may be necessary to produce "prima facie evidence of the execution of the instrument," it is not deemed a requirement of recordability," much less a requirement for efficacy as between the parties.

48

The provisions of section 29 may be criticized as involving minor details inappropriate for an organic copyright statute. The justification for a separate section devoted to acknowledgment is probably the need for some special rule concerning the disposition of federally created property; this appears to be the reason underlying similar provisions in the Federal statutes relating to patents 8 and registered trademarks.49 Unlike the patent and trademark statutes, however, the effect of section 29 is limited to foreign assignments, and it is unclear why domestic assignments are denied this evidentiary advantage. Consideration might be given to granting similar advantages to domestic assignments executed before a notary public.

Further possibilities of improving the present provision may be gleaned from the patent and trademark laws in other respects. For example, it may be that the class of officers before whom a foreign assignment may be acknowledged should be expanded. This was in fact proposed in section 11 of the Vestal bill,50 which included

any notary public, judge or magistrate of any foreign country authorized to administer acts in such country and whose authority shall be proved by certificate of a diplomatic or consular officer of the United States.

C. DISCRETION OF THE REGISTER OF COPYRIGHTS AS TO RECORDATION

Every public official with the power and duty to record certain documents is often faced with the problem of determining whether particular papers offered for record meet the specified requirements. As indicated earlier the Copyright Office is extremely liberal in recording papers submitted to it. This latitude would seem justifiable in view of the lack of clear statutory directions concerning the scope of recordable documents. A stricter attitude could probably be adopted under the present law, however; the cases dealing with the authority of ministerial officers such as recorders of deeds appear to agree that such officers can determine the types of documents they have power to record, and can refuse recordation for other types. In an attempt to avoid any possible abuse of administrative discretion in the area of recording copyright transfers, the Vestal bill provided:

52

The register of copyrights shall, upon payment of the prescribed fee, record any assignment of copyright, or any grant, license, or mortgage of any right pertaining to the copyright in any work protected under this Act or any previous Acts of the United States * * *. The register of copyrights shall have no discretion to refuse to record any instrument presented to him for record as aforesaid.53

This provision failed to solve the problem of what constructive notice is effected by recordation of an instrument not entitled to record. And it probably would have left the Register with discretion to determine whether a particular document constituted an "assignment

47 See Copyright Office Circular No. 10 (1956).

48 35 U.S.C. § 261 (1952).

49 15 U.S.C. § 1060 (1952).

50 H.R. 12549, 71st Cong., 2d Sess. (1930). Cf. Section 13(2)(a) (b), Thomas bill, S. 3043, 76th Cong., 3d Sess. (1940).

of copyright" or a "grant, license, or mortgage of any right pertaining to copyright in any work

* ** 54

IV. EFFECTS OF RECORDATION

A. PRIORITY IN RECORDING

Section 30 provides that "every assignment of copyright shall be recorded ***." While this provision at first glance seems mandatory, the remainder of the section makes it clear that the consequences of failure to record are limited. The relationship between the immediate parties, and the validity of the assignment itself as between them, are not affected by the recording provisions.55 And, since the mere failure to record also has no effect on the validity of the copyright, it cannot be used as a defense in an ordinary infringement action.56

Moreover, the consequences of failure to record within the time periods specified are limited even as to subsequent transferees. A subsequent purchaser can take advantage of the failure to record an earlier transfer only if his own purchase was made without notice of the earlier transfer,57 for a valuable consideration, and was duly recorded. And even if a subsequent purchaser has satisfied these requirements and records first, he cannot prevail against an earlier assignment that is recorded within 3 or (for transfers executed abroad) 6 months after its execution.

The present provision relies on a system combining three basic features:

1. A requirement that, to prevail, the subsequent purchaser's transfer must itself be duly recorded;

2. A requirement that the subsequent purchaser must not have had actual or constructive notice of the earlier assignment; and 3. The allowance of a period of time for recording the earlier transfer before a later transfer can acquire priority.

