Tag: Librarian of Congress

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Copyright Legislation

Just What Is the Case with the CASE Act? A Brief Overview

The following post comes from Ryan Reynolds, a 3L at Scalia Law and Research Assistant at CPIP.

chrome copyright symbolBy Ryan Reynolds

The phrase “creators have rights, but no remedies” is likely familiar to those aware of the current landscape of copyright protection for individual creators and small businesses (“Creators”). While the Copyright Act of 1976 grants a bundle of rights to Creators for the protection of their works, for years Creators have faced an uphill battle enforcing those rights against infringers. There are many who are optimistic, however, that things might soon change with the passage of “The Copyright Alternative in Small-Claims Enforcement Act of 2020” (CASE Act).

Signed into law as part of H.R. 133, the Consolidated Appropriations Act, [for Fiscal Year] 2021 (“CAA”), the CASE Act creates a Copyright Claims Board (“CCB”) within the Copyright Office to handle small copyright claims (small only in the sense of their relatively modest economic value). As there is some time before the CCB comes into operation, the earliest being December 21, 2021, and the latest June 2022, now is a good time to provide an overview of just what the CASE Act does. Before venturing fully into the mechanics of the CASE Act, however, it is important to first highlight why its supporters felt it was needed.

Why Is It Needed?

Copyright cases are almost exclusively an area of federal jurisdiction, meaning that copyright infringement cases must be brought in a federal rather than state court; however, litigating a copyright infringement case in federal court is anything but easy. First, the average cost of litigating a copyright infringement claim has been estimated at $397,000—a cost that often greatly outweighs any potential recovery for Creators’ works. It is for this reason that many attorneys are simply unwilling to take Creators’ copyright infringement cases, leaving many Creators feeling disenfranchised.

Second, the complexity of the federal court system is often overwhelming for Creators. As stated in the Copyright Office’s 2013 Copyright Small Claims report, “Small copyright owners, who frequently lack experience with federal courts, often find federal litigation too difficult . . . and may be unable to navigate ‘the often complex procedural rules that govern federal litigation . . . .’” As highlighted in the report, even the Copyright Act’s registration requirement—the gateway requirement to launch a copyright infringement claim—can be problematic for Creators. It requires that a copyright owner successfully register, or receive a rejection of registration, from the Copyright Office before launching an infringement claim. Moreover, for a Creator to qualify for statutory damages and attorney’s fees, the Copyright Act requires the registration of the work within three months of its publication, or if unpublished, before the act of infringement. The failure to register within the required time is critical, as without the potential recovery of statutory damages (which can range up to $150,000 per work infringed), a Creator’s recovery would not likely overcome the legal fees incurred litigating the case.

As stated in the report, the result of this cost and complexity is that “federal court is effectively inaccessible to copyright owners seeking redress for claims of relatively low economic value, especially individual creators who are of limited resources.” Enter the CASE Act, which aims to create a less expensive and less procedurally complex alternative to the current system by creating the CCB within the Copyright Office. But how will the CCB operate?

How Will It Operate?

When the CCB becomes operational, a party will have the choice of commencing a copyright infringement proceeding in either federal court or the CCB. In contrast to federal court, and as will be discussed in more detail later, proceedings in the CCB are completely voluntary. Another way in which the CCB differs from federal court is in its authority over copyright infringement claims only where the total damages sought do not exceed $30,000. As to the CCB’s structure, it will be composed of three full-time Copyright Claims Officers. Each of the Officers must have seven years of legal experience; two of them must also have extensive copyright adjudication experience, while one must have extensive alternative dispute resolution experience. The Librarian of Congress will appoint these Officers to staggered six-year terms, and they will be supported by at least two full-time Copyright Claims Attorneys with at least three years of experience.

To make the CCB more accessible to Creators, the CCB’s proceedings aim to be more streamlined and user friendly than federal courts. A proceeding before the CCB begins when the claimant files a claim to the CCB that includes the proper filing fee and a statement of the material facts. In contrast to federal court, the CASE Act only requires a completed application for registration of the claimant’s work(s), rather than a certificate of registration or refusal of registration by the Copyright Office to commence the claim. After the claim is approved for compliance with the law and applicable regulations by a Copyright Claims Attorney, the claimant has 90 days to complete service. After receiving service, the respondent then has 60 days to opt out of the proceeding before it becomes “active”; however, in the “interests of justice,” the CCB can extend this window another 60 days.

