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New Law Introduced For Copyright Small Claims Court

In general, copyright lawsuits can be expensive. They require a lawyer who is well-versed with the copyright laws and federal court system. Yet, any creator or owner of copyright knows that the real scourge tends to happen with piracy. In some instances, no alterations, no messy facts, and no major damages can make it easier to recoup litigation costs. However, Hakeem Jeffries, who is the Representative for New York’s 8th Congressional District, has acknowledged the issue, prompting another round to get legislation passed starting this year. So, what is in the law? What is the possible effect? Why would this be more beneficial to a copyright holder?

What is a Small Copyright Claim?

The idea is simple and has been thrown around since 2013.  It is an expedited and limited system for copyright claims, akin to small claims courts that exist in state courts. This system would allow copyright holders to affordably pursue claims of up to $30,000, seek declarations of non-infringement, or DMCA claims under 17 U.S.C. 512(f). Also, the officers in this system would be different from federal judges and would be required to have experience in copyright laws and alternative dispute resolution.

This is not a true “small claims court” since it is more complicated. To avoid setting up an entire new judicial system, as would be required under the Constitution, the Copyright Alternative in Small-Claims Enforcement Act (“CASE” Act) creates a voluntary arbitration process through the Copyright Office under the Library of Congress. Effectively, this would mean that arbitrators would be a part of the Legislative Branch or Executive Branch as it’s slightly unclear issue. The fact would remain that the small-claims system would not be an official court, and more of a voluntary arbitration proceeding.

This has extended to an “opt-out” ability for an individual, where he/she may choose to opt-out of the proceedings, causing it to be dismissed without prejudice. Ultimately, it would mean the “small claims” system could be a goose egg – i.e., good to solve a handful of disputes, but not truly fixing the problem for copyright holders unless there was a bilateral willingness to handle the case through the expedited system.

What are the ramifications?

Ultimately, due to the opt-out provision, it may be difficult for the CASE Act to really benefit copyright holders. While it does allow small claims to proceed affordably and quickly, however, it removes the attorney’s fees provision of the Copyright Act.

Furthermore, it is suitable for more cut-and-dry cases. For example, in cases like Kirtsaeng or the litigation over the Klingon language, the larger entity may elect to resolve the issue in federal court, to push for a quick settlement due to the threat of attorney’s fees which may be awarded through the Copyright Act. This would not be possible in the so-called “small claims” system, and effectively deprives the interested parties of leverage in litigation, as they can afford to continue the litigation far longer than a small claims case.

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