CASE Act Explained

This apparent disparity in access to justice for wealthy and indigent copyright owners has been the subject of conversation and debate within the legal and arts communities, prompting a federal legislative attempt at finding a solution. The Copyright Alternative in Small Claims Enforcement Act of 2019 (CASE Act) is a proposed congressional amendment to the current copyright statute that would create an alternative dispute resolution program for copyright small claims and other legal proceedings. See, H.R. 2426, 116^th Cong. (2019); S. 1273, 116^th Cong. (2019). The bill calls for the establishment of a copyright claims board (CCB) — a small adjudicatory body housed within the Copyright Office to provide an alternative forum for the resolution of certain copyright disputes. Comprised of three experienced copyright attorneys, each appointed for a term of six years by the Librarian of Congress, the CCB would be tasked with conducting proceedings, issuing determinations and awarding monetary damages or other relief on a limited range of eligible copyright claims. These claims include: for infringement; for declarations of non-infringement; and for misrepresentation regarding notice and takedown of allegedly infringing online material, along with permissible counterclaims or legal defenses.

Many of the CASE Act's provisions are designed to reduce the costs and complexity typically associated with federal litigation. The bill would allow parties to a CCB proceeding to be represented by an attorney or qualified pro bono law student, or to participate pro se. Although the proceedings would be held at the Copyright Office in Washington, DC, there are no requirements for the parties or their witnesses to appear in-person. Rather, the proceedings would be conducted largely through written submissions, hearings, and conferences carried out online or over the phone, saving the parties a great deal of time and money on travel. Additionally, claimants and respondents in a CCB proceeding would each be subject to a "three strikes" rule with regard to the filing of claims or counter-claims, allowing up to two opportunities for amended filings with no additional filing fees or costs. The bill also attempts to avoid unnecessary costs associated with service of the claim by providing procedures for waiving the service similar to those outlined in the Federal Rules of Civil Procedure. (Compare H.R. 2426, §1506(g)(6) with Fed. R. Civ. P. 4(d).)

In exchange for the reduced costs and increased leniency in the filing process, the CASE Act contains a number of restrictions on financial recovery. The primary limitation is a $30,000 cap on total monetary recovery allowed in any given proceeding, which may consist of either actual damages and profits or statutory damages. Statutory damages awards are similarly capped at $15,000 per work infringed — roughly half the statutory maximum available in federal court — and do not allow for findings of willful infringement, which would normally increase the statutory damages maximum to $150,000. The CASE Act also mirrors current rules of federal copyright litigation in that it imposes a copyright registration requirement on parties seeking to bring claims for copyright infringement before a case may be filed or a determination rendered. Additionally, parties to a CCB proceeding would not be entitled to recover attorney fees absent a showing of bad faith by the opposing party.

Proceedings under the CASE Act are also entirely voluntary in nature, granting respondents the opportunity to "opt-out" of a proceeding within 60 days from the date of service. However, once a case has been deemed "active" following expiration of the opt-out period, the parties become subject to a form of binding arbitration, forfeiting their opportunity to have the case decided in court and waiving their right to a jury trial. H.R. 2426, §1506(g)(1); see also, §1507(a), stating that a final determination by the copyright claims board precludes relitigation of the claims by any court or tribunal.

Any party seeking to amend a final determination of the CCB must issue a request for reconsideration identifying a clear error of law or fact material to the outcome of the case within 30 days. Although the parties may request review of the final determination by the Register of Copyrights following a failed reconsideration request, such review is limited to consideration of whether the CCB abused its discretion in denying reconsideration. Judicial review of CCB determinations is likewise limited, with district court intercession permitted only in the case of: fraud, corruption, misrepresentation or other misconduct by the parties; a showing that the CCB exceeded its authority or failed to render a final determination on the subject matter at issue; or a showing of excusable neglect in the case of a default determination.

In spite of the apparent restrictions on monetary damages and the limits to judicial review or appeal, the cost-saving mechanisms and increased accessibility to justice provided in the language of the CASE Act have received widespread support from many arts organizations advocating for the interests of individual artists. Among them are the Copyright Alliance, the Professional Photographers of America, the Authors Guild and the Graphic Artists Guild. Other noteworthy supporters of the CASE Act include the American Bar Association, the AFL-CIO and the U.S. Chamber of Commerce.

The bill, which passed the House of Representatives on Oct. 22, 2019, by a vote of 410-6 was sent to the Senate for further deliberation. (The Senate Judiciary Committee approved the bill in September 2019). This new piece of groundbreaking legislation will empower independent artists to vindicate their right to enjoy the fruits of their creative labor.

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Ryan W. Morris is the executive director of Philadelphia Volunteer Lawyers for the Arts, a nonprofit legal services organization offering pro bono attorney referrals and educational services to qualifying individual artists, arts and cultural nonprofits and creative entrepreneurs in the greater Philadelphia region.