Who Owns Superman? - Part IV

    This is the fourth in my series of posts on the fight over the rights to Superman. You can find the previous posts here, here, and here.     

           After the lawsuits discussed in the previous post, it appeared the litigation over the rights to Superman had ended. However, two notable events subsequently occurred: 1) DC’s parent company entered into agreements with Siegel and Shuster to pay them for the remainder of their lives, and 2) U.S. Copyright law changed allowing those who transferred the rights to their copyrights to terminate the transaction after a set amount of time passed (the timing varies depending on when the work was created and assigned).[1]

Following the ’70s litigation, the New York Times featured a story depicting the current living conditions of the creators of Superman.[2] The story described them as nearly destitute and struggling to get by while their creation had earned millions for DC.[3]  In the article, an executive vice president of Warner Communications, the parent company of DC, said that even though Warner did not have a legal obligation to do anything for Siegel and Shuster, there was a moral obligation, and he said the company intended to provide them with an annual stipend.[4]

Following the article, and other ones like it, on Dec. 23, 1975, DC entered into another agreement with Siegel and Shuster.[5] Once again, Siegel and Shuster acknowledged that DC owned all rights to Superman.[6] In return, DC paid them “modest annual payments for the remainder of their lives; provided them medical insurance under the plan for its employees; and credited them as the ‘creators of Superman.’”[7] The agreement gave each a lump sum of $17,500 and annual stipends of $20,000.[8] It was later raised to $30,000 per year, and they also received a $15,000 bonus after the success of Superman: The Movie.[9]

The agreement stated that DC/WB was under no legal obligation to provide them with these payments. However, they were doing so because of their past contributions to the company and their current circumstances.[10] The agreement also stated DC would stop making the payments if either Siegel or Shuster, or someone on their behalf, asserted any rights to Superman.[11]

The agreement also provided Siegel’s spouse with monthly payments for her life if Siegel died before Dec. 31, 1985. During the term of the agreement, DC “increased the amount of the annual payments, and on at least two occasions paid the pair special bonuses.”[12] DC later amended the agreement with Siegel providing that his wife would continue to get his benefits if he predeceased her at any time.[13]

After Shuster died in 1992, DC increased the annual payments made to his sister to $25,000 per year, which she shared with her brother, and it paid all of Shuster’s outstanding debt.[14] Shuster’s sister and brother entered an agreement on October 2, 1992 confirming the above and regranting all of “Shuster’s rights to DC and vowed never to assert a claim to such rights.”[15] DC also paid her bonuses from time to time over the next few years ranging from $10,000 to $25,000.[16]

 All told, DC paid the Siegels and Shusters more than $4 million under the 1975 agreement, as a later court found.[17]

During the same time as the 1975 agreement was being signed, Congress was revamping the Copyright Act. In 1976, a new Copyright Act was passed. Notably, it extended the duration of copyright terms and eliminated the copyright renewal term. Most important to our discussion here, it also gave artists the ability to terminate any previous transfers of their rights to their creations executed before January 1, 1978,[18] which was later extended to heirs in the ’90s.[19] However, the termination provision would not apply to works made for hire.[20]

Had the Second Circuit upheld the decision that Superman was a work made for hire, the litigation between the DC and Superman’s creators would have ended. However, the court’s ruling that Superman was created by Siegel and Shuster and the change in copyright law opened the door for more litigation. We’ll discuss these attempts to terminate the transfer of Superman’s rights in the next post.

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[1] See 17 U.S.C. §304(c).

[2] Mary Breasted, Superman’s Creators, Nearly Destitute, Invoke His Spirit, N.Y. TIMES, Nov. 22, 1975, http://www.nytimes.com/1975/11/22/archives/supermans-creators-nearly-destitute-invoke-his-spirit.html?_r=0 (last visited December 12, 2016).

[3] Id.

[4] Id.

[5] Siegel v. Warner Bros. Entertainment, Inc., 542 F.Supp.2d 1098, 1113 (C.D. Cal. 2008).

[6] Id.

[7] Id.

[8] DC Comics v. Pacific Pictures Corp., No. 10-3633, at  2 (C.D. Cal. Oct. 17, 2012); Bruce Lambert, Joseph Shuster, Cartoonist, Dies; Co-Creator of Superman Was 78, N.Y. Times, Aug. 3, 1992, http://www.nytimes.com/1992/08/03/arts/joseph-shuster-cartoonist-dies-co-creator-of-superman-was-78.html (last visited December 13, 2016).

[9] Bruce Lambert, Joseph Shuster, Cartoonist, Dies; Co-Creator of Superman Was 78, N.Y. Times, Aug. 3, 1992, http://www.nytimes.com/1992/08/03/arts/joseph-shuster-cartoonist-dies-co-creator-of-superman-was-78.html (last visited December 13, 2016).

[10] Siegel, 542 F. Supp.2d at 1113.

[11] Id.

[12] Id.

[13] Id.

[14] DC Comics v. Pacific Pictures Corp., No. 10-3633, at  3.

[15] Id. at 4.

[16] Id. at 5.

[17] Id. at 3.

[18] See 17 U.S.C. §304(c).

[19] See 17 U.S.C. §304(d).

[20] Id.