The Senators said the real impact of the Fourth Estate decision ‘will be the extended unlawful exploitation of a copyright owner’s intellectual property.’
On March 14, Senators Thom Tillis (R-NC) and Chris Coons (D-DE), respectively the Chairman and Ranking Member of the Senate Judiciary Committee’s Subcommittee on Intellectual Property, sent a letter addressed to Karyn Temple, Acting Register of Copyrights at the U.S. Copyright Office expressing concerns that Tillis and Coons share about the U.S. Supreme Court’s recent decision in Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC.
In Fourth Estate, the nation’s highest court held that the Copyright Office must complete the review of an application for copyright registration before the copyright owner can file an infringement lawsuit in U.S. district court pursuant to Section 411(a) of the Copyright Act. The Supreme Court’s decision solved a split among circuit courts in which some appellate courts, including the Fifth and Ninth Circuits, had said that an infringement action may commence once the registration application had been submitted, while others, like the Tenth and Eleventh Circuits, had held that the Copyright Office must take action on the application prior to the commencement of an infringement suit. By siding with the Tenth and Eleventh Circuits, the Supreme Court has ruled that all U.S. copyright owners must now wait for the registration of their application to be completed prior to filing a lawsuit for infringement.
Will the Copyright Office Need More Resources to Reduce the Application Backlog?
As the letter from Sens. Tillis and Coons notes, it takes an average of about six months for the Copyright Office to fully process registration applications. Given that the Supreme Court has now ruled that these applications must be fully processed prior to the filing of a suit, Senators Tillis and Coons said the real impact of the Fourth Estate decision “will be the extended unlawful exploitation of a copyright owner’s intellectual property.”
“A delay of several months is a significant amount of time in today’s digital economy and could lead to significant prejudice to copyright owners. This outcome is troubling,” said the letter.
While the Senators acknowledged that the Library of Congress and the Copyright Office have undergone recent efforts to modernize their systems and operations, they posed a series of questions on copyright registration issues for the Copyright Office. Tillis and Coons asked for the Copyright Office to respond to these questions by April 14. Those questions are:
- What steps will the Copyright Office take to reduce the pendency of current copyright registration applications?
- How will the Office ensure such a backlog of applications doesn’t occur in the future?
- What budgetary resources does the Office need to reduce the pendency of applications from several months to a few weeks at most?
- Will the Office develop and submit a pendency reduction plan to the Senate IP Subcommittee by May 31?
- Will the Office commit to providing staff from the Senators’ offices with quarterly updates on efforts to reduce copyright registration backlogs?
- Is the Office developing a strategic plan on modernization initiatives, and if so, when would that plan be released?
What to Do in the Meantime
Alex Kaplan, Partner at Proskauer, said it was clear that the letter from Senators Tillis and Coons represented a proactive response to the potential concerns of the Fourth Estate decision.
Kaplan said that the letter should be “comforting” to copyright owners in that it not only demonstrates concern about how court decisions affect IP rights, but because it presses the Copyright Office to expedite the registration process.
“While asking the Copyright Office to return to a processing time of one to two weeks seems a lofty goal, Congress is forcefully pushing the Copyright Office to greatly cut down on the timeframe to issue or deny registrations, and offering the Office the opportunity to request the funding necessary to do so,” Kaplan said.
Jim Hough, Partner at Morrison & Foerster, indicated that some positive changes could be accomplished through Congressional action without major budgetary appropriations. “Whether Fourth Estate will result in a substantial uptick in the pace of copyright registrations remains to be seen, but many have predicted that it will, and I think it is sensible for Congress to be concerned about whether the Copyright Office has plans to deal with the fallout,” he said. Hough also noted that Congress has a number of tools at its disposal if it does indeed conclude that the Fourth Estate decision will have an adverse impact on copyright owners’ ability to protect their rights:
“Congress can fix the problem easily by either increasing the Copyright Office budget to reduce processing times, or by amending 411(a) to clarify that a copyright owner may commence litigation upon delivering an application for copyright registration to the Copyright Office. Since the latter fix would not cost any money, I suspect that may be more appealing than the former.”
Although the Fourth Estate decision creates new Supreme Court precedent that all circuit courts will follow, it doesn’t drastically change the situation for creators who want to prevent infringing uses of their work, according to Gene Markin, Shareholder at Stark & Stark:
“I do not believe the decision hinders the enforcement of intellectual property rights,” said Markin. “It merely creates a condition precedent for filing an infringement lawsuit, which has existed in many jurisdictions prior to the Supreme Court’s decision.”
Markin added that the decision makes clear what practitioners need to do in order to effectively enforce their rights:
“Any copyright owner concerned about potential infringement should file for and obtain a certificate of registration prior to publication or commercial dissemination of the subject work. Any owner who does not have a registration but learns of infringement should send the infringer a cease and desist letter at the same time as filing its application for infringement. If the owner wants to be able to file suit sooner rather than later, then he can take advantage of the Copyright Office’s expedited registration procedure, which for an extra fee will result in a registration being issued within a few days or weeks.”