FOR PUBLICATION
`
`UNITED STATES COURT OF APPEALS
`FOR THE NINTH CIRCUIT
`
`No. 13-55421
`
`D.C. No.
`2:12-cv-02725-
`ABC-FFM
`
`OPINION
`
`THE RAY CHARLES FOUNDATION, a
`California Corporation,
`Plaintiff-Appellant,
`
`v.
`
`RAENEE ROBINSON, an individual;
`RAY CHARLES ROBINSON, JR., an
`individual; SHEILA ROBINSON, an
`individual; DAVID ROBINSON, an
`individual; ROBERT F. ROBINSON, an
`individual; REATHA BUTLER, an
`individual; and ROBYN MOFFETT, an
`individual,
`
`Defendants-Appellees.
`
`Appeal from the United States District Court
`for the Central District of California
`Audrey B. Collins, District Judge, Presiding
`
`Argued and Submitted
`February 12, 2015—Pasadena, California
`
`Filed July 31, 2015
`
`
`
`UNITED STATES COURT OF APPEALS
`FOR THE NINTH CIRCUIT
`
`No. 13-55421
`
`D.C. No.
`2:12-cv-02725-
`ABC-FFM
`
`OPINION
`
`THE RAY CHARLES FOUNDATION, a
`California Corporation,
`Plaintiff-Appellant,
`
`v.
`
`RAENEE ROBINSON, an individual;
`RAY CHARLES ROBINSON, JR., an
`individual; SHEILA ROBINSON, an
`individual; DAVID ROBINSON, an
`individual; ROBERT F. ROBINSON, an
`individual; REATHA BUTLER, an
`individual; and ROBYN MOFFETT, an
`individual,
`
`Defendants-Appellees.
`
`Appeal from the United States District Court
`for the Central District of California
`Audrey B. Collins, District Judge, Presiding
`
`Argued and Submitted
`February 12, 2015—Pasadena, California
`
`Filed July 31, 2015
`
`
`
`2
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`Before: David Bryan Sentelle,* Morgan Christen,
`and Andrew D. Hurwitz, Circuit Judges.
`
`Opinion by Judge Christen
`
`SUMMARY**
`
`Copyright
`
`Reversing the district court’s dismissal for lack of
`jurisdiction, the panel held that the Ray Charles Foundation,
`the sole beneficiary of Ray Charles’s estate, had standing to
`challenge the validity and effectiveness of notices of
`termination of copyright grants conferred by Charles to the
`predecessor of Warner/Chappell Music.
`
`The panel held that the Foundation had Article III
`standing and that the suit was ripe. The panel held that the
`Foundation did not have standing to challenge the termination
`notices as a beneficial owner. Nonetheless, the Foundation
`was a real party in interest because the termination notices
`affected its right to royalties, and its claims fell within the
`statutory zone of interests. Accordingly, it had standing to
`sue to challenge whether the underlying works were works
`made for hire and thus not subject to the termination
`
` * The Honorable David Bryan Sentelle, Senior Circuit Judge for the U.S.
`Court of Appeals for the District of Columbia Circuit, sitting by
`designation.
`
` ** This summary constitutes no part of the opinion of the court. It has
`been prepared by court staff for the convenience of the reader.
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`3
`
`provisions of 17 U.S.C. §§ 203 and 304(c). The panel
`remanded the case for further proceedings.
`
`COUNSEL
`
`Mark Daniel Passin (argued), Yakub Hazzard, and Daniel G.
`Stone, Robins, Kaplan, Miller & Ciresi LLP, Los Angeles,
`California, for Plaintiff-Appellant.
`
`Marc Toberoff (argued), Toberoff & Associates, P.C.,
`Malibu, California, for Defendants-Appellees.
`
`
`
`4
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`OPINION
`
`CHRISTEN, Circuit Judge:
`
`When music legend Ray Charles died, he left behind
`remarkable legacies in music and philanthropy. This appeal
`arises from the intersection of the two. Seven of Charles’s
`heirs purported to terminate copyright grants that Charles
`conferred while he was alive. The Ray Charles Foundation,
`the sole beneficiary of Charles’s estate, filed suit to challenge
`the terminations. The district court dismissed the suit for lack
`of jurisdiction, and the Foundation now appeals. We reverse
`the district court’s order and remand for further proceedings.
