Congress Shouldn't Turn the Copyright Office Into A Copyright Court

While most people are focused on net neutrality, surveillance, and tax reform, a few legislators are quietly mulling over a different problem: copyright reform. 

Five years ago, Representative Bob Goodlatte, chair of the House Judiciary Committee, launched a series of hearings and studies that he said would lead to comprehensive copyright reform. EFF and many others testified on the merits and problems in virtually every facet of copyright law, and we all waited expectantly for the “Next Great Copyright Act.” For better or worse, that dramatic reform never happened. Instead, we got the CASE Act, a bill to create a small claims process for copyright. The impetus behind this bill comes largely from photographers and other visual artists, who want a way to bring small-value copyright claims with lower expenses. They are legitimately concerned that the cost of litigation puts strong copyright protection out of reach for many artists.

But the CASE Act is not the right solution. First, it would create a new quasi-court within the Copyright Office. Aside from the constitutional questions that raises, the Copyright Office is not known for its neutrality on copyright issues. Second, the powers given to this new tribunal would invite gamesmanship and abuse. Third, it would magnify the existing problem of copyright’s unpredictable civil penalties. Finally, it would put this new tribunal in charge of punishing DMCA abuse, but sharply limit the punishment available, undermining what little deterrent effect still exists in the statute.

Let’s break it down.

The CASE Act Would Turn the Copyright Office Into a Copyright Court

The current bill, the “CASE Act of 2017” (H.R. 3945), would set up a “Copyright Claims Board” within the Copyright Office, staffed by three judges called “Claims Officers” and empowered to hear copyright complaints from all over the country. Proceedings at the Claims Board would be voluntary, but if a respondent fails to opt out, the proceedings become binding, and the outcome can be enforced in federal court. The Board can issue damages awards of up to $15,000 per work infringed, or $30,000 per proceeding. If the parties consent, it can also issue “agreements to cease infringing activity” that become binding injunctions.

Unfortunately, the Copyright Office has a history of putting copyright holders’ interests ahead of other important legal rights and policy concerns. We fear that any small claims process the Copyright Office conducts will tend to follow that pattern.

The CASE Act’s “opt-out” approach, which attempts to make the process more palatable by allowing defendants to choose to go to federal court instead, doesn’t help. If the process required respondents to give affirmative consent, or “opt-in,” the Copyright Office would have greater incentive to design proceedings that safeguard the respondents’ interests, and clear standards that everyone can understand. Equally importantly, an opt-in approach would help ensure that both participants affirmatively choose to litigate their dispute in this new court, and help prevent copyright holders from abusing the system to obtain inexpensive default judgments that will be hard to appeal (grounds for appeal are sharply limited).

More Automatic Civil Penalties, No Need to Show Harm

The bill would make copyright’s already unfair and unpredictable civil penalty regime even worse. Current law lets courts award civil penalties, known as statutory damages, of up to $150,000 for each copyrighted work infringed. These penalties go to the copyright holder, but aren’t tied to any measure of actual harm. In fact, copyright holders don’t have to introduce any evidence at all to show that they were harmed by an infringement (or that the infringer profited). Statutory damage awards vary wildly from one case to the next, making copyright lawsuits a game of financial Russian roulette for defendants.

Under current law, statutory damages do have a small safety measure attached: they’re not available for works that weren’t registered with the Copyright Office in a timely way. That rule is important because copyright applies automatically to creative works the moment they’re fixed in a tangible form. The timely registration rule limits the universe of works that are eligible for statutory damages. The CASE Act would throw that safety away. While the Act limits the damages available in a single proceeding, it allows statutory damages of up to $7,500 for works that were not timely registered. That makes countless millions more works eligible for automatic, no-proof-required civil penalties. It’s worth noting that a majority of U.S. states limit small