The user-friendly goal of the CCB is best exhibited by the Act’s requirement that the proceedings take place solely “by means of written submissions, hearings, and conferences carried out through internet-based applications.” The only exception to this convenience is when there is “material” “physical or other nontestimonial evidence” that otherwise the CCB cannot review. Further, proceedings before the CCB will be more informal than in federal court. There is no requirement for representation by an attorney, there is limited discovery, and the formal rules of evidence do not apply. If the parties do not settle, at the close of the proceeding the CCB must make factual findings based on the preponderance of the evidence and issue a publicly available written determination.

With regard to remedies, the CCB has the authority to award either actual damages, and the respondent’s profits, or statutory damages. If the CCB awards statutory damages, it “may not make any finding that, or consider whether, the infringement was committed willfully,” and if timely registration has been made with the Copyright Office, the CCB can award up to $15,000 for each work infringed, though this is subject to a $30,000 maximum. In an important shift from existing law, however, even if the work was not timely registered, the CCB may still award up to $7,500 for each work infringed to a maximum total of $15,000 in a single proceeding.

Within 30 days of the issuance of the final determination of the CCB, a party can request reconsideration by the CCB. After giving the other parties an opportunity to respond, the CCB may either deny the request or amend the determination. If the CCB denies the request for reconsideration, a party then has 30 days to request the Register of Copyrights to review the CCB’s determination. After giving the other parties time to respond, the Register may deny or remand the proceeding to the CCB for reconsideration. Finally, within 90 days of the final determination, or the post-determination reconsideration, a party can appeal to a U.S. District Court. It is also in federal district court where a party can seek enforcement of the CCB’s determination if the other parties to the matter refuse to abide by its determination. For a visual representation of this process, the Copyright Alliance has put together an informative flowchart.

The CASE Act requires that three years after the CCB becomes operational the Register of Copyrights make assessment of its effectiveness. While whether the CASE Act will create the change hoped for by its supporters is yet to be seen, in my view, the attention given to address the challenges to Creators is critically important.

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Copyright

Senate IP Subcommittee Hearing Addresses Section 1201 Reform

The following post comes from Liz Velander, a recent graduate of Scalia Law and a Research Assistant at CPIP.

U.S. Capitol buildingBy Liz Velander

Last week, the Senate Intellectual Property Subcommittee, led by its Chairman, Senator Thom Tillis (R-NC), held a hearing entitled “Are Reforms to Section 1201 Needed and Warranted?” The hearing explored Section 1201’s operation, as well as potential reforms to improve the effectiveness of Section 1201 in the administration of the triennial rulemaking proceeding that establishes temporary exemptions. Chairman Tillis was particularly interested in hearing proposals to further streamline the rulemaking process and to amend the statute so that exemptions permit third-party assistance.

The hearing consisted of two panels. First, the U.S. Copyright Office, who administers Section 1201 rulemaking. Second, industry and academic experts who shed light on how Section 1201 has been working for copyright owners and users, and the practical implications of potential reforms. Regan Smith, General Counsel and Associate Register of Copyrights, U.S. Copyright Office, was the sole panelist on Panel I. Panel II included: Vanessa Bailey, Global Director, Intellectual Property Policy, Intel Corporation; Professor Blake Reid, Director, Samuelson-Glushko Technology Law & Policy Clinic, University of Colorado Law School; Matthew Williams, Partner, Mitchell Silberberg & Knupp LLP; Seth Greenstein, Partner, Constantine Cannon LLP; Morgan Reed, President, ACT | The App Association; and Aaron Lowe, Senior Vice President, Regulatory and Government Affairs, Auto Care Association.

Section 1201 of the Digital Millennium Copyright Act (DMCA) protects “technological measures,” also known as “technological protection measures” (TPMs), employed by copyright owners to protect their works from unauthorized access or use. Section 1201 gives copyright owners a cause of action when someone circumvents TPMs that have been employed to prevent unauthorized access or use of their copyrighted works. Common examples of TPMs include password systems that prevent nonsubscribers from accessing streaming services, code that prevents DVDs from playing on unauthorized devices, and code that prevents a purchaser from copying the text of an e-book or sending the file to others.