`
`BACKGROUND1
`
`I. Charles’s Copyright Interests
`
`In the 1950s, Ray Charles Robinson, young and early into
`his career, entered into several contracts with music publisher
`Atlantic Records and its subsidiary, Progressive Music
`Publishing Co. The contracts indicated that Charles was an
`employee of the publishers, who owned all copyright interests
`in Charles’s work. Under the contracts, Charles was entitled
`to advance payments and future royalties.
`
`By 1980, Charles had achieved considerable success and
`renown. That year, he renegotiated his copyright grants with
`
` 1 Because the Foundation appeals the district court’s decision on a
`motion to dismiss, we “accept all allegations of fact in the complaint as
`true and construe them in the light most favorable to the plaintiff[].”
`Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1139 (9th Cir.
`2003).
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`5
`
`Progressive’s successor in interest. The renegotiation
`pertained to songs Charles had previously conveyed to
`Progressive, as well as published and unpublished works that
`he had not yet assigned to any publisher. The 1980 grant
`entitled Charles to royalties and another advance payment.
`
`Charles founded a nonprofit corporation now known as
`The Ray Charles Foundation.
` The Foundation was
`established for “scientific, educational[,] and charitable
`purposes.” It provides research and scholarship grants for the
`benefit of deaf, blind, and underprivileged youths.
`
`At the time of his death, Charles had twelve adult
`children, seven of whom are involved in this case as
`Defendants-Appellees.2 In 2002, Charles informed all of his
`heirs that he would establish irrevocable trusts of $500,000
`for each of them if they agreed to waive further claims to his
`estate. Each of the heirs, including all of the Terminating
`Heirs, signed a contract providing:
`
`My father, Ray Charles Robinson, has told me
`that he will set up an irrevocable trust for my
`benefit, to be funded with $500,000. This gift
`is my entire inheritance from him and I
`understand that I will not inherit anything
`further under my father’s estate plan and that
`I am waiving any right to make a claim
`against his estate.
`
` 2 We use the term “Terminating Heirs” to refer to the seven Defendants-
`Appellees who served the termination notices. We use “Charles’s heirs”
`to refer to all twelve of the artist’s adult children, including those not
`involved in this suit.
`
`
`
`6
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`Charles passed away in 2004. According to the
`complaint, Charles’s will named the Foundation as his sole
`beneficiary and devised “all of [Charles’s] rights in his works
`and rights under contracts, including the compositions that
`are the subject of this action, to The Foundation.” The
`Foundation is precluded from accepting private donations. It
`relies on royalties from Charles’s works to fulfill “the wishes
`of Ray Charles and [t]he Foundation’s purpose.”
`
`II. Relevant Statutory Provisions
`
`Sections 203 and 304 of the Copyright Act of 1976
`govern termination of copyright grants. 17 U.S.C. §§ 203,
`304(c), 304(d). The provisions were designed to “safeguard[]
`authors against unremunerative transfers . . . needed because
`of the unequal bargaining position of authors, resulting in part
`from the impossibility of determining a work’s value until it
`has been exploited.” H.R. Rep. No. 94-1476, at 124 (1976);
`see also 3 Melville B. Nimmer & David Nimmer, Nimmer on
`Copyright § 11.07[E][4][b] (Matthew Bender, rev. ed. 2014)
`(observing that the provisions were intended to protect
`“authors and their spouses, children, and grandchildren
`against unremunerative
`transfers and
`improve
`their
`bargaining position”).
`
`Section 203 pertains to grants and transfers made after
`1978: “In the case of any work other than a work made for
`hire,[3] the . . . grant of . . . any right under a copyright,
`
` 3 A work made for hire is:
`
`(1) a work prepared by an employee within the scope of
`his or her employment; or
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`7
`
`executed by the author . . . , otherwise than by will, is subject
`to termination under [specified] conditions.” 17 U.S.C.
