Showing posts with label Copyright Infringement Damages. Show all posts
Showing posts with label Copyright Infringement Damages. Show all posts

Thursday, April 14, 2022

Damages and Other Considerations when Bringing a Copyright Infringement Claim Before the USA's New Copyright Claims Board

Some barriers to entry in bringing or defending a copyright infringement claim in federal court include costs and the requirement for timely registration.

Concerning costs, the legal and expert expenses of federal copyright infringement lawsuits have made it difficult for plaintiffs and defendants who can not afford to spend a minimum of tens or hundreds of thousands of dollars, especially given that experts generally cannot be compensated on a contingent basis. (Further, in diversity actions, the minimum amount in controversy required to invoke the jurisdiction of the federal courts is $75,000.)

The US's CASE Act was designed to provide an avenue for plaintiffs to enforce their copyrights at lower cost and for defendants based in the United States to limit their copyright infringement damages to no more than $30,000 per proceeding by creating a so-called "small claims court" (technically a "Copyright Claims Board") for copyright infringement claims.  While there seem to be some big challenges in effecting the CASE Act's Copyright Claims Board's commencement of hearings, especially its reliance on law school programs and students who may be unwilling to participate, when it is up an running (hopefully later this year), I am optimistic that it may be a good option for potential clients who can't afford to retain legal counsel or experts and defendants who wish to limit their liability.

The second barrier to bringing a copyright infringement claim in federal court is the requirement that the infringed work (if it is a U.S. work) was registered timely with the Library of Congress (i.e., prior to the infringement or within three months after its publication).  If the work was not registered timely (and it is not a foreign work), the plaintiff cannot bring a claim in federal court. However, it can make a claim before the Copyright Claims Board newly established by the CASE Act. 

In any case, keep in mind that, the CASE Act process is voluntary; once a claim is filed, defendants have a sixty day period to opt-out. This method is not available to plaintiffs if the defendant is a federal or state government or a foreign entity, or for claims previously established in pending cases. Therefore, it may not be a proper venue for many cases, even before considering the damages limitations described below.

The maximum damages that the CASE Act's Copyright Claims Board can award are as follows:

  • If the plaintiff seeks actual damages, up to US $30,000 per work may be awarded (subject to the limit of US $30,000 per proceeding, meaning that if a plaintiff proved in one case covering multiple works actual damages in excess of US $30,000 for each work claimed, the plaintiff would only be entitled to a maximum of US $30,000).
  • If the plaintiff instead seeks statutory damages, awards are limited to US $15,000 per work and US $30,000 per proceeding.
  • If the Copyright Claims Board finds that the copyrights claimed were not timely registered, the maximum damages mentioned above are halved to $7,500 per work and $15,000 per claim. 
  • Claims under $5,000 are subject to different procedures, which are currently being established.
  • The Copyright Claims Board may award reasonable costs and attorneys’ fees for bad faith conduct, which is capped at $5,000 for parties represented by attorneys and $2,500 for pro se claimants.

Also worthy of your consideration when selecting the proper venue to bring a copyright infringement claim is that the Copyright Claims Board can not grant an injunction, but it can approve an agreement between the parties to cease activities as part of its final determination.

This may be the best option for clients who can't afford your (or our) services, or who failed to timely register their copyrights, although, since the system is entirely untested and unproven, I would hesitate to direct one to bring or defend a case before the Copyright Claims Board until we have seen sample outcomes. The website to file a claim with the Copyright Claims Board just launched this month at https://ccb.gov/.