Congress enacted Section 1201 to foster a lawful online market for copyrighted works while providing several statutory exemptions to avoid impeding lawful uses. For additional flexibility, the law authorizes the Librarian of Congress to adopt temporary exemptions following a rulemaking proceeding administered by the Copyright Office every three years. During the triennial rulemaking, the Copyright Office solicits exemption petitions from the public and develops a comprehensive administrative record using information submitted by interested parties. Based on the evidence submitted, the Register of Copyrights provides a written recommendation to the Librarian of Congress as to which exemptions are warranted, along with proposed regulatory text. Upon the Librarian’s approval, the exemptions are published in the Federal Register and remain in effect for three years.

In the seventh triennial rulemaking (2017-2018), the Copyright Office instituted a new “streamlined” process for renewing existing exemptions. In this streamlined process, proponents of an existing exemption can petition to have the exemption renewed by certifying that they are not aware of material changes in fact, law, or other circumstances that would justify reevaluating the basis for the exemption. If the Copyright Office does not receive an objection outlining relevant new circumstances, the exemption will be renewed without going through the traditional three-step commenting process. These changes have greatly improved the efficiency of the rulemaking process.

On the first panel, Ms. Smith, representing the U.S. Copyright Office, explained the crux of the dispute about Section 1201 reform. On the one hand, “some Section 1201 stakeholders credit the subsequent explosion of legitimate digital dissemination models to the protection established by section 1201 in 1998.” On the other hand, “stakeholders express that the growing ubiquity of software-enabled products in American life—automobiles, refrigerators, medical devices, and so on—raises concerns that Section 1201 may be operating with an unintended reach that the permanent exemptions and the triennial rulemaking only partially address.” In 2017, the Copyright Office “completed a comprehensive study in the operation of the law, taking into account stakeholder perspectives throughout the copyright ecosystem.” It concluded that “while the overall framework of Section 1201 appears to be functioning as intended, the system would benefit from certain updates to the rulemaking procedures, as well as targeted legislative reforms.”

Ms. Smith listed the recommended legislative reforms in order of priority. First, for Congress to provide discretion in the rulemaking to adopt exemptions that permit third-party assistance at the direction of the intended user. Second, for reconsideration of several changes to the permanent exemptions for security testing and encryption research, “including expanding the types of permitted activities, easing the requirements to seek authorization from the owner of the relevant system or technology, and eliminating or clarifying the multifactor eligibility tests for certain statutory exemptions.” Third, for Congress to adopt new permanent exemptions, such as: “an exemption to enable blind, visually impaired, or print disabled person to utilize assistive technologies; an exemption for unlocking used mobile devices; and an exemption to allow diagnosis, repair, or maintenance of a computer program, including to circumvent obsolete access controls.” Finally, Ms. Smith recommended legislation to provide for presumptive renewal of exemptions adopted in the previous rulemaking cycle.

On the second panel, stakeholders argued for and against legislative reform. Ms. Bailey, representing Intel Corporation, testified that “the Librarian of Congress has struck the right balance between ease of use and content protection under the existing regulatory framework.” She described Section 1201 as “the bedrock on which the digital content ecosystem is built.” She urged against legislative revision, arguing that “the reliable protection provided by Section 1201 is essential to the maintenance of industry-standard TPMs and the digital content ecosystem.”

The next panelist, Prof. Reid, strongly disagreed with Ms. Bailey. He represented “people who are blind, visually impaired, or print disabled, educational disability services professionals, and security researchers.” Prof. Reid argued for expansive changes to the triennial rulemaking process, asserting that “the triennial review regularly imposes an unnecessary and unfair burden on decent, hard-working people who play by the rules and who merely seek to go about their livelihoods and serve their communities without fear of breaking a law that could subject them to ruinous liability in federal court litigation or even criminal charges.” Mr. Greenstein echoed many of Prof. Reid’s concerns about Section 1201’s overreach. He proposed a number of legislative reforms to the Subcommittee, such as allowing third parties to obtain the means to circumvent access in order to repair consumer products at the direction of the intended user. “Congress intended Section 1201 is protect copyrights, not business models,” stated Mr. Greenstein.

