According to this analysis linked from the article, there are several challenges in Time Warner's copyright claim, so common sense might even one day prevail:
> The claim that “Happy Birthday to You” is still under copyright has three principal weaknesses. Most significantly, there is a good argument that copyright in the song has never been renewed. [...] Second, the first authorized publication of “Happy Birthday to You,” in 1935, bore a copyright notice that was almost certainly not in the name of the owner of copyright in the song. Under the law in force at the time, publication with notice under the wrong name resulted in forfeiture of copyright protection. Third, the current putative owner of copyright in “Happy Birthday to You,” can only claim ownership if it can trace its title back to the author or authors of the song. Yet it appears that the only possible authors to whom it can trace title are Mildred and Patty Hill themselves, and there is scant evidence that either of them wrote the song.
Not to worry, copyright terms will be extended again long before "Steamboat Willy" expires. Disney has lots of friends in Washington. Nothing copyright after 1927 will ever be in the public domain.
In case anybody else is wondering, Steamboat Willie currently will expire in 2023. If the timing of the previous copyright extension acts continues, we should see a new copyright extension act within the next three years or so.
Assuming, of course, it isn't entirely coincidental that the copyright extension acts tend to pop up every time Steamboat Willie gets close to entering the public domain.
I wonder how Steamboat Willie entering the public domain would affect the Mickey Mouse related trademarks (e.g. the mouse ears and such), considering that most of it is simply derived from the character first publicly introduced in that film. I know that trademark law is orthogonal to copyright, but it would certainly allow diluting the brand.
> The claim that “Happy Birthday to You” is still under copyright has three principal weaknesses. Most significantly, there is a good argument that copyright in the song has never been renewed. [...] Second, the first authorized publication of “Happy Birthday to You,” in 1935, bore a copyright notice that was almost certainly not in the name of the owner of copyright in the song. Under the law in force at the time, publication with notice under the wrong name resulted in forfeiture of copyright protection. Third, the current putative owner of copyright in “Happy Birthday to You,” can only claim ownership if it can trace its title back to the author or authors of the song. Yet it appears that the only possible authors to whom it can trace title are Mildred and Patty Hill themselves, and there is scant evidence that either of them wrote the song.
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1111624