Copyright Small Claims Act: Update - Creative Law Center

Copyright Small Claims Act: Update

A copyright small claims court is an idea whose time has come. 

The problem with the current system of copyright enforcement in the United States is that it's too expensive and complex. Estimates are that it costs an average of ~$350,000 to prosecute a federal lawsuit to enforce copyrights. I have been involved in cases that have taken as long as seven years to resolve and cost my clients anywhere from $250,000 to $800,000. Most creative professionals simply can't afford to protect their rights. The game is for the big players only.

A Note about this Post

On October 22, 2019, the CASE Act  (H.R. 2426) passed in the House by a vote of 410-6. The bill was received in the Senate for action the next day. The language of the bill has changed since this post was originally written but its essence remains untouched. Here is the version of the bill that was sent to Senate.

The way it stands now, visual artists, authors, songwriters, bloggers, vloggers, and small businesses have rights in their creative properties, but no meaningful remedies when their work is taken. Certain members of Congress, working with key stakeholders, are trying to fix that problem.

Copyright Small Claims: the Proposal

On September 27, 2018, the House Judiciary Committee held a hearing on the Copyright Alternative in Small-Claims Enforcement (CASE) Act HR 3945. The CASE Act is an attempt to create a simple and inexpensive process that will allow creative professionals to bring claims of infringement or seek declarations of non-infringement.

The  idea of the current draft is that there would be a small claims tribunal called the Copyright Claims Board operating out of the Copyright Office. Three Officers would hear the claims. Attorneys would be optional; claimants could bring and argue their cases themselves. Hearings would be conducted electronically with no need to appear in person. So, no travel costs.

Using the Copyright Claims Board to resolve an issue is completely optional. A copyright holder does not need to file a claim there and the respondent (the person against whom the claim is filed) can opt out of the process.

Damages are limited. Statutory damages per work infringed cannot exceed $15,000, total damages cannot exceed $30,000. Filing an application for copyright registration is required before a claim can be brought. A claimant is limited to filing up to 10 cases per year, referred to as the "cap."

Activism Works

I am by no means an expert on the legislative process but before September 27th, the CASE Act had stalled in Congress. Other pieces of legislation impacting intellectual property rights, specifically addressing the rights of musicians, took priority. Individuals and organizations who have worked on the CASE Act continued pressing to have the bill moved forward.

In August, I went to Washington with one of my clients to meet with Joe Keeley, Chief Counsel of the Subcommittee on Courts, Intellectual Property, and the Internet of the House Judiciary Committee. Our goal was to express our support for the bill and push for a hearing.

My client, Elizabeth Putsche, has been involved in litigation over ownership of a body of work consisting of 15,000 photographs for nearly four years in four different courts, both state and federal in two different states. Her ordeal has turned her into a copyright reform activist. Her persistence, as well as the hard work of many others, resulted in a hearing being scheduled just a month after our visit.

Elizabeth Putsche and Kathryn Goldman after meeting at House Judiciary Committee.

The CASE Act: the Hearing

There were five witnesses at the hearing: two who represent organizations in support of the bill; two who represent various aspects of big tech who oppose the bill; and a photographer who wants a meaningful way to enforce her rights.

These are the witnesses you will see in the clip below (links are to their written testimony):