Senator Chris Coons (D-DE) sought feedback from other panelists about the suggestion that Congress provide the Librarian flexibility to allow consumers to seek third-party help. Mr. Reed, representing the App Association, asserted that we already have a “robust ability” to conduct authorized repair. Ms. Bailey agreed, stating “the Copyright Office has already taken steps to make the exemptions more usable.” She pointed out that “unlike anti-circumvention exemptions, which can be modified or abandoned if they prove less useful than expected, should an anti-trafficking exemption be improvidently granted, the effects on the marketplace would be permanent because the tools can’t distinguish between permissible and impermissible use.”

Senator Richard Blumenthal (D-CT) was specifically concerned about voting machine integrity, asking the panel whether they would support a permanent cybersecurity and voting machine exemption. Prof. Reid stated that such an exemption is “critical to the cybersecurity of this country and the future of our democracy.” Mr. Reed and Ms. Bailey both reiterated their position that a legislative change was unnecessary because the Copyright Office already had the flexibility to address the issue.

The hearing was cut short by a live vote, and Chairman Tillis concluded the hearing by thanking each panelist and stating that they may submit further comments to the record.

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Copyright

IP Scholars Explain Why We Shouldn’t Use SurveyMonkey to Select Our Next Register of Copyrights

Washington D.C. at nightIn a letter submitted to House Judiciary Committee today, nine IP scholars (organized by CPIP’s Sandra Aistars) express their support for the Committee’s proposal to modernize the Copyright Office. The letter identifies three major challenges facing the Copyright Office, including “(1) insufficient funds, staff, and infrastructure to efficiently perform its core functions; (2) operational impediments stemming from its integration with the Library of Congress; and (3) potential risk of constitutional challenges to its decision-making authority should the Office take on increased regulatory or adjudicatory responsibility.”

The IP scholars laud the Committee’s recommendation that the Office be led by a principal officer of the government, nominated and confirmed like other senior government officials. The scholars also express their concern with the Library’s highly-unusual method of using a SurveyMonkey questionnaire to identify the knowledge, skills, and abilities required to run the Copyright Office.

On December 16th, the newly-appointed Librarian solicited the public to “provide input to the Library of Congress on expertise needed by the Register of Copyrights.” The survey consists of the following three questions:

    1. What are the knowledge, skills, and abilities you believe are the most important for the Register of Copyrights?

 

    1. What should be the top three priorities for the Register of Copyrights?

 

  1. Are there other factors that should be considered?

The survey then provides an area to upload additional comments and assures that the feedback “will be reviewed and will inform development of knowledge, skills and abilities requirements for the position.”

While there may be benefits to soliciting public input on the knowledge, skills, and abilities a Register of Copyrights should embody, as the IP scholars’ letter points out, relying on a limited SurveyMonkey experiment discounts the guidance codified in Section 701(b) of the Copyright Act. Section 701(b) already lists the functions and duties of the Register of Copyrights, including:

(b) In addition to the functions and duties set out elsewhere in this chapter, the Register of Copyrights shall perform the following functions:

 

(1) Advise Congress on national and international issues relating to copyright, other matters arising under this title, and related matters.(2) Provide information and assistance to Federal departments and agencies and the Judiciary on national and international issues relating to copyright, other matters arising under this title, and related matters.

(3) Participate in meetings of international intergovernmental organizations and meetings with foreign government officials relating to copyright, other matters arising under this title, and related matters, including as a member of United States delegations as authorized by the appropriate Executive branch authority.

(4) Conduct studies and programs regarding copyright, other matters arising under this title, and related matters, the administration of the Copyright Office, or any function vested in the Copyright Office by law, including educational programs conducted cooperatively with foreign intellectual property offices and international intergovernmental organizations.

(5) Perform such other functions as Congress may direct, or as may be appropriate in furtherance of the functions and duties specifically set forth in this title.

Rather than crowd sourcing the job description, the Librarian should review the Copyright Act and consider candidates that would be best qualified to fulfill the explicit and established standards of 701(b).

By handing this over to anyone willing to fill out a SurveyMonkey form, the Library of Congress is politicizing a process that shouldn’t be politicized. The letter warns that “[w]hile it is often laudable to seek public input on important issues of policy, an online survey seeking input on job competencies from any internet user is an inefficient and inappropriate approach for developing selection criteria for this important role, particularly where such minimal background is provided to survey-takers and where there appears to be no mechanism to encourage constructive comments.”

