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Epic Copyright Battle Between Superman Heirs and Warner Bros

What would it be like if you had to fight Superman?  You may be thinking, "Superman is the hero, so why would he fight me?"  Work with us for a minute.  After all, when the concept of "Superman" was first developed, he was a villain and not a hero.  Superman_Man_of_Steel_125

Imagine for a moment going mano-a-mano against the Man of Steel.  Just regular, mortal you against a brightly-garbed warrior who has super-strength, can fly, is faster than a speeding bullet, and has only one weakness.  It doesn't sound like much fun.  It would seem rather hopeless ... unless you had some Kryptonite in your back pocket.

The heirs of the two co-creators of the legendary comic book hero must feel just as hopeless at times in their fight over what they feel is "truth, justice and the American way."  They have been battling the powerful media conglomerates, Warner Bros. and DC Comics, for many years in a series of (seemingly) never-ending lawsuits.  The heirs claim entitlement to full ownership of the Superman copyrights.

Warner Bros. and DC Comics say the heirs never owned the rights and the two corporations have nothing wrong.  Their position is that even if the heirs did have valid claims at one time, the heirs agreed to let Warner and DC keep the copyrights in exchange for increased royalty payments and other compensation.

Superman was created by writer Jerome Siegel and illustrator Joseph Shuster, each credited with a 50% stake in the royalties.  Their creation was picked up by DC Comics in 1937, who then hired the pair to create comic strips, with DC owning all work created from that point on.  But the big battle centered on who owned the rights to the Superman character himself, as previously developed by Siegel and Shuster and as he first appeared in Action Comics Volume I in 1938.

Siegel and Shuster had an on-again, off-again relationship with DC, often suing over their rights, but ultimately returning to work for DC each time.  Siegel and Shuster passed away in 1996 and 1992, respectively, without achieving their dream of reclaiming the rights to the Superman character.

New hope came with the passage of the Copyright Act of 1976, and certain amendments to the law in 1999, which provided limited rights to creators such as Siegel and Shuster, and their heirs, to reclaim copyrights.  If Warner Bros. and DC are in the role of Superman in this long-lasting battle, then surely the Copyright Act is the Kryptonite.  But, that Act is riddled with exceptions and loopholes that make it very hard to successfully use.

In 1997, the Siegel heirs filed notice under the Copyright Act, formally seeking to reclaim 50% of the Superman copyrights.  The Shuster heirs did the same in 2003.  Both of these filings provoked litigation between the two families and Warner Bros./DC Comics.

The Siegel family enjoyed rare success under the Copyright Act, achieving a court ruling in 2008 in its favor.  The Judge wrote at that time, "After seventy years, Jerome Siegel's heirs regain what he granted so long ago--the copyright in the Superman material that was published in Action Comics, Vol 1."  In other words, this court ruling returned 50% control over the primary rights to the Superman character to the Siegel family.  Warner and DC soon appealed.

A couple weeks ago, the Shuster family lost their bid to achieve the same result.  The same United States District Court in California ruled against Shuster's heirs and in favor of Warner and DC.  So that 50% share of the primary Superman rights still rests in corporate hands.

The Shuster heirs will soon appeal that ruling, which means the battle is far from over.  The federal court appellate system will decide both cases.

Setting aside the complicated intricacies of the Copyright Act, and what specific copyrights could and could not be reclaimed by the heirs, both court cases turn primarily on the same important issue -- did the heirs already reach agreements with the corporations to give up their rights to the copyrights, in exchange for higher royalties and other benefits?

The recent court decision in the Shuster case held that Joseph Shuster's sister and brother did precisely that in 1992, when they agreed to accept higher royalties ($25,000 per year, for the rest of the sister's life) plus payment of Joseph's estate debts.

Similarly, Warner and DC contend that the Siegel heirs reached an agreement for higher royalties in exchange for the copyright claims in 2001.  Unlike with the Shuster family, the Judge in that case felt the agreement was never formally reached because there were too many points of disagreement at the time.  Warner Bros. and DC Comics say that ruling was incorrect.  They contend on appeal that a binding deal was struck and they want that agreement enforced.

In the meantime, Jerome Siegel's only daughter, Laura Siegel Larson, has penned an open letter to Superman fans, vowing to continue the "David and Goliath struggle" in the face of a separate lawsuit by Warner Bros. against her and her attorney, noted copyright attorney Marc Toberoff.  You can read that letter here.

This related lawsuit is based on documents stolen from Toberoff's office, which were then secretly delivered to Warner Bros.  The company sued because of these documents, which it says proves there was a binding agreement in place in 2001.  Warner blames Toberoff for wrongfully convincing Larson and her mother to breach the deal in 2002.  It has asked a court to  severely sanction Toberoff for wrongdoing and accuses Toberoff of trying to wrest control of the copyright for his own personal profits.

Larson is upset that Warner Bros. is using these documents to seek the removal of her attorney  from the lawsuits.  She says that Toberoff stood by the family for years, battling "legions of highly paid corporate lawyers that Warner Bros. has at its disposal."  She accuses Warner Bros. of bullying and intimidation tactics, in a desperate attempt to hold on to the extraordinarily-profitable Superman rights.

Regardless of which side you believe, there is no denying how much is at stake in the fight.  The Los Angeles Times reported that Superman has brought in billions of dollars in revenue, including $500 million from domestic box office takes alone over the course of five movies.  There is a new Warner Bros. movie, "Man of Steel", scheduled for a June, 2013 release -- not to mention planned "Avengers" style movies based on Superman and other DC Comics heroes.  All of that is in jeopardy if the Siegel and Shuster heirs win control of the rights to the character through the appeals.

At first blush, it can be confusing as to why there are such big disagreements over whether the heirs and corporations reached agreements or not.  Either they agreed or they didn't, right?  Why's that so hard to figure out?

As with many areas of the law, it's not so simple.  The law requires a "meeting of the minds" on the important elements of the deal for there to be a binding legal agreement.  With the Shusters, there was one (according to the court, but subject to change on appeal).  The Shuster siblings, apparently acting without an attorney, agreed to give up all copyright claims for more money.

The Siegel case is much more complicated.  When the potential deal was reached (or not reached), there were lawyers involved for both sides who exchanged lengthy letters outlining the points of the transaction as each side understood them.  But, according to the court (again, subject to change on appeal), the key points never matched so no binding legal agreement was created.  The Court of Appeals will address whether this ruling was correct or not in early November, although it could take months for the Court to issue a ruling.

While most people will never have to worry about something as valuable as Superman copyrights, it is very common for disputes to arise regarding an estate, trust or assets of someone who passed away.  Many families try to resolve these disputes without lawyers, as the Shuster heirs did.  Whenever there is a dispute over anything of value, smart heirs work with experienced probate attorneys from the start.  Good probate attorneys can help facilitate resolutions and avoid more fighting down the road.  No one wants to hire an attorney when there is conflict over an estate, but it's often the quickest way to end conflict.

This isn't to say that all attorneys will help resolve fighting rather than foster it.  There are lawyers who try to do just the opposite so they can earn a bigger fee.  That's why carefully choosing a good, experienced probate attorney -- who you are comfortable with -- can make all the difference.  And remember to be careful reaching informal agreements with someone you have a disagreement with; you could come to regret it later, as at least some of the Superman heirs do.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter and Google+.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation.