Heirs to Anne of Green Gables Author Have Valid Reversionary Copyright Interest, Ontario Superior Court Rules in Suit Against Licensee

2000-01-01

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HEIRSTOANNEOFGREENGABLESAUTHORHAVEVALIDREVERSIONARY
COPYRIGHTINTEREST,ONTARIOSUPERIORCOURTRULESINSUIT
AGAINSTLICENSEE

BarryGamache*
LEGERROBICRICHARD,Lawyers
ROBIC,Patent&TrademarkAgents
55St-Jacques,Montreal(Quebec)CanadaH2Y3X2
Tel.(514)987-6242-Fax(514)845-7874
E-mail:marion@robic.com–WebSite:www.robic.ca

ArecentdecisionoftheOntarioSuperiorCourtofJusticedeterminedthefateofa
copyrightgoingbackto1908inthefamouscharacterofAnneofGreenGables
describedinthefictionalworkbearingthesamenameandauthoredbyLucyMaud
Montgomery(AnneofGreenGablesLicensingAuthorityInc.v.AvonleaTraditions
Inc.,[2000]O.J.No.740,CourtFileNo.95-CU-89192,OntarioSuperiorCourtof
Justice,March10,2000,J.WilsonJ.).

ThecharacterAnneinLucyMaudMontgomery’snovelAnneofGreenGablesisa
youngorphangirlwhoseappealtoresidentsofPrinceEdwardIslandandtotherest
ofCanadahassurvivedintactthe20
thCentury.

Duringthemid1980’s,theheirsofLucyMaudMontgomery(whohadpassedaway
onApril24,1942)becameawareofandclaimedareversionarycopyrightinterestin
AnneofGreenGablesandanysequelswrittenbytheauthor.Theseheirsinitiateda
licensingprogramincludingalicensewhichwasgrantedtothedefendant.This
licensealloweddefendantAvonleaTraditionsInc.tomerchandisesouvenirswhich
borethenamesandlikenessofcharactersderivedfromthe1908book.Thelicense
agreementwasconcludedinAugust1988butwasterminatedbytheplaintiffsinApril
1994duetodefendant’sfailuretopayroyaltiesorprovideanaccountingthereofas
contemplatedbythelicenseagreement.

Variousnegotiationsoccurredbetweenthepartieswithapurposetoamicably
resolvetheirdifferences.However,thesenegotiationsfailedandlegalactionwas
takenbyplaintiffsinAugust1995.Initssuit,plaintiffssoughtdamagesforunpaid
royaltiespriortoandafterterminationofthelicenseagreementinApril1994andalso
requestedaninjunctionpreventingdefendantfromcontinuingtodealinmerchandise
relatedtoAnneofGreenGables.Initsdefence,AvonleaTraditionsInc.raised
severalIPissuestocontestplaintiff’saction.Oneoftheissuesraisedbythe
defendantwaswhethertheheirshadavalidreversionarycopyrightinterestunder

©LEGERROBICRICHARD,1999-2002.
*LawyerwiththelawfirmLEGERROBICRICHARD,g.p.andwiththepatentand
trademarkagencyfirmROBIC,g.p.Publishedat(2001),2-4WorldLicensingLaw
Reports3-4underthetitleHeirs’ReversionaryRightsOutweighRightsofLicensee.

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Canada’sCopyrightAct(R.S.C.1985,c.C-42)atthetimethelicenseagreementwas
enteredintobythepartiesin1988.

Section34.1ofCanada’sCopyrightActprovidesthatcopyrightispresumedtoexist
inaworkunlessthecontraryisestablished.Canada’sCopyrightActprovidesthatthe
termforwhichcopyrightshallsubsistinaworkshallbethelifeoftheauthor,the
remainderofthecalendaryearinwhichtheauthordies,andaperiodoffifty(50)
yearsfollowingtheendofthatcalendaryear.

AsLucyMaudMontgomerypassedawayinApril1942,thecopyrightinthework
AnneofGreenGablesexpiredin1992.Theundisputedfactsofthecaserevealed
thatcopyrightinAnneofGreenGableshadbeenregisteredonJune11,1908by
L.C.Page&CompanyInc.asassigneeofthatright.Copyrightwasfurtherassigned
topublishersFarrar,Straus&Giroux,Inc.whothereafterheldallrightsinAnneof
GreenGables.