`§ 203(a) (emphasis added). Under this statute, termination of
`a copyright grant may be effected at any time during a five-
`year period, starting 35 years after the execution of the grant.
`Id. § 203(a)(3). Because the 35-year period began with grants
`made in 1978, opportunities to execute termination notices
`under § 203 started to accrue “for the first time on January 1,
`2013.” U.S. Copyright Office, Analysis of Gap Grants under
`the Termination Provisions of Title 17 at 8 (Dec. 7, 2010),
`available at http://www.copyright.gov/reports/gap-grant-
`analysis.pdf.
`
`Subsection 304(c) covers grants made before 1978:
`
`In the case of any copyright subsisting in
`either its first or renewal term on January 1,
`1978, other than a copyright in a work made
`for hire, the exclusive or nonexclusive grant
`of a transfer or license of the renewal
`copyright or any right under it, executed
`before January 1, 1978, by any of the persons
`designated by subsection (a)(1)(C) of this
`
`(2) a work specially ordered or commissioned for use as
`a contribution to a collective work, as a part of a motion
`picture or other audiovisual work, as a translation, as a
`supplementary work, as a compilation, as an
`instructional text, as a test, as answer material for a test,
`or as an atlas, if the parties expressly agree in a written
`instrument signed by them that the work shall be
`considered a work made for hire.
`
`17 U.S.C. § 101.
`
`
`
`8
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`section, otherwise than by will, is subject to
`termination under [specified] conditions.
`
`17 U.S.C. § 304(c) (emphasis added). The subsection is “a
`close but not exact counterpart of section 203.” See H.R.
`Rep. No. 94-1476, at 140. Under § 304(c), terminations may
`be effected during a five-year period starting 56 years from
`the date the copyright was secured, or January 1, 1978,
`whichever is later. 17 U.S.C. § 304(c)(3). Most existing
`case law on copyright termination pertains to § 304(c)
`because opportunities to terminate copyright grants became
`ripe under this statute earlier than grants subject to § 203.4
`
`The Copyright Office’s regulations provide:
`
`A copy of the notice of termination shall be
`recorded in the Copyright Office before the
`effective date of termination, as a condition to
`its taking effect. However, the fact that the
`Office has recorded the notice does not mean
`that it is otherwise sufficient under the law.
`Recordation of a notice of termination by the
`Copyright Office is without prejudice to any
`party claiming that the legal and formal
`requirements for issuing a valid notice have
`not been met, including before a court of
`competent jurisdiction.
`
` 4 There are some other distinctions between the termination rights
`conferred under § 203 and § 304(c), but they are not relevant to this
`appeal. See H.R. Rep. No. 94-1476 at 140–42 (discussing differences).
`A third termination provision not relevant to this case exists in 17 U.S.C.
`§ 304(d).
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`9
`
`37 C.F.R. § 201.10(f)(6). Effective termination causes “all
`rights . . . that were covered by the terminated grants [to]
`revert to the author, authors, and other persons owning
`termination interests [as provided in previous clauses].”
`17 U.S.C. § 203(b). A deceased “author’s surviving children
`. . . own the author’s entire termination interest unless there
`is a widow or widower . . . .” Id. § 203(a)(2)(B); see also id.
`§ 304(c)(2)(B).
`
` Both § 203 and § 304(c) are silent on who may challenge
`the validity of termination notices.
`
`III.
`
`The Subject Termination Notices
`
`In March 2010, the Terminating Heirs filed 39 notices
`under § 203 and § 304(c) to terminate pre- and post-1978
`grants authorized by Charles. They served the notices on
`various parties,
`including Warner/Chappell Music,
`Progressive’s successor in interest. The notices served on
`Warner/Chappell pertain to the 51 compositions at issue in
`this case. Those works include some of Charles’s greatest
`hits, such as “I Got A Woman,” “A Fool for You,”
`“Blackjack,” “Leave My Woman Alone,” and “Hallelujah, I
`Love Her So.” The notices have staggered effective dates,
`ranging from April 1, 2012 through September 28, 2019.