  • David P. Trust is the CEO of Professional Photographers of America. Mr. Trust does a nice job of laying out the struggles faced by creative professionals enforcing their rights. He emphasizes the real life impact the problem has on their ability to earn a living.
  • Matthew Schruers is Vice President for Law and Policy at the Computer and Communications Industry Association, a trade group. He's worried about the problem of trolls clogging up the system with claims against internet users who illegally download videos (mostly porn). I love the part where he pretends to speak for the millions of internet users who he really doesn't speak for but who can't be there to speak for themselves, but if they were they'd object. Representative Jeffries (D-NY) deals with Mr. Schruers's arguments handily toward the end of the clip. 
  • Jenna Close is a professional photographer and past Chair of the American Society of Media Photographers. She brought the point home, again and again, that though she may have the rights, she doesn't have the remedy to enforce them. The Committee showed her a great deal of respect. Her testimony was impressive, in both content and delivery. She's a boss.
  • Jonathan Berroya is Senior Vice President and General Counsel of the Internet Association. Mr. Berroya also represented big industry players. His primary concern was that the bill should not undermine §512 of the DMCA protections for internet service providers.  But later, he overstepped his charge with a hypothetical about a needle pointin' grandma from Boca Raton. Representative Doug Collins (R-GA) gave Mr. Berroya a solid smack-down over the use of a hypothetical. It's fun to watch, but I'm sure Mr. Berroya still isn't happy about it.
  • Keith Kupferschmid is the CEO of the Copyright Alliance. My impression is that he has taken the laboring oar on negotiating this legislation on behalf of creative professionals. In his written statement, he thoughtfully details the reasons and compromises that make the CASE Act read the way it does.

I distilled eight minutes of what I consider to be highlights from the 90-minute hearing:

If you are interested in watching the full hearing, the video used to be here but they've taken it down.

Copyright Small Claims Board and Fair Use

Out of all the issues discussed in the hearing, the one I found most compelling was raised by Representative Zoe Lofgren (D-CA). She wants to be sure that the doctrine of fair use is properly implemented by the proposed Copyright Claims Board. It's a valid concern. How can the defense of fair use be equitably applied by a Copyright Claims Board if there is no meaningful appeal or oversight?

A fair use analysis is the responsibility of the copyright owner before bringing a claim. It is also the responsibility of the individual or entity who uses the creative work of others. How can the legislation incorporate an even-handed and legally honest application of fair use? 

Turning the Copyright Small Claims Bill into a Law

The hearing ended with a request from Chairman Bob Goodlatte (R-VA) that all participants consider and present language that would address the issues raised at the hearing.

This bill, although it is bi-partisan in the House, does not have a counterpart in the Senate. The Senate Judiciary Committee has been distracted by other matters. Sponsors in the Senate are needed. I suspect that grassroots efforts to recruit one or more sponsors are underway. It wouldn't surprise me if the Senate sponsor came from a smaller state, they tend to be more responsive. If you know one, you could help out here.

Key Takeaways

It's just a matter of time before the CASE Act becomes law. When it does, you will need to have copyright registrations on your work to enforce your rights. File them now. You'll need them later.

Activism works. Speak up for your rights and not only will you be able to keep them, you will be able to enforce them.

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About the Author

Kathryn Goldman helps small business people, writers, artists, and creative professionals make a living from their creative work by teaching them how to protect and enforce their rights. She is an attorney who writes these posts to help you be more thoughtful about intellectual property and the law as you build your business, write your stories, and create your art.

  • Thom Reece says:

    Kathryn: The link listed in the article to watch the full video of the hearing is a dead link. Any chance you have a correct one?

  • Thom Reece says:

    Thanks for the update on this important legislation, Kathryn. It appears that the bill, as it is now framed, has a few serious loop holes. I wonder how remedies might be proactively influenced in the mark-up stage when the Senate and House get together to work out differences and concerns? What kind of strategy would you suggest?

  • I support the law, but the option for the accused party to simply opt out makes it seem like it lacks teeth. If the person who infringed can just decide not to cooperate then how enforceable is this bill if it becomes law? That’s my one gripe, because my guess is that if infringers facing litigation know they can just opt out, won’t most of them do so?

    • The CASE Act is not a perfect solution by any means. The ISP industry would prefer opt-in which would be even worse. As Ms. Close mentions in her testimony (which I may not have included in the clip) with opt-out at least the infringer has to take some action. As it stands now, they just ignore DMCA takedown notices directed to them. Also, if the infringer opts out and the copyright holder chooses to proceed in federal court, there are the risks of much higher damages and attorneys fees.

      One step at a time, I think.

      • me says:

        If the infringer opts out will that work against them if the case goes to federal court? Also, if they opt out would they need to agree to anything at all, like jurisdiction?

