Why is No One Talking About this Provision of the CASE Act? It’s Because It Benefits Users of Copyrighted Works

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From The Copyright Alliance:

The Copyright Alternative in Small-Claims Enforcement Act of 2019 (the CASE Act), H.R. 2426 and S. 1273, a bill that would create an optional small claims tribunal within the U.S. Copyright Office, was introduced by Congress in May 2019. Before that, it had been introduced in different forms in prior Congresses as well.

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Ever since the Digital Millennium Copyright Act (DMCA) was passed, anti-copyright groups have been circulating horror stories about the DMCA notice and takedown process being used to harass users, suppress speech and remove material posted by users who have valid fair use defenses.[1] The DMCA includes provisions to protect against such misuse. One way that the DMCA protects against misuse is that it requires the sender of a DMCA takedown notice to assert under penalty of perjury that the material is infringing. Consequently, sending a takedown notice for the sole purpose of stifling speech opens that person up to a perjury charge. Another way the DMCA protects against misuse is found in Section 512(f) of the DMCA, which makes those who use the DMCA takedown process for the filing of false infringement claims liable for the damages suffered as well as for attorneys’ fees.

Anti-copyright groups like EFF, Public Knowledge and Engine counter that these protections are essentially ineffective because most of the recipients of takedown notices are individuals who do not have the money to sue in federal court [2] and because these recipients are often too afraid to file DMCA counter-notices because of the requirement in the DMCA that the counter-notice include a “statement that the subscriber consents to the jurisdiction of Federal District Court for the judicial district in which the address is located.…”

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If only there were a solution for this—perhaps some legislation in Congress that might help address these concerns. In fact, there is and it’s called the CASE Act, a bill that would create an optional small claims tribunal to resolve the following types of claims by both copyright owners and users of copyrighted material:

• claims of infringement brought by copyright owners;
• declarations of non-infringement brought by users;
• claims of misrepresentation of infringement in takedown notices under Section 512(f) of the DMCA brought by users;
• claims of misrepresentation of infringement in counter-notices under Section 512(f) of the DMCA brought by copyright owners; and
• counterclaims and legal and equitable defenses (like fair use) brought by any party.

In the corpus of articles and blogs about the CASE Act, the primary, if not sole, focus has been on claims of infringement that can be brought by copyright owners. Unfortunately, there has been little, if any, discussion about claims that can be brought by usersunder the CASE Act.

Regrettably, anti-copyright vigilantes like EFF, ReCreate and Public Knowledge that purport to represent the interests of users are so laser focused on their disdain for copyright and the CASE Act’s provisions that will help copyright owners that they have FAILED to apprise users about the bill’s provisions that are designed to specifically benefit them.

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Complaint #1: It is too costly for a user to challenge a cease and desist letter or DMCA takedown notice even when they have a meritorious defense.

These groups say that the high cost of litigation in the federal court system effectively prevents users from bringing declaratory action for noninfringement or DMCA misrepresentation claims against copyright owners. The CASE Act addresses these concerns by creating a low-cost, efficient, and streamlined way to resolve copyright infringement disputes that is accessible and affordable to individuals and small businesses and is a viable alternative to federal court. Here are a few ways that the CASE Act is much more affordable than federal court:

• Attorneys’ Fees: The small claims process created by the CASE Act is simplified so that there is no need to hire an attorney. The largest cost associated with defending a copyright infringement case is the cost of hiring an attorney. In fact, the cost of hiring an attorney often exceeds the damages a user could obtain in a 512(f) misrepresentation case or a declaration of non-infringement action (since there would be no damages in such an action). Providing parties with the practical ability to defend themselves without paying tens of thousands of dollars (or more) to an attorney will enable users to bring claims (and defenses) that they cannot presently bring because of the high cost of doing so. If a party feels the need for legal representation, the CASE Act allows them to use the pro bono assistance of law students (supervised by a licensed attorney). The renowned copyright skeptic Larry Lessig famously argued fair use “is the right to hire a lawyer.” Once the CASE Act passes that statement will no longer be true (if it ever were).

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• Travel Costs: Unlike federal court, participation in the small claims process takes place remotely. There is no need to travel to the Copyright Office in Washington DC. The CASE Act explicitly states that proceedings “shall be conducted at the offices of the Copyright Claims Board without the requirement of in-person appearances by parties or others”and that each party will make its case “by means of written submissions, hearings, and conferences carried out through internet-based applications and other telecommunications facilities.” The ability to participate remotely in the proceedings without the need to travel to Washington DC is a significant cost savings relative to bringing a case in federal court (where remote participation is generally not permitted), to say nothing of the tremendous convenience of not having to travel away from one’s home or business.

. . . .

Complaint #2: Users are too intimidated to file a DMCA counter-notice because to do so they must agree to be sued in federal court.

If, in fact, users with meritorious defenses or viable misrepresentation claims are not using the counter-notice process because they are intimidated by having to agree to litigate in federal court, the CASE Act provides an ideal alternative by allowing them to assert their claims and defenses without the complexity and trepidation they associate with federal court.

Complaint #3: The DMCA doesn’t give the parties time to explore alternatives to federal court litigation.

In comments filed with the U.S. Copyright Office, Engine, one of the groups that complained about the efficacy of the counter-notice process, said that one of the problems with the counter-notice process was that it “require[s] rights holders to proceed directly from notice to federal suit, with no time or ability to pursue mediation or other alternate dispute resolution.”  . . . .  The CASE Act effectively does what Engine is asking for by establishing a process to resolve copyright infringement claims and defenses in a cost-effective, quick fashion, without proceeding directly to federal court.

Link to the rest at The Copyright Alliance

PG would like to think that a Copyright Small Claims Court would work for individual authors, but has a couple of concerns:

— Small Claims Courts in various states appear to vary in efficacy according to the general attitude and qualifications of the judges in those courts. Typically those courts have jurisdiction over a limited geographic area so litigants can appear in person. The most recent version CASE Act (admirably) does not require the litigants to appear in person and contemplates that hearing officers in Washington DC will be resolving many cases based upon the written submissions of the parties and, in the event a hearing is required, that many such hearings will be conducted online or on the telephone with the litigants providing testimony, etc., from their homes or other nearby location without having to travel to Washington.

The current legislation does permit one or both of the parties to optionally appear in person, however. Based upon a lot of time spent in court during an early stage of his legal career, PG is a bit concerned about the asymmetry of methods of persuasion between an in-person party or advocate and one who is remote. He would prefer that, if one party wants to participate remotely, the entire hearing is handled remotely so the playing field is absolutely equal.

— Under the CASE Act, if a copyright holder/author files what the judge/hearing officer decides is a case without merit, the judge/hearing officer can assess costs and fees against the copyright holder in amounts large enough to heavily burden a great many indie authors.

Many Small Claims Courts in various states have upper limits for damages in the hundreds of dollars. CASE courts can assess damages of up to $30,000 plus attorneys fees if the hearing officer decides the claimant has acted in bad faith. That is enough to seriously harm a great many indie authors. PG understands that the UK has an IP Small Claims court that divides claims by the amount of damages claimed – equivalent to small, medium and large damages range. That type of system might assuage some of PG’s concerns about over-sized penalties imposed on authors who don’t have access to much money.