`Each notice specifies a date on which it purports to terminate
`all rights tied to the copyright grants, at which point those
`rights will revert in proportionate shares to each of Charles’s
`heirs. See 17 U.S.C. §§ 203(b), 304(c)(6). The Terminating
`Heirs issued multiple termination notices for some of the
`compositions, thereby purporting to subject individual works
`to multiple termination dates. For example, three termination
`notices were issued for the song “Mary Ann,” each asserting
`
`
`
`10
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`a different termination date: April 1, 2012, November 15,
`2015, and May 3, 2019.
`
`The Copyright Office recorded the termination notices in
`January 2012. See U.S. Copyright Office, Public Catalog,
`Recorded Document Nos. V3603D883 (§ 203 notices),
`V3603D884–898, V3603D904–905, V3603D909–910,
`V3603D914, V3603D916–917, V3603D919, V3603D924,
`V3604D349 (§ 304 notices); see also Harris v. Cnty. of
`Orange, 682 F.3d 1126, 1132 (9th Cir. 2012) (“We may take
`judicial notice of undisputed matters of public record.”).
`
`IV.
`
`District Court Proceedings
`
`In March 2012, the Foundation brought suit to challenge
`the termination notices. Its complaint asserts state law claims
`for breach of contract and breach of the implied covenant of
`good faith and fair dealing, and a federal claim for
`declaratory and injunctive relief. The district court granted
`the Terminating Heirs’ motion to dismiss the state law claims
`under California’s anti-SLAPP statute, and the Foundation
`does not appeal that ruling.
`
`The federal claim is the only one at issue in this appeal.
`In it, the Foundation requests “a judicial determination of the
`validity and effectiveness of the termination notices and its
`rights and obligations.” It also seeks a declaratory judgment
`establishing:
`
`(1) the compositions at issue are excluded
`from the termination provisions because they
`were works made for hire; (2) if the
`compositions were not works made for hire,
`then
`the 1980 agreement constituted a
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`11
`
`renegotiation of the transfer of most of the
`songs, satisfying
`the statutory right of
`termination; (3) the notices pertaining to
`unpublished works are invalid because the
`right of publication of those songs were not
`exercised within five years of the 1980
`agreement; (4) the 1980 agreement constituted
`a new transfer and all termination deadlines
`should be calculated from that date; and
`(5) the Court should determine which of the
`multiple
`termination notices
`for each
`composition is operative, if any.[5]
`
`Further, the Foundation seeks to enjoin the Terminating Heirs
`from claiming that they are, or will become, the rightful
`owners of the copyright interests; entering any agreement that
`would transfer those interests; and using the compositions in
`ways not permitted by parties who do not own copyright
`interests.
`
`The Terminating Heirs moved to dismiss. They argued
`that the Foundation lacked standing to bring its federal claim
`because it was really asserting the rights of Warner/Chappell,
`Progressive’s successor in interest and the current copyright
`owner. The Terminating Heirs relied in part on the
`inalienable nature of termination rights, which cannot be
`waived through contract. See 17 U.S.C. §§ 203(a);
`304(c)(5)–(6)(B). They highlighted the fact that Congress
`enacted the current statutory termination provisions when it
`
` 5 The complaint also seeks a declaration that the Terminating Heirs
`breached their contracts with Charles. Because the district court dismissed
`the state law contract claim, it also dismissed the request for that
`declaration. The Foundation does not appeal these decisions.
`
`
`
`12
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`extended copyright renewal terms because it intended to
`benefit authors and their statutory heirs, not grantees. See
`H.R. Rep. No. 94-1476 at 140. In opposition, the Foundation
`asserted that it alleges injury to itself, and that there is no
`authority supporting the Terminating Heirs’ position that
`copyright ownership is a prerequisite for challenging a
`termination notice.