        I think if they faced possible extra penalties for not cooperating and also had to agree to the area where the case would be held it would work!

        • Those are both great ideas. I don’t know if they have been raised before. I’ve reached out to the Copyright Alliance and I will ask about the negotiations relating to the statutory language when I hear from them.

          • Recently I read the latest article from Copyright Alliance about the CASE Act here:

            I was previously under the impression that there would be *some* consequence for opting out, however minor, but it looks like there is none at all.
            The only consequence is the risk of being taken to federal court – which is exactly the same whether or not the CASE Act becomes law.
            I had brought up this complaint to the Copyright Alliance and received this in the reply:
            “This bill is not aimed at protecting infringers. The primary goal of this bill is to give creators who presently cannot afford federal court (and as a result have no way to enforce their rights) a less expensive alternative. Statistics show that the average cost of hiring an attorney and suing for infringement in federal court is well above $200,000, which is more than most creators (including both middle class and low-income creators) can afford. The CASE Act would create an alternative with a simplified process that would allow creators to more easily represent themselves, use the assistance of law students in legal clinics, or obtain low-cost or pro bono representation from attorneys.

            However, because this is an alternative to federal court, the constitution requires that it be made optional. This leads many to question why anyone would choose to participate. For that reason, you may hear supporters of the bill discussing why the CASE Act is advantageous not only for creators but also for accused infringers.

            At the end of the day, an accused infringer can never be sure whether the creator whose work they’ve infringed can afford federal court, or may even be able obtain pro bono representation to take the case to federal court. So deciding to opt out could be a gamble that leaves them in a worse position. And a federal court could look at that decision to opt out unfavorably. So while infringers may opt out, many might decide to settle with the creator (this has been the result in the UK where a similar small claims process was enacted a few years ago), or actually choose to participate in the small claims process where the potential damages are lower than in federal court. ”

            While it’s true they may not know whether or not the creator has pro bono representation, they might also very well know how very few cases ever make it to court at all and that the expense and time are the reason why.
            It’s not too hard to assess how large a company is, there are even sites dedicated to reporting on how much companies make so I wouldn’t bank on the risk of federal court under the CASE Act any more than it would matter right now.

            Is there any other aspect that can be added to the bill that would give the infringer more incentive to opt in, or create a consequence for not using the copyright tribunal?
            Why wouldn’t there be any public record of the suit being brought forward as there is with other types of lawsuits?

            It mentions that federal courts may see their opting out unfavorably, but contrary to what I thought might be enforced before seeing the details, there are no rules in place or specific federal penalties for opting out at all, so it still seems to lack teeth for me.
            I would still rather have the CASE Act go through than have nothing, but, I feel like we need reform of copyright law in general all around in order to really protect artists from all walks of life, not just the middle class that is mentioned in talks of the CASE Act.
            What about the working class? Have none of these sponsors of the bill heard of the age old term ‘starving artist’? It’s known because too often it’s true.
            Artists are not often middle class in the first place – especially these days as the middle class keeps shrinking and the number of those living around the poverty line increases, and I still feel like there is something lacking if it’s as easy as just saying ‘no’ for the infringer and it leaves a struggling artist in the same situation they were in in the first place.

            In an ideal world, copyright cases could be brought before any state court rather than requiring the cost of federal. Why must they be brought before federal court in the first place when other legal issues don’t have that restriction?
            I know it would never happen anytime soon, but ideally I wish the federal requirement would get struck and we had the option to fight through any state court.

            How about a monetary penalty if it does go to court and the infringer is found guilty after opting out of small claims?
            Or, how about a default ruling in favor of the claimant if the infringer never responds to the notice?
            How about a public notice of the filing whether they opt out or not?

            Any of these things would help make it more enforceable. As it stands, I don’t feel much more protected with it than I do currently and many artists share my concerns.
            Who should I go to with these concerns to get them heard by the people pushing the bill?
            Do I have a better chance going to my state senators or representatives, or to one of the people already active in pursuing the CASE Act?

