At the end of December 2020, Congress passed an “omnibus” bill which justifiably received significant attention for providing financial relief during the coronavirus pandemic. Included in the legislation, in addition to the changes to trademark law discussed above, were also new laws related to copyright: the CASE Act and the Protecting Lawful Streaming Act.
The CASE Act
In 2019, we wrote about the Copyright Alternative in Small-Claims Enforcement (CASE) Act – a new mechanism for handling copyright claims. It is now law. The new law creates a Copyright Claims Board within the United States Copyright Office, which can hear cases involving total damages of up to $30,000. The purported benefit is that parties save money and time – parties who choose this option waive their right to a jury trial, and don’t engage in the formal motion practice required in Federal court. Damages are capped at $15,000 per work, and $30,000 total. Attorney’s fees can only be awarded for bad faith conduct, and are generally limited to $5,000. A dissatisfied party can request reconsideration, can ask the Register of Copyrights to review whether the board has abused its discretion, and – under extremely limited circumstances – can seek relief from a Federal court.
As we pointed out in 2019, a significant downside of the law is that this new Board could end up being utilized against individual Internet users, while sophisticated business defendants opt out of the process. While the new law bars parties who file frivolous claims from initiating a new claim for 12 months, the standard for what constitutes a “frivolous” claim is fairly high; for example, Federal courts rarely issue “Rule 11” sanctions against parties who file frivolous claims. The CASE Act makes it more likely that large media companies will be able to quickly sue individual infringers who are unaware of their rights. On the other hand, small businesses and individual copyright owners won’t have to pay tens or hundreds of thousands of dollars to enforce their copyright interests.
Protecting Lawful Streaming Act
Also included in the omnibus bill is a bill aimed at copyright infringers who use “digital transmission” (i.e., the Internet) to stream pirated movies, music, and other copyrighted works by making infringement a felony offense, punishable by 3, 5, or 10 years depending on the severity of the offense and whether the defendant is a repeat offender. This was intended to resolve a gap in the law, under which distribution of works could be a felony under certain circumstances, but illicit streaming itself wasn’t a felony.
Gamers who use the Twitch platform to stream video of themselves playing video games had been concerned that they would now face felony charges; however, the law clarifies that the targets are “digital transmission services” that are “primarily designed or provided” to enable access to pirated copyrighted works, or which “has no commercially significant purpose or use other than to” provide these pirated works, or “is intentionally marketed by or at the direction of that person to promote its use in” streaming the pirated works. In other words, probably not Twitch gamers. Users of illicit streaming services could still be liable under existing copyright law; the new law adds penalties against the providers of such streaming services themselves. So the person illegally filming a new movie at the theater won’t be liable under the new law, but the service that streams the recording will be.
It seems apparent that the new laws are meant to give large media companies more ammunition to fight the persistent problem of copyright infringement. How will they affect small businesses, individual copyright owners, and regular consumers? Only time will tell. If you have questions, contact the lawyers at Lipton, Weinberger & Husick for guidance.
— Joshua D. Waterston, Esq.