Unfortunately Duran Duran did not ask the above question about the copyright assignment provisions and governing law clause in its publishing agreement in 1980. The publishing agreement signed by the group granted, on a worldwide basis, the "entire copyrights" in Duran Duran compositions for the full term to Gloucester Place Music Ltd (then called Tritec Music Ltd, and now part of the Sony/ATV group) ("Gloucester Place"). The agreements were expressly subject to English law and the exclusive jurisdiction of the English Courts.
However, in 1978, the US enacted a new Copyright Act which included section 203 that allowed musicians to reclaim their copyright from publishers after 35 years by serving advance notice. Also recognising the unequal relationship that may exist between artists and publishers, the section also included the provision that this right could not be contracted away.
With the 35 year point approaching, Duran Duran duly served the copyright reversion notice on Gloucester Place in 2014 reclaiming its US copyright in its music. Gloucester Place responded by seeking a determination from the High Court that such notices, if not retracted would represent a breach of contract, i.e. by terminating an assignment which Duran Duran had no right to do.
Gloucester Place accepted that the notices were valid and effective for their purpose as a matter of US law. Its case was that Duran Duran had as a matter of English Law contractually promised not to bring about such effects i.e. not to exercise their reversionary rights under the US Copyright Act. Duran Duran argued that the agreement could not properly be construed to contain such promises, and even if it was, it would be contrary to public policy to enforce them.
In his decision handed down on 2 December 2016, Arnold J upheld Gloucester Place's claim. His decision was based on the fact that the contract was made under English law, and on its proper interpretation the parties are assumed to have been aware when entering into the agreement of the effect of section 203, and to have still contracted away the US copyright for its full term. Arnold J stated that the language of the copyright agreements “would have conveyed to a reasonable person… that the parties’ intention was that the ‘entire copyrights’ in the compositions should vest, and remain vested, in the claimant (Gloucester Place) for the ‘full term’ of the copyrights.”
Arnold J rejected Duran Duran's reliance on English public policy as inconsistent with the well-established principle that English courts will enforce a contract which is valid and enforceable under English law even if the contract would be unenforceable as contrary to public policy in another country with which the contract has a connection.
Unfortunately Duran Duran did not introduce expert evidence as to the position under US law and instead treated it as a fact or self-evident. Perhaps this case may have been decided differently if such evidence had been submitted but the failure to present this evidence to Mr Justice Arnold undermined Duran Duran's reliance on the US law point.
Hopefully this will serve as a lesson to other musicians to ensure that they understand everything about the copyright in their works both now and in the future and that they seek the necessary legal advice when entering into an agreement and ask the right questions from the outset, especially where conflicting laws are in play.
*EDIT (13 February 2017)*
Duran Duran have been granted leave to appeal against the December 2016 ruling. On Friday 3 February 2017, Duran Duran issued a press release outlining the details of the appeal, which was allowed by Mr Justice Arnold.
We will of course update you as and when we have any further information.