    • The opt-out system is a little sticky, yes, I agree with you Angela, but as Katherine points out this bill is a step in the right direction (and opt-in – which is essentially what we have now – is infinitely worse) and will probably not be perfect. My other thought about opt-out, besides the fact that is DOES force the other party to acknowledge the claim and take some form of action, is that in many instances they would prefer the more affordable and timely path of a small claims settlement than the threat of going to federal court. There are, according to a big business lawyer I met awhile back, many companies that expressed to her that they are actually in favor of a small claims option as it is easier for them as well.

      The other thing I would like to point out, while not related to this issue specifically, is an often overlooked aspect of this bill: the more we creators have a remedy to infringement that we will use, the more we will be educating those who mistakenly think everything on the internet is free. When actions have consequences – real ones – word gets around. Copyright infringement is, in my mind, a cultural issue as much as anything, and when creators have an actual stick to hit back with, we have the power to truly change the minds of those around us.

  • I would like to add, as a member of the Writers’ Union of Canada, how dreadfully the Fair Use Clause in our Copyright Legislation has been interpreted by Schools and Universities. Basically, they have decided that all use is “fair” and no longer pay anything at all to writers or publishers for use of our work in their classes. Right now, they are even taking our representatives to court for *back* payments to us. I urge creators in the USA to be very aware of this kind of misuse of “fair use”.

  • Dear Kathryn,
    I very much appreciate being kept informed of such important issues. You do extremely important pro bono work, Kathryn. Thank you! I might use the CASE system once it is established, unless as a Canadian citizen I would not be allowed. Does the Statute of Limitations exist in the United States on copyright infringement lawsuits, or other copyright violations? Will CASE have a Statute of Limitations? Thanks again.

    • Welwyn,
      Canadian citizens who have registered their copyrights with the U.S. Copyright Office will be able to bring claims before the Board. A claim cannot be brought against a non-U.S. citizen unless it is a counterclaim against a person who originated a claim. There will be a three year statute of limitations.

      So, if the infringement happens in the U.S., non-U.S. nationals will be able to use the law.


  • Thanks, Kathryn, for continuing to keep us informed. As you said, too many relevant issues are being drowned out by the current situation clogging media coverage. Appreciate everything you do to help the “little people”.

    • In my email this morning, I used the phrase “creative middle class.” I heard Rep. Collins say it during the hearing. What do you think of that phrase? Is it politically neutral or politically charged?

      • I like it. Much better than the “richly creative poverty-stricken”, or similar!

      • CS says:

        “Creative Middle Class” doesn’t bother me but I’ve been using “independent creatives,” (or creators), and sometimes throwing in “creative small businesses.”

        • I’m not sure, I wonder why it’s focused on middle class only rather than working class as well? So many artists are struggling to make a living, hell I don’t even think that I would be considered middle class once the cost of living in the SF bay area and all expenses are considered. I like the term independent artists or creatives, or creative small businesses đŸ™‚ That way, we aren’t leaving a group out of this, particularly a group that has the hardest time fighting for their rights.

  • Debbie says:

    Hi Kathryn,

    I want to thank you so much for sharing this important information. You are really a jewel. As a up-and-coming author, hopefully to be published before the year’s end, I have been worried about how easily it is for someone to infringe on my work. Not saying that anyone has or will, but it’s always a possibility, and I would like to know I have the best protection possible when I share my work as a small creative. Especially, sense I’m writing a screenplay, too, where I know theft is probably higher in that area. It is for that reason, I will be sure to get a NDA, register my works with the copyright office, and maintain all my records of interaction with any contacts I share with. With that said, I will include all records related to creating the works.
    I can’t wait for the CASE Act to become law.

    Thanks again, and I appreciate you and all you do!

    • You’re welcome, Debbie. Let me add a thought about “always” using an NDA. Not everyone will sign them, even reputable people refuse to sign them because they do not want somebody coming back accusing them of stealing an idea that they had independently. When to use an NDA or walk away from a potential collaboration when someone won’t sign it requires a judgment call. Some folks will sign anything and still aren’t trustworthy; others can be trusted on a hand shake.

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