It might be argued that the first of these features requiring the second purchaser to record in order to prevail over the first-is anomalous, on the ground that recordation by the subsequent purchaser does not seem to affect the equities between him and the first purchaser one way or the other. However, reliance on someone's failure to record by a person who himself has failed to record might raise questions of "clean hands." The requirement can also be defended on the ground that the first purchaser who may wish to record his transfer at a later date, as well as future purchasers, are entitled to notice of the second transferee's instrument. Prior revision bills have generally included such a requirement. 58

An alternative approach to the second feature might be exclusive reliance on priority of recordation without regard to actual notice. Under this system, the purchaser who records first prevails, regardless of which purchase took place first, and regardless of whether the second

The administrative difficulties raised by this provision were described by former Register Solberg. Hearings Before House Committee on Patents on HR. 10434, 69th Cong., 1st Sess., at 239 (1926). He later testified that under then existing practices "the Register of Copyrights nevers attempt to pass upon the sufficiency or validity of any document presented for recordation.' Hearings Before Senate Committee on Patents on H.R. 12549, 71st Cong., 3d Sess. at 234 (1931).

See Banks Law Pub. Co. v. Lawyers Co-operative Pub. Co., 169 Fed. 386, 387 (2d Cir. 1909).

See New Fiction Publishing Co. v. Star Co., 220 Fed. 994, 996 (S.D.N.Y. 1915). Cf. Webb v. Powers, 29 Fed. Cas. 511, Case No. 17, 323 (C.C.D. Mass. 1847).

Edward B. Marks Music Corp. v. Charles K. Harris Music Pub. Co., 225 F. 2d 518 (2d Cir. 1958). 58 E.g., Perkins bill, H.R. 11258, 68th Cong., 2d Sess. (1925).

purchaser had actual notice of the first transfer. This system might in some cases reward the unscrupulous, but it may have advantages in placing a premium on early recordation and avoiding fact issues regarding actual notice. The new Mexican law, for example, provides that

When two or more persons are assignees of the same rights in a given work, the assignment first registered shall prevail, but without prejudice to the right to impugn the register, or to the corresponding penal action.59

The approach of legislative proposals in this country has generally been to require that a subsequent purchaser be free of actual notice of a prior conflicting grant in order to prevail. The 1940 Thomas bill apparently required such "good faith" and lack of notice at the time the subsequent grantee recorded his grant. Once recorded under these circumstances the grant prevailed over earlier grants not yet recorded.

B. TIME LIMITS FOR RECORDATION

Section 30 prescribes that an assignment "shall be recorded in the Copyright Office within 3 calendar months after its execution in the United States or within 6 calendar months after its execution without the limits of the United States." 60 This language presents several questions which have not been illuminated by authoritative interpretation. For example, the 3 and 6 months provision is ambiguous in its applicability to the obligation of the second purchaser to record. Must the second purchaser, in order to take advantage of the first purchaser's failure to record, record his own assignment within this period to qualify as one "whose assignment has been duly recorded"? Such a requirement seems unnecessary, and it is doubtful whether it would be supported under the present law, but a clarification of the statutory language is obviously desirable.

A more pressing question involves the precise effect of a delay in recording beyond the 3- or 6-month period on the part of the first transferee. Is recordation during this initial period the only means of obtaining protection against subsequent purchasers; or is it sufficient if the first assignment is recorded before the second is executed, or at least before the second is recorded?

61

The patent law is clear in protecting the first purchaser as long as he records before execution of the second purchase.62 A literal reading of section 30 suggests that the situation may be different in the case of copyright assignments, and that a failure to record within 3 or 6 months defeats the assignment against any subsequent purchaser. There would seem to be little reason, however, why copyright assignments should be treated differently from patent assignments for this purpose.

59 Article 123. Diario Oficial, Vol. 219, No. 50, Dec. 31, 1956.

60 17 U.S.C. § 30 (1952).

61 This question was involved in Edward B. Marks Music Corp. v. Charles K. Harris Music Pub. Co., note 56 supra, but was not considered in view of the court's determination that the second purchaser had actual notice of the first transaction.

62 35 U.S.C. § 261 (1952). See Why Corp. v. Super Ironer Corp., 128 F. 2d 539 (6th Cir. 1942).

The recording of an assignment, even after the initial period, affords the type of notice which recording statutes seek, and could well prevent a subsequent purchaser from taking "without notice." In the long run, it produces a more complete record, since the incentive to record survives the initial period. There thus appear to be strong arguments in favor of a revision along the lines of the patent law, protecting the first purchaser if he records "within three months * * * or prior to the date of such subsequent purchase or mortgage.' Another possibility, going even further, would be to protect the first purchaser if he records "within three months * * or prior to the recording of such subsequent purchase or mortgage."