As recently as April of last year, Fight for the Future incited an effort to spam the Copyright Office while it solicited comments regarding the DMCA notice and takedown process. Engaging in a campaign of misinformation, the advocacy group flooded the Office with automated “comments” that crippled the regulations.gov website during the last 48 hours of an important collection period. The Register’s selection process should not be handed over to Internet bullies and trolls.

The next Register of Copyrights will have an immediate and lasting effect on the administration of copyright laws, and the Library of Congress should respect long-standing norms as well as Congress’s instructions as embodied in the Copyright Act. The IP scholars’ letter reiterates that the statutory obligations of Section 701(b) require certain competencies of a Register of Copyrights and ensures that “the successful candidate can meet the management and leadership expectations attendant to a senior executive officer position in the federal government.” This is an important process that deserves more serious consideration than a SurveyMonkey poll.

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Administrative Agency Copyright Uncategorized

A New Librarian of Congress and a New Copyright Office

By Sandra Aistars

U.S. Capitol buildingWith the Senate considering the confirmation of Dr. Carla Hayden as the next Librarian of Congress, I have joined thirteen other intellectual property law professors in an Open Letter suggesting that her confirmation should serve as an important reminder that the U.S. Copyright Office, a department within the Library of Congress, needs to be updated so that it can best serve the needs of the American people in the digital age.

As President Obama stated in his announcement of the nomination, “Dr. Hayden has devoted her career to modernizing libraries so that everyone can participate in today’s digital culture.” Indeed, I share Dr. Hayden’s enthusiasm for modernizing our libraries so that they can better promote and preserve our nation’s collective learning and culture for all to enjoy. This is especially important when it comes to the Library of Congress, the oldest and largest cultural institution in the United States.

However, it’s also important to provide the Copyright Office with the resources and authority it needs to perform its role as the nation’s leading expert on copyright law and a major facilitator of the marketplace for creative and scholarly works. Members of Congress and numerous stakeholders have been calling for modernization of the Copyright Office for years. They recognize that the Office faces significant structural challenges that limit its effectiveness in serving the American public. As the Office notes in its recent strategic plan, “there is no question that it must now modernize to meet current and future needs.”

Even though the Copyright Office and the Library of Congress have significantly different business needs, the Office is stuck using the Library’s information technology (IT) systems, which are not only antiquated, but were designed to serve a different purpose. A recent report by the Government Accountability Office finds that “serious weaknesses” in the Library’s IT systems are thwarting the Office’s ability to fulfill its mission in registering, recording, and depositing copyrighted works. The Office needs funding to improve these essential IT systems and to tailor them to its specific needs.

The legal structure of the Copyright Office should also be updated to best position it for success. There is currently no agency with independent, comprehensive rulemaking authority when it comes to copyright law. The Register of Copyrights can only establish regulations for administering the duties and functions of the Copyright Office, subject to approval by the Librarian of Congress. This inefficient structure burdens the Librarian with responsibilities that more appropriately should fall on the Register—the fully-vetted, leading expert in the Copyright Act.

Moreover, the Register of Copyrights is not appointed as a principal officer of the United States by the President. This means that should the Office take on additional duties like administering a small copyright claims court, the Register could not appoint and oversee the administrative law judges that would run this process. Likewise, the Register currently has no power over the three judges of the Copyright Royalty Board that determine the rates and terms of statutory copyright licenses. Congress has consistently assigned the Office more duties and relied upon its vast proficiency in copyright law, but the authority of the Register has not been updated accordingly.

Although I and the other signatories of the Open Letter do not all agree on every issue in copyright law, including where the Copyright Office should be positioned within our government, we do all agree that the Register of Copyrights should be a principal officer of the government. Only when the Register is appointed by the President and confirmed by the Senate will she have the authority and accountability appropriate to administer our nation’s copyright system.

The confirmation of Dr. Hayden as the new Librarian of Congress promises us the much-needed modernization of the Library of Congress, and it also provides us with the opportunity to reflect upon the needs of the Copyright Office. Both the Librarian and the Register play important roles in promoting and preserving our nation’s culture, but those roles are fundamentally different in nature. These two talented leaders should work closely with each other as partners, each possessing the authority and responsibility suitable for their differing areas of expertise.

The time to modernize the Copyright Office is now. Congress can ensure the continuing success of our copyright system by providing the Office with the resources and authority it needs to better serve us all in the digital age.

To read the full Open Letter, please click here.