On Tuesday, Ludlow Music agreed to allow JibJab to distribute its film, which is based on the tune, without interference.
Also Tuesday, JibJab dropped its lawsuit against Ludlow. The settlement ended Ludlow's copyright claims against Shockwave subsidiary AtomFilms and network provider Speedera Networks, said Fred von Lohmann, an attorney at the Electronic Frontier Foundation, which defended JibJab in the case.
Attorneys for JibJab said they have found evidence that the copyright on Guthrie's song expired in 1973, meaning that anyone can use it for free.
"This song belongs to you and me," quipped von Lohmann.
New York-based Ludlow sent JibJab a cease-and-desist letter in July, asking that the film be removed from the Web. JibJab responded with a lawsuit in California federal court seeking a ruling that the film's use of the Guthrie tune was protected under fair use.
Ludlow filed for its initial copyright in 1956 and renewed it in 1984.
Still, Von Lohman said Guthrie first sold the sheet music for "This Land" in 1945, which set the clock running on a 28-year copyright term. That means that Ludlow's copyright renewal may have come 11 years too late.
Even without the alleged copyright expiration, JibJab would be entitled to distribute its animation under fair-use exemptions for parodies, von Lohman said.
An attorney for Ludlow, however, disputed the animators' view of the song's copyright status.
Ludlow's chief legal representative, Paul LiCalsi, said on Wednesday that because "This Land" was last copyrighted during a period when the song was technically considered unpublished, Ludlow's rights to the song never lapsed, he said.
"Since there was no official publication after the last copyright, the song is still protected under the law," said LiCalsi, of the Chicago-based firm Sonnenschein, Nath & Rosenthal.
LiCalsi also said the JibJab movie does not technically classify as a parody of "This Land." In order to qualify legally as a parody of the song, LiCalsi said, the new material must comment on or criticize the ideas represented by the original property. Since JibJab was making a statement about politics, and not Guthrie's song, he said, the film's use of "This Land" was not protected.
Still, the attorney said Ludlow is not planning to pursue any further legal claims against JibJab.
JibJab's wildly popular short film takes pokes at both President Bush and Sen. John Kerry. According to Internet statistician ComScore Media Metrix, JibJab's online lampoon received 10.4 million unique hits during July. The animated Flash video drove an additional 8 million hits to the AtomFilms site, which hosted the piece and helped stream the movie for JibJab's site.
The bipartisan political prank drew more than three times the number of visits as did the official campaign Web sites of the presidential candidates.
A previous effort by JibJab was a political comedy launched in 2000 that featured Bush and former Vice President Al Gore in a battle of freestyle rappers. But that piece garnered only 5 million unique hits.
JibJab said it didn't spend a dime to promote the movie. Instead, a promotional e-mail sent to 250,000 registered members of the company's "fan list" set off a tidal wave of Internet buzz. The parody was posted countless times on Internet forums and joke sites.
The traffic onslaught hasn't come without headaches, however. JibJab's lone server was at one point crushed by the torrent of activity, according to the company.
CNET News.com's Matt Hines contributed to this report.
