Important Copyright Legislation Is Slipped Into the New Stimulus Bill and Signed Into Law

December 29, 2020 | Insights

By Emilio Nicolas

Signed into law on December 27, 2020, the Consolidated Appropriations Act, 2021 contained more than just COVID-19 relief and federal government funding. The omnibus bill also included two significant pieces of copyright legislation: the Copyright Alternative in Small-Claims Enforcement Act (CASE Act), which creates a voluntary small claims court for resolving certain copyright disputes, and the Protecting Lawful Streaming Act, which makes certain unauthorized online streaming activities a felony offense.

The CASE Act: New Tribunal, New Procedures, and New Litigation Strategies

As reported last year when the House passed an earlier version of the bill, the CASE Act establishes the Copyright Claims Board (CCB), a three-person tribunal administered by the Copyright Office and charged with adjudicating relatively small copyright disputes, including copyright infringement claims and DMCA misrepresentation claims of $30,000 or less. The law is the same as last reported, save for a couple of seemingly trivial changes in text, the addition of a new “opt-out” clause for libraries and archives, and an extension of time for the CCB to commence operations.

Proponents of the CASE Act highlight its ability to afford artists, songwriters, and other content creators a means to enforce their copyrights without the high costs and complexities associated with litigating claims in federal court. Dissenters, on the other hand, contend that the CASE Act will lead to an increased number of copyright infringement claims and adverse decisions, and could deprive defendants of their right to a jury trial and access to the courts. Several critics have even argued that the CASE Act is outright unconstitutional.

An apparent attempt to bridge the gap is the CASE Act’s allowance for a defendant to “opt-out” of a CCB proceeding within 60 days after being properly served with a notice and claim, in which case the proceeding will be dismissed “without prejudice” and the claimant forced to re-litigate in federal court. Only time will tell if that “voluntary” system is enough to render the CCB a long-standing tribunal. Under the new law, the Copyright Office has one year (or, for good cause, up to 18 months) to get the CCB up and running.

The Protecting Lawful Streaming Act: Criminalizing Copyright Infringement Via Willful Unauthorized Online Streaming Activities

The Protecting Lawful Streaming Act (PLSA) makes it a felony offense for a person to “willfully, and for purposes of commercial advantage or private financial gain, offer or provide . . . a digital transmission service” that has the primary purpose of publicly performing (i.e., streaming) works without the copyright owner’s permission or a valid legal excuse. According to Senator Thom Tillis (R-NC), the congressperson who spearheaded the PLSA, the new law is intended to “apply only to commercial, for-profit streaming piracy services” and not individual streamers or users.

The law had already criminalized certain acts of copyright infringement. However, only the unauthorized reproduction or distribution of certain works under specific circumstances was punishable as a felony-level offense. See 17 U.S.C. § 506(a)(1); see 18 U.S.C. §§ 2319(a)-(d). With the PLSA, illegal online streaming activities are now punishable in the same manner.

The PLSA comes at a time when online platforms are facing challenges to their immunity from certain types of civil liability, including a push for the repeal of Section 230(c) of the Communications Decency Act. Interestingly, the day after Congress passed the PLSA, Senator Tillis released his “first discussion draft of legislation to reform the Digital Millennium Copyright Act (DMCA)” entitled the Digital Copyright Act of 2021. The focal point of Senator Tillis’ new legislation is a replacement of the DMCA’s long-standing “notice-and-take-down” system with a controversial “notice-and-stay-down” system. The new system would require an online service provider to locate and remove all copies of an allegedly infringing work from its system or network in response to a take-down notice, instead of removing the single copy identified in the notice. More on that bill coming soon. Stay tuned.

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