`
`During oral argument on the motion to dismiss, the
`Foundation alternatively argued that even if the 51 works
`were not created as works made for hire, the Foundation is a
`beneficial owner6 with standing to sue for copyright
`infringement and that it should therefore have standing to
`challenge the termination notices. The Terminating Heirs
`argued that the concept of beneficial ownership is not
`relevant here because beneficial ownership pertains only to
`copyright infringement. After oral argument, the district
`court ordered supplemental briefing on two issues:
`
`(1) Assuming that the works at issue were not
`works made for hire and the Foundation is a
`“beneficial owner” of the copyrights, does the
`Foundation have standing under the Copyright
`Act to challenge the termination notices under
`§§ 304(c) and 203(a) as a “grantee” of an
`“exclusive or nonexclusive grant of a transfer
`or license” of any right under the copyrights?
`
` 6 Beneficial owners include, “for example, an author who had parted
`with legal title to the copyright in exchange for percentage royalties based
`on sales or license fees.” Warren v. Fox Family Worldwide, Inc.,
`328 F.3d 1136, 1144 (9th Cir. 2003) (quoting H.R. Rep. No. 94-1476, at
`159).
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`13
`
`(2) Given the allegations in the current
`complaint, can the Foundation allege facts to
`support a claim that the works were not works
`made for hire consistent with Rule 11?
`
`After the parties filed their supplemental briefs, the
`district court issued an order granting the motion to dismiss,
`concluding that the Foundation lacked standing to bring this
`action. The court first observed that the Terminating Heirs
`did not challenge the Foundation’s constitutional standing
`and “the Foundation has at least plausibly alleged that it
`exists here.” The court then moved to what it termed
`“prudential standing.” Applying the zone-of-interests test,
`the court concluded that the Foundation’s asserted interests
`were not among those protected by § 203 and § 304(c). The
`court reasoned: “Those sections do not define who may
`challenge termination notices, although, by their terms, they
`only contemplate that certain parties will be involved in the
`termination process.” The court noted that the sections do not
`mention parties that acquire by bequest the right to receive
`future royalty streams. The district court concluded that this
`“indicate[s] that only authors, statutory heirs owning a
`termination interest, and grantees of transfers and their
`successors fall within the ‘zone of interests’ Congress
`contemplated in enacting these provisions.”
`
`Thus, the court reasoned that the Foundation could only
`claim third-party standing because it was “only asserting
`Warner/Chappell’s interests in the termination notices,” not
`its own. The district court did not address the Foundation’s
`interest in the continued receipt of royalties. Because the
`Foundation did not show that it had a close relationship with
`Warner/Chappell, or that Warner/Chappell was incapable of
`protecting its own interests, the court concluded that the
`
`
`
`14
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`Foundation did not have third-party standing to challenge the
`termination notices. See Powers v. Ohio, 499 U.S. 400,
`410–11 (1991) (“We have recognized the right of litigants to
`bring actions on behalf of third parties, provided three
`important criteria are satisfied: The litigant must have
`suffered an injury in fact thus giving him or her a sufficiently
`concrete interest in the outcome of the issue in dispute; the
`litigant must have a close relation to the third party; and there
`must exist some hindrance to the third party’s ability to
`protect his or her own interests.” (citations and internal
`quotation marks omitted)).
`
`In response to the Foundation’s alternative theory that it
`has standing as a beneficial owner of the copyright interests,
`the district court concluded that because the Foundation’s
`complaint alleged that the compositions were created as
`works for hire, it was not a beneficial owner and thus did not
`have standing to challenge the termination notices.7 The
`court denied leave to amend, pretermitting whether the
`Foundation could amend its complaint to allege that the
`compositions were not works made for hire because in either
`event, the Foundation’s interests did not fall within the
`termination provisions’ zone of interests, and the Foundation
`lacked third-party standing to assert the interests of
`Warner/Chappell.
`
`The Foundation timely appealed. We have jurisdiction
`under 28 U.S.C. § 1291, and we reverse the district court’s
`decision.
`
` 7 A creator of a work made for hire does not qualify as a beneficial
`owner even if he or she is entitled to royalties. See Warren, 328 F.3d at
`1144–45.
