Bill establishing a small claims court for copyright holders aces House, 410-6; EFF, others, not pleased

The United States House of Representatives has unanimously passed the CASE Act, which establishes a small claims court for musicians and other copyright owners that offers an alternative to resolving costly disputes. 

The average cost of litigating a copyright infringement case in federal court is approximately $379,000.

Small creators, including photographers, musicians, videographers and journalists whose work is infringed have a right to enforce their IP under copyright law, but are typically unable to do so due to financial barriers.

The Copyright Alternative in Small-Claims Enforcement (CASE) Act, is a bipartisan bill sponsored by U.S. Representatives Hakeem Jeffries (D-NY) and Doug Collins (R-GA). The CASE Act creates a small claims board in the U.S. Copyright Office and provides an affordable and reliable alternative for creators to protect their work under the law. The bill passed the House in a 410-6 bipartisan vote.

If approved by the Senate, the CASE Act will create a copyright claims board within the U.S. Copyright Office to rule on small claims infringement cases where damages would be capped at $15,000 per claim and $30,000 total. (The Bill has a good chance of passing.)

Patents, Too?

“The bill would give independent creators a practical way to enforce their rights without the burden of hiring an attorney to fight the infringement in federal court,” reports Billboard. “Cases would be decided by a three-judge panel of subject matter experts inside the Copyright Office, who will hear only straightforward cases of alleged infringement.”

With strong bipartisan support for copyright holders, can a similar fast track court for patent holders be far behind? Don’t hold your breath.

A judicial insider told IP CloseUp that despite making sense in principal, patents are fundamentally a different intellectual property right, without the strong support of content interests, like publishers and motion picture studios.

“There is already an informal system of small fast patent settlements that are accomplished through licensing,” a former judge for the Court of Appeals for the Federal Circuit told this blog. “While far from perfect, negotiations of this nature keep the majority of patent disputes at bay. Additionally, copyright infringement does not rise and fall on validity, but with many patents validity is frequently the basis for paying damages or not. Without injunctive powers, a patent small claims court would not have much meaning.”

Chilling Effect

Despite easy passage, not everyone is thrilled with the CASE Act. TechDirt called it “dangerous” and the Electronic Frontier Foundation and the American Civil Liberties Union, argue that the bill’s passage “runs the risk of creating a chilling effect” with respect to speech online. The ACLU has claimed that average internet users could potentially face thousands of dollars in fines for simply sharing a meme or other piece of content.

The Senate Judiciary Committee approved the bill in August without amendment. Now it is up to the Senate where Ron Wyden and Rand Paul are likely to ask for changes. Paul, a libertarian, is uncomfortable with too much judicial oversight which he believes could stifle fair-use and clog courts. Wyden believes that it it will be the big content holders, like Disney, Sony and Time Warner (AT&T) who will benefit most.

IPKat, a well-regarded IP blog, cited the non-profit Copyright Alliance in saying the bill is hope for “hundreds of thousands of U.S. photographers, illustrators, graphic artists, songwriters, and authors, as well as a new generation of creators including bloggers and YouTubers.”

Congressmen Jeffries and Collins last year sponsored and saw through to passage the Music Modernization Act. Jeffries represents Brooklyn; Collins rural Georgia. It is heartening these politically polar forces had the vision and conviction to come together with others in the House and Senate to support American creators and copyright holders.

Similar broad support for encouraging inventions and inventors, and resolving patent disputes, has not been forthcoming, although there are signs more certain patent rights are necessary and good for innovation and the economy.

Middle Class Livelihood

“The establishment of the Copyright Claims Board [with the CASE Act] is critical for the creative middle class who deserve to benefit from the fruits of their labor,” said Rep. Jeffries. “Copyright enforcement is essential to ensure that these artists, writers, musicians and other creators are able to commercialize their creative work in order to earn a livelihood.

“The CASE Act will enable creators to enforce copyright protected content in a fair, timely and affordable manner. This legislation is a strong step in the right direction.”

Highlights of the CASE Act:

  • The CASE Act would create the Copyright Claims Board at the Copyright Office. The board would be made up of subject matter experts who would hear and rule on these small claims cases.
  • The CASE Act would cap statutory damages at $15,000 per claim (a mere 10% of what a plaintiff could be awarded in district court) and total damages at $30,000 per case.
  • The CASE Act would allow proceedings to be undertaken over the phone and online, without an attorney.

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