Re: Contracts and Copyright Duration

On 4/18/96, John Noble wrote:
>
>At 12:15 PM 4/17/96 -0500, kcrews[_at_]velcome.iupui.edu wrote:
>>
>> On Tue, 16 Apr 1996, John Noble wrote:
>>>
>>> As a practical matter, I suggest there's no difference at all in terms
>>> of "promoting the progress of science." The copyright owner can demand
>>> a license fee of $100 per year for 200 years, or could charge a one-time
>>> payment of the present value of that sum for a license with a term
>>> exactly corresponding to the copyright term or something less, and make
>>> the licensee finance that payment with a bank loan payable over 200
>>> years at $100 per year. The term and amount of the payment under a
>>> license is simply a question of financing, clearly negotiable between
>>> contracting parties, and, I would suggest, not subject to preemption.
>>> The only difference is remedy. If the licensee stops making payments
>>> before the copyright expires, the licensor may be entitled to an
>>> injunction prohibiting continued use of the software. If the licensee
>>> stops making payments after the copyright expires, licensor can only
>>> get monetary damages.
>>>
>>> John Noble
>>> <jnoble[_at_]dgs.dgsys.com>
>>
>> Perhaps we are talking about two different transactions. I am looking
>> at the possibility that a copyright owner would leverage the term of
>> protection by securing a license for a longer term. My use of the
>> word "payments" is perhaps the source of confusion. Your comments seem
>> to focus on a payment plan that reaches beyond the term of copyright
>> protection. I am troubled by the ability of a licensor to secure a
>> license that requires protection and that licenses uses beyond the
>> duration provided by law; I am not troubled by the prospect that
>> financing the license may continue on for years after.
>
> I don't think we are talking about two different transactions. Its
> the same transaction viewed from two different angles. You express
> concern about a license term which exceeds the duration of copyright,
> but are not troubled by payment obligations which exceed the duration
> of the copyright. How though, other than the term of the payment
> obligation, do you measure the term of the license? In other words
> while I can't prevent your continued use of the licensed software
> after the expiration of the copyright, if I can enforce a promise to
> continue payments after the expiration of the copyright, I have for
> all practical purposes accomplished the same end. No?
>
> John Noble
> <jnoble[_at_]dgs.dgsys.com>

Let's look at some different possibilities (assumin 75 years for convenience):

1. I license you to make all copies you like for 75 years for $75,000, lump sum
2. I license you to make all copies you want for 75 years for $1,000 per year
3. I license you to make all copies you want for 75 years for $75,000, payable at $750 a year for 100 years
4. I license you to make all copies you want for 100 years for $750 per year
5. I license you to make all copies you want for $1,000 per year for as many years as you continue to pay, but you promise never, at anytime no matter how far in the future, to make any copies without payment.

1,2, and 3 are probably valid, but I would assume that 4 and 5 are preempted.

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     Buford C. Terrell                             1303 San Jacinto
     Professor of Law                             Houston, TX 77002
     South Texas College of Law                 voice (713)646-1857
     terrell[_at_]stcl.edu                             fax (713)646-1677
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