One of the past year’s most important U.S. copyright bills, the Copyright Alternative in Small-Claims Enforcement Act of 2020 (the CASE Act) was passed in December. It establishes an administrative tribunal process for copyright claims of up to $30,000. Though targeted to small parties, larger businesses that own massive amounts of copyrightable content will also benefit. Additionally, the law also permits DMCA claims of contributory infringement by social media platforms and other Internet Service Providers and hosts of web content.
United States federal courts have exclusive subject matter jurisdiction over copyright claims. Pursuing relief for copyright violations can be a costly and time-consuming endeavor and is often too expensive for small copyright holders and, where the claim is small, not cost-effective for larger parties. The CASE Act is designed to address this issue. In accordance with the law, the United States Copyright Office has been instructed to set up a Copyright Claims Board to adjudicate small claims. The board will consist of a three-member panel of experienced copyright claims officers. The administrative tribunal is empowered to resolve copyright claims with potential damages up to $30,000. Statutory damages are limited to $15,000.
Thus, the CASE Act provides an additional legal tool to help deter and remedy the infringement. The law’s small claims process makes it easier and less costly for copyright holders to assert their rights, challenge infringement, and disincentive further violations.
Defendants, however, are more likely to face relatively weak copyright claims although the CASE Act allows them to opt-out within 60 days, thereby securing dismissal without prejudice from the Copyright Claims Board. If a defendant opts out, the copyright holder must proceed with traditional federal litigation. This tactic may disincentivize the plaintiff from pursuing its claim and also frustrates the Act’s original purpose of making copyright claims affordable.
Claimants can request that the Board facilitate a settlement, providing a system for early resolution. Once the case is decided, however, the CASE Act, offers very limited recourse for appeal. Similar to binding arbitration, the parties can challenge the Board’s decision only on the basis of fraud, misrepresentation, or misconduct, and may not directly appeal to a federal court.