The Nuts and Bolts of the Copyright Claims Board

August 23, 2021

The Consolidated Appropriations Act which came into existence on December 27, 2020 incorporates the Copyright Alternative in Small-Claims Enforcement Act (the “CASE Act”) which established the new Copyright Claims Board (“CCB”) within the U.S. Copyright Office.¹ By creating the CCB, Congress delivered on a long-pending recommendation from the Copyright Office that copyright owners should be given an alternative, streamlined, cost-efficient means of enforcing their intellectual property rights without having to bring an action in federal court which can be expensive and lengthy. The Board is scheduled to begin operations by December 27, 2021 unless the Copyright Office seeks a delay.² Participation in a proceeding before the CCB will be entirely remote and will be conducted primarily through written submissions.³ In most cases, a hearing will not be necessary; however, if a hearing is held, it will be held via remote means through the internet or a teleconference.⁴ A party to a proceeding before the CCB may be, but is not required to be, represented by an attorney.⁵

The CCB is composed of a tribunal of three “Copyright Claims Officers” appointed by the Librarian of Congress who will decide small copyright infringement claims (up to $30,000 in actual or statutory damages).⁶ In addition, the Register of Copyrights will hire at least two additional Copyright Claims Attorneys who will serve to assist the Officers, assist the public with respect to subpoenas and procedures before the Board, and otherwise support the Register of Copyrights.⁷ The CCB will have jurisdiction over copyright infringement claims, claims seeking a declaration of noninfringement, certain claims arising under the notice and takedown provisions of the Digital Millennium Copyright Act (“DMCA”), and related defenses and counterclaims.⁸

Claims may be commenced before the CCB while a copyright application is still pending prior to issuance of a Certificate of Registration.⁹ A final determination may not be rendered, however, until the registration certificate has been issued by the Copyright office.¹⁰ Accordingly, the proceeding may be held in abeyance pending registration determination.¹¹ If an application is subsequently refused, the proceeding will be dismissed without prejudice.¹²

To initiate a proceeding, a claimant will file a claim including a statement of material facts with the CCB, and a Copyright Claims Attorney will evaluate it to determine whether it meets the procedural requirements, providing the claimant multiple opportunities to correct any deficiencies.¹³ Once a Copyright Claims Attorney determines that all of the requirements have been met, the Board will instruct the claimant to proceed with service.¹⁴ The board will make factual findings based on a preponderance of the evidence standard and will issue final written determinations, which must be reached by a majority of the Board, with any dissents appended to the decision.¹⁵ The statute of limitations to file a claim with the CCB is within three years after a claim has accrued.¹⁶

The proceedings before the CCB are voluntary—a party served with a claim can opt out of the proceeding within 60 days and choose to resolve the dispute in federal court.¹⁷ However, under the statute, an affirmative opt out from each Board proceeding is required in order to preserve the right to resolve the dispute in an Article III court.¹⁸ Failure to properly file an opt-out notice within 60 days of being served with a notice of a claim will: (i) serve as consent to the Board proceeding; (ii) forfeit your right to have the dispute decided by an Article III court; and (iii) waive the right to a jury trial regarding the dispute.¹⁹ Therefore, once served with a complaint, a defendant must timely object to adjudication by the CCB to force a plaintiff to bring suit in district court. While there is no general, pre-emptive opt-out process available to the general public, the Register of Copyrights is creating regulations allowing libraries or archives to opt out of all CCB proceedings.²⁰

To streamline the process, CCB proceedings will not include any formal motion practice.²¹ Instead, the parties may ask the Board to address discovery and case management issues, and in turn, the Board may ask parties to address specific questions about their case.²²

The decisions issued by the CCB will be subject to limited judicial review. The losing party may request a reconsideration by the CCB and, if the request is denied, a review by the Register of Copyrights.²³ The review is limited to consideration of whether the CCB abused its discretion in denying reconsideration of its decision.²⁴ A review and order by a federal court is available only in circumstances, where i) the decision was the result of fraud, corruption, misrepresentation or other misconduct; ii) the Board exceeded its authority or failed to render a final decision; or iii) the decision was based on a default or failure to prosecute due to excusable neglect.²⁵

The CCB may not consider or make a finding that the infringement was committed willfully in determining statutory damages.²⁶ However, the Board may consider as a factor in awarding statutory damages whether the infringer has agreed to cease or mitigate the infringing activity.²⁷ Decisions of the CCB have limited preclusive effect and are binding only with respect to the parties to the action and may not be relied upon as legal precedent, even in future proceedings before the Board.²⁸

The act provides certain safeguards to prevent any abuse of the procedure. The Copyright Office can cap the number of claims a party can bring before the CCB per year to hinder serial abuse. Therefore, if a party repeatedly file frivolous or harassing claims, the CCB can bar such claimants from bringing claims for 12 months.²⁹ Small copyright owners could benefit from the reduced expense of pursuing their claims before the CCB rather than federal court, although the “opt-out” provision may undermine that benefit. Some critics have questioned the constitutionality of the Board with respect to the narrow scope of review and the method of appointment of the copyright claim officers.³⁰ It remains to be seen if there are any constitutional challenges to the Board and how the Board will actually function. However, it is important to note that even though CCB provides a new forum and procedure to litigate, it does not change the substantive copyright law.