NEW YORK (Billboard) - In nine short years, Paul McCartney will hit the jackpot again.
The 67-year-old former Beatle — already worth about 440 million pounds ($737 million), according to a report by Britain’s Sunday Times in April — will be able to start reclaiming the copyrights to the lucrative Beatles catalog.
He and John Lennon, the Fab Four’s primary songwriters, lost control of pop’s most coveted catalog as the band was falling apart. They continued to receive songwriting royalties, but have lost out on a massive windfall over the years from licensing deals.
All but a handful of Beatles copyrights eventually ended up with Michael Jackson, and these 250-or-so songs form the crown jewel of Sony/ATV Music Publishing, a 50-50 joint venture between the late singer and Sony Corp.
The U.S. Copyright Act of 1976 gave songwriters the ability to recapture the publishing share of the copyright on pre-1978 works after two consecutive 28-year terms or 56 years. That means Beatles compositions registered in 1962 will be eligible for reversion in the United States in 2018, while songs written in 1970 will be eligible in 2026.
Under a clause in the Copyright Act, heirs of songwriters who die during the first 28-year term can recapture the publisher’s portion of copyrighted works at the end of that term. In the case of Lennon, who died in 1980, the publisher’s portion of his share of the Lennon-McCartney catalog for songs written in 1962 became eligible for reversion in 1990, while songs written in 1970 were eligible in 1998.
Sources say that Sony/ATV cut a deal with Lennon’s widow, Yoko Ono, prior to the reversion dates to retain its publisher’s share for the life of the copyright.
In the internecine history of the Beatles’ publishing, Lennon and McCartney effectively lost control of the group’s song rights even while the group was still a recording entity, in 1969.
That was when Northern Songs, the company established six years earlier solely to publish their joint compositions by English publisher Dick James and Beatles manager Brian Epstein, was sold to British media tycoon Lew Grade’s ATV Music. Ownership of ATV subsequently passed to Australian billionaire Robert Holmes a Court and then, in 1985, to Jackson, who paid $47.5 million for the company.
In 1995, Sony came into the picture, forming a joint venture with trusts formed by Jackson, creating a new entity: Sony/ATV Music Publishing. Under the deal, Sony paid Jackson $110 million and gave him a 50% stake in the merged company, which at the time was valued at about $500 million, according to the 2007 book ‘Northern Songs: The True Story of the Beatles’ Song Publishing Empire’ by Brian Southall with Rupert Perry. Sources estimate that Sony/ATV is now valued at about $1.7 billion.
Sony/ATV’s Beatle holdings essentially represent everything recorded under the Beatles name by Lennon and McCartney, except for five songs: the A- and B-sides of their first U.K. singles, “Love Me Do”/“P.S. I Love You” (owned by McCartney); “Please Please Me”/“Ask Me Why” (administered by Universal Music); and “Penny Lane,” owned by Catherine Holmes a Court, the daughter of the late magnate.
In the meantime, Sony/ATV is aggressively exploiting its Beatles copyrights. The deal with MTV Networks to develop the forthcoming “The Beatles: Rock Band” videogame is one indication of that.
(Reporting by Ed Christman, Susan Butler and Paul Sexton)
Editing by Dean Goodman at Reuters