Today marks six months since the U.S. Copyright Office launched the Copyright Claims Board (CCB)—the small copyright claims court established by the Copyright Alternative in Small-Claims Enforcement (CASE) Act. Although virtually all the cases filed with the CCB in the first six months are still in the early phases, it’s not too early to take a look at the CCB and analyze how it is working so far. There are some interesting trends to note that may guide potential CCB claimants who are considering whether to file claims, prospective respondents who are trying to determine whether to participate or opt out, and all parties as they learn how to best navigate this new small copyright claims tribunal.
Domestic and Foreign Creators are Filing Claims–Most Without Using Attorneys
As of the writing of this blog post, more than 260 cases were filed with the CCB at a rate of about 1.5 cases a day. We thought there might be a rush of cases filed when the CCB first launched, followed by a decrease and plateau as the months progressed. Interestingly, that is proving not to be the case so far as the number of cases filed each month has remained steady over the past six months, which may signal the CCB’s longevity and desirability as a forum for resolving certain copyright disputes.
Of the 260 or so cases filed, a little over 80% of the claims filed have been infringement claims. This is a testament to the need and desire for the CCB, evidenced by the support of thousands of creators who called for the creation of a small copyright claims system so they could enforce their rights. As individual creators and small businesses have been enforcing their copyrights in the new small claims court, we are heartened that they have the opportunity do so.
It is particularly interesting to see that foreign claimants have filed a little over 10% of the CCB cases. Remember, the CASE Act allows foreign claimants to file CCB claims, but neither a foreign nor a U.S. resident CCB claimant may file claims against a foreign respondent (although a U.S. resident who is a respondent in a CCB proceeding may file counterclaims against a foreign claimant). While the CASE Act was pending we heard from many creators and small businesses, but virtually all of them were U.S. residents so we had no idea that the CCB would also be so fervently welcomed by creators and copyright owners throughout the globe who, like their U.S. counterparts, had little to no recourse to enforce their rights in the United States.
Not surprisingly, in roughly two-thirds of the CCB cases, the claimant is not using an attorney. Since the CCB was designed to be an affordable and accessible alternative to federal court where CCB parties could represent themselves, it’s encouraging to see that goal be realized and verified by the numbers showing that the majority of these claimants are bringing CCB claims on their own.
However, it is not a surprise that some difficulties arise when claimants represent themselves. Unfortunately, many CCB claimants do not fully understand how to use the CCB or understand some of the intricacies of copyright law. That has led to many claims needing to be amended—resulting in increased review time by CCB attorneys, longer timelines caused by multiple back-and-forths between claimants the CCB attorneys, and many claims being dismissed. While these struggles are not ideal and results in a more cumbersome experience, they are not insurmountable obstacles for CCB claimants. The amendment and dismissal processes for noncompliant CCB claims can help educate individual creators and businesses about the scope of their rights so that they better understand copyright law and their rights going forward. And as the U.S. Copyright Office and we at the Copyright Alliance make more educational materials available to help CCB parties, we are confident the number of amendments and dismissals will decrease over time.
The CCB Begins Hearing its First Cases
As of the writing of this blog post, there are seven active proceedings and no determinations rendered by the CCB. This low number is not surprising for several reasons including that the CCB regulations give ample opportunities and time for claims to be corrected through amendments and to move through the process before the case comes before the CCB Officers as an active case. For example, once the claimant files a CCB case, if the claim is found not to be in compliance, the claimant will be given 30 days to amend the claim, followed by a second 30-day opportunity to amend the claim if the initial amendment still fails to comply with the requirements. Once the CCB attorney approves the claims for service of process, the claimant has 90 days to complete service on the respondent and then, once the respondent is served, they have 60 days to decide whether to participate or opt out of the proceeding. These timelines don’t include review time by the CCB attorneys, possible extensions granted by the CCB attorneys, or other situations that could prolong the initial stages of a CCB proceeding. So, it could take roughly five months or longer before a case becomes an active proceeding.
But not all active cases have to go through those stages or take that long to become an active case. In fact, the origins of the first active CCB case may be surprising. There is a little-known provision in the CASE Act that allows a federal judge to refer a copyright case that is pending in federal court to the CCB, upon the mutual consent of the parties to the case. So when the first active CCB case turned out to be a case that was referred to the CCB from the Central District of California, it was a bit of a surprise to just about everyone and a good sign that judges and litigants view the CCB as a viable and appropriate alternative to federal court.
Claimants Are Using the CCB to Try to Settle Their Copyright Disputes or Resolve Their Copyright Disputes as a Precursor to Filing in Federal Court
In a little over 10% of the cases that have been dismissed by the CCB, the claimant voluntarily dismissed the case. We are aware of several cases in which a voluntary dismissal occurred as the result of a settlement between the parties. When the CASE Act was being considered, we thought that the CCB would lead to increased respect for the rights of copyright owners and lead to more settlements, and, at this early stage, that seems to be the case.
