There truly is no Sonny without Cher, and the Central District of California has agreed. In Cher v. Bono, the court held that federal copyright termination rights do not preempt an entitlement to royalties arising under state contract laws and that Cher must be paid her half of royalties for iconic songs written by Sonny Bono and recorded by Sonny and Cher during their marriage in the 1960s and '70s, including “I Got You Babe” and “The Beat Goes On.” The Grammy-award-winning artist filed suit in 2021 against her former husband's fourth wife and surviving widow, Mary Bono, seeking continuing payment of a 50% share of royalties from musical compositions and recordings created or acquired during her marriage to Sonny. After three years of litigation, Judge Kronstadt rejected Mary Bono's attempt to terminate Cher's royalties, ruling that Sonny and Cher's divorce settlement agreement was not preempted by federal copyright termination provisions.
When Sonny and Cher ended their eleven-year marriage, they signed a Marriage Settlement Agreement (MSA) in 1978, in which Cher was assigned an “undivided 50% interest” in both record royalties for songs recorded by the pop duo during their marriage and composition royalties for songs written and/or acquired by Sonny during their marriage. Sonny paid these royalties to Cher until his death in 1998, and Mary Bono had continued the payments thereafter. In 2016, Mary, along with Sonny's heirs, sent a Notice of Termination, pursuant to § 304(c) of the Copyright Act, to music publishers to which Sonny had granted a transfer or license of copyright in music compositions that he had authored or co-authored. Under this provision (which, incidentally, appears immediately after § 304(b), which codified the 1998 Sonny Bono Copyright Term Extension Act), authors or their heirs have a right to terminate previous grants of a transfer or license of copyright in pre-1978 works during a specific window of time beginning 56 years after the copyright was secured. Termination rights are intended to enable authors who may have granted rights to publishers early in their careers, when they had little bargaining power, to reclaim those rights and renegotiate more favorable terms if commercial success over the years has increased the market value of their works. (Termination rights for later works are codified in § 203 of the Copyright Act.) Once the terminations became effective, Mary Bono stopped paying Cher her half of composition royalties, and in 2021, she advised Cher that she was no longer entitled to 50% of record royalties either. Mary argued that a “grant” of copyright includes royalties, and that the “grant” of royalties to Cher reverted to Sonny's heirs upon termination. Cher filed suit in October 2021, seeking a declaration that she must be paid her cut of the royalties under the MSA, and seeking damages for breach of contract. Both parties filed for summary judgement in November 2023.
The question before the court was whether Cher's right to composition royalties under the MSA constituted a copyright “grant” that would be affected by a Notice of Termination. (By the time the dispute reached summary judgment, Mary Bono had conceded that the termination did not affect Cher's right to royalties from the sound recordings.) The court found that the MSA makes no mention of a transfer or license of copyrights in Sonny's songs. Instead, Cher's rights under the MSA stem from Sonny's corresponding property interests and arise exclusively under state law. The statute expressly states that termination “in no way affects rights arising under any other Federal, State, or foreign laws,” § 304(c)(6)(E), and thus, the Notice of Termination under federal copyright law could not affect Cher's state-law-based contractual right to receive financial compensation in exchange for the release of claims arising from her marriage to Sonny. The court also noted that various circuit courts have held that a right to receive royalties is distinct from a grant of copyright. Finally, the court pointed out that, even if Cher's rights under the MSA were deemed copyright grants, the termination right invoked by Sonny's heirs under § 304 applies only to copyright grants executed before January 1, 1978, and the MSA, which was executed on August 10, 1978, is beyond the scope of that provision.
Mary Bono contended that § 304 preempts state contract law, pointing specifically to § 304(c)(5), which provides that “[t]ermination of the grants may be effected notwithstanding any agreement to the contrary, including an agreement to make a will or to make any future grant.” Mary argued that the MSA constituted “an agreement to the contrary” and was therefore ineffective in the face of the termination notice. The court disagreed, noting that the only type of rights terminable under § 304(c) are copyright grants, and that therefore, an “agreement to the contrary” must be a contract that purports to divest authors and heirs of the right to terminate copyright assignments or licenses. Because the MSA referred only to royalties, not to the underlying copyrights themselves, it did not impact Sonny's heirs' right to terminate copyright grants, and it was therefore not an “agreement to the contrary” that could be preempted by the statute.
Having found that Cher's right to composition royalties under the MSA was not a copyright “grant,” and was therefore not affected by the Notice of Termination, the court held in favor of Cher on her declaratory judgment and breach of contract claims. In addition to now having to continue to pay Cher her half of future royalties, Mary Bono could have to pay Cher over $400,000 to cover the three years during which payments were suspended.
The case is Cher v. Bono, LA CV21-08157 JAK (RAO) 2024 U.S. Dist. LEXIS 95672 (C.D. Cal. May 29, 2024).
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