*

9763

On the other hand, the advantages of allowing any initial period for recording must be weighed against the fact that, at any point in time, a prospective purchaser can never be completely certain that the silence of the record insures his protection. He cannot detect from the record a prior purchase which has not yet been recorded; and the later recordation of the prior purchase will defeat him if it takes place within 3 months after its execution.

The concept of an initial period is deeply rooted in U.S. copyright law. It furnished an integral part of the first statutory provision for the recordation of transfers, in which the prescribed period was 60 days.64 Moreover, a 3-month period is provided in both the Federal patent and trademark statutes. Yet, such periods do not appear to be common in recording provisions in foreign laws,66 and several of the revision bills proposed recording provisions without this feature.67

65

Statutes providing for recording of interests in real property now rarely provide initial time periods. The same seems to be true with respect to chattel mortgages.69 On the other hand, some sort of protective time period is specified in a number of conditional sales statutes.70 The Uniform Conditional Sales Act provides for a 10-day period during which a purchaser is protected against subsequent purchasers even if he has not yet recorded." The drafters of the Uniform Act in 1922 considered such a period warranted by considerations of distances and unavoidable delays. Such considerations appear much less persuasive in the light of modern facilities for transmission of documents. On the other hand, recordation in one place, i.e., the Copyright Office in Washington, D.C., of transactions occurring throughout the United States might call for some period of grace. Whether or not the 3- or 6-month provision serves a useful and realistic function can be tested to some extent by commercial practice. A survey of 545 documents of all types recorded in the Copyright

43 This approach was taken in the recent design protection proposal. See Section 20 (c), H.R. 8873, 85th Cong. 1st Sess. (1957).

Act of June 30, 1834, 4 STAT. 728.

65 See notes 48 and 49 supra.

But see Article 163, Lebanese Law (Decree No. 2385, Jan. 17, 1924; Amendatory decree, No. 526, Sept. 22, 1926) (Abstract of act of assignment must be sent to Director of Protection Office within fifteen days of execution).

67 E.g., Section 16, Sirovich bill, H.R. 10364, 72d Cong., 1st Sess. (1932); section 16, Thomas bill, S. 3043, 76th Cong., 3d Sess. (1940).

69 IV AMERICAN LAW OF PROPERTY § 17.32 (1952).

92 JONES, LAW OF CHATTEL MORTGAGES AND CONDITIONAL SALES § 261a (Bowers ed. 1933).

70 Id. § 1067.

71 Section 5.

722 U.L.A. p. 9.

56582-60-10

Office between February 5, 1958, and March 3, 1958, produced the following information concerning the timelag between execution and receipt in the office for recordation:

There is not much doubt from these figures that commercial copyright practice favors early recordation of transfers. The figures also suggest that requiring recordation within a reasonable period results in little or no inconvenience in the vast majority of cases, and that the present periods of grace might even be shortened without serious results. It is also possible to infer that a relatively short period serves a realistic purpose in encouraging early recordation, although this seems more conjectural. It is difficult to predict what the time lag between execution and recordation would be if the grace periods were abolished; a trend toward later recordation might result, or recordation might be made more promptly if the first of two conflicting transfers to be recorded were to prevail.

C. CONCEPTS OF "NOTICE" AND "VALUABLE" CONSIDERATION

The requirement that a purchaser, to be protected against prior unrecorded transfers, must be "without notice," poses certain questions which have not yet been fully answered. For example, must the purchaser be free from notice both at the time of this purchase and at the time his transfer is "duly recorded"? And, under what circumstances is a purchaser charged with notice by reason of facts that called for inquiry on his part?

The latter question was involved in Brady v. Reliance Picture Corp." The court there characterized the plaintiff's position as follows:

What this allegation amounts to is that, where a publisher copyrights a work of an author, there must of necessity exist some arrangement between them, and that, perchance, the author may have reserved something undisclosed which the person dealing with the owner of the copyright should have suspected although an examination of the recorded title provided for by law shows good title.74 The court rejected this argument as an undue commercial burden. not contemplated by the copyright law.

73 232 Fed. 259 (S.D.N.Y. 1916).

74 Id. at 262.