Content theft has been the bane of adult content creators’ existence since the advent of the internet. Given the ease with which content can be copied and republished on tube sites, file lockers and “leak” sites, unsavory content thieves have been able to earn a comfortable living by committing widespread copyright infringement.
Until now, the only realistic legal option for content creators has been to send DMCA notices to infringing websites or their hosts, and hope that they comply with U.S. copyright law by taking down the infringing content. Anything further required extensive federal court litigation along with a registration issued by the U.S. Copyright Office. If the infringement occurred before the copyright registration, the creator was ordinarily limited to recovering only actual damages and unable to seek recovery of attorneys’ fees. Such litigation could take years to finish and substantial resources to pursue.
Adult content creators and producers should familiarize themselves with this new option for combating piracy of their valuable content and consider pursuing claims where appropriate; the new CASE Act procedures are quicker and far less expensive than federal court litigation.
That is all about to change. Adult content creators in the United States will soon have a new option to recover “small claims” money damages for copyright infringement, thanks to the Copyright Alternative in Smalls-Claims Enforcement Act. Passed in December 2020, the CASE Act allows a copyright holder to file an administrative claim with the U.S. Copyright Office to recover up to $30,000 in damages for infringement by copyright thieves. Administrators have been drafting the regulations that will govern how these proceedings will work.
UNDERSTANDING THE PROCESS
On April 25, 2022, the U.S. Copyright Office adopted a rule which sets forth the procedures for bringing these claims, opting out of proceedings, and filing responses through the new Copyright Claims Board created by the CASE Act. As an alternative to expensive and time-consuming federal court litigation, the new CCB is a voluntary administrative forum for resolving certain copyright disputes valued at $30,000 or less.
What does it cost?
The rule adopts a two-tiered fee structure which requires a $40 filing fee followed by a $60 payment once all respondents have been served and the opt-out period expires. This structure is meant to ensure that the fees for filing a claim under the CCB are not cost-prohibitive, while also being costly enough to deter frivolous claims. There is no fee to file a counterclaim.
How are claims filed?
Claims must be filed electronically with the CCB and must include the identity of the parties, the category of the work, the registration status of the work, the type of claim, the harm experienced, the relief sought and other relevant facts, along with an affirmation confirming the accuracy of the information in the claim.
The Copyright Office will issue educational materials to assist claimants in filing claims. The CCB will review the claims to determine if sufficient information has been provided to place the respondent on notice. If not, the CCB will require the claimant to provide more details. Claims by unrepresented claimants will be construed liberally to satisfy the review requirements.
What information must be shared?
In an effort to facilitate settlements and discovery, claimants and respondents must provide contact information, their own or their attorney’s. Generally, the claimant must also provide the respondent’s address. However, this requirement can be waived if the claimant can show that the three-year statute of limitations is likely to expire within 30 days of filing the claim. In such cases, the claimant will have to provide the respondent’s address before the claim can continue, but not at the time of filing.
Can claims be dismissed?
A party may request dismissal of a claim or counterclaim for unsuitability, at any time. The CCB may also raise the issue. The opposing party will have the opportunity to respond.
How will respondents be notified of a claim?
An initial notice of proceeding will be created by the CCB but must be served by the claimant on the respondent along with the claim. The initial notice will describe the CCB, the nature of CCB proceedings, basic information about the claim and claimant, the respondent’s right to opt out, the consequences of opting out or proceeding, as well as information on how to learn more about copyright and the CCB, available defenses and differences between federal litigation and CCB proceedings. The initial notice will also include references to pro bono legal assistance. Proof of service or a waiver must be filed within seven days of service.
Further, claimants must not include with the service of the initial notice any additional substantive communications such as settlement demands or exhibits that were not filed as part of the claim. Good faith settlement discussions are encouraged during the opt-out period but must occur separately from service.
A second notice of proceeding will be issued by the CCB to the respondent no later than 20 days after the claimant files a proof of service or a completed waiver, provided the respondent has not opted out. The second notice mirrors the initial notice in substance.
Can companies designate an agent for service of claims?
Probably. The Copyright Office is currently considering a separate rule which would allow corporations, partnerships, and other unincorporated associations to designate agents to receive service of the initial notice and claim. If a designated agent is listed, the claimant must serve the claim upon that agent. Designating an agent can help avoid missing a notice of claim and ensure the company has sufficient time to decide whether to opt out.
Can respondents waive personal service?
Yes. Claimants may request, by mail or other reasonable means, that the respondent sign a waiver of personal service form. Waiving service can provide potential benefits to both parties in some circumstances.
How can a respondent opt out?
To opt out of a CCB proceeding, the respondent must file a paper or electronic form within 60 days of service and provide the docket number, verification code, certain identifying information and a signed affirmation. Opting out of the CCB proceeding requires the claimant to file traditional federal litigation to pursue the claim further.
Respondents may request an extension of the 60-day opt out period when such extension is in the interests of justice.
Claimants generally cannot refile a claim for the same acts or theories of recovery after a respondent opts out. However, if the respondent opts out and later changes their mind in favor of proceeding before the CCB, the claimant may refile the claim with the respondent’s consent.
How are responses filed?
Responses must be electronically filed and contain identifying information and details concerning the dispute, including any defenses and relevant evidence, along with a certification that the information provided in the response is accurate and truthful. The Office will provide respondents with a list of common defenses in the notification form and its educational materials.
Can the respondent file a counterclaim?
Yes. Respondents may file counterclaims that arise from the same transaction or occurrence as a claim, and implicate copyright or an agreement affecting the relief to be awarded. Counterclaims must be asserted in the response, unless good cause exists for allowing a later counterclaim. Once a response with a counterclaim is filed by the respondent, a claimant may not withdraw or opt out from the CCB proceeding.
FINAL RECOMMENDATIONS
The new CASE Act procedures are quicker and far less expensive than federal court litigation, so adult content creators and producers should familiarize themselves with this new option for combating piracy of their valuable content and consider pursuing claims where appropriate. Media outlets and online platforms should likewise become educated on these issues and evaluate potential designation of an agent for receiving notice of claims to avoid lost or misdirected notices which could result in up to $30,000 in liability if not addressed.
This new option for pursuing copyright infringement is about to heat up, so expect significant activity in this area in the near future.
Walters Law Group represents content creators throughout the world in connection with intellectual property enforcement issues. Nothing in this article is intended as legal advice. For further information, visit firstamendment.com/contact-us/ or reach out on social media @walterslawgroup.
