Cher v. Bono

District court grants Cher summary judgment on her claim for royalties under 1978 Marriage Settlement Agreement with ex-husband Sonny Bono, holding that termination notice under Copyright Act did not terminate Cher’s contractual royalty rights, which arose under state law.

In connection with their divorce, Cher and Sonny Bono entered into a 1978 Marriage Settlement Agreement (MSA) that granted Cher 50% of all musical composition royalties, record royalties and other assets derived from musical compositions written by Bono prior to Feb. 1, 1974, or acquired prior to the couple’s separation. In 2016, Mary Bono, Sonny’s second wife and an heir to his estate, served various music publishers to whom Sonny had licensed his compositions a notice of termination of those licenses under Section 304(c) of the Copyright Act. Mary Bono claimed that the termination notice terminated all of Cher’s rights under the MSA, and ceased paying Cher royalties. 

Cher sued Mary Bono in 2021, seeking a declaratory judgment that the termination notice did not impact her rights under the MSA, and for breach of contract based on Bono’s failure to pay royalties. Bono asserted counterclaims seeking declaratory relief that she and Sonny’s other heirs have sole discretion under the MSA to appoint an administrator, and that Bono has the right to enter into new agreements to exploit the sound recording covered by the MSA. The parties filed cross-motions for summary judgment. 

The court first considered Bono’s argument that Cher lacked standing because she sold her catalog to a third party during the pendency of the suit. The court held that Cher had standing because she was the sole owner of her rights under the MSA at the time the action was filed. The court also rejected Mary Bono’s argument that the action should be dismissed because Cher failed to join Sonny’s four children as parties, finding that Bono adequately represented any interests Sonny’s children may have in this proceeding. 

Turning to the parties’ dueling requests for a declaratory judgment, the court first considered Mary Bono’s argument that the termination notice under the Copyright Act preempts any rights Cher acquired under the MSA. The court disagreed, holding that the MSA transferred only royalty and approval rights under state law, and not the copyrights to the underlying works. Because Cher’s rights arose solely under state contract law, they were not impacted by Bono’s notice of termination under Section 304(c) of the Copyright Act. The court applied the same analysis to Cher’s breach of contract claim, holding that, because Cher’s motion has been granted as to the claim for declaratory relief, as a matter of law, Bono breached the MSA by refusing to pay Cher her share of the royalties due under the MSA. The court distinguished other cases where a songwriter assigns rights to his or her compositions in exchange for a promise to pay royalties. The MSA, by contrast, granted Cher royalty interests in exchange for a release of claims arising out of the parties’ marital status.

Summary prepared by Tal Dickstein and David Forrest