security, 19 LAW & CONTEMP. PROB. 254, 266-267 (1954).

See Margolis, Divisibility of Copyrights in Relation to Income Taz, annexed hereto as Supplement 1. That memorandum indicates that the basis for the taxation of income derived from copyrights is governed by the provisions of the Internal Revenue Code; that in most situations divisibility of copyright is not a factor; and where it is a factor, the recent court decisions and the Treasury ruling based thereon treat copyrights as divisible for tax purposes.

99 Indivisibility may sometimes be confused with composite works. A title such as Indivisibility and Destination, 14 REVUE INTERNATIONALE DU DROIT D'AUTEUR 190 (1957) may be misleading, in this context.

100 Kupferman, Copyright Co-Owners, 19 ST. JOHN'S L.R. 95, 107, 108 (1945); Schulman, Authors' Rights, in SEVEN COPYRIGHT PROBLEMS ANALYZED 19, 30 (1952); Taubman, Joint Authorship and Co-Ownership in American Copyright Law, 31 N.Y.U.L. REV. 1246 (1956); Rosengart, Principles of CoAuthorship in American, Comparative and International Copyright Law, 25 SO. CAL. L.R. 247, 256 (1952); Redleaf, Co-Ownership of Copyright, 119 N.Y.L.J. 760, 782, 802, 822 (Mar. 1-4, 1948).

However, in Waterman v. MacKenzie the Supreme Court stated that it was perfectly possible to assign an undivided share in the entire patent.io

2. Derivative works

Upon occasion, the courts have confused a grant of rights under the copyright with the end product of a right; e.g., the grant of motion picture rights in a book may result in a motion picture, which itself is separately copyrightable. Some have used this as a test of whether the transfer is an assignment or license; i.e., if the grant of a right could lead to a new version, the grant is an assignment.102 There is no basis for such a distinction; 103 the fact that dramatic rights may be the basis of a new copyright in a motion picture is no reason for treating their transfer as an assignment while calling a grant of performing rights, which may be just as valuable, but will not lead to a new copyright, a license.

IV. NEED FOR DIVISIBILITY

A. COMMENTATORS

The commentators have always had reservations about the indivisibility doctrine.104

Despite any belief that the indivisibility rule may still be good law, members of the copyright bar treat it as an anachronism and, except for procedural purposes, tend to disregard it. As a practitioner rather than a text writer, Weil felt strongly that, under commercial practice, "all these rights are divisible;" it was a purely accidental thing that they happen to be "technically part of an indivisible whole." 105 He added, "I cannot for the life of me see just what reason there is for opposing divisibility * * * in the long run, the rules of business will count." 106 Attorneys find that "the legal concept of an indivisible copyright is not reflected in business dealings," 107 and that a copyright is "industrially divisible." 108 The rule has been characterized as "fictitious," "fairly meaningless," an "outmoded fiction," or just a misapplication of Waterman v. Mackenzie. 109 If it ever had any meaning, some feel it has now fallen into disrepute. 110

Henn however has been impressed with the fact that the present law, in its constant references to the "copyright proprietor" can be "made consistent" only on the assumption of a single proprietorship.1 Henn therefore believes that the doctrine of indivisibility is an "estab

10: 138 U.S. 252, at 255 (1891).

Photo-Drama Motion Picture Co., Inc. v. Social Uplift Film Corp., 220 Fed. 448 (2d Cir. 1915). 10 Henn, supra note 56, at 433.

111

10AMDUR, COPYRIGHT LAW AND PRACTICES 789 (1936); DE WOLF, AN OUTLINE OF COPYRIGHT LAW viii (1925); LADAS, INTERNATIONAL PROTECTION OF LITERARY AND ARTISTIC PROPERTY 795 (1938); WEIL, AMERICAN COPYRIGHT LAW 548 (1917); Solberg, The Present Copyright Situation, 40 YALE L.J. 184, 190-191 (1930); Contra: BALL, LAW OF COPYRIGHT AND LITERARY PROPERTY 545 (1944).

105 Hearings on General Revision Before House Committee on Patents, 71st Cong., 2d Sess. 224 (1930); Cf. WEIL, AMERICAN COPYRIGHT LAW 547 (1917).

100 Ibid.

107 Schulman, Authors' Rights, in SEVEN COPYRIGHT PROBLEMS ANALYZED 19, 28 (1952). 10 Burton, Business Practices in the Copyright Field, in SEVEN COPYRIGHT PROBLEMS ANALYZED 87, 88 (1952).

189 Cohn, Old Licenses and New Uses, 19 LAW & CONTEMP. PROB. 184, 187 (1954); Finkelstein, The Copyright Law-A Reappraisal, 104 U. OF PA. L. REV. 1025, 1061 (1956); Pilpel, Tar Aspects of Copyright Property, in 1953 COPYRIGHT PROBLEMS ANALYZED 177, 181 (1953); Sargoy, Re-Eramining Some Basic Copyright Concepts, Outline of Address at Copyright Symposium, A.B.A., ÏV(F) (Aug. 20, 1955); WARNER, RADIO AND TELEVISION RIGHTS 157 (1953).

119 Kaplan, Literary and Artistic Property (Including Copyright) as Security, 19 LAW & CONTEMP. PROB. 254, 265 (1954).

Henn, supra note 56, at 416-418. See also Wasserstrom, Magazine, Newspaper and Syndication Problems, in 1953 COPYRIGHT PROBLEMS ANALYZED 159, 166 (1953).

lished element of the American copyright system" and a "worthwhile, if not essential element thereof." 112

The greatest difficulty with indivisibility has occurred in the periodical field and an examination of the application of the doctrine in that field should be helpful.

B. PERIODICALS-A CASE STUDY 113

The periodical situation has been complicated by the problem of the copyright notice. The copyright in an entire issue of a periodical does not protect a particular article unless the rights in the article have been assigned to the publisher, 114 or unless the publisher or an employee has written the article. If the publisher is the copyright proprietor of a particular article, the general notice will protect it and there is no need for a separate notice; if he is not the proprietor and there is no separate notice, the article falls into the public domain.

A well-known writer, aware of his rights, may insist upon the use of a separate copyright notice in his own name on his story, but this is still rather unusual. 115 Most writers either do not have the bargaining power to secure a separate notice or are perfectly content to leave the copyright details to the publisher. Despite the warning of the Dam case, there is no standard practice with respect to the transfer of rights. In many cases, the only contract is one similar to that entered into in the Dam case; i.e., providing for payment but saying nothing as to the transfer or return of any rights. Sometimes the receipt for payment is more specific; e.g., Colliers has used this form:

Received from (Collier's) the above sum as payment * * * for * * * all literary property and other rights therein, including complete publication rights and the right to copyright the same in (Collier's) name ***. After publication, (Collier's) upon request will transfer and assign to the author all rights in and to the copyright secured on said work. 116

If nothing is said of the transfer of any rights, as in the Dam case, the courts must fall back on trade custom. If the transaction is spelled out as in the case of Collier's, the courts will give effect to the agreement. But the transaction is not always clear cut and the same procedure is not always followed by smaller periodicals.

117

The most important difficulties with the present practices are as follows:

1. No initial transfer

Where there is no specific transfer of the literary property, resort must be had to the trade practice. According to Wasserstrom, this practice is that "authors who contribute their literary or artistic material to those media authorize the publishers thereof to copyright the contributions in the name of the publishers, usually under blanket or general notices of copyright imprinted on the periodicals, and to

112 Henn, Divisibility of Copyright, Outline of Address at Copyright Symposium, A.B.A., 6 (Aug. 20, 1955). 113 For the distinction between periodical, magazine, first and second serial rights, see: Wasserstrom, Magazine, Newspaper and Syndication Problems, in 1953 COPYRIGHT PROBLEMS ANALYZED 159, 164-165 (1953); Henn, supra note 56 at 421-423.

114 Morse v. Fields, 127 F. Supp. 63, 65 (S.D.N.Y. 1954); Ilyin v. Avon Publications, Inc., 144 F. Supp. 368, 372 (S.D.N.Y. 1956).

115 it is too much to expect a publisher to copyright each entry in a thick periodical ***. Only the seasoned author will reserve rights under a contract or even trouble to make a contract at all": Laskin, All Rights Unreserved, in COPYRIGHT LAW SYMPOSIUM, No. 7 at pp. 91, 98 (1956).

118 Morse v. Fields and Hearst Corp., 127 F. Supp. 63, 65 (S.D.N.Y. 1954).

117 Ibid.