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A Small Claims Court for Copyright Disputes? CASE Act Creates New Alternative Process for Smaller Copyright Claims

  • A new law known as the Copyright Alternative in Small-Claims Enforcement (CASE) Act creates an entirely new tribunal within the U.S. Copyright Office for resolving smaller copyright disputes.
  • Before the CASE Act, aggrieved copyright owners generally needed to file a lawsuit in federal court to enforce their rights.
  • The CASE Act aims to create a more efficient and cost-effective means for copyright owners to resolve their disputes, but its true impact on copyright disputes remains unclear given that participation in the process is voluntary.

What the CASE Act Does

The CASE Act creates a Copyright Claims Board (“CCB”) consisting of Copyright Claims Attorneys (not judges) who will hear and adjudicate claims. Copyright owners may bring copyright infringement claims, declaratory judgment claims, and certain Digital Millennium Copyright Act claims before the CCB, but only if claims were not already decided or are not pending before a court. The parties to CCB disputes are permitted to exchange discovery in the form of document requests, interrogatories, and requests for admission (unless good cause is shown for additional discovery), just like in federal court litigation.

As in any small claims case, the amount of damages available to an aggrieved party is limited. The CCB is permitted to award a prevailing copyright owner no more than $30,000. The CASE Act permits a copyright owner to pursue actual damages or statutory damages. Unlike federal litigation, statutory damages are available for works that are not timely registered, though such damages are limited to $7,500 per infringed work and $15,000 total in any one proceeding.

In addition to monetary compensation, the CCB may require that the infringing party cease the infringing activity, but only if the infringing party agrees to do so during the proceeding and on the record. Further, copyright owners typically will not be able to recover their attorneys’ fees or costs, except in instances of bad faith.

After the CCB makes a ruling, that ruling, with few exceptions, has preclusive effects before the courts and the CCB. If the losing party does not like the CCB’s determination, it is given the opportunity to request reconsideration within 30 days. If the losing party disagrees with the outcome of reconsideration, it may challenge the CCB determination in federal district court within 90 days after the action is finalized.

What the CASE Act Means for Copyright Owners

The CASE Act gives copyright owners a new, “small claims” process for resolving copyright claims, enabling them to enforce their rights through a tribunal other than federal court. In addition, a copyright owner does not need to own a copyright registration to file a CCB action (unlike at the federal court level where, with few exceptions, a registration is a prerequisite to filing a lawsuit). That being said, a registration is a prerequisite before the CCB can issue a decision, so filing a copyright application will be necessary at some point.

There is a catch. Participation in CCB proceedings is voluntary: the respondent has 60 days after receiving notice of the proceeding to opt out (if the respondent does not opt out, it waives any right to a jury trial or remedy at the district court level). Therefore, a respondent can force a copyright owner to pursue litigation in federal court.

While specific regulations on the practice and procedure of the CCB will be forthcoming from the Register of Copyrights, at present, the CASE Act appears to create an accelerated and cost-effective means for copyright owners to enforce their copyrights. However, because the entire process is voluntary, whether the CASE Act will actually simplify the copyright dispute process remains to be seen.

 

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