Copyright Claims Board (CCB)
In December 2020, the Copyright Alternative in Small Claims Enforcement (CASE) Act was passed by Congress to address what many creators of copyrighted works (e.g., authors, photographers, musicians and videographers) viewed as prohibitive costs when attempting to enforce their copyrights against alleged infringers. Under the law as it existed until that date, claims for copyright infringement could only be filed in federal court and the costs of pursuing a federal lawsuit can run to tens or even hundreds of thousands of dollars. As a result, many creators believed they did not have a viable option to protect their rights in their works.
The CASE Act seeks to remedy this by creating within the US Copyright Office a new adjudicative body, the Copyright Claims Board (CCB). The CCB has limited jurisdiction to hear “small” claims relating to copyright. Only three types of claims may be brought before the CCB and the CCB only has authority to award a claimant monetary damages up to a maximum of $30,000. Before June 16, 2022, proceedings before the CCB were merely theoretical. Since that date the CCB has begun accepting small claims and will proceed to make determinations in accordance with the CASE ACT.
What Claims Can Be Brought Before The CCB?
The CCB has limited authority to hear claims. Only three categories of claims may be brought before the tribunal:
- A claim of copyright infringement
- A claim seeking a declaration of non-infringement
- A claim of misrepresentation under either a notification or counter-notification under Section 512(f) of the Digital Millennium Copyright Act of 1998 (DMCA) relating to the “takedown” procedures for user-generated content.
Even among the three categories, some claims are specifically excluded from being brought before the CCB:
- Claims against a federal or state government agency
- Claims or counterclaims against a person residing outside of the US – unless the non-resident initiates the proceeding.
Moreover, the relief the CCB can grant a prevailing party on either a claim or counterclaim is limited to actual or “statutory” damages, except that the CCB cannot make a determination or award of damages based upon “willful” conduct.
What Relief May the CCB Award a Claimant or Counterclaimant?
As for any CCB final determination, the total recovery limit is $30,000, exclusive of attorney’s fees (which may be awarded only for a showing of bad faith or misconduct) and even then a there is maximum of $5,000 for parties represented by counsel and $2,500 for self-represented (pro se) parties. However, the $30,000 ceiling is further limited to $15,000 in statutory damages for each work infringed (which is half of what is available in a federal court action), where registrations for the works in question were timely obtained. That amount is further reduced to a total of $15,000 or $7,500 per work where claims are based upon a belated or pending copyright registration. This differs from federal court where no statutory damages are available for a late registration and one cannot even file a lawsuit if the registration is pending. The CCB has no power to issue injunctive relief, meaning the CCB has no authority to force anyone to engage in, or refrain from, certain conduct, such as committing copyright infringement.
What About Really Small Claims?
There are even further streamlined proceedings if a claimant limits a claim to $5,000 or less. In such cases, the claim will be heard before a single Copyright Claims Officer. The permitted written statements of the parties are required to be shorter in length than statements for larger value claims before the full CCB.
What Responses and Counterclaims May Be Made in Reply to a Claim?
Just as the types of claims that can be brought before the CCB are limited, so are the responses. Generally, a respondent has 30 days from the issuance of a scheduling order to file a response to the claim (akin to an answer in a lawsuit) and/or a counterclaim. The scheduling order sets dates for exchange of documents and witness statements, court conferences and hearings. Permitted defenses to an infringement claim include:
- the work is not protectible by copyright or is in the public domain
- the claimant does not own the work in question
- the respondent is a joint owner of the work
- the respondent has a valid license
- statute of limitations
- fair use
- certain statutory exemptions.
Permitted responses to a claim of non-infringement include:
- lack of a case or controversy (an actual copyright dispute)
- the usage is beyond the scope of a license or other agreement
- statute of limitations.
The only defenses for a claim of misrepresentation under the DMCA are statute of limitations and variations on a theme:
- no misrepresentation
- no knowing misrepresentation
- no material misrepresentation
- no injury to the client resulting from any misrepresentation.
Any counterclaims against the claimant must be filed at the same time as the response to the claim. Only counterclaims relating to claims of infringement, non-infringement or DMCA misrepresentation and certain contract claims relating to an applicable license may be brought and the limitations on damages the CCB may award also applies to counterclaims. Claimants are not allowed to opt out of any counterclaims brought against them.
Who Hears Claims and How Is the Process Administered?
