With the U.S. Copyright Office’s new small claims court—the Copyright Claims Board (CCB)—launching on June 16, we thought we’d pass along some of the most important information that copyright owners and users should know about this new tribunal.
1. The CCB can hear three types of claims.
The CCB can hear three types of claims by copyright owners and users:
- infringement claims;
- claims for declarations of non-infringement. This type of claim might be brought when a copyright owner has alleged that someone is infringing their work and either has threatened to take action to enforce their rights (such as in a cease-and-desist letter) or has sent a DMCA takedown notice. The alleged infringer can bring a claim before the CCB to request that the CCB issue a declaration stating that the activity they are engaged in does not infringe the copyright owner’s exclusive rights;
- claims under section 512(f) of the Copyright Act for misrepresentations in a DMCA notice or counternotice. Users who received a DMCA takedown notice from a copyright owner can challenge that notice if they believe the copyright owner knowingly misrepresented that the material or activity is infringing in the notice. Similarly, a copyright owner who sent a DMCA takedown notice and then received a counternotice from the user may challenge that counternotice if they believe the user knowingly misrepresented that material or activity was removed or disabled by mistake or misidentification.
These are the only types of claims that can be brought. Ownership disputes, termination claims, trademark claims, etc., cannot be heard by the CCB. Also, the CCB cannot hear any claim or counterclaim that has been finally decided by or is pending before a federal court—unless that court has granted a stay to permit that claim or counterclaim to proceed before the CCB.
2. The CCB cannot hear claims against certain parties (under certain circumstances).
The CCB cannot hear any claim or counterclaim by or against a federal or state governmental entity. The CCB also cannot hear any claim against someone who does not reside in the United States. However, the CCB can hear a counterclaim against a foreign resident when that foreign resident has first brought a CCB claim themselves. Lastly, the CCB cannot hear any claims against an online service provider (OSP) that is referring, linking, or storing alleged infringing material on behalf of a user (as those terms are defined in the DMCA, found in 17 USC 512(b)(c) and (d)) unless the OSP has been notified of the infringement through a properly submitted takedown notice under the DMCA but fails to expeditiously remove or disable access to the material identified in the notice.
3. Participation in the CCB is voluntary.
The U.S. Constitution requires that participation in the CCB be voluntary. Thus, the person being sued (referred to as the “respondent”) can “opt out” of the proceeding. A respondent has 60 days from the date notice is served on them to opt out of a proceeding. In special circumstances, the CCB may extend the 60-day period. The opt-out form can be found here. If the respondent opts out of the CCB proceeding, the proceeding is immediately terminated. (Although the person who brings the CCB claim (referred to as the “claimant”) is still free to bring their claim as a lawsuit in federal court.) The CCB process is also voluntary for claimants. A claimant is not required to use the CCB to decide their infringement, non-infringement, or section 512(f) misrepresentation case. Parties can use other alternatives, such as bringing their claim in federal court or before a mediator.
4. A party can bring or defend a case without the need to hire an attorney.
The CCB process is intended to be much simpler and more streamlined than federal court that it will be unnecessary for the parties to hire attorneys to represent them. A party can hire an attorney if they wish, but the use of an attorney is completely optional. Interestingly, at the time this blog was drafted, attorneys were being used by claimants in a little less than half of the infringement cases. If a party feels the need for legal representation, they may also retain law school clinic students that are supervised by a licensed attorney so long as the student-representative has the client’s written consent to represent the party and has completed: (i) their first year at an American Bar Association accredited law school; (ii) training in copyright law as determined by their supervising attorney; and (iii) a review of the CCB regulations and the Copyright Alternative in Small-Claims Enforcement (CASE) Act statutory text. The CCB will provide a directory on its website of law school clinics and pro bono legal services organizations that have expressed interest in providing pro bono law student representation before the CCB.
5. The damages that the CCB can award a prevailing party are capped.
In a copyright infringement case filed in federal court, a successful plaintiff may be awarded up to $150,000 in statutory damages per work infringed. In contrast, when an infringement claim, or counterclaim, is brought before the CCB a successful claimant or counterclaimant may be awarded up to $15,000 in statutory damages per work infringed—which is 10% of the maximum damages available in federal court. Also, the total amount of damages that can be awarded in each case before the CCB is limited to $30,000, as compared to federal court, which has no limit.
6. Statutory damages are available for copyrighted works that are not timely registered.
In infringement cases before a federal court, statutory damages can only be awarded where the copyright owner has timely registered their works. Under U.S. copyright law, a copyrighted work is “timely” registered if it is registered with the U.S. Copyright Office either before the infringement starts or within three months after first publication of the work, if the infringement began after the work was first published. But in infringement cases before the CCB, statutory damages are available regardless of whether the work was timely registered. Whether the work is timely registered will impact the upper cap on damages, as the cap is significant lower for works that are not timely registered. For works not timely registered, statutory damages are limited to $7,500 per copyrighted work infringed and a total of $15,000 for all works infringed in a case that were not timely registered. This means that in a case involving only infringement claims in which all the works at issue were not timely registered, the CCB can award a no more than $15,000 for the entire case, as compared to $30,000 where all the works were timely registered.