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`15
`
`STANDARD OF REVIEW
`
`“We review de novo a district court’s order dismissing a
`complaint for lack of jurisdiction under Rule 12(b)(1).”
`Warren v. Fox Family Worldwide, Inc., 328 F.3d 1136, 1139
`(9th Cir. 2003). At this stage, the Foundation “need only
`show that the facts alleged, if proved, would confer standing
`upon” it. Id. at 1140.
`
`ANALYSIS
`
`There is no challenge to the Foundation’s Article III
`standing. The “irreducible constitutional minimum of
`standing” requires that (1) the Foundation suffer a concrete,
`particularized, and actual injury in fact; (2) there be “a causal
`connection between the injury and the conduct complained
`of”; and (3) a favorable decision will likely redress that
`injury. Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61
`(1992).
` The Foundation’s complaint satisfies
`these
`requirements: it establishes that the Foundation relies on
`royalties from the copyright grants; the Terminating Heirs’
`notices sought to terminate those grants; the terminations, if
`valid, would deprive the Foundation of its income stream; and
`a declaration of the terminations’ invalidity would redress
`that deprivation.
`
`Although neither party argued ripeness, “it is our duty to
`consider sua sponte whether [a suit] is ripe, because ‘the
`question of ripeness goes to our subject matter jurisdiction to
`hear the case.’” Haw. Newspaper Agency v. Bronster,
`103 F.3d 742, 745 (9th Cir. 1996) (alteration omitted)
`(quoting Shelter Creek Dev. Corp. v. City of Oxnard,
`838 F.2d 375, 377 (9th Cir. 1988)); see also Ctr. for
`
`
`
`16
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`Biological Diversity v. Kempthorne, 588 F.3d 701, 708 (9th
`Cir. 2009) (“[R]ipeness . . . is not waivable.”).
`
`The Foundation’s suit is ripe. The Foundation’s claims
`pertain to termination notices for grants governing 51
`different works, executed in different contracts, at different
`times. Termination notices do not automatically terminate
`grants; the effective dates of termination depend on the date
`of each grant and the validity of the notices. See 17 U.S.C.
`§§ 203(a)(3), 304(c). The Terminating Heirs issued the
`termination notices in March 2010, the Copyright Office
`recorded the notices in January 2012, and the earliest asserted
`termination date passed on April 1, 2012. That asserted date
`pertained to at least seven of Charles’s works, including “I
`Got A Woman,” one of Charles’s most famous songs. The
`Foundation filed its complaint on March 28, 2012, and the
`district court granted the Terminating Heirs’ motion to
`dismiss on January 25, 2013. The asserted termination dates
`for 12 of the 51 works had passed by the time of the district
`court’s order, and the dates for a total of 23 works have
`elapsed as of the issuance of this opinion.
`
`The Foundation alleges that the notices of termination
`immediately clouded its ability to assess its future income
`stream and to rely on the royalties. Its complaint presents
`questions regarding the nature of the underlying works, such
`as whether they were works made for hire, and if so, when
`their respective termination dates would be effective. Review
`of these questions does not require us to engage in abstract
`inquiries about speculative injuries. See Wolfson v. Brammer,
`616 F.3d 1045, 1057 (9th Cir. 2010) (“The ripeness doctrine
`is peculiarly a question of timing, designed to separate
`matters that are premature for review because the injury is
`speculative and may never occur from those cases that are
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`17
`
`appropriate for federal court action. Through avoidance of
`premature adjudication, the ripeness doctrine prevents courts
`from becoming entangled in abstract disagreements.”
`(alteration, citations, and internal quotation marks omitted));
`see also id. at 1058 (identifying the question of ripeness as
`“whether the issues presented are ‘definite and concrete, not
`hypothetical or abstract’” (quoting Thomas v. Anchorage
`Equal Rights Comm’n, 220 F.3d 1134, 1139 (9th Cir. 2000)
`(en banc))). We accept as true the Foundation’s allegation
`that the effects of the termination notices “have been felt in
`a concrete way” because the notices have “created an
`enormous cloud over the future copyright ownership” of the
`51 works and made it “very difficult, if not impossible, to
`exploit the valuable copyrighted assets.” The Foundation’s
`complaint is therefore not premature. It would be an
`inefficient use of judicial resources to compel the Foundation
`to file a different suit after each termination date has passed.
