The Copyright Act of 1976 defines the transfer of copyright ownership as "an assignment, mortgage, exclusive license, or any other conveyance, alienation, or hypothecation of a copyright or of any of the exclusive rights comprised in a copyright, whether or not it is limited in time or place of effect, but not including a nonexclusive license. [145] The Copyright Act expressly permits such transfers to be effectuated, including only specific aspects of the bundle of rights in a copyrighted work by means of a conveyance or by operation of law. [146] Section 201(d) of the Act provides that:

The Copyright Act of 1976 expressly provides that mere transfer of a material object that is the subject of copyright protection does not, in and of itself, transfer ownership of a copyright in part or in whole. [148] Conversely, transfer of a copyright will not suffice to obtain title to any specific material object that may be the subject of copyright protection. [149]

For a transfer of copyright to be valid other than by operation of law, [150] the transfer must be in the form of an instrument of conveyance (i.e., a writing.) [151] The Act expressly requires that the instrument bear the signature of the transferor-not only the transferee to be valid. [152] As with all contracts, the term "assignment" or "transfer" is not expressly required to be incorporated into the body of the document; rather, the overriding factor is the mutual intent of the parties to transfer an ownership interest in the copyright. [153]

Furthermore, an instrument that embodies the transfer of copyright ownership may in fact be valid in and of itself; however, the Copyright Act of 1976 states that notarial acknowledgment of the transfer document will serve as prima facie evidence of a valid transfer. [154]

The Copyright Act of 1976 provides a mechanism by which parties to a copyright assignment or other transfer may record the transferee as the owner of the copyright. [155] Although the act does not specifically require a transfer to be recorded, a generally accepted and highly recommended practice is for a transferee to submit transfer documents to the Copyright Office for recordation. In many instances, a transferee does not want specific terms contained in the transfer document to become a matter of public record, so hesitates or fails to record the transfer at all. However, this problem can be easily remedied by using a short form document, which incorporates the basic provisions evidencing transfer to the new owner but may omit certain terms and conditions that are unnecessary for recordal purposes but vital to the transaction. [156] For instance, transferees often do not wish to disclose the consideration recited in the transfer document, so may choose to replace the specific dollar amount with a phrase such as "for good and valuable consideration. [157]

Timely recordal of a transfer document is critical in protecting the new owner's rights over and above any representations and warranties incorporated in the transfer document itself. Recordation of a document is constructive notice to third parties about the transferee's recently acquired ownership interest. [158] Constructive notice operates as a vital precaution to both the transferee and a possible subsequent purchaser in the same copyright. In the event that the original transferor attempts to once again sell an interest in the same copyright, timely recordation by the original transferee will alert the new potential buyer that the transferor does not have clear and unfettered title to the copyright. In fact, this specific scenario is contemplated by the Copyright Act of 1976, which establishes priority in ownership of a copyright based upon timely recordal: [159]

As between two conflicting transfers, the one executed first prevails if it is recorded, in the manner required to give constructive notice under subsection (c), within one month after its execution in the United States or within two months after its execution outside the United States, or at any time before recordation in such manner of the later transfer. Otherwise the later transfer prevails if recorded first in such manner, and if taken in good faith, for valuable consideration or on the basis of a binding promise to pay royalties, and without notice of the earlier transfer.

Thus, a transferee who fails to record may lose its ownership interest in a copyright, despite the existence of a valid transfer document, by failing to record before a subsequent purchaser who was unaware of the existence of the prior transfer and paid valuable consideration for the same copyright. The presumed public policy behind this penalty for lack of recordation is an increase in the certainty of commercial transactions and a penalty for those who fail to announce their rights. [160] However, a transferee who records the transfer of ownership before a subsequent assignee will always prevail against the subsequent transferee. [161] In rare circumstances when a subsequent transferee purchases for value and records a transfer of a copyright before the original transferee within one month of the original transfer, the original transferee is protected by the statutory one month grace period in which to record. As such, the original transferee will be protected from any attempt by a subsequent purchaser for value without notice if recordation occurred within the one-month grace period. [162]