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Mills Music, Inc. v. Snyder
United States Supreme Court
469 U.S. 153 (1985)
Ted Snyder authored a musical composition in 1923 that was assigned to Mills Music, Inc. (plaintiff) about a decade later. Then, in 1940, the parties entered into a written agreement pursuant to which Mills acquired the renewal right therein in exchange for the distribution of certain royalties to Snyder. Mills thereafter issued over 400 licenses to various record companies authorizing the use of the song in sound recordings. These record companies prepared and exploited separate derivative works, for which, pursuant to the licenses, the record companies were obligated to remit royalties to Mills. Mills, in turn, was obligated to remit a portion of those royalties to Snyder. When Snyder died, his widow and his son (the Snyders) (defendants) succeeded to his interest in this arrangement with Mills. In 1978, the Snyders served Mills with a notice of termination in accordance with Section 304(c) of the Copyright Act and demanded that all royalties on the derivative works be remitted to them. The disputed funds were placed in escrow, and an interpleader action was initiated. The district court held for Mills. The appellate court reversed after concluding that the Snyders’ termination caused the ownership of the song to revert to them and, therefore, the termination carried with it Mills’s right to collect royalties under the licenses to the record companies. Mills appealed.
Rule of Law
Holding and Reasoning (Stevens, J.)
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