`
`We recognize that, as in cases in which suits were found
`unripe for adjudication, the record contains no determination
`by the Copyright Office of the validity of the termination
`notices. See Smith v. Casey, 741 F.3d 1236, 1244–45 (11th
`Cir. 2014). But the parties made clear in the district court
`that “there [i]s nothing pending before the Copyright Office”
`because the Office does not typically hold proceedings to
`adjudicate the validity of termination notices. The Copyright
`Office has expressly stated “it does not issue or enforce
`notices of termination,” but “only serves as an office of
`public record for such documents.” Compendium of
`Copyright Office Practices III § 2305 (2014). “The fact that
`a document has been recorded is not a determination by the
`U.S. Copyright Office concerning the validity or the effect of
`that document. That determination can only be made by a
`court of law.” Id. (emphasis added). And “the fact that the
`
`
`
`18
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`[Copyright] Office has recorded the notice does not mean that
`it is otherwise sufficient under the law”; recordation “is
`without prejudice to any party claiming that the legal and
`formal requirements for issuing a valid notice have not been
`met, including before a court of competent jurisdiction.” 37
`C.F.R. § 201.10(f)(6).
`
`Satisfied that this suit meets the threshold requirements of
`constitutional standing and ripeness, we proceed to the only
`remaining issue: whether the Foundation may sue to
`challenge the termination notices.
`
`I.
`
`The Foundation argues that it has standing to challenge
`the termination notices as a beneficial owner. It bases this
`argument on its status as the sole beneficiary of Charles’s
`will.8 The Foundation reasons that because the Copyright Act
`accords standing to beneficial owners in the context of
`infringement, beneficial owners have standing in the context
`of termination. We disagree. The term “beneficial owner”
`comes from 17 U.S.C. § 501, which is titled “Infringement of
`copyright.” Subsection 501(b) provides that a beneficial
`owner is entitled “to institute an action for any infringement.”
` See also Silvers v. Sony Pictures Entm’t, 402 F.3d 881, 885
`(9th Cir. 2005) (en banc) (reasoning that only a legal or
`beneficial owner may sue for infringement). The district
`
` 8 If some or all of the works were not made for hire, then Charles was
`likely a beneficial owner of those works because he would have been “an
`author who had parted with legal title to the copyright in exchange for
`percentage royalties based on sales or license fees.” Warren v. Fox Family
`Worldwide, Inc., 328 F.3d 1136, 1144 (9th Cir. 2003) (quoting H.R. Rep.
`No. 94-1476, at 159) (internal quotation marks omitted).
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`19
`
`court relied in part on the concept of beneficial ownership
`when it granted the motion to dismiss, but the Foundation’s
`claims are about termination of copyright grants, not
`copyright infringement. The argument that the Foundation
`may be a beneficial owner lends no support to its claim to
`standing.
`
`II.
`
`The Terminating Heirs argue that the Foundation must
`satisfy the requirements for third-party standing because the
`complaint actually asserts the interests of Warner/Chappell.
`The Foundation argues that it is a “real party in interest and
`[that it is] not asserting rights of a third party.” We agree
`with the Foundation.
`
`Historically, courts have treated the limitation on third-
`party standing as a prudential principle that requires plaintiffs
`to assert their own legal rights. See Erwin Chemerinsky,
`Federal Jurisdiction § 2.3.4 (6th ed. 2012). “[E]ven when the
`plaintiff has alleged injury sufficient to meet the ‘case or
`controversy’ requirement, th[e Supreme] Court has held that
`the plaintiff generally must assert his own legal rights and
`interests, and cannot rest his claim to relief on the legal rights
`or interests of third parties.”9 Warth v. Seldin, 422 U.S. 490,
`
` 9 Lexmark International, Inc. v. Static Control Components, Inc., 134 S.
