An Open-and-Shut Case for the CCB? It Depends.

Copyright owners now have another venue for enforcing copyrights: the Copyright Claims Board (CCB). Established by the Copyright Alternative in Small-Claims Enforcement Act of 2020 (CASE Act), the CCB aims to provide copyright owners an efficient and low-cost alternative to traditional federal court for certain copyright claims. However alluring that sounds, copyright owners should carefully consider the following notable differences between CCB proceedings and copyright infringement suits in federal court when selecting a forum in which to bring suit.

1. A copyright registration certificate is not required, but recommended.

Unlike in federal court, where a plaintiff must have a copyright registration certificate (or an official refusal to register) before it can bring a copyright infringement claim, a claimant needs only a pending copyright application to bring a copyright claim with the CCB. The copyright application can be submitted either before or concurrently with filing the claim. However, if a certificate has not issued at the time of filing, the CCB will hold the proceeding in abeyance for up to one year, or until a registration certificate is submitted to the CCB. Failure to submit a registration certificate by end of the one year period, or issuance of an official refusal to register from the Copyright Office, will result in the proceeding being dismissed without prejudice. The claimant can then bring the same claim in federal court.

2. Only certain types of claims and defenses can be brought.

Parties are permitted to bring only the following types of claims before the CCB:

• a claim for infringement under the Copyright Act;
• a claim for a declaration of noninfringement under the Copyright Act;
• a claim for misrepresentation under the Digital Millennium Copyright Act;
• a counterclaim arising under the same transaction or occurrence of the original claim;
• a counterclaim arising under an agreement about the same transaction or occurrence of the original claim; and
• any legal or equitable defenses available under law arising from the claim or counterclaim.

3. Only certain accused parties are subject to the jurisdiction of the CCB.

The CCB does not have any jurisdiction over an entity residing or domiciled outside the United States unless that entity initiated the proceedings and is subject to counterclaims. This is unlike federal courts, which can exercise jurisdiction over a foreign entity if its infringing acts occur inside the United States. Therefore, while the CCB would not be able to adjudicate a claim against a foreign entity importing infringements into the U.S., a federal court would.

4. An accused infringer can effectively force the copyright owner out of the CCB and into federal court.

Unlike in federal court, an accused party can voluntarily opt out of a CCB proceeding. Filing a timely opt-out notice avoids a default CCB determination against the accused party, and prevents the copyright owner from refiling the claim before the CCB. Should the copyright holder choose to continue pursuing its claim, it would have to file suit in federal court.

5. Only monetary relief is available, and it is capped at $30,000.

In a single proceeding, a claimant cannot seek to recover more than $30,000, not including attorneys’ fees and costs. A claimant can elect to recover either actual damages and profits or statutory damages. For timely registered works, the statutory damage award may not exceed $15,000 for each work infringed. For works not timely registered, the statutory damage award may not exceed $7,500 – a significant contrast from federal court, which awards no statutory damages for works not timely registered. Additional differences between the federal court and CCB damages schemes is that in federal court, actual damages are not capped, and for timely registered works, the statutory damage award can be up to $150,000.

If the CCB determines that a party has acted in bad faith, it can require that party to pay the opposing party’s reasonable costs and attorneys’ fees, which are capped at either $5,000 in cases where the opposing party is represented by an attorney or $2,500 in cases where opposing party appears pro se. There is no cap on attorneys’ fees and costs in federal court.

As for injunctive relief, the CCB cannot issue injunctions like a federal court. However, an infringer’s agreement to stop infringing conduct can provide the CCB the basis to require the infringing party to cease infringing conduct.

This article appeared in the June 2022 issue of MarkIt to Market®. To view our past issues, as well as other firm newsletters, please click here.