7. The CCB cannot issue an injunction but can issue something very similar.
Unlike in federal court, injunctions are not available in CCB proceedings. However, if the parties reach an agreement for one party to cease infringing activity, cease sending DMCA notice for section 512(f) violations, or to cease some other activity, the CCB can make that agreement part of its final determination.
8. All CCB proceeds are remote, so there is no need to travel to the Copyright Office.
CCB proceedings are conducted without the requirement of in-person appearances by parties or others. What this means in practice is that each party will make its case through written submissions and that hearings and conferences will be take place online or through other telecommunications facilities. To facilitate these proceedings, the Copyright Office created an online filing and case management system for the CCB, called the eCCB, which can be found on the CCB website. Parties and their representatives can register to get access to the eCCB in order to file and distribute documents related to CCB proceedings, receive electronic delivery of documents from the CCB, and review case documents.
9. The discovery process in a CCB proceeding is much less complex and more streamlined compared to a case in federal court.
The entire CCB process is intended to be simple, efficient, and streamlined for faster resolution of copyright disputes. What this means in practice is that discovery—which is portion of a CCB proceeding during which the parties exchange information and documents related to a case—is much more limited and is much quicker than discovery that takes place in federal court. For example, there is no formal motions practice (formal requests made to a court, e.g., a motion asking the court to dismiss a case) at the CCB. The CCB also provides standard forms and questions for the parties to conduct the discovery process, so that parties do not have to come up with the discovery requests on their own to get relevant information from the other party.
10. Businesses may designate a CCB agent to be served when they are sued.
Corporations, partnerships, or associations may designate an agent to receive service of CCB claim notices. These agents are called designated service agents. There is an application on the CCB website that must be completed by corporations, partnerships, or associations who wish to designate a service agent. If a service agent has been designated, the claimant must serve the designated agent. The directory can be searched by claimants or anyone else.
11. There are different procedures for “smaller” claims.
A claimant seeking $5,000 or less in damages may choose to bring their claim under a more simplified “smaller claims” process. There are several differences between a regular small claims process and the “smaller claims” process. Most notably, unlike regular small claims cases, “smaller claims” cases are decided by only one CCB Officer and discovery in these cases is significantly more limited. Claimants who choose to bring smaller claims, will usually do so when they file their claims. However, claimants can change their minds any time before the initial notice in the case is filed.
12. There are limits on the number of cases that a party can file.
In a 12-month period, a claimant can bring up to 30 cases. There are also limits on the number of cases that law firms and attorneys can bring. Law firms are limited to filing no more than 80 cases, and attorneys no more than 40 cases.
13. CCB Determinations are not legal precedent.
When the CCB issues a final determination, it cannot be cited or relied upon in the future as legal precedent before any court or tribunal, including the CCB itself.
14. CCB Determinations can be appealed, but the ability to appeal is purposely limited.
A CCB final determination may be challenged in the following limited circumstances:
- If either the claimant or the respondent is unhappy with the final determination by the CCB, they may challenge the determination by requesting reconsideration of, or an amendment to it, provided they identify a clear error of law or fact material to the outcome, or a technical mistake by the CCB. This is called a “request for reconsideration.”
- If the CCB denies the request for reconsideration, the aggrieved party can request a review by the Register of Copyrights. The review by the Register is limited to consideration of whether the CCB abused its discretion in denying reconsideration. The Register will either deny the request or send the proceeding back to the CCB for reconsideration of issues specified by the Register and for issuance of an amended final determination.
- After reconsideration and review by the Register have been completed or deadlines have passed without a request for either reconsideration or review since the CCB’s final determination, the losing party has a limited right to appeal the decision to federal district court. The losing party may seek an order from a federal district court requesting the court vacate, modify, or correct the CCB determination only if (i) the CCB’s final determination was the result of fraud, corruption, misrepresentation, or other misconduct; (ii) the CCB exceeded its authority or failed to render a final determination; or (iii) in the case of a default or determination based on a failure to prosecute, if it is established that the default or failure was due to excusable neglect.
15. Anyone can access information about the CCB and the cases filed before the CCB.
The CCB’s online filing and case management system, which is called the eCCB, is publicly accessible. If anyone wants to learn more about cases being filed before the CCB they can easily do so by searching the CCB docket. And publicly available documents filed in these cases can also be searched. As of yesterday, 50 cases have been filed. Nine of the cases involve “smaller claims.” Forty of the cases involve infringement claims and 4 involve Section 512(f) misrepresentation claims. The works at issue in these cases are Pictorial Graphic & Sculpture (24 cases); Literary Works (5) Motion Picture and Audiovisual Works (7) Sound Recordings (3); Musical Works (4). Some cases include claims for multiple works. The Copyright Office also has numerous resources available for people to learn more about the CCB, including:
- Information about the CCB, including the Officers bios, fees and key features of the CCB;
- Information about CCB procedures, including discovery, hearings and conferences, defaults and reviews;
- A CCB Handbook;
- FAQs; and
- Directory of Libraries and Archives who have preemptively opted out.
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