`Ct. 1377 (2014), removed the zone-of-interests inquiry from the prudential
`standing doctrine, but Lexmark did not pertain to third-party standing. Id.
`at 1387 n.3 (“This case does not present any issue of third-party standing,
`and consideration of that doctrine’s proper place in the standing firmament
`can await another day.”). We conclude, in unison with all other courts to
`have spoken on the issue, that the third-party-standing doctrine continues
`to remain in the realm of prudential standing. See, e.g., HomeAway Inc.
`v. City & Cnty. of S.F., No. 14-cv-04859-JCS, 2015 WL 367121, at *7
`
`
`
`20
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`499 (1975). This rule ensures that “plaintiffs possess such a
`personal stake in the outcome of the controversy as to assure
`that concrete adverseness which sharpens the presentation of
`issues upon which the court so largely depends for
`illumination of difficult constitutional
`[or statutory]
`questions.” Thinket Ink Info. Res., Inc. v. Sun Microsystems,
`Inc., 368 F.3d 1053, 1057 (9th Cir. 2004) (internal quotation
`marks omitted).
`
`It is undisputed that copyright ownership lies with
`Warner/Chappell, but just as the termination notices affect
`Warner/Chappell’s ownership of copyrights, they also
`directly affect the Foundation’s right to royalties. See
`17 U.S.C. §§ 203(b), 304(c)(6); Larry Spier, Inc. v. Bourne
`Co., 953 F.2d 774, 780 (2d Cir. 1992). The Foundation is the
`sole recipient of royalties flowing from Charles’s copyright
`grants and effective termination would deprive it of the right
`to receive prospective royalties. See Larry Spier, 953 F.2d at
`780. We thus have little difficulty concluding that the
`Foundation is litigating its own stake in this controversy.
`
`the
`is buttressed by comparing
`This conclusion
`Foundation’s interests to Warner/Chappell’s. The publisher’s
`interests will be prejudiced only if Charles’s heirs are
`
`(N.D. Cal. Jan. 27, 2015) (unpublished) (declining to extend “Lexmark to
`invalidate a prudential standing doctrine that it explicitly did not reach,”
`and observing that the holding “is consistent with a number of other courts
`that have interpreted Lexmark as leaving the prudential doctrine of third-
`party standing unaffected”); Chandler & Newville v. Quality Loan Serv.
`Corp. of Wash., No. 03:13-cv-02014-ST, 2014 WL 2526564, at *4 (D. Or.
`Jun. 3, 2014) (unpublished) (“Because Lexmark did ‘not present any issue
`of third-party standing,’ the Court did not decide the ‘doctrine’s proper
`place in the standing firmament,’ leaving it as part of the prudential
`standing inquiry.”).
`
`
`
`THE RAY CHARLES FOUND. V. ROBINSON
`
`21
`
`successful in their efforts to terminate the existing grants and
`then either agree to grant copyright ownership to another
`publisher, or renegotiate grants with Warner/Chappell on
`terms less favorable to the publisher than the terms of the
`existing grants. Otherwise, it makes no difference to
`Warner/Chappell whether it continues to pay royalties to the
`Foundation under the current grants, or to Charles’s heirs
`under new grants. In their brief on appeal, the Terminating
`Heirs recognize that if they decide to renegotiate grants with
`Warner/Chappell, the publisher’s interests will be largely
`unaffected: “A terminated grantee may well be more
`interested in maintaining an amicable relationship with the
`terminating author or statutory heir to facilitate re-licensing.”
`Indeed,
`the statutory
`termination provisions
`reflect
`Warner/Chappell’s interest in remaining friendly to the
`Terminating Heirs, by giving negotiating priority
`to
`terminated grantees:
`
`A further grant, or agreement to make a
`further grant, of any right covered by a
`terminated grant is valid only if it is made
`after the effective date of the termination. As
`an exception, however, an agreement for such
`a further grant may be made between [a
`majority of the statutory heirs] and the
`original grantee or such grant
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