NEW YORK — You’d better watch out: “Santa Claus Is Comin’ to Town” is comin’ back into the hands of the heirs of a songwriter who composed it.

Rejecting a lower-court ruling, the 2nd U.S. Circuit Court of Appeals in Manhattan on Thursday ruled for a daughter and grandchildren of John Frederick Coots.

Coots, who wrote the music for hundreds of songs before his 1985 death, co-wrote the song in 1933 with James Lamont “Haven” Gillespie, who died in 1975.

“Terrific!” said Coots’ lone surviving child, Gloria Coots Baldwin, in a telephone conversation from her Boca Raton, Fla., home.

David Milian, a Miami attorney, called the decision “a milestone in the development of copyright law” because of the lengths the 2nd Circuit went to analyze the termination rights of artists under copyright law. The decision was written by Circuit Judge Debra Ann Livingston.

Baldwin, 81, and two granddaughters sued EMI Feist Catalog in Manhattan federal court in 2012, claiming entitlement to re-establish their share of publishing copyright ownership in December 2016.

A three-judge appeals panel agreed, rejecting EMI Feist’s claims it could hold the copyright until 2029. EMI Feist is an arm of the London-based music company EMI Group. A lower-court judge in December 2013 had ruled for the company. Its lawyers did not immediately return messages seeking comment.

Baldwin — one of the composer’s four children — said she initiated the legal case for the benefit of younger relatives.

She said the family had always received a songwriter’s royalty cut but no longer got payouts from publishing rights. She said she did not know how much those rights were worth.

“We’ll find out, won’t we?” Baldwin said.

According to court papers, Coots’ heirs had been offered $2.75 million by EMI about eight years ago to drop claims.