The Trustee for the Truman Capote Literary Trust, established as a charitable trust under the will of prolific author Truman Capote, sued Paramount Pictures in Los Angeles County Superior Court this week. The lawsuit seeks declaratory relief that the rights to produce features based on Capote’s classic novella Breakfast At Tiffany’s have reverted to the Trust because Paramount failed to timely produce another film based on the novella under a 1991 agreement between the parties.
The complaint sets forth the long and storied history of the rights to Breakfast at Tiffany's, beginning with a 1958 agreement between Capote and Paramount under which Capote granted Paramount the motion picture rights to the novella, which Paramount produced in 1961 as a critically-acclaimed and culturally-significant film. The Trust alleges that, under the Copyright Act of 1909, the copyright reverted to Capote’s estate in 1986 upon his death and was assigned to the Trust in 1990.
Under the 1909 Act, which applied to Capote’s novella, authors had exclusive copyrights to their copyrighted works for 28 years and during that time authors could renew that copyright for an additional 28 years. If, during the initial term of the work, authors died childless and unwed but with a will, the renewal rights passed to their executors. Accordingly, when Capote passed away in 1984 before the renewal period, the rights reverted to Capote’s executor who renewed the copyright in 1986. Then, in 1990, Capote’s executor assigned the rights to all of Capote’s literary works to the Trustee for the Trust.
But what happened to the motion picture rights, including renewal rights, already granted to Paramount in 1958? The Trust asserts that the copyright grant under the 1958 agreement was contingent on Capote being alive for the renewed copyright term, so Paramount lost those rights when Capote died before the renewal period.
On that point, the complaint cites the U.S. Supreme Court case of Stewart v. Abend, 495 U.S. 207, 220 (1990), which determined that the "renewal provisions [of the Copyright Act] were intended to give the author a second chance to obtain fair remuneration for his creative efforts and to provide the author's family a 'new estate' if the author died before the renewal period arrived." On that basis, the Court held that “if the author [of a story upon which a derivative work is based] dies before the renewal period, then the assignee may continue to use the original work only if the author's successor transfers the renewal rights to the assignee.” Id. at 221. Based on Stewart, the Trust claims that Paramount lost all rights in the novella upon Capote's death.
Nevertheless, the Trust asserts that after Capote’s death, it agreed to work with Paramount on a new rights agreement that would allow Paramount to continue distributing the original 1961 film adaptation and grant an option to produce future derivative works. According to the Trust, the resulting 1991 agreement provided two consecutive option periods ending in 1994, with a six-year reversionary period ending in 2000 where all rights other than rights to exploit the original film reverted to the Trust. After the reversionary period, Paramount then had an additional option period to produce derivative works ending in 2003 after which the rights would revert to the Trust permanently if no work was produced.
The complaint alleges that, pursuant to the agreement, Paramount paid $300,000 in 1994 to produce a motion picture. Paramount allegedly believes this payment granted it the derivative rights and rendered the 2003 reversion inapplicable. The 1991 agreement is not attached to the complaint, however.
The complaint then explains what precipitated the lawsuit. The Trust had engaged in discussions with third parties for a limited television series based on the novella but Paramount sent the Trust cease-and-desist letters asserting rights to the work. Although the Trust disagreed with Paramount's assessment, both parties began negotiations to co-produce a television series together (while each maintained it owned the rights). Those talks then fell through allegedly because Paramount’s feature film department decided it wanted to produce another film based on the novella which currently has a screenplay. In response, the Trust filed this action to determine which party actually owns the rights.
Paramount has not yet commented on the lawsuit. It remains to be seen whether this lawsuit will persist or resort in new negotiations between the parties.
"[The Trust] was willing to negotiate a new agreement that would grant Paramount the continuing right to distribute the Original Picture, and to grant an option to Paramount to allow it to produce future films based upon Capote's Work. However, it was essential that such grant of future rights would be conditional upon Paramount's actually producing at least one motion picture by a date certain."