The CCB consists of three full-time Copyright Claims Officers who will collectively hear claims as a tribunal. Each Copyright Claims Officer must have no less than seven years’ legal experience and also have relevant copyright expertise. At least one of the three must also have a background in “alternative dispute resolution” (ADR) such as arbitration and mediation. To stagger the terms of the Copyright Claims Officers, their initial terms are for four, five and six years, respectively, and thereafter each such officer is appointed for a full six-year term. The Copyright Claims Officers are assisted by two full-time Copyright Claims Attorneys who review claims, responses and other documents filed with the CCB to ensure that they comply with the CASE Act and applicable regulations that have been adopted.
How Do CCB Proceedings Compare to Federal Court Actions?
Proceedings before the CCB are extremely streamlined compared to litigation in federal court. Claims and counterclaims are filed online through the eCCB portal and includes extensive use of drop-down menus to facilitate filings. There is very limited “discovery” (exchange of documents and other information) and expert witnesses are almost never permitted. Moreover, all proceedings will either be based solely on written submissions or, if the CCB thinks the situation merits it, there will be remotely held hearings. The system is designed so that parties (including companies who are not allowed to represent themselves in federal court) may represent themselves, although they are also permitted to have attorneys participate on their behalf.
How and When May a Respondent Opt Out of a CCB Proceeding?
Because the Copyright Claims Officers are not federal judges with lifetime tenure and because participation in CCB proceedings involves a party’s waiver of the right to a jury trial, participation in CCB proceedings is entirely voluntary. This means that any party on the receiving end of a claim (referred to as a respondent) has a right to opt out of the proceeding within 60 days of being served with the claimant’s claim (akin to a complaint in a lawsuit) and the required notice prepared by the CCB. If the respondent opts out, the proceeding is dismissed as to the opting out respondent “without prejudice,” meaning the claimant can still pursue a lawsuit in federal court against that party.
What Provisions Are There for Taming “Copyright Trolls”?
Because of the ease in which one may bring a claim before the CCB and the very low filing cost ($100 payable in two installments), there was concern that the CCB would be a haven for copyright trolls, like the few lawyers who have filed thousands of meritless cases in federal court. The CASE Act and regulations limit the number of claims any attorney may file in a 12-month period. If the CCB finds that a party pursued a claim or defense for harassment or other another improper purpose without a reasonable basis in fact or law on more than one occasion within a 12-month period, that party (or attorney) will be barred from initiating any other claim before the CCB for a period of 12 months.
Can I Dispute the Copyright Claims Board’s Decision?
Review of CCB determinations is very limited. First, a party can apply to the CCB for reconsideration of their claim or counterclaim. If the CCB refuses the request, a party can ask for a review of the CCB’s decision by the Register of Copyrights. There is an additional $300 filing fee for this review. The Register’s review is limited to determining only whether the CCB committed an abuse of discretion in reaching its decision.
As a last resort, a party may, within 90 days of the CCB’s issuing its final determination, seeking an order from a federal district court to vacate, modify or correct the CCB decision, but only under three circumstances:
1) the determination was issued as a result of fraud, corruption, misrepresentation or other wrongful conduct; or
2) the CCB exceed its authority or failed to render a final determination; or
3) with respect to a party’s default based upon excusable neglect.
What to Consider Before Filing a Claim With the CCB
While filing a claim with the CCB may be a cost-effective and efficient way for copyright owners, especially individuals, to protect their rights, there are certain benefits to filing an action in federal court. The low cost and efficiency of streamlined online proceedings before the copyright experts at the CCB need to be balanced against the availability of much higher potential monetary awards, the availability of injunctive relief (i.e., a court can order a defendant to either take affirmative steps or to stop infringing conduct and can even order the impoundment and destruction of infringing items), the right to a jury trial and broad rights of appeal to appellate courts.
If you are a party that has been served with a claim before the CCB, you should carefully consider whether to participate in the proceeding or to opt out. While participating limits your potential liability significantly, many claimants will not have the resources to pursue a lengthy and costly lawsuit in federal court or may not be able to proceed if there is no copyright registration. Opting out of a CCB proceeding could deter a claimant from proceeding against you at all. Also, if you are considering bringing a counterclaim, you will have more forms of relief available to you in federal court, such as a right to a jury trial and a broad right of appeal.
In either case, whether you’re considering filing a claim or opting out of a proceeding, it’s best to consult with experienced copyright counsel to make an informed decision as to how to proceed.
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