There is also evidence that the CCB is being used by claimants who otherwise would file their claims in federal court, but instead decided to first file at the CCB in an attempt to resolve their copyright dispute quickly and inexpensively without needing to file in federal court. For example, after the CCB claim in Dermansky v. Hayride Media was dismissed due to the respondent opting out of the CCB proceeding, the CCB claimant then brought those claims to a federal court in the Eastern District of Louisiana. The CCB claimant, now plaintiff, noted to the court in paragraphs 33 and 34 of the complaint that the copyright claims were first filed in the CCB as an attempt at a “cost-efficient and streamlined conclusion to this matter . . .” In paragraph 36, she points out that the defendant’s decision to opt out of the CCB proceeding opens them up to potentially increased damages as well as additional remedies for claims that were not available before the CCB. This demonstrates that respondents should carefully consider whether claimant might file in federal court when determining whether to opt out or participate in a CCB proceeding, in addition to a slew of other factors to consider. A list of the factors to consider were outlined in this blog post about what a respondent might consider when presented with the option to opt out.
What We Know About Opt-Out So Far
The most frequently asked question we get about the CCB is why respondents can opt out of a CCB proceeding. As we explain on our FAQ page, CCB participation is voluntary in order to comply with the requirements of the U.S. Constitution. Understandably, the opt-out provision is concerning for claimants who want to enforce their copyrights in a meaningful way without taking on the expenses and headaches of a federal lawsuit.
At this stage, there is not yet a sufficient sample size to draw conclusions about respondents’ behaviors, including decisions on whether to opt-out, and we caution readers not to place too much emphasis on any opt-out figures at this early stage. What we can say, however, is that so far only about 10% of the cases dismissed by the CCB have been dismissed due to a respondent’s opt out, showing that opt-outs are not proving to be the primary driver of dismissals at the CCB.
In the event a respondent does opt out, claimants should be aware of our SCOOP Program, designed to reimburse a CCB claimant’s loss of the initial filing fee that results from a respondent’s opt out, provided they meet the requirements programs—which include becoming more knowledgeable about the CCB before filing a claim by watching our educational video.
Claimants Are Still Learning How to File Permissible Claims and Serve Process
The biggest reason why the CCB dismisses cases is not because the respondents are opting out or settling—instead, it is because claimants are not meeting CCB requirements and deadlines. About 80% of the cases dismissed by the CCB are dismissed because of claimant’s failure to meet CCB requirements and deadlines. The issues could stem from a host of reasons. But one of the biggest reasons seems to be that many claimants do not understand how to file permissible claims with the CCB. As we note in our CCB videos and FAQ page about permissible claims, there are certain requirements to properly file a claim with the CCB such as understanding that:
- the CCB can only hear three types of copyright claims (no patent, other intellectual property, or non-copyright claims allowed);
- claimants cannot bring claims against certain respondents (for example, a claimant cannot bring a claim against foreign residents); and
- the CCB cannot grant injunctions.
From claims filed so far at the CCB, we also found that claimants might need to better understand the elements of proving copyright infringement. Over the coming months we’ll be providing more detailed information about the elements of infringement. In the meantime, you can check out our general page on How to Prove Copyright infringement.
The Copyright Claims Attorneys (CCAs) assist claimants by notifying claimants about the noncompliance of certain claims. CCB claimants, if they want their case to proceed, must amend their claims to be compliant with CCB regulations by the deadlines given by the CCAs. If not, the CCB will simply dismiss the case. To avoid having their cases be dismissed CCB claimants should also keep in mind these ten things when filing a CCB claim.
CCB claimants also seem to struggle with completing service of process—the method through which the claimant notifies the respondent(s) of the CCB claims. About 10% or so of CCB cases that are dismissed because of a failure to comply with CCB orders are dismissed due to the claimant failing to provide proof of service by the CCB’s deadline. Admittedly, service of process is a part of the CCB proceeding that can be difficult to figure out because rules vary from state to state, but it is nonetheless crucial. The Copyright Alliance has a video and FAQ page on CCB service of process which explains, among other things, what documents must be served on the respondent, how much time the claimants have to serve the respondents, and who can serve the respondents. There are also other resources that provide information about state-specific service of process rules.
It is too early to make any definitive statements about which aspects of the CCB are working well and which are not, and how the CCB is actually working in practice. As the creative community familiarizes itself with CCB requirements, copyright law requirements, and the procedures and processes of the CCB—especially service of process—we expect the number of cases dismissed by the CCB begins to decrease.
The Copyright Alliance has many educational videos and FAQs on our website and we will continue to create new educational materials and putting on educational events. So if you are a claimant or respondent looking for more information about the CCB, please remember to check our website for information regularly. And we’ll check back in in June 2023 to take another look at the CCB.
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