Party 2 borrowed the book, presumably they were allowed to read it, including sounding the words. Party 1 withheld permission to write the words down, and were judged entitled to withhold permission, is that not an exercise of copyright? True, the ownership seems to go with owning the book not with originating the words, IP was not litigated AFAIK.
To add to an old thread: the copyright office now has images of their card catalog on line at https://vcc.copyright.gov/browse . The site is not really easy to navigate, but it's better than nothing, and so far the catalog they show for 1938-1945 only displays two registrations under the name of Msgr. Hellriegel, neither of them in 1941, and neither with the title of the hymn.
This gives the appearance that the song was never registered for copyright and is likely to be in the public domain.
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