Canada’sCopyrightActallows”reversionaryrights”withrespecttotheheirsofan
author.Insummary,thecopyrightinanywork”reverts”totheauthor’sestate25
yearsaftertheauthor’sdeath,notwithstandinganyassignmentagreementmade
duringtheauthor’slifetime.Theserightsaredescribedinthefollowingfashionby
Richard,H.G.etal.intheCanadianCopyrightActAnnotated,Carswell,Toronto,
1993atp.14-3:”Subsection14(1)isnotthebestexampleoflegislativeclarity.
Accordingtothissection,subjecttocertainconditionswheretheauthorofaworkis
thefirstownerofthecopyrighttherein,noassignmentofthesaidcopyrightnorgrant
ofanyinterestmadebyhim,isoperativetovestintheassigneeorgranteerights
relatingtothecopyrightformorethan25yearsaftertheauthor’sdeath.Uponthe
terminationofthis25-yearperiod,thetitleorinterestinthecopyrightdevolvesonthe
author’slegalrepresentativesaspartofhisestate.”Thesereversionaryrightscan
howeverbelimitediftheassigneeofthecopyright(inthiscaseFarrar,Straus&
Giroux,Inc.)provideswrittennoticeofaclaiminaccordancewithstatutory
requirementsoutlinedatsubsection60(2)(a)oftheAct.

Inthiscase,theheirsassertedthevalidityoftheirreversionarycopyrightwhenthey
concludedthelicenseagreementwiththedefendantin1988.Additionally,therewas
noevidencebeforetheCourtthatL.C.Page&CompanyInc.oritssuccessorfiled
theappropriatenoticeorclaimtoregisterorrenewthecopyrightinterestunder
subsection60(2)(a)oftheCopyrightAct.Quitethecontrary,ina1986agreement
betweenFarrar,Straus&Giroux,Inc.andL.M.Montgomery’sheirs,theformer
acknowledgedthelatter’sreversionaryrights.Intheabsenceofanoticefiledbyany
ofthecopyright’sassigneesasprovidedbytheCopyrightAct,thereversionaryrights
infavourofLucyMaudMontgomery’sheirscameintoeffectin1967,25yearsafter
theauthor’sdeath.Inrejectingthedefendant’sargument,theCourtconcludedthat
theheirshadavalidreversionarycopyrightwhichhad”reverted”tothembackin
1967.

Asanadditionalargument,defendantquestionedwhetheracopyrightinterestovera
literaryworkincludedtherighttolicensetwo-andthree-dimensionalobjectswhich

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borearesemblancetocharactersdescribedinAnneofGreenGables,undoubtedlya
literarywork.TheCourtreviewedcaselawwhichextendedcopyrightprotectionto
descriptionsofcharactersfoundinliteraryworks.TheCourtnotedthecommentsof
McKayJ.inPrestonv.20
thCenturyFoxCanadaLtd.(1990),33C.P.R.(3d)242
(F.C.T.D.)totheeffectthata”requirementforcopyrightofcharactersinaliterary
workisthatthedescriptionintheworkbesufficientlyclearlydelineatedsuchthatthe
charactersubsequentlybecomeswell-knownandwidelyrecognized”.

Inthecaseunderconsideration,theCourtanalysedLucyMaudMontgomery’s
descriptionofAnneandthesituationsinwhichsheisfeaturedinthebookas”clearly
delineated,distinctive,thoroughandcomplete”.TheCourtconcludedthatduringits
duration,thecopyrightintheliteraryworkAnneofGreenGablesextendedtothe
two-andthree-dimensionalimagesthatweresoldbythedefendant.

TheCourtrejectedalltheargumentsbroughtforthbythedefendant(includingtrade-
markchallenges)andallowedplaintiff’sclaim.Outstandingroyaltiesowedbetween
1988andApril1994alongwithdamagesforthecommonlawtortofpassingoffafter
April1994wereawardedtotheplaintiff.Aninjunctionwasalsograntedrestraining
defendantfromanydealingsinthe”AnneofGreenGables”merchandise.

Atparagraph274ofherdecision,theCourtnotedthatattheheartofdefendant’s
failuretopayroyaltieswasitsirrationalyetfirmlyheldviewthattheheirsdidnot
deservepaymentofroyalties,asitwasdefendantwhowasexertingalloftheeffort
andwork.This”irrationalview”fundamentallyunderminestheconceptofcopyright
andeventhepurposeofalicenseagreement.Obviously,inthiscase,defendant’s
challengewasnotallowedinlightoftheMontgomeryheirs’clearrights.